STOCK OPTIONS

12 Months Ended

Dec. 31, 2022

Share-Based Payment Arrangement [Abstract]

In April 2014, the Company adopted the Corbus Pharmaceuticals Holdings, Inc. 2014 Equity Incentive Plan (the “2014 Plan”). Pursuant to the 2014 Plan, the Company’s Board of Directors may grant incentive and nonqualified stock options and restricted stock to employees, officers, directors, consultants, and advisors.

Pursuant to the terms of an annual evergreen provision in the 2014 Plan, the number of shares of common stock available for issuance under the 2014 Plan shall automatically increase on January 1 of each year by at least seven percent (7%) of the total number of shares of common stock outstanding on December 31st of the preceding calendar year, or, pursuant to the terms of the 2014 Plan, in any year, the Board of Directors may determine that such increase will provide for a lesser number of shares.

On January 1, 2022, pursuant to an annual evergreen provision contained in the 2014 Plan, the number of shares reserved for future grants was increased by 292,205 shares, which was seven percent (7%) of the outstanding shares of common stock on December 31, 2021. As of January 1, 2022 there was a total of 1,144,567 shares reserved for issuance under the 2014 Plan and there were 558,671 shares available for future grants. Options issued under the 2014 Plan generally vest over 4 years from the date of grant in multiple tranches and are exercisable for up to 10 years from the date of issuance.

In accordance with the terms of the 2014 Plan, effective as of January 1, 2023, the number of shares of common stock available for issuance under the 2014 Plan increased by 291,991 shares, such amount being seven percent (7%) of the outstanding shares of common stock on December 31, 2022 (see Note 18). As of January 1, 2023, the 2014 Plan had a total reserve of 1,436,558 shares and there were 741,870 shares available for future grants.

Share-based Compensation

For stock options issued and outstanding for the years ended December 31, 2022 and 2021, the Company recorded non-cash, stock-based compensation expense of $5,719,637 and $9,480,373, respectively, net of estimated forfeitures.


	Twelve Months Ended December 31,
	2022	2021

Research and development expenses	$577,472	$2,969,347
General and administrative expenses	5,142,165	6,511,026
Total stock-based compensation	$5,719,637	$9,480,373

The fair value of each option award for employees and non-employees is estimated on the date of grant using the Black-Scholes option pricing model that uses the assumptions noted in the following table, except for the expected term for non-employees as noted in the following. The Company uses historical data, as well as subsequent events occurring prior to the issuance of the financial statements, to estimate option exercises and employee terminations in order to estimate its forfeiture rate. The expected term of options granted under the 2014 Plan, all of which qualify as “plain vanilla” per SEC Staff Accounting Bulletin 107, is determined based on the simplified method due to the Company’s limited operating history and is 6.25 years based on the average between the vesting period and the contractual life of the option. For non-employee options, the expected term is the contractual term. The risk-free rate is based on the yield of a U.S. Treasury security with a term consistent with the option.

The weighted average assumptions used principally in determining the fair value of options granted were as follows:


	Twelve Months Ended December 31,
	2022			2021
Risk free interest rate		1.99	%		0.76	%
Expected dividend yield		0	%		0	%
Expected term in years		6.25			6.23
Expected volatility		98.08	%		102.96	%
Estimated forfeiture rate		12.43	%		9.12	%

A summary of option activity for years ended December 31, 2022 and 2021 is presented below:


Options	Shares	Weighted Average Exercise Price		Weighted Average Remaining Contractual Term in Years	Intrinsic Value
Outstanding at December 31, 2020	476,321		154.50
Granted	245,793		70.80
Exercised	(27,953)		33.90
Forfeited or canceled	(182,655)		151.20
Expired	(636)		209.10
Outstanding at December 31, 2021	510,870	$	121.90
Granted	185,169		12.90
Exercised	—		—
Forfeited or canceled	(56,019)		107.13
Expired	(22,024)		166.53
Outstanding at December 31, 2022	617,996	$	88.99	6.78	$	11,195,964
Exercisable at December 31, 2022	358,611	$	125.97	5.37	$	3,177,014
Vested and expected to vest at December 31, 2022	584,143	$	92.55	6.66	$	9,969,530

The weighted average grant-date fair value of options granted during the years ended December 31, 2022 and 2021 was $10.20 and $57.30 per share, respectively. The aggregate intrinsic value of options exercised during the years ended December 31, 2022 and 2021 was approximately $0 and $1,769,714, respectively. As of December 31, 2022, there was approximately $6,302,350 of total unrecognized compensation expense, related to non-vested share-based compensation arrangements. The unrecognized compensation expense is estimated to be recognized over a period of 2.05 years at December 31, 2022.

As summary of non-vested stock options for the years ended December 31, 2022 and 2021 is presented below:


Options	Shares			Weighted Average Fair Value
Non-vested December 31, 2020		144,576		$	124.20
Granted		245,793			57.30
Vested		(74,731	)		120.60
Forfeited		(105,135	)		84.00
Non-vested at December 31, 2021		210,503		$	67.80
Granted		185,169			10.19
Vested		(107,269	)		67.54
Forfeited		(29,019	)		43.06
Non-vested at December 31, 2022		259,384		$	29.59