6.	Stock-Based Compensation

2015

Equity Plan

The Diffusion Pharmaceuticals Inc.

2015

Equity Incentive Plan, as amended (the

"2015

Equity Plan"), provides for increases to the number of shares reserved for issuance thereunder each

January 1

equal to

4.0%

of the total shares of the Company’s common stock outstanding as of the immediately preceding

December 31,

unless a lesser amount is stipulated by the Compensation Committee of the Company's board of directors. Accordingly,

1,339,215

shares were added to the reserve as of

January 1, 2020,

which shares

may

be issued in connection with the grant of stock-based awards, including stock options, restricted stock, restricted stock units, stock appreciation rights and other types of awards as deemed appropriate, in each case, in accordance with the terms of the

2015

Equity Plan. As of

March

31,

2020,

there were

485,602

shares of common stock available for future issuance under the

2015

Equity Plan.

The Company recorded stock-based compensation expense in the following expense categories of its unaudited interim consolidated statements of operations for the periods indicated:

	Three Months Ended March 31,
	2020		2019
Research and development	$	96,530	$	13,596
General and administrative		94,850		77,608
Total stock-based compensation expense	$	191,380	$	91,204

The following table summarizes the activity related to all stock option grants for the

three

months ended

March

31,

2020:

	Number of Options			Weighted average exercise price per share		Weighted average remaining contractual life (in years)		Aggregate intrinsic value
Balance at January 1, 2020		309,276		$	55.78			$	—
Granted		873,500			0.47
Expired		(147	)		142.50
Outstanding at March 31, 2020		1,182,629		$	14.91		9.0	$	—
Exercisable at March 31, 2020		560,524		$	30.60		8.2	$	—

The weighted average grant date fair value of stock option awards granted was

$0.36

during the

three

months ended

March 31, 2020.

The total fair value of options vested during the

three

months ended

March 31, 2020

and

2019

was

$0.2

million and

$0.2

million, respectively.

options were exercised during any of the periods presented. At

March

31,

2020,

there was

$0.4

million of unrecognized compensation expense that will be recognized over a weighted-average period of

1.81

years.

Options granted were valued using the Black-Scholes model and assumptions used to value the options granted during the

three

months ended

March 31, 2020

were as follows:

Expected term (in years)	5.70
Risk-free interest rate	1.7	%
Expected volatility	113.7	%
Dividend yield	—

Restricted Stock Awards

During the

three

months ended

March 31, 2020,

the Company granted

98,100

restricted stock awards to a member of the board of directors of the Company. The grant date fair value of each restricted stock award granted during the

three

months ended

March 31, 2020

was

$0.51.

The shares begin to vest

months after the grant date. The Company recognized approximately

$4,000

in expense related to this award during the

three

months ended

March 31, 2020

and, at

March 31, 2020,

there was approximately

$46,000

of unrecognized compensation cost that will be recognized over a weighted average period of

2.83

years.