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Share Based Payments | 12 Months Ended
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Dec. 31, 2023
Share Based Payments [Abstract] |
SHARE BASED PAYMENTS | 14. SHARE BASED PAYMENTS Group and Company Options The Company operates share-based payment arrangements to remunerate directors and key employees in the form of a share option scheme. The exercise price of the option is normally equal to the market price of an ordinary share in the Company at the date of grant. The Company is currently operating two plans (Tiziana Life Sciences PLC) Share Option Plan which is closed for any new issuances and the Tiziana Life Sciences Ltd 2021 Equity Incentive Plan. Tiziana Life Sciences PLC Share Option Plan
|  | 2023 |  |  | 2022 Restated |  |  | 2021 |
|  | Weighted |  |  |  |  |  | Weighted |  |  |  |  |  | Weighted |  |  |  |
|  | Average exercise price (cents) |  |  | Options (’000) |  |  | Average exercise price (cents) |  |  | Options (’000) |  |  | Average exercise price (cents) |  |  | Options (’000) |
Outstanding at 1 January |  |  | 59 |  |  |  | 6,724 |  |  |  | 90 |  |  |  | 22,234 |  |  |  | 67 |  |  |  | 17,024 |
Granted |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 166 |  |  |  | 5,210 |
Forfeited/Cancelled |  |  | (44 | ) |  |  | (103 | ) |  |  | (92 | ) |  |  | (15,510 | ) |  |  | - |  |  |  | - |
Exercised |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Outstanding at 31 December |  |  | 62 |  |  |  | 6,621 |  |  |  | 59 |  |  |  | 6,724 |  |  |  | 90 |  |  |  | 22,234 |
Exercisable at 31 December |  |  | 60 |  |  |  | 2,829 |  |  |  | 58 |  |  |  | 2,732 |  |  |  | 54 |  |  |  | 7,616 |
No options were exercised during 2023, 2022 or 2021. The total outstanding fair value charge of the share option instruments is deemed to be approximately $2,602k (2022: $3,223k (restated), 2021: $12,339k). Under the Tiziana Life Sciences PLC Share Option Plan, the total expense recognized for the year ending 31 December 2023 arising from share – based payment transactions under the Tiziana Life Sciences PLC Share Option Plan is $703k of which $51k relates to forfeitures during the year (2022 $1,199k, 2021: $5,173k). Share options outstanding at the end of the year have the following expiry dates and exercise prices:
Grant Date |  | Expiry Date |  | Exercise Price |  |  | Share Options at 31 December 2023 (’000) |
26 June 2014 |  | 26 June 2024 |  | $ | 0.47 |  |  |  | 1,831 |
30 April 2018 |  | 30 April 2028 |  | $ | 1.10 |  |  |  | 500 |
6 May 2020 |  | 5 May 2028 |  | $ | 0.47 |  |  |  | 3,690 |
23 July 2020 |  | 26 July 2030 |  | $ | 2.11 |  |  |  | 100 |
25 August 2020 |  | 24 August 2030 |  | $ | 1.98 |  |  |  | 500 |
Total |  |  |  |  |  |  |  |  | 6,621 |
Fair value of options granted The Directors have used the Black-Scholes-Merton option pricing model to estimate the fair value of all of the options granted during the year to December 31, 2023, applying the assumptions below. Historical volatility is based on the historical volatility of the Company itself. The Company has estimated a forfeiture rate of zero. The model inputs for options granted during the year ended 31 December 2022 valued under the Black-Scholes-Merton model included:
|  | 4 November 2022 |  |  | 1 August 2022 |
Grant date share price |  | $ | 0.679 |  |  | $ | 0.741 |
Exercise share price |  | $ | 0.679 |  |  | $ | 0.741 |
Risk free rate |  |  | -0.10% to -0.02% |  |  |  | 0.32% to 0.65% |
Expected volatility |  |  | 99% to 122% |  |  |  | 90% to 126% |
Option life |  |  | 10 years |  |  |  | 10 years |
Weighted average share price |  | $ | 0.67 |  |  | $ | 0.741 |
Weighted average fair value per share option |  | $ | 0.690 |  |  | $ | 0.690 |
For the options issued in August 2020 with a market condition attached, the Directors have used the Monte Carlo simulation to estimate the fair value of these options. The Company uses the following methods to determine its underlying assumptions:
| ● | expected volatilities are based on the historical volatilities of the market;
| ● | the expected term of the award is 4 years and is based on managements’ assessment of when the market condition is likely to be achieved; and
| ● | a range of fair values per share were produced and management have determined the most appropriate value based on their knowledge of the market and vesting conditions being fulfilled.
