Stockholders' Equity

6 Months Ended

Jun. 30, 2022

Stockholders' Equity

Stockholders' Equity

6. Stockholders’ Equity

In 2005, we adopted the 2005 Stock Option and Incentive Plan (2005 Plan) that authorizes us to grant stock options, restricted stock and other equity-based awards. As of June 30, 2022, 577 options to purchase shares of common stock were outstanding pursuant to grants in connection with the 2005 Plan. No additional shares are available for issuance under the 2005 Plan. The amount, terms of grants, and exercisability provisions are determined and set by our board of directors.

Effective August 2014, we adopted our 2014 Equity Incentive Plan, as amended (2014 Plan), that authorizes us to grant stock options, restricted stock, and other equity-based awards, subject to adjustment in accordance with the 2014 Plan. As of June 30, 2022, 2,791,555 options to purchase shares of common stock were outstanding pursuant to grants in connection with the 2014 Plan, and 700,490 shares of common stock were available for future issuance. The amount, terms of grants, and exercisability provisions are determined and set by our board of directors. In accordance with the 2014 Plan, on January 1, 2022, the shares of common stock available for future grants under the 2014 Plan was increased to 2,343,330.

Stock Options

There were 5,721,407 stock options outstanding as of June 30, 2022 at a weighted average exercise price of $11.32 per share, including 2,929,275 stock options outstanding outside of the 2014 Plan, granted as inducements to new employees. During the six months ended June 30, 2022, 1,608,519 options were granted to employees and directors at a weighted average exercise price of $9.66 per share. Of the options granted, 1,218,783 options were granted pursuant to the 2014 Plan and 389,736 were granted outside of the 2014 Plan as inducements for new employees.

Total compensation cost recognized for all stock option awards in the statements of operations is as follows (in thousands):

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2022		2021		2022		2021
Research and development	$	1,226	$	1,083	$	2,405	$	2,273
General and administrative		2,125		1,827		4,024		5,617
Total	$	3,351	$	2,910	$	6,429	$	7,890

Restricted Stock

All issued and outstanding restricted shares of common stock are time-based, and become vested within two years of the grant date, pursuant to the 2014 Plan. Compensation expense is recorded ratably over the requisite service period. Compensation expense related to restricted stock is measured based on the fair value using the closing market price of our common stock on the date of the grant. As of June 30, 2022, we had 15,125 outstanding shares of restricted common stock.

During the six months ended June 30, 2022, we granted 771,234 restricted stock units, which vest within four years of the grant date, pursuant to the 2014 Plan. As of June 30, 2022, we had 743,092 restricted stock units outstanding.

Total compensation cost recognized for all restricted stock awards and restricted stock units in the statements of operations is as follows (in thousands):

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2022		2021		2022		2021
Research and development	$	171	$	—	$	270	$	—
General and administrative		295		81		497		136
Total	$	466	$	81	$	767	$	136

Preferred Stock

As of June 30, 2022, 4,300 shares of our Series A Convertible Preferred Stock (Preferred Stock) remained outstanding, convertible into 860,000 shares of our common stock. During the three months ended June 30, 2022, 275 shares of our Preferred Stock were converted into 55,000 shares of common stock.

Stock Issued in Connection with Ovid License Agreement

On March 29, 2022, pursuant to an exclusive patent license agreement with Ovid Therapeutics Inc. (Ovid), we issued 123,255 shares of our common stock to Ovid. The shares were issued in reliance upon the exemption from the registration requirements of the Securities Act of 1933, as amended (the Securities Act) provided by Section 4(a)(2) of the Securities Act and Regulation D thereunder as sales by an issuer not involving any public offering (see Part II, Item 2. Unregistered Sales of Equity Securities and Use of Proceeds). The fair value of these shares is reflected in operating expenses for the six months ended June 30, 2022.