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Stock-Based Compensation | 12 Months Ended
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Sep. 30, 2024
Stock-Based Compensation [Abstract] |
Stock-Based Compensation | NOTE 8 - Stock-Based Compensation During the years ended September 30, 2024 and 2023, stock-based expense related to the stock options and restricted stock units was included in selling, general and administrative and research and development costs as follows in the accompanying statements of operations:
|  | 2024 |  |  | 2023 |
Selling, general and administrative |  | $ | 1,064,819 |  |  | $ | 905,108 |
Research and development |  |  | 279,657 |  |  |  | 200,349 |
Total stock-based compensation expense |  | $ | 1,344,476 |  |  | $ | 1,105,457 |
The Company’s 2017 Equity Incentive Plan (“2017 Plan”) provides for the issuance of restricted shares and stock options to employees, directors, and consultants of the Company. Effective October 1, 2021, no shares were available for issuance under the 2016 Equity Incentive Plan. Inducement Plan In addition to the Company’s 2017 Equity Incentive Plan (the “2017 Plan”), the Company adopted the NeuroOne Medical Technologies Corporation 2021 Inducement Plan (the “Inducement Plan”) on October 4, 2021, 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. On November 9, 2023, the Company’s Board of Directors adopted the First Amendment to the Company’s Inducement Plan, increasing the aggregate number of shares of common stock that may be issued pursuant to equity incentive awards under the Inducement Plan by 150,000 shares for a total of 570,350 shares of common stock that may be issued. 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 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. On January 1, 2024 and 2023, 1,051,556 and 129,479 shares were added to the 2017 Plan, respectively, as a result of the evergreen provision. Stock Options During the years ended September 30, 2024 and 2023, 1,225,669 and 459,512 stock options were granted to employees, directors and consultants, respectively, with a weighted average grant date fair value of $1.08 and $0.88 per share, respectively. The options granted have vesting periods ranging from being immediate to four years. All options expire ten years from the date of grant. The total expense for the years ended September 30, 2024 and 2023 related to the stock options was $808,057 and $632,315, respectively. The following table summarizes the Company’s stock option plan activity for the years ended September 30, 2024 and 2023 as follows:
|  | Number of Options |  |  | Weighted Average Exercise Price |  |  | Weighted- Average Remaining Contractual Term (years) |  |  | Aggregate Intrinsic Value(1) |
Outstanding at September 30, 2022 |  |  | 1,239,915 |  |  | $ | 5.40 |  |  |  | 8.0 |  |  | $ | 89,295 |
Granted |  |  | 469,512 |  |  | $ | 1.55 |  |  |  | — |  |  |  | — |
Exercised |  |  | — |  |  | $ | — |  |  |  | — |  |  |  | — |
Forfeited/Cancelled |  |  | (1,000 | ) |  | $ | 3.78 |  |  |  | — |  |  |  | — |
Outstanding at September 30, 2023 |  |  | 1,708,427 |  |  | $ | 4.34 |  |  |  | 7.7 |  |  | $ | 20,064 |
Granted |  |  | 1,225,669 |  |  | $ | 1.26 |  |  |  | — |  |  |  | — |
Exercised |  |  | — |  |  | $ | — |  |  |  | — |  |  |  | — |
Forfeited/Cancelled |  |  | (120,000 | ) |  | $ | 1.33 |  |  |  | — |  |  |  | — |
Outstanding at September 30, 2024 |  |  | 2,814,096 |  |  | $ | 3.13 |  |  |  | 7.7 |  |  | $ | 22,685 |
Vested and expected to vest at September 30, 2024 |  |  | 2,814,096 |  |  | $ | 3.13 |  |  |  | 7.7 |  |  | $ | 22,685 |
Vested and exercisable at September 30, 2024 |  |  | 1,409,840 |  |  | $ | 4.79 |  |  |  | 6.4 |  |  | $ | 22,643 |
(1) | The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying options and the fair value of our common stock as of September 30, 2024 and 2023 of $0.99 and $0.89 per share, respectively. As of September 30, 2024 and 2023, 2,780,581 and 1,682,912 outstanding options, respectively, had no intrinsic value.
The weighted-average assumptions used in the Black-Scholes option-pricing model are as follows for the stock options granted during the years ended September 30:
|  | 2024 |  |  | 2023 |
Expected stock price volatility |  |  | 111.9 | % |  |  | 57.4 | %
Expected life of options (years) |  |  | 6.1 |  |  |  | 5.8 |
Expected dividend yield |  |  | 0 | % |  |  | 0 | %
Risk free interest rate |  |  | 4.6 | % |  |  | 3.7 | %
During the years ended September 30, 2024 and 2023, 289,072 and 337,753 stock options vested, respectively. During the years ended September 30, 2024 and 2023, 120,000 and 1,000 stock options were forfeited, respectively. No options were exercised during the years ended September 30, 2024 and 2023. Restricted Stock Units A summary of restricted stock unit (“RSU”) activity is as follows for the years ended September 30, 2024 and 2023:
|  | Number of |
|  | Shares |
Non-vested at September 30, 2022 |  |  | 414,430 |
Granted |  |  | 310,728 |
Vested |  |  | (331,788 | )
Non-vested at September 30, 2023 |  |  | 393,370 |
Granted |  |  | 1,006,725 |
Vested |  |  | (270,333 | )
Non-vested at September 30, 2024 |  |  | 1,129,762 |
During the years ended September 30, 2024 and 2023, 1,006,725 and 310,728 RSUs were granted to members of the Company’s board of directors and employees with a grant date fair value of $1.03 and $1.60 per unit, respectively. The RSUs granted in fiscal year 2024 vest over a four-year period in equal annual installments on the anniversary date of the grant, subject to the recipient’s continued service on such dates. The RSUs granted in fiscal 2023 vest over a one to three year period with some of the RSUs vesting ratably on a monthly basis and others vesting at 50 percent on the first anniversary of the grant date with the remaining RSUs vesting in equal quarterly installments on the last day of each quarter over 24 months, subject to the recipient’s continued service on such dates. During the years ended September 30, 2024 and 2023, 270,333 and 331,788 RSUs vested, respectively. The total expense for the years ended September 30, 2024 and 2023 related to the RSU’s was $536,419 and $473,142, respectively. No RSUs were forfeited during the years ended September 30, 2024 and 2023. General As of September 30, 2024, 297,461 shares were available for future issuance on a combined basis under the 2017 Plan and the Inducement Plan. Unrecognized stock-based compensation was $2,373,628 as of September 30, 2024. The unrecognized share-based expense is expected to be recognized over a weighted average period of 2.3 years.

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