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Note 14 - Stock Based Compensation | 12 Months Ended
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Dec. 31, 2018
Notes to Financial Statements |
Disclosure of Compensation Related Costs, Share-based Payments [Text Block] | NOTE 1 4 : STOCK BASED COMPENSATION Stock Option and Incentive Plan On September 28, 2010, the Board of Directors approved the adoption of the 2010 Stock Option and Incentive Plan the ( “2010 Plan”) to provide for the grant of equity-based awards to employees, officers, non-employee directors and other key persons providing services to the Company. Awards of incentive options may be granted under the 2010 Plan until September 2020. No other awards may be granted under the 2010 Plan after the date that is 10 years from the date of stockholder approval. An aggregate of 5,556 shares were initially reserved for issuance in connection with awards granted under the 2010 Plan and on May 18, 2016, an additional 11,111 shares were reserved for issuance under the 2010 Plan. On May 9, 2017, the stockholders approved an additional 125,000 shares for issuance under the 2010 Plan. On April 12, 2018, the stockholders approved an additional 500,000 shares for issuance under the 2010 Plan. The following table presents the automatic additions to the 2010 Plan since inception pursuant to the “evergreen” terms of the 2010 Plan:
January 1, |  | Number of shares |
2012 |  |  | 2,502 |
2013 |  |  | 2,871 |
2014 |  |  | 4,128 |
2015 |  |  | 5,463 |
2016 |  |  | 7,257 |
2017 |  |  | 12,623 |
2018 |  |  | 106,076 |
Total additional shares |  |  | 140,920 |
The Company granted options to purchase 611,668 and 143,027 shares of common stock to employees and directors during the year ended December 31, 2018 and 2017, respectively. The weighted average grant date fair value of options granted during 2018 and 2017 was $2.02 and $4.80, respectively. There are 3,575 options available for grant under the 2010 Plan as of December 31, 2018, and as a result of the evergreen provision contained in the 2010 Plan, an additional 233,862 shares were added to the 2010 Plan on January 1, 2019. Compensation costs associated with the Company’s stock options are recognized, based on the grant-date fair values of these options, over the requisite service period, or vesting period. Accordingly, the Company recognized stock-based compensation expense of $1,053,496 and $786,550 for the years ended December 31, 2018 and 2017, respectively, which was included in the following captions in the consolidated statements of operations.
|  | Year Ended December 31, |
|  | 201 8 |  |  | 201 7 |
General and administrative |  | $ | 809,110 |  |  | $ | 621,668 |
Research and development |  |  | 244,386 |  |  |  | 164,882 |
Total stock compensation expense |  | $ | 1,053,496 |  |  | $ | 786,550 |
The fair value of stock options granted for the years ended December 31, 2018 and 2017, was calculated using the Black-Scholes option-pricing model applying the following assumptions:
|  | Year ended December 31, |
|  | 201 8 |  | 201 7 |
Risk free interest rate |  | 2.47% | - | 2.71% |  | 1.86% | - | 2.04% |
Expected term (in years) |  | 5.24 | - | 5.57 |  | 5.32 | - | 6.36 |
Dividend yield |  |  | -% |  |  |  | -% |  |
Expected volatility |  | 108.81% | - | 126.43% |  | 112.86% | - | 114.19 |
Options issued and outstanding as of December 31, 2018, and their activities during the year then ended are as follows:
|  | Number of Underlying Shares |  |  | Weighted- Average Exercise Price Per Share |  |  | Weighted- Average Contractual Life Remaining in Years |  |  | Aggregate Intrinsic Value |
Outstanding as of January 1, 2018 |  |  | 172,510 |  |  | $ | 49.27 |  |  |  |  |  |  | $ |  |
Granted |  |  | 611,668 |  |  |  | 2.39 |  |  |  |  |  |  |  |  |
Forfeited |  |  | (795 | ) |  |  | 562.55 |  |  |  |  |  |  |  |  |
Outstanding as of December 31, 2018 |  |  | 783,383 |  |  |  | 12.14 |  |  |  | 9.17 |  |  | $ |  |
Exercisable as of December 31, 2018 |  |  | 317,042 |  |  |  | 24.39 |  |  |  | 8.97 |  |  | $ |  |
Vested and expected to vest |  |  | 783,383 |  |  |  | 12.14 |  |  |  | 9.17 |  |  | $ |  |
