9.Stock-Based Compensation Plan

The 2017 Plan – On December 21, 2017, the Company’s stockholders approved the Bio-Path Holdings, Inc. 2017 Stock Incentive Plan (as amended, the “2017 Plan”), which replaced the First Amended 2007 Stock Incentive Plan, as amended (the “2007 Plan”). The 2007 Plan expired by its terms in January 2018, and no awards were made under the 2007 Plan from the approval of the 2017 Plan on December 21, 2017 until the expiration of the 2007 Plan. The 2017 Plan provides for the grant of Incentive Stock Options, Non-Qualified Stock Options, Restricted Shares, Restricted Share Units, Stock Appreciation Rights, Performance-Based Awards and other stock-based awards, or any combination of the foregoing to the Company’s employees, non-employee directors and consultants. On December 19, 2019, the Company's stockholders approved an amendment to the 2017 Plan to increase the number of shares reserved for grant and issuance pursuant to the 2017 Plan by 600,000 shares to 660,000 shares. As of December 31, 2020, there were 402,724 additional shares of common stock reserved for future issuance of awards under the 2017 Plan. Under the 2017 Plan, the exercise price of awards is determined by the Board of Directors or the compensation committee of the Board of Directors, and for options intended to qualify as qualified Incentive Stock Options, may not be less than the fair market value as determined by the closing stock price at the date of the grant. Each option and award under the 2017 Plan shall vest and expire as determined by the Board of Directors or the compensation committee. Options expire no later than ten years from the date of grant. All grants provide for accelerated vesting if there is a change of control, as defined in the 2017 Plan.

Stock option awards granted for the years 2020 and 2019 were estimated to have a weighted average fair value per share of $4.34 and $16.26, respectively. The fair value calculation is based on stock options granted during the year using the Black-Scholes option-pricing model on the date of grant. In addition, for all stock options granted, exercise price was determined based on the fair value as determined by the closing stock price at the date of the grant. For stock options granted during 2020 and 2019 the following weighted average assumptions were used in determining fair value:


	2020		2019
Risk-free interest rate	0.50	%	2.23	%
Expected volatility	122	%	126	%
Expected term in years	6.0		6.0
Dividend yield	—	%	—	%

The Company determines the expected term of its stock option awards using the simplified method based on the weighted average of the length of the vesting period and the term of the exercise period. Expected volatility is determined by the volatility of the Company’s historical stock price over the expected term of the grant. The risk-free interest rate for the expected term of each option granted is based on the U.S. Treasury yield curve in effect at the time of grant.

Option activity under the Plans for the year ended December 31, 2020 was as follows (in thousands, except as noted):


				Weighted
		Weighted-		Average
		Average		Remaining	Aggregate
		Exercise		Contractual	Intrinsic
	Options	Price		Term	Value
		(per share)		(in years)
Year Ended December 31, 2020
Outstanding at December 31, 2019	68	$	68.56	7.7	$	—
Granted	211		5.01	9.4
Forfeited	(4)		7.19
Expired	(1)		28.67
Outstanding at December 31, 2020	274	$	20.57	8.7	$	3,750
Vested and expected to vest December 31, 2020	238	$	22.66	8.7	$	—
Exercisable at December 31, 2020	66	$	63.95	7.2	$	3,070

The aggregate intrinsic value represents the total pretax intrinsic value (the difference between the Company’s closing stock price on December 31, 2020 and the exercise price, multiplied by the number of in-the-money options) that would have been received by the option holders had all option holders exercised their options on December 31, 2020. This amount changes based on the fair value of the Company’s stock.

Option activity under the Plans for the year ended December 31, 2019 was as follows (in thousands, except as noted):


				Weighted
		Weighted-		Average
		Average		Remaining	Aggregate
		Exercise		Contractual	Intrinsic
	Options	Price		Term	Value
		(per share)		(in years)
Year Ended December 31, 2019
Outstanding at December 31, 2018	37	$	112.60	7.5	$	—
Granted	35		18.40	9.2
Forfeited	(3)		36.68
Expired	(1)		61.18
Outstanding at December 31, 2019	68	$	68.56	7.7	$	—
Vested and expected to vest December 31, 2019	58	$	76.12	7.4	$	—
Exercisable at December 31, 2019	26	$	138.77	5.5	$	—

The aggregate intrinsic value represents the total pretax intrinsic value (the difference between the Company’s closing stock price on December 31, 2019 and the exercise price, multiplied by the number of in-the-money options) that would have been received by the option holders had all option holders exercised their options on December 31, 2019. This amount changes based on the fair value of the Company’s stock.

Stock-Based Compensation Expense – Total stock-based compensation expense for the year ended 2020 was $0.6 million, which consisted of research and development expense of $0.1 million and general and administrative expense of $0.5 million. As of December 31, 2020, future stock-based compensation expense for all outstanding unvested options was $0.9 million, which is expected to be recognized over a weighted-average vesting period of 2.6 years. Total stock-based compensation expense for the year ended 2019 was $0.7 million, which consisted of research and development expense of $0.1 million and general and administrative expense of $0.6 million.