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SHARE CAPITAL AND OTHER EQUITY INSTRUMENTS | 9 Months Ended
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Sep. 30, 2021
Equity [Abstract] |
SHARE CAPITAL AND OTHER EQUITY INSTRUMENTS | NOTE 5 - SHARE CAPITAL AND OTHER EQUITY INSTRUMENTS Offerings On January 14, 2021, the Company completed an offering of 2,221,334 shares of Common Stock and pre-funded warrants at approximately $4.50 per share and a concurrent private placement of warrants to purchase 1,666,019 shares of Common Stock at $4.95 per share, exercisable immediately and terminating five years after the date of issuance for gross proceeds of approximately $10,000,000. The net proceeds to the Company after deducting financial advisory fees and other costs and expenses were approximately $8,800,087, with $4,617,087 of such amount allocated to share capital and $4,846,000 allocated to warrant liability and the remaining $663,000 recorded as an expense. On February 11, 2021, the Company completed an offering of 3,007,026 shares of Common Stock and a concurrent private placement of warrants to purchase 1,503,513 shares of Common Stock at $4.90 per share, exercisable immediately and terminating five year from the date of issuance for gross proceeds of approximately $12,800,000. The net proceeds to Enveric from the offering after deducting financial advisory fees and other costs and expenses were approximately $11,624,401, with $7,016,401 of such amount allocated to share capital and $5,135,000 allocated to warrant liability and the remaining $527,000 recorded as an expense. Stock Options SCHEDULE OF STOCK OPTIONS
|  | Number of Shares |  |  | Weighted Average Exercise Price |  |  | Weighted Average Fair Value |  |  | Weighted Average Remaining Contractual Term (years) |  |  | Aggregate Intrinsic Value (USD) |
Outstanding – January 1, 2021 |  |  | 929,765 |  |  | $ | 1.53 |  |  | $ | 2.50 |  |  |  |  |  |  |  |  |
Granted |  |  | 80,000 |  |  | $ | 3.50 |  |  | $ | 2.81 |  |  |  |  |  |  |  |  |
Options assumed pursuant to acquisition of MagicMed |  |  | 973,840 |  |  | $ | 1.34 |  |  | $ | 1.83 |  |  |  |  |  |  |  |  |
Exercised |  |  | (143,796 | ) |  | $ | 0.23 |  |  | $ | 5.69 |  |  |  |  |  |  |  |  |
Expired forfeited, or cancelled |  |  | (692,475 | ) |  | $ | 1.69 |  |  | $ | 1.98 |  |  |  |  |  |  |  |  |
Outstanding – September 30, 2021 |  |  | 1,147,334 |  |  | $ | 1.57 |  |  | $ | 2.09 |  |  |  | 5.7 |  |  | $ | 730,438 |
Exercisable at September 30, 2021 |  |  | 931,810 |  |  | $ | 1.52 |  |  | $ | 2.00 |  |  |  | 4.9 |  |  | $ | 550,191 |
Options granted during the three months ended September 30, 2021 were valued using the Black Scholes model and the following assumptions: SCHEDULE OF STOCK OPTION ASSUMPTION
Term (years) |  |  | 7.0 |
Stock price |  | $ | 3.50 |
Exercise price |  | $ | 3.50 |
Dividend yield |  |  | 0 | %
Expected volatility |  |  | 79 | %
Risk free interest rate |  |  | 1.3 | %
The Company’s stock based compensation expense related to stock options for the three months ended September 30, 2021 and 2020 was $4,683 and $0, respectively. The Company’s stock based compensation expense related to stock options for the nine months ended September 30, 2021 and 2020 was $4,683 and $0, respectively. As of September 30, 2021, the Company had $504,903 in unamortized stock option expense with a weighted average amortization period equal to 2.9 years During the first quarter 2021, the Company exchanged options to purchase 560,404 shares of common stock for 325,410 restricted stock units and 42,125 restricted stock awards. In connection with this exchange, the Company recognized $298,714 in inducement expense related to the increase in fair value of the new awards over the old awards, which is included in other expenses on the Company’s unaudited condensed consolidated statement of operations and comprehensive loss. Restricted Stock Awards The Company’s activity in restricted common stock was as follows for the nine months ended September 30, 2021: SCHEDULE OF RESTRICTED STOCK UNITS AND AWARDS ACTIVITY
