Quarterly report pursuant to Section 13 or 15(d)

STOCK-BASED COMPENSATION

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STOCK-BASED COMPENSATION
 6 Months Ended
Jun. 30, 2024
Share-Based Payment Arrangement [Abstract]  
STOCK-BASED COMPENSATION

Note 13. STOCK-BASED COMPENSATION

 

The Company granted options and restricted stock awards under its 2014 Equity Incentive Plan (the “2014 Plan”). Under the 2014 Plan, the Company is authorized to grant options or restricted stock for up to 2,000,000 shares of Common Stock. On June 6, 2023, the Company received stockholder approval to increase the number of authorized shares from 1,142,857 to 2,000,000. Options or restricted stock awards may be granted to employees, the Company’s board of directors, and external consultants who provide services to the Company. Options and restricted stock awards granted under the 2014 Plan have vesting schedules with terms of one to three years and become fully exercisable based on specific terms imposed at the date of grant. The 2014 Plan expired according to the respective 10-year term of the 2014 Plan in March 2024. A new 2024 Incentive Compensation Plan (the “2024 Plan”) was approved at the Annual Meeting of Shareholders on June 4, 2024.

 

The Company has recorded stock-based compensation expense related to the issuance of restricted stock awards in the following line items in the accompanying condensed consolidated statements of operations:

 

    2024     2023     2024     2023  
   

Three Months Ended

June 30,

    

Six Months Ended

June 30,

  
    2024     2023     2024     2023  
                         
Research and development   $ 35,345     $ 10,620     $ 57,227     $ 21,889  
General and administrative     251,949       159,634       512,680       305,979  
Total stock-based compensation expense   $ 287,294     $ 170,254     $ 569,907     $ 327,868  

 

The following table summarizes stock option activity under the 2014 and 2024 Plan:

 

   

Number of

options

    

Weighted-average

exercise price

    

Weighted-average

remaining contractual

term (in years)

    

Aggregate

intrinsic value

  
Outstanding at December 31, 2023     683,695     $ 3.99       2.9       158,332  
Granted     —       —                  
Exercised     (208,031 )     1.16                  
Forfeited     (137,854 )     1.16                  
Outstanding at June 30, 2024     337,810     $ 6.88       5.08       —   
                                 
Vested and exercisable at June 30, 2024     337,612     $ 6.88       5.08       —   

 

 

As of June 30, 2024, there was no unrecognized compensation cost related to non-vested stock options.

 

During the six months ended June 30, 2024, 208,031 options were exercised at an exercise price of $1.155, of which 143,183 options were from a cashless exercise, and 137,854 options were forfeited due to a cashless exercise.

 

The following table summarizes restricted stock award activity under the 2014 and 2024 Plan:

 

   

Number of

restricted stock

awards (RSA)

    

Weighted-average

grant price

    

FMV on

grant date

    

Vested number

of RSA

    

Unvested number

of RSA

  
Balance at December 31, 2023     540,967     $ 2.24     $ 1,209,391       447,905       93,062  
Granted     419,756       1.66       698,655       266,774       152,982  
Forfeited     —       —       —       —       —  
Balance at June 30, 2024     960,723     $ 1.99     $ 1,908,046       714,679       246,044  

 

During the three months ended June 30, 2024, the Company issued restricted stock awards (“RSAs”) for 419,756 shares of Common Stock to employees, non-employees, and the board of directors. The shares vest in equal monthly installments over terms of between immediately up to three years, subject to the employees and non-employees providing continuous service through the vesting date. During the three months ended June 30, 2024, 6,846 shares vested from RSAs granted prior to January 1, 2024, and 266,774 shares vested from RSAs granted during the six months ended June 30, 2024.