At December 31, 2018, there were 466,341 unvested options outstanding and the related unrecognized total compensation cost associated with these options was $1,152,367. This expense is expected to be recognized over a weighted-average period of 1.45 years. Executive Option Grants Classified as Liabilities ( "2018 Liability Grants") On June 27, 2018, the Company granted 2,300,000 options to the Chief Executive Officer and 700,000 to the Chief Financial Officer. Each option is exercisable for an equivalent number of shares of Company's common stock. The options were granted pursuant to an option award agreement and were granted outside the Company’s 2010 Plan; however, they are subject to the terms and conditions of the 2010 Plan. On January 13, 2019, the 2018 liability options were canceled. The Liability Grants were exercisable for shares of common stock at an exercise price of $2.38 per share, which was the fair value on the date of grant. The options had an exercise period of ten years from their date of issuance. If at the time the options were exercised the Company cannot deliver shares of common stock to the optionee including, for example, if there were insufficient shares available under the Plan at the time of exercise, then in lieu of the optionee paying the exercise price and the Company issuing shares of stock, the option only would be exercised on a cash “net basis” so that the Company would pay cash in an amount equal to the excess of the fair value of the common stock over the option exercise price. There were not sufficient shares available under the Plan. Therefore the Company would have been obligated to settle these options in cash if they were exercised. Because these options contained provisions that would require the Company to settle the options in cash in an event outside the Company’s control, they were accounted for as liabilities. The Liability Grants were subject to vesting requirements. Twenty- five percent of the options were vested as of the grant date, 50% of the options would have vested quarterly over two years, and the remaining 25% would have vested upon achievement of certain milestones related to clinical trial progress. As of December 31, 2018, all of the options that vested upon achievement of clinical trial milestones were vested. At December 31, 2018, there were 1,125,000 unvested options outstanding and the related unrecognized total compensation cost associated with these options was $857,673. This expense was expected to be recognized over a weighted-average period of 1.5 years. Compensation costs associated with the Liability Grants were initially recognized, based on the grant-date fair values of these options, over the requisite or vesting period for time-based options or when it is probable the performance criteria were achieved for options that vest based on performance. Compensation cost was remeasured each period based on the market value of our underlying stock until award vesting or settlement. For the year ended December 31, 2018, the Company recognized compensation expense related to these options of $1,410,025, which was included in the following captions in the consolidated statements of operations.
|  | Year Ended December 31, 2018 |
General and administrative |  | $ | 869,515 |
Research and development |  |  | 540,510 |
Total stock compensation expense |  | $ | 1,410,025 |
The fair value of liability options granted for the year ended December 31, 2018, was calculated using the Black-Scholes option-pricing model applying the following assumptions:
| Year Ended December 31 , 2018 |
Risk free interest rate | 2.51 | - | 2.94% |
Expected term (in years) | 4.5 | - | 5.0 |
Stock price | $1.02 | - | $2.38 |
Dividend yield |  | % |  |
Expected volatility | 122.0 | - | 125.0% |
Refer to footnote 16 for further description.

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- Definition The entire disclosure for compensation-related costs for equity-based compensation, which may include disclosure of policies, compensation plan details, allocation of equity compensation, incentive distributions, equity-based arrangements to obtain goods and services, deferred compensation arrangements, employee stock ownership plan details and employee stock purchase plan details. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -URI http://asc.fasb.org/topic&trid=2228938 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 50 -URI http://asc.fasb.org/subtopic&trid=2208855 + Details
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