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STOCK-BASED COMPENSATION | 9 Months Ended
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Sep. 30, 2024
Share-Based Payment Arrangement [Abstract] |
STOCK-BASED COMPENSATION |
12) | STOCK-BASED COMPENSATION
Stock Options During the nine months ended September 30, 2024 and 2023, the Company granted options to purchase the number of shares of the Company’s common stock set forth in the table below (in thousands): SCHEDULE OF STOCK OPTION GRANTED
|  | Nine months ended September 30, |
|  | 2024 |  |  | 2023 |
Stock options granted |  |  | 2,375 |  |  |  | 237 |
There were no stock options granted during either of the three months ended September 30, 2024 or 2023. On January 1, 2024, Sanjeev Luther was appointed as President, Chief Executive Officer and a director of the Company. Upon his appointment, he was granted a non-qualified stock option to purchase approximately 1,685,000 shares of the Company’s common stock. The stock option has an exercise price of $1.80 per share, which was equal to the fair market value (as defined in the 2020 Restated Equity Incentive Plan) of the Company’s common stock on the date of grant, will vest over four years, with 25% of the shares vesting on the first anniversary of the grant date and the remaining 75% of the shares vesting in equal monthly installments over the three years thereafter, in each case, subject to continued service. The stock option was granted pursuant to the terms of Mr. Luther’s employment agreement and as a material inducement to his joining the Company in accordance with Nasdaq Listing Rule 5635(c)(4). On April 26, 2024, the vesting terms of Mr. Luther’s stock option award were amended so that the option vests over three years, with 25% of the shares vesting on the first anniversary of the grant date and the remaining 75% of the shares will vest in equal monthly installments over the remaining two years, in each case, subject to continued service. Since the only modification to Mr. Luther’s stock option award was to the vesting terms, there was no change to the fair value of the stock option and the total compensation cost was unchanged. However, the total compensation cost will be recognized over three years rather than four years, and as a result, the Company recognized approximately $0.1 million in additional stock-based compensation expense during the nine months ended September 30, 2024 as a result of the modification. The Company recognizes stock-based compensation expense for stock options granted to employees, directors and certain consultants. The Company estimates the fair value of stock options using the Black-Scholes option pricing model. The fair value of stock options granted is recognized as expense over the requisite service period on a straight-lined basis. The following weighted-average assumptions were used for stock options granted during the nine months ended September 30, 2024 and 2023: SCHEDULE OF WEIGHTED-AVERAGE ASSUMPTIONS USED FOR STOCK OPTIONS GRANTED
|  | Nine months ended September 30, |
|  | 2024 |  |  | 2023 |
Weighted average risk-free rate |  |  | 4.45 | % |  |  | 3.82 | %
Weighted average volatility |  |  | 97.91 | % |  |  | 95.15 | %
Dividend yield |  |  | 0.00 | % |  |  | 0 | %
Expected term |  |  | 5.85 years |  |  |  | 5.44 years |
The per-share weighted average grant-date fair value of stock options granted during the nine months ended September 30, 2024 and 2023 were as follows: SCHEDULE OF WEIGHTED AVERAGE GRANT-DATE FAIR VALUE OF STOCK OPTIONS
|  | Nine months ended September 30, |
|  | 2024 |  |  | 2023 |
Weighted average grant date fair value |  | $ | 1.44 |  |  | $ | 2.99 |
Vesting of all stock options is subject to continuous service with the Company through the applicable vesting date. As of September 30, 2024, there were approximately 2,516,000 shares of the Company’s common stock subject to outstanding stock options. Restricted Stock Units The Company recognizes the fair value of RSUs as expense on a straight-line basis over the requisite service period. For performance-based RSUs, the Company begins recognizing the expense once the achievement of the related performance goal is determined to be probable. Outstanding RSUs are settled in an equal number of shares of common stock on the vesting date of the award. An RSU award is settled only to the extent vested. Vesting generally requires the continued employment or service by the award recipient through the applicable vesting date. Because RSUs are settled in an equal number of shares of common stock without any offsetting payment by the recipient, the measurement of cost is based on the quoted market price of the stock at the measurement date, which is the grant date. In lieu of paying cash to satisfy withholding taxes due upon the settlement of vested RSUs, at the Company’s discretion, an employee may elect to have shares of common stock withheld that would otherwise be issued at settlement, the value of which is equal to the amount of withholding taxes payable. During the three and nine months ended September 30, 2024 and 2023, less than 1,000 RSUs vested. As of September 30, 2024, there were less than 1,000 RSUs outstanding. The Company did not grant RSUs during either of the three or nine months ended September 30, 2024 and 2023. Stock-Based Compensation Expense For the three and nine months ended September 30, 2024 and 2023, the Company recognized stock-based compensation expense as follows (in thousands): SCHEDULE OF STOCK-BASED COMPENSATION EXPENSE
|  | Three months ended September 30, |  |  | Nine months ended September 30, |
|  | 2024 |  |  | 2023 |  |  | 2024 |  |  | 2023 |
Research and development |  | $ | 13 |  |  | $ | 57 |  |  | $ | 74 |  |  | $ | 177 |
General and administrative |  |  | 392 |  |  |  | 117 |  |  |  | 1,036 |  |  |  | 900 |
Total |  | $ | 405 |  |  | $ | 174 |  |  | $ | 1,110 |  |  | $ | 1,077 |

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