In March 2017, the Company’s Board of Directors adopted, and the stockholders approved, the 2017 Stock Option and Incentive Plan (the “2017 Plan”), that became effective in April 2017. The 2017 Plan provides for the issuance of incentive awards up to 4,600,000 shares of common stock to officers, employees, consultants and directors, less the number of shares subject to issued and outstanding awards under the Company’s 2011 Equity Incentive Plan that were assumed in the Merger. The 2017 Plan also provides that the number of shares reserved for issuance thereunder will be increased annually on the first day of each year beginning in 2018 by four percent (4%) of the shares of our common stock outstanding on the last day of the immediately preceding year or such smaller increase as determined by our Board of Directors. As a result of the evergreen increase, a total of 1,623,520 shares were added to the 2017 Plan on January 1, 2019 and a total of 1,623,520 shares were added to the 2017 Plan on January 1, 2020.

The options granted generally vest over 48 months. Under the 2017 Plan, options vest in installments of 25% at the one-year anniversary and thereafter in 36 equal monthly installments beginning on the 1^st of the month after the one-year anniversary date, subject to the employee’s continuous service with the Company. In May 2019, the Company issued a special retention grant of options to purchase an aggregate of 2,419,050 shares of common stock which vest in installments of 50% at June 30, 2020 and 50% at June 30, 2021, subject to the employee’s continuous service with the Company. The options generally expire ten years after the date of grant. The fair value of the options at the date of grant is recognized as an expense over the requisite service period. During the years ended December 31, 2019 and 2018, 4,666,728 and 1,615,200 option awards were granted, respectively. All option awards granted during 2019 and 2018 were under the 2017 Equity Plan.

As of December 31, 2019 and 2018, 1,983,093 and 2,959,562 shares were reserved for issuance under the 2017 Plan, respectively.

The following table summarizes the stock option activity during the years ended December 31, 2019 and 2018:

	Shares			Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (in Years)		Aggregate Intrinsic Value
Outstanding, January 1, 2018		1,912,980		$	3.72		8.24	$	2,738,704
Granted		1,615,200			3.64
Exercised		(52,099	)		1.47
Expired/cancelled		(124,949	)		3.23
Outstanding, December 31, 2018		3,351,132		$	3.73		8.24	$	142,788
Expected to vest, December 31, 2018		2,197,619		$	4.17		9.19	$	-
Options exercisable, December 31, 2018		1,153,513		$	2.90		6.37	$	142,788
Outstanding, January 1, 2019		3,351,132		$	3.73		8.24	$	142,788
Granted		4,666,728			1.85
Exercised		—
Expired/cancelled		(2,682,010	)		2.70
Outstanding, December 31, 2019		5,335,850		$	2.60		6.23	$	2,866
Expected to vest, December 31, 2019		2,395,265		$	1.93		9.00	$	2,866
Options exercisable, December 31, 2019		2,940,585		$	3.15		3.98	$	—

Aggregate intrinsic value represents the estimated fair value of the Company’s common stock at the end of the period in excess of the weighted average exercise price multiplied by the number of options outstanding or exercisable. The aggregate intrinsic value of the options at December 31, 2019 and 2018 was $2,866 and $142,788, respectively.

No stock options were exercised during 2019. Stock options exercised during 2018 had an intrinsic value of $139,108.

For the years ended December 31, 2019 and 2018, the Company recognized compensation expense for stock options of $1,085,842 and $2,982,173, respectively. During the fourth quarter of 2019, the Company recorded a one-time stock-based compensation cumulative reversal of $1,051,735 for the forfeitures of outstanding equity awards related to the Chief Executive Officer and Chief Financial and Business Officer who departed the Company on October 15, 2019. As of December 31, 2019, there was $2,309,337 of unrecognized compensation cost related to stock options, which is expected to be recognized over a weighted average period of 2.31 years.

The Company uses the Black-Scholes option pricing model to determine the estimated fair value for stock-based awards. For the years ended December 31, 2019 and 2018, there were 4,666,728 and 1,615,200 options granted out of the 2017 Plan, respectively. Option pricing models require the input of various assumptions, including the option’s expected life, expected dividend yield, price volatility and risk-free interest rate of the underlying stock. As there has not been significant public market activity of the Company’s Common Stock, the Company has determined the volatility assumption for options granted based on data from a peer group of companies that issued options with substantially similar terms. The expected volatility of options granted has been determined using the average of the historical volatility measures of this peer group of companies for a period equal to the expected life of the option. The risk-free interest rate is based on the rate applicable to U.S. Treasury zero-coupon issues, with remaining maturities commensurate with the expected term of the options granted in effect on the date of grant. The Company has not paid, and does not anticipate paying, cash dividends on shares of Common Stock; therefore, the expected dividend yield is assumed to be zero in the option valuation model. Accordingly, the weighted-average fair value of the options granted during the years ended December 31, 2019 and 2018, was $1.11 and $2.22, respectively. The calculation was based on the following assumptions.

Shares of restricted stock generally had similar vesting terms as stock options. A summary of the Company’s restricted stock activity and related information for the years ended December 31, 2019 and 2018 is as follows:

	Shares			Weighted Average Grant Date Fair Value
Nonvested, January 1, 2018		91,576		$	2.12
Granted		60,000			4.75
Vested		(149,243	)		3.18
Forfeited		(2,333	)		2.25
Nonvested, December 31, 2018		—		$	—

Nonvested, January 1, 2019		—		$	—
Granted		—			—
Vested		—			—
Forfeited		—			—
Nonvested, December 31, 2019		—		$	—

For the years ended December 31, 2019 and 2018, the Company recognized compensation expense for restricted stock of $0 and $449,689, respectively. As of December 31, 2019, all restricted stock had vested.

The Company recognized the following compensation cost related to employee and non-employee stock-based compensation activity for the periods presented below.

The decrease in compensation expense during the year ended December 31, 2019, is primarily due to the cumulative reversal for the forfeitures of outstanding equity awards related to the Chief Executive Officer, Chief Financial and Business Officer and other employees who left the Company during 2019.