Stock Options

3 Months Ended

Mar. 31, 2020

Share-based Payment Arrangement [Abstract]

Stock Options

Note 5. Stock Options

The following table summarizes stock option activity for the period ended March 31, 2020:

	Number of Options		Weighted Average Exercise Price ($)		Weighted Average Remaining Contractual Term		Aggregate Intrinsic Value ($)
Outstanding at December 31, 2019		2,317,500		2.68		5.68 years	$	1,460,507
Grants		620,571
Outstanding at March 31, 2020		2,938,071		2.80		5.50 years	$	11,625
Exercisable at March 31, 2020		317,500		3.41		4.17 years		11,625
Available for grant at March 31, 2020		16,820,194

During the three months ended March 31, 2020, the Company granted Alan L. Rubino, the Company’s President and Chief Executive Officer, an option to purchase up to 620,571 shares of the Company’s common stock at an exercise price of $3.23. The option was granted in fulfillment of the Company’s obligation under the terms of Mr. Rubino’s employment agreement dated November 15, 2019. The fair value of the option was estimated at the date of grant using the Black-Scholes option pricing model. Assumptions regarding volatility, expected term, dividend yield and risk-free interest rate are required the Black-Scholes model. The volatility assumption is based on the Company’s historical experience. The risk-free interest rate is based on a U.S. Treasury note with maturity similar to the option award’s expected life. The expected life represents the average period of time that options granted are expected to be outstanding.

The assumptions for volatility, expected life, dividend yield and risk-free interest rate for the options granted are as follows:

	Three Months Ended
	March 31, 2020
Risk-free interest rate		1.67	%
Expected life in years		3.30
Expected Volatility		107.35	%
Expected dividend yield		0	%

The share-based compensation cost resulting from stock option grants, including those previously granted and vesting over time is expensed ratably over the respective vesting periods. During the three months ended March 31, 2020 and 2019, the Company recognized $465,763 and $832, respectively, in stock-based compensation. As of March 31, 2020, the Company’s unrecognized compensation cost related to unvested stock options was $2,746,876 to be amortized through 2023. Stock-based compensation has been included in the consolidated statement of operations as follows:

	Three Months Ended
	March 31,
	2020		2019
Research and development	$	-	$	-
General and administrative		465,763		832
Total	$	465,763	$	832

The following table summarizes information about stock options outstanding and exercisable at March 31, 2020:

		Stock Options Outstanding						Stock Options Exercisable
Range of Exercise Prices		Number of Shares Subject to Outstanding Options		Weighted Average Contractual Life (years)		Weighted Average Exercise Price		Number of Shares Subject to Options Exercise		Weighted Average Remaining Contractual Life (Years)		Weighted Average Exercise Price
	1.05		55,000		4.00		1.05		55,000		4.00		1.05
	1.25		7,500		5.21		1.25		7,500		5.21		1.25
	1.34		7,500		5.25		1.34		7,500		5.25		1.34
	1.70		7,500		5.54		1.70		7,500		5.54		1.70
	2.28		7,500		6.30		2.28		7,500		6.30		2.28
	4.20		232,500		4.03		4.20		232,500		4.03		4.20
	1.98		667,800		5.63		1.98		-		-		-
	2.48		667,800		5.63		2.48		-		-		-
	3.23		664,400		5.63		3.23		-		-		-
	3.23		620,571		5.76		3.23		-		-		-
	Total		2,938,071		5.50	$	2.80		317,500		4.17	$	3.41