Stock-Based Compensation

12 Months Ended

Dec. 31, 2021

Share-based Payment Arrangement [Abstract]

Stock-Based Compensation

11. Stock-Based Compensation

On June 12, 2018, our stockholders approved the 2018 Equity Incentive Plan (the “2018 Plan”) to replace our 2015 Equity Incentive Plan (the “2015 Plan”). On July 8, 2020, our stockholders approved an amendment to the 2018 Plan to increase the number of shares of common stock available for issuance under the 2018 Plan by 800,000 shares from 50,000 to 850,000. In addition, up to 122,279 shares of our common stock previously reserved for issuance under the 2015 Plan are available for issuance under the 2018 Plan to the extent such shares were available for issuance under the 2015 Plan as of June 12, 2018 or thereafter cease to be subject to awards outstanding under the 2015 Plan, such as by expiration, cancellation, or forfeiture of such awards.

On June 24, 2021, our stockholders approved an amendment to the 2018 Plan to increase the number of shares of common stock available for issuance under the 2018 Plan by 3,000,000 shares.

Stock options are generally issued with a per share exercise price equal to no less than fair market value of our common stock at the date of grant. Options granted under the 2018 Plan generally vest immediately, or ratably over a two- to 36-month period coinciding with their respective service periods. Options under the 2018 Plan generally have a term of five years. Certain stock option awards provide for accelerated vesting upon a change in control.

As of December 31, 2021, we had 2,838,100 shares of common stock available for issuance under the 2018 Plan.

Stock Options

We measure the fair value of stock options with service-based vesting criteria to employees, directors and consultants on the date of grant using the Black-Scholes option pricing model. The Black-Scholes valuation model requires us to make certain estimates and assumptions, including assumptions related to the expected price volatility of our stock, the period during which the options will be outstanding, the rate of return on risk-free investments, and the expected dividend yield for our stock.

The weighted-average assumptions used in the Black-Scholes option-pricing model used to calculate the fair value of options granted during the year ended December 31, 2021 were as follows:

	Employee
Expected volatility		95.8	%
Expected dividend yield		-
Expected term (in years)		3.01
Risk-free interest rate		0.46	%

The weighted average grant date fair value of options granted during the year ended December 31, 2021 was $0.97 per share, as per the table below.

The weighted-average assumptions used in the Black-Scholes option-pricing model used to calculate the fair value of options granted during the year ended December 31, 2020, were as follows:

	Employee
Expected volatility		92.1	%
Expected dividend yield		-
Expected term (in years)		3.5
Risk-free interest rate		0.17	%

Due to our limited operating history and lack of company-specific historical or implied volatility, the expected volatility assumption was determined based on historical volatilities from traded options of biotech companies of comparable size and stability, whose share prices are publicly available. The expected term of options granted to employees is calculated based on the mid-point between the vesting date and the end of the contractual term according to the simplified method as described in SEC Staff Accounting Bulletin 110 because we do not have sufficient historical exercise data to provide a reasonable basis upon which to estimate the expected term due to the limited period of time our awards have been outstanding. For non-employee options, the expected term of options granted is the contractual term of the options. The risk-free interest rate is determined by reference to the implied yields of U.S. Treasury securities with a remaining term equal to the expected term assumed at the time of grant. The expected dividend assumption is based on our history and expectation of dividend payouts. We have not paid and do not intend to pay dividends.

The table summarizes the stock option activity for the periods indicated as follows:

	Number of Options			Weighted Average Exercise Price Per Share		Weighted Average Remaining Contractual Term (years)		Aggregate Intrinsic Value (1)
Outstanding at December 31, 2019		136,489		$	27.85		3.9	$	-
Granted		370,397		$	1.37		4.9	$	-
Exercised		-		$	-		-	$	-
Forfeited		(10,415	)	$	-		-	$	-
Expired		-		$	-		-	$	-
Outstanding at December 31, 2020		496,471		$	8.63		3.9	$	-
Granted		598,649		$	0.97		4.6	$	-
Exercised		-		$	-		-	$	-
Forfeited		(3,300	)	$	-		-	$	-
Expired		(4,000	)	$	-		-	$	-
Outstanding at December 31, 2021		1,087,820		$	4.08		3.9	$	-
Exercisable at December 31, 2021		649,153		$	5.38		1.8	$	-

(1) The aggregate intrinsic value on the table was calculated based on the difference between the estimated fair value of our stock and the exercise price of the underlying option. The estimated stock values used in the calculation was $0.98 and $1.73 per share for each of the years ended December 31, 2021 and 2020, respectively.

The weighted average grant date fair value of options granted to employees for the year ended December 31, 2021 was $0.97 per share.

At December 31, 2021, the total compensation cost related to non-vested options not yet recognized was $581, which will be recognized over a weighted average period of 27 months, assuming the grantees complete their service period required for vesting.

Restricted Stock Units

The following table summarizes restricted stock unit activity for the years ended December 31, 2021 and 2020:

	Number of Units			Weighted Average Grant Date Fair Value Per Unit
Outstanding as of December 31, 2019		5,877		$	30.28
Granted		30,738	(1)	$	1.97
Vested		(4,543	)	$	1.42
Forfeited		-		$	-
Outstanding as of December 31, 2020		32,072		$	4.13
Granted		-		$	-
Vested		(31,405	)	$	4.22
Forfeited		-		$	-
Outstanding as of December 31, 2021		667		$	1.80

(1) 30,738 restricted stock units were granted on July 23, 2020 with a weighted average grant date fair value of $1.97.

The stock-based compensation expense was recorded as follows:

	Years Ended December 31,
	2021		2020
Research and development	$	3	$	9
General and administrative		762		636
Total stock-based compensation expense	$	765	$	645

The allocation between research and development and general and administrative expense was based on the department and services performed by the employee or non-employee.