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Stock-Based Compensation | 6 Months Ended
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Mar. 31, 2023
Stock-Based Compensation [Abstract] |
Stock-Based Compensation | NOTE 8 – Stock-Based Compensation During the three and six months ended March 31, 2023 and 2022, stock-based compensation expense related to stock-based awards was included in selling, general and administrative and research and development costs as follows in the accompanying condensed statements of operations.
|  | Three Months Ended |  |  | Six Months Ended |
|  | March 31, |  |  | March 31, |
|  | 2023 |  |  | 2022 |  |  | 2023 |  |  | 2022 |
Selling, general and administrative |  | $ | 199,467 |  |  | $ | 194,874 |  |  | $ | 454,932 |  |  | $ | 357,875 |
Research and development |  |  | 38,161 |  |  |  | 37,842 |  |  |  | 82,877 |  |  |  | 77,913 |
Total stock-based compensation expense |  | $ | 237,628 |  |  | $ | 232,716 |  |  | $ | 537,809 |  |  | $ | 435,788 |
Stock Options During the three months ended March 31, 2023 and 2022, under the 2017 Equity Incentive Plan (the “2017 Plan”), the Company granted 56,781 and 60,000 stock options, respectively, to its board of directors, officers and employees. During the six months ended March 31, 2023 and 2022, the Company granted 130,512 and 62,000, respectively, to its board of directors, officers, employees and consultants. Vesting generally occurs over an immediate to 48 month period based on a time of service condition although vesting acceleration is provided under one grant in the event that a certain milestone is met. The grant date fair value of the grants issued during the three months ended March 31, 2023 and 2022 was $0.88 and $1.00 per share, respectively. The grant date fair value of the grants issued during the six months ended March 31, 2023 and 2022 was $0.75 and $1.03 per share, respectively. The total expense for the three months ended March 31, 2023 and 2022 related to stock options was $142,003 and $145,421, respectively. The total expense for the six months ended March 31, 2023 and 2022 related to stock options was $323,747 and $307,782, respectively. The total number of stock options outstanding as of March 31, 2023 and September 30, 2022 was 1,370,427 and 1,239,915, respectively. The weighted-average assumptions used in the Black-Scholes option-pricing model are as follows for the stock options granted during the three and six months ended March 31, 2023 and 2022:
|  | Three Months Ended |  |  | Six Months Ended |
|  | March 31, |  |  | March 31, |
|  | 2023 |  |  | 2022 |  |  | 2023 |  |  | 2022 |
Expected stock price volatility |  |  | 58.1 | % |  |  | 53.5 | % |  |  | 55.5 | % |  |  | 53.5 | %
Expected life of options (years) |  |  | 5.3 |  |  |  | 6.1 |  |  |  | 5.2 |  |  |  | 6.1 |
Expected dividend yield |  |  | 0 | % |  |  | 0 | % |  |  | 0 | % |  |  | 0 | %
Risk free interest rate |  |  | 3.7 | % |  |  | 1.6 | % |  |  | 3.9 | % |  |  | 1.6 | %
During the three months ended March 31, 2023 and 2022, 84,778 and 182,217 stock options vested, respectively, and zero and 9,167 stock options were forfeited during these periods, respectively. During the six months ended March 31, 2023 and 2022, 212,224 and 201,060 stock options vested, respectively, and zero and 22,501 stock options were forfeited during these periods, respectively. During the three and six months ended March 31, 2023 and 2022, no options were exercised. Restricted Stock Units During the three and six months ended March 31, 2023, the Company granted an aggregate of 61,728 restricted stock units (“RSUs”) to its board of directors under the 2017 Plan. The weighted average grant date fair value of the RSUs granted during the three and six months ended March 31, 2023 was $1.62 per unit. The RSUs vest over a one year period in equal monthly installments on the last day of each month, subject to the recipient’s continued service on such dates. During the three and six months ended March 31, 2022, the Company granted an aggregate of 355,950 restricted stock units (“RSUs”) to certain officers and employees under the 2017 Plan. The weighted average grant date fair value of the RSUs granted during the three and six months ended March 31, 2022 was $2.10 per unit. The RSUs vest over a three year period with 50 percent vesting on the first anniversary of the grant date and the remaining RSUs vesting in equal monthly installments on the last day of each month over 24 months, subject to the recipient’s continued service on such dates. During the three months ended March 31, 2023 and 2022, 219,880 and 3,444 RSUs vested, respectively, and no RSUs were forfeited during these periods. During the six months ended March 31, 2023 and 2022, 241,810 and 9,088 RSUs vested, respectively, and no RSUs were forfeited during these periods. The total expense for the three months ended March 31, 2023 and 2022 related to these RSUs was $95,625 and $87,295, respectively. The total expense for the six months ended March 31, 2023 and 2022 related to these RSUs was $214,062 and $128,006, respectively. Inducement Plan On October 4, 2021, the Company adopted the NeuroOne Medical Technologies Corporation 2021 Inducement Plan (the “Inducement Plan”), pursuant to which the Company reserved 420,350 shares of its common stock to be used exclusively for grants of awards to individuals who were not previously employees or directors of the Company, as an inducement material to the individual’s entry into employment with the Company within the meaning of Rule 5635(c)(4) of the Nasdaq Listing Rules. The Inducement Plan was approved by the Company’s Board of Directors without stockholder approval in accordance with such rule. 2017 Plan Evergreen Provision Under the 2017 Plan, the shares reserved automatically increase on January 1st of each year, for a period of not more than ten years from the date the 2017 Plan is approved by the stockholders of the Company, commencing on January 1, 2019 and ending on (and including) January 1, 2027, to an amount equal to 13% of the fully-diluted shares outstanding as of December 31st of the preceding calendar year. Notwithstanding the foregoing, the Board may act prior to January 1st of a given year to provide that there will be no January 1st increase in the share reserve for such year or that the increase in the share reserve for such year will be a lesser number of shares of common stock than would otherwise occur pursuant to the preceding sentence. “Fully Diluted Shares” as of a date means an amount equal to the number of shares of common stock (i) outstanding and (ii) issuable upon exercise, conversion or settlement of outstanding awards under the 2017 Plan and any other outstanding options, warrants or other securities of the Company that are (directly or indirectly) convertible or exchangeable into or exercisable for shares of common stock, in each case as of the close of business of the Company on December 31 of the preceding calendar year. Effective January 1, 2023, 129,479 shares were added to the 2017 Plan as a result of the evergreen provision. General As of March 31, 2023, 1,708,219 shares were available in the aggregate for future issuance under the 2017 Plan and Inducement Plan. No shares were available for future issuance under the 2016 Equity Incentive Plan. Unrecognized stock-based compensation was $1,334,727 as of March 31, 2023. The unrecognized share-based expense is expected to be recognized over a weighted average period of 1.5 years.

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