XML 23 R12.htm IDEA: XBRL DOCUMENT v3.21.1
Stockholders' Deficit
 3 Months Ended
Mar. 31, 2021
Equity [Abstract]  
Stockholders' Deficit

NOTE 6 - STOCKHOLDERS’ DEFICIT

 

Stock-Based Compensation

 

In connection with the consummation of the Merger completed on February 12, 2016, we adopted Prior Protagenic’s 2006 Employee, Director and Consultant Stock Plan (the “2006 Plan”). On June 17, 2016, our stockholders adopted the 2016 Plan and, as a result, we terminated the 2006 Plan. We will not grant any further awards under the 2006 Plan. All outstanding grants under the 2006 Plan will continue in effect in accordance with the terms of the particular grant and the 2006 Plan.

 

Pursuant to the 2016 Plan, the Company’s Compensation Committee may grant awards to any employee, officer, director, consultant, advisor or other individual service provider of the Company or any subsidiary. On each of January 1, 2017, January 1, 2019 and January 1, 2020, pursuant to an annual “evergreen” provision contained in the 2016 Plan, the number of shares reserved for future grants was increased by 564,378 shares, or a total of 1,693,134 shares. As a result of these increases, as of March 31, 2021 and December 31, 2020, the aggregate number of shares of common stock available for awards under the 2016 Plan was 4,868,623 shares and 4,868,623 shares, respectively. Options issued under the 2016 Plan are exercisable for up to ten years from the date of issuance.

 

There were 5,673,861 options outstanding as of March 31, 2021. The fair value of each stock option granted was estimated using the Black-Scholes assumptions and or factors as follows:

 

Exercise price   $ 5.60  
Expected dividend yield     0 %
Risk free interest rate     0.81%-1.54 %  
Expected life in years     5-10  
Expected volatility     149%-158 %  

 

There were 5,597,861 options outstanding as of December 31, 2020. The fair value of each stock option granted was estimated using the Black-Scholes assumptions and or factors as follows:

 

Exercise price   $ 1.75  
Expected dividend yield     0 %
Risk free interest rate     0.64%-1.61 %  
Expected life in years     10  
Expected volatility     140%-146 %  

 

The following is an analysis of the stock option grant activity under the Plan:

 

         

Weighted

Average

    

Weighted

Average

  
    Number     Exercise Price     Remaining Life  
Stock Options                        
                         
Outstanding December 31, 2020     5,597,861     $ 1.47       6.48  
Granted     366,000     $ 5.60       9.69  
Expired     (280,000 )   $ 1.00       -  
Exercised     (10,000 )   $ 1.00       -  
Outstanding March 31, 2021     5,673,861     $ 1.76       6.78  

 

A summary of the status of the Company’s nonvested options as of March 31, 2021, and changes during the three months ended March 31, 2021, is presented below:

 

Nonvested Options   Options    

Weighted-

Average
Exercise Price

  
Nonvested at December 31, 2020     862,833     $ 1.75  
Granted     366,000     $ 5.60  
Vested     (106,291 )   $ 4.70  
Forfeited     -     $ -  
Nonvested at March 31, 2021     1,122,542     $ 2.93  

 

As of March 31, 2021, the Company had 5,673,861 shares issuable under options outstanding at a weighted average exercise price of $1.76 and an intrinsic value of $23,025,089.

 

The total number of options granted during the three months ended March 31, 2021 and 2020 was 366,000 and 1,387,497, respectively. The exercise price for these options was $5.60 per share.

 

The Company recognized compensation expense related to options issued of $345,975 and $360,436 during the three months ended March 31, 2021 and 2020, respectively, in which $344,499 and $325,794 is included in general and administrative expenses and $1,476 and $34,641 in research and development expenses, respectively. For the three months ended March 31, 2021, $136,203 of the stock compensation was related to employees and $209,772 was related to non-employees.

 

As of March 31, 2021, the unamortized stock option expense was $2,778,726 with $397,760 being related to employees and $2,380,966 being related to non-employees. As of March 31, 2021, the weighted average period for the unamortized stock compensation to be recognized is 3.50 years.

 

On February 25, 2021, the Company issued a total of 366,000 options to purchase shares of the Company’s common stock to five individuals, with 350,000 of these options being issued to related parties. These options had a grant date fair value of $2,009,063. These options have an exercise price of $5.60. 16,000 of the options vest immediately and 350,000 of the options vest monthly over 48 months. These options were approved by the board of directors on February 25, 2021.

 

During the three months ended March 31, 2021, 10,000 options were exercised for 10,000 shares of the Company’s common stock. These options had an exercise price of $1.00.

 

Warrants:

 

A summary of warrant issuances are as follows:

 

         

Weighted

Average

    

Weighted

Average

  
    Number     Exercise Price     Remaining Life  
Warrants                        
                         
Outstanding December 31, 2020     4,007,058     $ 1.06       1.86  
Expired     (150,249 )     1.25       -  
Exercised     (373,042 )     1.25       -  
Outstanding March 31, 2021     3,483,767     $ 1.03       1.85  

 

As of March 31, 2021, the Company had 3,483,767 shares issuable under warrants outstanding at a weighted average exercise price of $1.03 and an intrinsic value of $16,684,157.

 

During the three months ended March 31, 2021, 373,042 warrants were exercised for 240,123 shares of the Company’s common stock. The Company received $27,125 from these exercises.