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Stockholders' Equity

9 Months Ended

Sep. 30, 2024

Stockholders’ Equity [Abstract]

STOCKHOLDERS' EQUITY

NOTE 7 - STOCKHOLDERS’ EQUITY

Common Stock

During the nine months ended September 30, 2024, the Company issued 74,999 shares of common stock for the exercise of options for proceeds of $246,747.

On April 6, 2022, the Company entered into a new Open Market Sale Agreement with Jefferies LLC, as sales agent, pursuant to which we may offer and sell, from time to time, through Jefferies LLC, shares of our common stock, having an aggregate offering price of up to $100,000,000. We are not obligated to sell any shares under the agreement. As of September 30, 2024, no shares have been issued under this agreement.

Options and Warrants

In December 2014, the Board of Directors adopted and the Company’s shareholders approved Relmada’s 2014 Stock Option and Equity Incentive Plan, as amended (the “ 2014 Plan”), which allows for the granting of 5,152,942 common stock awards, stock appreciation rights, and incentive and nonqualified stock options to purchase shares of the Company’s common stock to designated employees, non-employee directors, and consultants and advisors.

In May 2021, the Company’s Board of Directors adopted and shareholders approved Relmada’s 2021 Equity Incentive Plan (the “2021 Plan”) which allows for the granting of 1,500,000 options or other stock awards.

In May 2022, the Company’s Board of Directors adopted and shareholders approved an amendment to the 2021 Plan to increase the shares of the Company’s common stock available for issuance thereunder by 3,900,000 shares.

In May 2023, the Company’s Board of Directors adopted and shareholders approved an amendment to the 2021 Plan to increase the shares of the Company’s common stock available for issuance thereunder by 2,500,000 shares.

These combined plans allowed for the granting of up to 13,052,942 options or other stock awards.

Stock options are exercisable generally for a period of 10 years from the date of grant and generally vest over four years.

As of September 30, 2024, 350 shares were available for future grants under the 2014 or 2021 Plan.

The Company utilizes the Black-Scholes option pricing model to estimate the fair value of stock options and warrants. The risk-free interest rate assumptions were based upon the observed interest rates appropriate for the expected term of the equity instruments. The expected dividend yield was assumed to be zero as the Company has not paid any dividends since its inception and does not anticipate paying dividends in the foreseeable future. The expected volatility was based on historical volatility.

The Company uses the simplified method for share-based compensation to estimate the expected term for equity awards for share-based compensation in its option-pricing model.

From January 1, 2024 through September 30, 2024, 487,434 options were issued to various consultants and employees with an exercise price ranging from $3.05 to $3.44 and a 10-year term, vesting over a 3.56 - 4 year period. The options granted include time-based vesting grants. The options have an aggregate fair value of approximately $1.3 million calculated using the Black-Scholes option-pricing model. Variables used in the Black-Scholes option-pricing model include: (1) discount rate of 4.10 – 4.51 % - (2) expected life of 5.92 - 6.25 years, (3) expected volatility of 113.5% - 114.1 %, and (4) zero expected dividends.

At September 30, 2024, the Company has unrecognized stock-based compensation expense of approximately $32 million related to unvested stock options which will be recognized over the weighted average remaining service period of 1.78 years.

Options

A summary of the changes in options during the nine months ended September 30, 2024 is as follows:

		Number of Options				Weighted Average Exercise Price Per Share				Weighted Average Remaining Contractual Term (Years)				Aggregate Intrinsic Value
Outstanding and expected to vest at December 31, 2023			17,416,192			$	12.99				8.3			$	11,183,370
Granted			487,434			$	3.10				9.63			$	-
Exercised			(74,999	)		$	-				-				-
Forfeited			(18,407	)		$	-				-			$	-
Cancelled			(4,757,628	)		$	-				-			$	-
Outstanding at September 30, 2024			13,052,592			$	16.47				7.02			$	599,973
Options exercisable at September 30, 2024			8,888,189			$	19.28				6.52			$	111,698

Warrants

A summary of the changes in outstanding warrants during the nine months ended September 30, 2024 is as follows:

		Number of Shares				Weighted Average Exercise Price Per Share
Outstanding at December 31, 2023			2,381,366			$	20.02
Forfeited			(717,915	)		$	-
Exercised			-			$	-
Outstanding at September 30, 2024			1,663,451			$	25.31
Warrants vested at September 30, 2024			1,600,326			$	25.05

At September 30, 2024, the Company had approximately $0.9 million of unrecognized compensation expense related to outstanding warrants.

At September 30, 2024, the aggregate intrinsic value of warrants vested and outstanding was $3,240.

Stock -based compensation for options and warrants by class of expense

The following table summarizes the components of stock-based compensation expense which includes stock options and warrants in the unaudited consolidated statements of operations for the nine months ended September 30, 2024 and 2023 (rounded to nearest $00):

		Nine Months Ended September 30, 2024				Nine Months Ended September 30, 2023
Research and development		$	5,007,300			$	5,463,100
General and administrative			18,450,700				28,453,800
Total		$	23,458,000			$	33,916,900