|  | Number of shares |  |  | Weighted average fair value |
Non–vested at January 1, 2021 |  |  | - |  |  | $ | - |
Granted |  |  | 70,986 |  |  | $ | 3.84 |
Vested |  |  | (64,334 | ) |  | $ | 4.24 |
Non–vested at September 30, 2021 |  |  | 6,652 |  |  | $ | 2.50 |
For the three months ended September 30, 2021 and 2020, the Company recorded $23,995 and $0, in stock-based compensation expense related to restricted stock awards, respectively. For the nine months ended September 30, 2021 and 2020, the Company recorded $80,109 and $0, in stock-based compensation expense related to restricted stock awards, respectively. As of September 30, 2021, unamortized stock-based compensation costs related to restricted share awards was $24,012, which will be recognized over a weighted average period of 0.25 years. Enveric Biosciences, Inc. and Subsidiaries Notes to Unaudited Condensed Consolidated Financial Statements Issuance of Restricted Stock Units The Company’s activity in restricted stock units was as follows for the nine months ended September 30, 2021: SCHEDULE OF RESTRICTED STOCK UNITS AND AWARDS ACTIVITY
|  | Number of shares |  |  | Weighted average fair value |
Non–vested at January 1, 2021 |  |  | - |  |  | $ | - |
Granted |  |  | 5,775,171 |  |  | $ | 3.65 |
Vested |  |  | (1,207,825 | ) |  | $ | 4.46 |
Non–vested at September 30, 2021 |  |  | 4,567,346 |  |  | $ | 3.43 |
For the three months ended September 30, 2021 and 2020, the Company recorded $458,308 and $0, respectively, in stock-based compensation expense related to restricted stock units, with $315,929 included as a component of general and administrative expenses and $118,474 included as a component of research and development costs in the unaudited condensed consolidated statement of operations. For the nine months ended September 30, 2021 and 2020, the Company recorded $4,710,225 and $0, respectively, in stock-based compensation expense related to restricted stock units, with $4,592,748 included as a component of general and administrative expenses and $118,474 included as a component of research and development expenses in the unaudited condensed consolidated statement of operations. As of September 30, 2021, the Company had unamortized stock-based compensation costs related to restricted stock units of $7,908,006 which will be recognized over a weighted average period of 3.57 years and unamortized stock based costs related to restricted stock units of $6,966,721 which will be recognized upon achievement of specified milestones. Warrants The following table summarizes information about shares issuable under warrants outstanding at September 30, 2021: SCHEDULE OF WARRANTS
|  | Warrant shares outstanding |  |  | Weighted average exercise price (USD) |  |  | Weighted average remaining life |  |  | Intrinsic value |
Outstanding at January 1, 2021 |  |  | 3,770,550 |  |  | $ | 2.13 |  |  |  | 5.0 |  |  | $ | 8,040,836 |
Issued |  |  | 4,146,146 |  |  | $ | 4.90 |  |  |  |  |  |  |  |  |
Assumed pursuant to acquisition of MagicMed |  |  | 5,913,672 |  |  | $ | 1.31 |  |  |  |  |  |  |  |  |
Exercised |  |  | (3,253,714 | ) |  | $ | 1.10 |  |  |  |  |  |  |  |  |
Outstanding at September 30, 2021 |  |  | 10,576,654 |  |  | $ | 2.76 |  |  |  | 3.6 |  |  | $ | 5,115,080 |
Exercisable at September 30, 2021 |  |  | 10,576,654 |  |  | $ | 2.76 |  |  |  | 3.6 |  |  | $ | 5,115,080 |
The warrants assumed pursuant to the acquisition of MagicMed contain certain down round features that would require adjustment to the exercise price upon certain events when the offering price is less than the stated exercise price.

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