Stock Option Plans and Warrants to Purchase Common Stock

12 Months Ended

Dec. 31, 2021

Stock Option Plans and Warrants to Purchase Common Stock

Stock Option Plans and Warrants to Purchase Common Stock

Note 9. Stock Option Plans and Warrants to Purchase Common Stock

Stock Option Plans

The Amended and Restated 2005 Equity Incentive Plan (“2005 Plan”) was replaced by the 2015 Plan, which was approved in June 2015. No securities are available for future issuance under the 2005 Plan. As of December 31, 2021, there are no shares currently available for grants under the 2015 Plan. In accordance with the 2015 Plan and the rules of the Nasdaq Stock Market, any additional grants offered may not be exercised until the Company’s stockholders approve an amendment increasing the number of shares authorized for issuance under the 2015 Plan. The plan is divided into four separate equity programs:

1) the Discretionary Option Grant Program, under which eligible persons may, at the discretion of the Plan Administrator, be granted options to purchase shares of common stock,

2) the Salary Investment Option Grant Program, under which eligible employees may elect to have a portion of their base salary invested each year in options to purchase shares of common stock,

3) the Automatic Option Grant Program, under which eligible nonemployee Board members will automatically receive options at periodic intervals to purchase shares of common stock, and

4) the Director Fee Option Grant Program, under which non-employee Board members may elect to have all, or any portion, of their annual retainer fee otherwise payable in cash applied to a special option grant.

Shares available for grant under the 2015 Plan were as follows:

Shares available for grant at January 1, 2021	214,689
Options granted	(452,189)
Options forfeited	207,246
Options exercised	30,254
Shares available for grant at December 31, 2021	—

Activity under the 2005 Plan and the 2015 Plan for the years ended December 31, 2021 and 2020

		Weighted
		Average
		Exercise
	Options	Price
Balance outstanding at December 31, 2019	1,506,972	$	3.77
Granted	520,812		2.17
Forfeited	(88,222)		13.06
Exercised	(5,758)		1.19
Balance outstanding at December 31, 2020	1,933,804	$	2.96
Granted	452,189		0.91
Forfeited	(239,914)		3.65
Exercised	(30,254)		0.85
Balance outstanding at December 31, 2021	2,115,825	$	2.48

As of December 31, 2021, there were 1,548,346 options exercisable with a weighted average exercise price of $2.89 and a weighted average remaining contractual term of 6.92 years. As of December 31, 2021, there were 2,115,825 options outstanding with a weighted average remaining term of 7.55 years. Options outstanding as of December 31, 2021 had no intrinsic value. Options exercised during the year ended December 31, 2021 had an intrinsic value of approximately $7,000 on the dates of exercise.

The Company awarded 452,189 and 520,812 stock options during the years ended December 31, 2021 and 2020, respectively, which had a weighted average grant date fair value per share of $0.56 and $0.97, respectively. The weighted-average exercise price, by price range, for outstanding options to purchase common stock at December 31, 2021 was:

	Weighted
	Average
	Remaining
	Contractual	Outstanding	Exercisable
Price Range	Life in Years	Options	Options
$0.71-$3.00	7.97	1,941,203	1,373,724
$6.40-$15.60	3.13	129,310	129,310
$20.10-$22.60	2.00	45,312	45,312
Total	7.55	2,115,825	1,548,346

The Company’s share-based compensation expense for the years ended December 31, 2021 and 2020 was recognized as follows:

Share-based compensation	2021		2020
Research and development	$	158,478	$	195,560
General and administrative		203,081		214,373
Total	$	361,559	$	409,933

At December 31, 2021, the total compensation cost for stock options not yet recognized was approximately $457,000 and will be expensed over the next three years.

Warrants to Purchase Common Stock

Warrant activity for the years ended December 31, 2021 and 2020 was as follows:

			Weighted
			Average
			Exercise
	Warrants		Price
Balance at December 31, 2019		6,192,711	$	2.88
Granted		—		—
Exercised		(461,234)		1.87
Expired		—		—
Balance at December 31, 2020		5,731,477	$	2.96
Granted		—		—
Exercised		(20)		3.95
Expired		(2,403,385)		3.95
Balance at December 31, 2021		3,328,072	$	2.25

The remaining life, by grant date, for outstanding warrants at December 31, 2021 was:

			Remaining
	Exercise		Contractual	Outstanding	Exercisable
Grant Date	Price		Life in Years	Warrants	Warrants
11/1/2017	$	2.50	0.83	49,872	49,872
3/29/2018	$	1.95	1.24	10,000	10,000
7/2/2018	$	2.25	0.01	3,268,200	3,268,200
Total				3,328,072	3,328,072