Modification of share – based payments. In May 2020, the Company reduced the exercise price for options issued to employees and directors to $0.48 (£0.35). This was approved by shareholders at a General Meeting held on May 6, 2020. The fair value of the modified options at the date of modification was determined using the option pricing models as described above. The incremental fair value was recognized as an expense over the period from the modification date to the end of the vesting period. The expense for the original option grant will continue to be recognized as if the terms had not been modified. The fair value of the modified options was determined using the same models and principles as described above. Tiziana Life Sciences Ltd Share Option Plan
|  | 2023 |  |  | 2022 |
|  | Weighted |  |  |  |  |  | Weighted |  |  |  |
|  | Average exercise price (cents) |  |  | Options (’000) |  |  | Average exercise price (cents) |  |  | Options (’000) |
Outstanding at 1 January |  |  | 69 |  |  |  | 2,575 |  |  |  | - |  |  |  | - |
Granted |  |  | 61 |  |  |  | 1,753 |  |  |  | 69 |  |  |  | 2,575 |
Forfeited/Cancelled |  |  | (57 | ) |  |  | (60 | ) |  |  | - |  |  |  | - |
Exercised |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Outstanding at 31 December |  |  | 73 |  |  |  | 4,268 |  |  |  | 69 |  |  |  | 2,575 |
Exercisable at 31 December |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
No options were exercised during 2023, 2022 or 2021. The total outstanding fair value charge of the share option instruments is deemed to be approximately $974k (2022: $1,176k) Under the Tiziana Life Sciences Ltd 2021 Equity Incentive Plan, the total expenses recognized for the year ending 31 December 2023 arising from share - based payment transactions are $1,019k, not including a charge of $57k for forfeitures during the year. (2022:$332k)
|  | 26 July 2023 |  |  | 14 March 2023 |
Grant date share price |  | $ | 0.67 |  |  | $ | 0.57 |
Exercise share price |  | $ | 0.67 |  |  | $ | 0.57 |
Risk free rate |  |  | 3.88 | % |  |  | 3.88 | %
Expected volatility |  |  | 118 | % |  |  | 119 | %
Option life |  |  | 10 years |  |  |  | 10 years |
Weighted average share price |  | $ | 0.67 |  |  | $ | 0.57 |
Weighted average fair value per share option |  | $ | 0.67 |  |  | $ | 0.57 |
Share options outstanding at the end of the year have the following expiry dates and exercise prices:
Grant Date |  | Expiry Date |  | Exercise Price |  |  | Share Options as at 31 December 2023 (’000) |
01 August 2022 |  | 01 August 2032 |  | $ | 0.74 |  |  |  | 725 |
04 November 2022 |  | 04 November 2032 |  | $ | 0.67 |  |  |  | 1,850 |
14 March 2023 |  | 14 March 2033 |  | $ | 0.57 |  |  |  | 993 |
26 July 2023 |  | 26 July 2033 |  | $ | 0.67 |  |  |  | 700 |
Total |  |  |  |  |  |  |  |  | 4,268 |
Group and Company Warrants No warrants were issued in 2022 or 2023. For warrants issued in 2020, the Directors have estimated the fair value of the warrants using the Black-Scholes valuation model and assumptions below:
|  | 21 January 2020 |  |  | 21 January 2020 |  |  | 1 June 2020 |
Grant date share price |  | £ | 0.43 |  |  | £ | 0.43 |  |  | £ | 1.15 |
Exercise share price |  | £ | 0.42 |  |  | £ | 0.35 |  |  | £ | 0.70 |
Risk free rate |  |  | 0.64 | % |  |  | 0.40 | % |  |  | 0.04 | %
Expected volatility |  |  | 61.7 | % |  |  | 84.7 | % |  |  | 111 | %
|  | 2023 $000 |  |  | 2022 $000 |  |  | 2021 $000 |
Outstanding at 1 January |  |  | 697 |  |  |  | 697 |  |  |  | 697 |
Exercised |  |  | (438 | ) |  |  | - |  |  |  | - |
Expired |  |  | (259 | ) |  |  | - |  |  |  | - |
Outstanding at 31 December |  |  | - |  |  |  | 697 |  |  |  | 697 |
No share-based payment charges relating to warrants were recorded during 2023, 2022 or 2021. Approximately $26K of share-based payment charges are included in the consolidated statement of operations and comprehensive loss for the year ended December 31, 2020.

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