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STOCK-BASED COMPENSATION
 6 Months Ended
Jun. 30, 2021
Share-based Payment Arrangement [Abstract]  
STOCK-BASED COMPENSATION

NOTE 6 – STOCK-BASED COMPENSATION

 

Stock Options: The following table summarizes stock option-based compensation for the three and six months ended June 30, 2021 and 2020:

 

   For the three months ended June 30,   For the six months ended June 30, 
   2021   2020   2021   2020 
Research and development  $608,000   $871,000   $1,217,000   $1,615,000 
General and administrative   719,000    707,000    1,193,000    1,219,000 
Stock option-based compensation expense included in operating expense  $1,327,000   $1,578,000   $2,410,000   $2,834,000 

 

 

We estimate the fair value of each option award on the date of grant using the Black-Scholes option valuation model. We then recognize the grant date fair value of each option as compensation expense ratably using the straight-line attribution method over the service period (generally the vesting period). The Black-Scholes model incorporates the following assumptions:

 

  ● Expected volatility - we estimate the volatility of our share price at the date of grant using a “look-back” period which coincides with the expected term, defined below. We believe using a “look-back” period which coincides with the expected term is the most appropriate measure for determining expected volatility.
  ● Expected term - we estimate the expected term using the “simplified” method, as outlined in Staff Accounting Bulletin No. 107, “Share-Based Payment.”
  ● Risk-free interest rate - we estimate the risk-free interest rate using the U.S. Treasury yield curve for periods equal to the expected term of the options in effect at the time of grant.
  ● Dividends - we use an expected dividend yield of zero because we have not declared or paid a cash dividend, nor do we have any plans to declare a dividend.

 

We used the following weighted-average assumptions to estimate the fair value of the options granted for the periods indicated:

 

   For the three months ended June 30,   For the six months ended June 30, 
   2021   2020   2021   2020 
Expected volatility   97%   111%   98%   111%
Expected term   5.67 years    6.25 years    5.93 years    6.25 years 
Risk-free interest rate   0.96%   0.23%   0.99%   0.30%
Expected dividend yield   0%   0%   0%   0%

 

The following table summarizes the options granted for the periods indicated:

 

                             
   For the three months ended June 30,   For the six months ended June 30, 
   2021   2020   2021   2020 
Options granted   1,205,808    1,897,119    3,355,308    3,073,046 
Weighted-average:                    
Exercise price  $1.60   $2.83   $2.05   $2.30 
Grant date fair value  $1.22   $2.36   $1.59   $1.92 

 

Restricted Common Stock: The following table summarizes restricted common stock compensation expense for the three and six months ended June 30, 2021 and 2020:

 

   For the three months ended June 30,   For the six months ended June 30, 
   2021   2020   2021   2020 
Research and development  $484,000   $147,000   $1,030,000   $472,000 
General and administrative   617,000    40,000    938,000    179,000 
Restricted stock-based compensation expense included in operating expense  $1,101,000   $187,000   $1,968,000   $651,000

 

 

 

 

The following table summarizes the restricted common stock granted for the periods indicated:

 

                             
   For the three months ended June 30,   For the six months ended June 30, 
   2021   2020   2021   2020 
Restricted common stock granted   926,484    1,083,313    1,975,734    1,083,313 
Restricted common stock forfeited   (220,136)   -    (428,659)   - 
Weighted-average:                    
Grant date fair value-granted awards  $1.60   $3.19   $1.97   $3.19 
Grant date fair value-forfeited awards  $2.05   $-   $1.89   $-