Quarterly report pursuant to Section 13 or 15(d)

STOCK-BASED COMPENSATION

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STOCK-BASED COMPENSATION
 9 Months Ended
Sep. 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
September 30,		     Nine Months Ended
September 30,		  
    2024     2023     2024     2023  
                         
Research and development   $ 30,605     $ 10,304     $ 87,832     $ 32,193  
General and administrative     155,082       74,941       667,762       482,120  
Total stock-based compensation expense   $ 185,687     $ 85,245     $ 755,594     $ 514,313  

 

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 September 30, 2024     337,810     $ 6.88       5.08       —  
                                 
Vested and exercisable at September 30, 2024     337,810     $ 6.88       5.08       —  

 

 

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

 

During the nine months ended September 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     488,611     $ 2.27     $ 1,109,391       448,011       40,600  
Granted     750,224       1.88       1,407,613       362,273       374,682  
Forfeited     (13,269 )     1.57       (20,832 )     —       —  
Balance at September 30, 2024     1,225,566     $ 2.04     $ 2,496,172       810,284       415,282  

 

During the three months ended September 30, 2024, the Company issued restricted stock awards (“RSAs”) for 330,468 shares of Common Stock to employees, non-employees, and the board of directors. The shares vest in equal monthly installments over terms of immediately and up to three years, subject to the employees and non-employees providing continuous service through the vesting date. During the three months ended September 30, 2024, 106 shares vested from RSAs granted prior to January 1, 2024, and 95,499 shares vested from RSAs granted during the nine months ended September 30, 2024.