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SHARE-BASED COMPENSATION | SHARE-BASED COMPENSATION Upon consummation of the Monster Merger, the Company had two stock option plans in existence, Monster’s 2012 Omnibus Incentive Plan (the “Omnibus Plan”) and the Innovate 2015 Stock Incentive Plan (the “Private Innovate Plan”). During 2018, the Board approved an amendment to the Omnibus Plan to, among other things, formally change the name of the Omnibus Plan to the Innovate Biopharmaceuticals, Inc. 2012 Omnibus Incentive Plan and increase the number of shares authorized for issuance under the Omnibus Plan to provide for an additional 3,000,000 shares. In addition, the shares reserved for issuance under the Omnibus Plan automatically increase on the first day of each calendar year beginning in 2019 and ending in 2022 by an amount equal to the lesser of (i) five percent of the number of shares of common stock outstanding as of December 31st of the immediately preceding calendar year or (ii) such lesser number of shares of common stock as determined by the Board (the “Evergreen Provision”). On January 1, 2019, the number of shares of common stock available under the Omnibus Plan automatically increased by 1,304,441 shares pursuant to the Evergreen Provision. The terms of the option agreements are determined by the Board. The Company’s stock options vest based on the terms in the stock option agreements and typically vest over a period of three or four years. These stock options typically have a maximum term of ten years. Private Innovate Plan As of December 31, 2019, there were 6,063,745 stock options outstanding under the Private Innovate Plan. Following completion of the Monster Merger, the Company has not issued, and does not intend to issue, any additional awards from the Private Innovate Plan. The range of assumptions used in estimating the fair value of the options granted or re-measured under the Private Innovate Plan using the Black-Scholes option pricing model for the periods presented were as follows:
The following table summarizes stock option activity under the Private Innovate Plan:
There were no options granted under the Private Innovate Plan during the years ended December 31, 2019 and 2018. The total intrinsic value of options exercised was approximately $81,000 and $378,000 during the years ended December 31, 2019 and 2018, respectively. The total fair value of stock option awards vested during the years ended December 31, 2019 and 2018 under the Private Innovate Plan was approximately $578,000 and $702,000, respectively. As of December 31, 2019, there was approximately $0.5 million of total unrecognized compensation cost related to unvested stock-based compensation arrangements under the Private Innovate Plan, which is expected to be recognized over a weighted-average period of 1.3 years. The Private Innovate Plan provides for accelerated vesting under certain change-of-control transactions, if approved by the Board. During the year ended December 31, 2019, the compensation committee approved the extension of the exercise periods of certain option holders’ vested options for an additional eighteen months. During the year ended December 31, 2019, the Company recognized additional compensation expense of $0.4 million associated with the modification of approximately 1.8 million options. Omnibus Plan As of December 31, 2019, there were options to purchase 2,717,870 shares of Innovate common stock outstanding under the Omnibus Plan and 1,102,739 shares available for future grants under the Omnibus Plan. The range of assumptions used in estimating the fair value of the options granted or re-measured under the Omnibus Plan using the Black-Scholes option pricing model for the periods presented were as follows:
The following table summarizes stock option activity under the Omnibus Plan:
The weighted-average grant date fair value of options granted under the Omnibus Plan was $0.71 and $3.76 during the years ended December 31, 2019 and 2018, respectively. The total fair value of stock option awards vested under the Omnibus Plan was approximately $1,227,000 and $1,032,000 during the years ended December 31, 2019 and 2018, respectively. As of December 31, 2019, there was approximately $1.2 million of total unrecognized compensation cost related to unvested stock-based compensation arrangements under the Omnibus Plan. This cost is expected to be recognized over a weighted-average period of 2.7 years. The Omnibus Plan provides for accelerated vesting under certain change-of-control transactions, if approved by the Board. During the year ended December 31, 2019, the Board approved grants of 490,000 RSUs. 390,000 of the RSUs vested immediately on the date of grant; the remaining 100,000 RSUs vest 50% on the date of grant and the remainder pro-rata over six months following the date of grant. The weighted-average fair value of RSUs granted during the year ended December 31, 2019 was $1.44 and the Company recognized share-based compensation expense for the RSUs of approximately $705,000 during the year ended December 31, 2019. There were no RSUs granted during the year ended December 31, 2018. Total share-based compensation expense recognized in the accompanying statements of operations and comprehensive loss was as follows:
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