8.	Stock-Based Compensation

The 2017 Plan – On December 21, 2017, the Company’s stockholders approved the Bio-Path Holdings, Inc. 2017 Stock Incentive Plan (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, however, no awards were made under the 2007 Plan upon approval of the 2017 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. As of December 31, 2017, the total number of shares reserved and available for grant and issuance pursuant to the 2017 Plan is 1,200,000 shares, subject to the terms of 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-based compensation expense was $0.1 million and $0.2 million for the three months ended March 31, 2018 and March 31, 2017, respectively. Of these amounts, stock-based compensation expense for personnel involved in the Company’s general and administrative activities for both the three months ended March 31, 2018 and March 31, 2017 was $0.1 million. Stock-based compensation expense for personnel involved in the Company’s research and development activities for the three months ended March 31, 2018 and March 31, 2017 was $20,000 and $0.1 million, respectively.

The Company utilized the Black-Scholes valuation model for estimating the fair value of the stock options granted, with the following weighted-average assumptions for options granted in the three months ended March 31, 2018 and 2017:

	2018			2017
Risk-free interest rate		2.59	%		2.09	%
Expected volatility		95	%		100	%
Expected term in years		6.1			6.1
Dividend yield		-	%		-	%

The following summary represents option activity under the Company’s stock-based compensation plan for the three months ended March 31, 2018:

			Weighted-
			Average
			Exercise
	Options		Price
	(in thousands)
Outstanding at December 31, 2017		642	$	11.60
Granted		3		2.08
Cancelled		(4)		11.88
Outstanding at March 31, 2018		641		11.58
Exercisable at March 31, 2018		573	$	10.82

As of March 31, 2018, the aggregate intrinsic value of outstanding stock options was none. The aggregate intrinsic value represents the total pretax intrinsic value (the difference between the Company’s closing stock price on March 31, 2018 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 March 31, 2018. This amount changes based on the fair market value of the Company’s stock.

As of March 31, 2018, unamortized stock-based compensation expense for all outstanding options was $0.8 million, which is expected to be recognized over a weighted average vesting period of 2.1 years.