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Stock-Based Compensation | 9 Months Ended
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Jun. 30, 2023
Stock-Based Compensation [Abstract] |
Stock-Based Compensation | NOTE 8 – Stock-Based Compensation During the three and nine months ended June 30, 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 |  |  | Nine Months Ended |
|  | June 30, |  |  | June 30, |
|  | 2023 |  |  | 2022 |  |  | 2023 |  |  | 2022 |
Selling, general and administrative |  | $ | 237,007 |  |  | $ | 211,472 |  |  | $ | 691,939 |  |  | $ | 569,347 |
Research and development |  |  | 59,395 |  |  |  | 44,076 |  |  |  | 142,272 |  |  |  | 121,989 |
Total stock-based compensation expense |  | $ | 296,402 |  |  | $ | 255,548 |  |  | $ | 834,211 |  |  | $ | 691,336 |
Stock Options During the three months ended June 30, 2023 and 2022, under the 2017 Equity Incentive Plan (the “2017 Plan”), the Company granted 339,000 and 88,890 stock options, respectively, to its board of directors, officers and employees. During the nine months ended June 30, 2023 and 2022, the Company granted 469,512 and 150,690, respectively, to its board of directors, officers, employees and consultants. Vesting generally occurs over an immediate to four-year 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 June 30, 2023 and 2022 was $0.92 and $0.57 per share, respectively. The grant date fair value of the grants issued during the nine months ended June 30, 2023 and 2022 was $0.88 and $0.76 per share, respectively. The total expense for the three months ended June 30, 2023 and 2022 related to stock options was $158,528 and $137,109, respectively. The total expense for the nine months ended June 30, 2023 and 2022 related to stock options was $482,276 and $444,891, respectively. The total number of stock options outstanding as of June 30, 2023 and September 30, 2022 was 1,708,906 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 nine months ended June 30, 2023 and 2022:
|  | Three Months Ended |  |  | Nine Months Ended |
|  | June 30, |  |  | June 30, |
|  | 2023 |  |  | 2022 |  |  | 2023 |  |  | 2022 |
Expected stock price volatility |  |  | 58.1 | % |  |  | 53.5 | % |  |  | 57.4 | % |  |  | 53.5 | %
Expected life of options (years) |  |  | 6.1 |  |  |  | 5.3 |  |  |  | 5.8 |  |  |  | 5.6 |
Expected dividend yield |  |  | 0 | % |  |  | 0 | % |  |  | 0 | % |  |  | 0 | %
Risk free interest rate |  |  | 3.6 | % |  |  | 2.8 | % |  |  | 3.7 | % |  |  | 2.3 | %
During the three months ended June 30, 2023 and 2022, 69,947 and 64,841 stock options vested, respectively, and 521 and 5,167 stock options were forfeited during these periods, respectively. During the nine months ended June 30, 2023 and 2022, 282,172 and 265,901 stock options vested, respectively, and 521 and 27,668 stock options were forfeited during these periods, respectively. During the three and nine months ended June 30, 2023 and 2022, no options were exercised. Restricted Stock Units During the three and nine months ended June 30, 2023, the Company granted an aggregate of 249,000 and 310,728 restricted stock units (“RSUs”) to its board of directors under the 2017 Plan, respectively. The weighted average grant date fair value of the RSUs granted during the three and nine months ended June 30, 2023 was $1.59 and $1.60 per unit, respectively. The RSUs vest over a one to three year period with some of the RSUs vesting ratably on a monthly and others vesting at 50 percent on the first anniversary of the grant date with 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 and nine months ended June 30, 2022, the Company granted an aggregate of 87,720 and 443,670 RSUs to certain directors, officers and employees under the 2017 Plan. The weighted average grant date fair value of the RSUs granted during the three and nine months ended June 30, 2022 was $1.14 and $1.91 per unit, respectively. The RSUs vest over a one to three year period with some of the RSUs vesting ratably on a monthly and others vesting at 50 percent on the first anniversary of the grant date with 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 June 30, 2023 and 2022, 52,299 and 9,606 RSUs vested, respectively, and no RSUs were forfeited during these periods. During the nine months ended June 30, 2023 and 2022, 294,109 and 18,694 RSUs vested, respectively, and no RSUs were forfeited during these periods. The total expense for the three months ended June 30, 2023 and 2022 related to these RSUs was $137,874 and $118,439, respectively. The total expense for the nine months ended June 30, 2023 and 2022 related to these RSUs was $351,935 and $246,445, 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 Company’s Board of Directors 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 June 30, 2023, 1,129,125 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 $1,745,365 as of June 30, 2023. The unrecognized share-based expense is expected to be recognized over a weighted average period of 2.0 years.

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