Equity (Tables)

3 Months Ended

Mar. 31, 2020

Summary of Stock Options Outstanding and Exercisable

The following table summarizes the Company’s stock option activity under both the 2010 Plan and 2019 Plan:

		Weighted		Weighted Average
	Number of	Average		Remaining		Aggregate
	Options	Exercise Price		Contractual Life		Intrinsic Value
Outstanding at December 31, 2019	6,000,000	$	1.33	5.40	$	—
Granted	340,000	$	0.69
Forfeited	(100,000)	$	1.70
Outstanding at March 31, 2020	6,240,000	$	1.29	5.45	$	1,350
Exercisable at March 31, 2020	5,717,000	$	1.36	5.08	$	1,350

The 100,000 stock options that were forfeited as of March 31, 2020 were issued under the 2010 Plan, which was cancelled as noted above. Therefore, these forfeited stock options were not added back to the 2019 Plan.

Stock options outstanding at March 31, 2020 are summarized in the table below:

	Number of	Weighted		Weighted Average
	Options	Average		Remaining
Range of Exercise Prices	Outstanding	Exercise Price		Contractual Lives
$0.40 - $2.00	5,212,000	$	0.73	6.13
$2.01 - $5.00	840,000	$	3.28	1.68
$5.01 - $8.62	188,000	$	7.97	3.60
	6,240,000	$	1.29	5.45

Assumptions Used in Computing Fair Value of All Options Granted

The Company computes the fair value for all options granted or modified using the Black-Scholes option pricing model. To calculate the fair value of the options, certain assumptions are made regarding components of the model, including the fair value of the underlying common stock, risk-free interest rate, volatility, expected dividend yield and expected option life. Changes to the assumptions could cause significant adjustments to the valuation. The Company calculates its volatility assumption using the actual changes in the market value of its stock. Forfeitures are recognized as they occur. The Company’s historical option exercises do not provide a reasonable basis to estimate an expected term due to the lack of sufficient data. Therefore, the Company estimates the expected term by using the simplified method. The simplified method calculates the expected term as the average of the vesting term plus the contractual life of the options. The risk-free interest rate is based on the U.S. Treasury yield in effect at the time of the grant for treasury securities of similar maturity. The Company computed the fair value of options granted during the period ended March 31, 2020, using the following assumptions:

Expected volatility	130.73% - 131.18	%
Risk free interest rate	1.62% - 1.67	%
Expected term (years)	5.00 - 5.51

Summary of Stock-Based Compensation Expense

The following table summarizes stock-based compensation expense for the three months ended March 31, 2020 and 2019:

	Three Months Ended March 31,
	2020		2019
Research and development expenses
Stock-based compensation	$	59,000	$	—
General and administrative expenses
Issuance of common stock for services		80,000		60,000
Stock-based compensation		154,000		28,000
Total stock-based compensation	$	293,000	$	88,000
Unrecognized expense at March 31, 2020		119,000
Weighted average remaining years to vest		0.52

2019 Stock plan

Stock Option Activity

The following table summarizes the activity of the 2019 Plan and the available options to be granted as of March 31, 2020:

	2019 Plan
Total shares reserved for equity awards		10,000,000
Options granted		(484,000)
Remaining shares available for future equity awards		9,516,000