TNF Pharmaceuticals, Inc. Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

Share-based Payments

Share-based Payments

9 Months Ended

Sep. 30, 2014

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Share-based Payments

Note 9 - Share-based Payments

(a)

Stock Warrants

The Company has issued warrants to various employees, consultants and members of the Board of Directors of the Company for their services either in connection with the Company’s ongoing efforts to raise capital or the development of the Company’s products. In addition, the Company has granted warrants to lenders in connection with the issuance of debt. Each warrant granted may be exchanged for a prescribed number of shares of common stock. The warrants expire March 18, 2015.

	2014				2013
			Weighted				Weighted
			Average				Average
	Warrants		Exercise Price		Warrants		Exercise Price

Outstanding at January 1		1,989	$	71.76		47,211	$	48.54
Cancelled during period		-		-		-		-
Expired during period		-		-		-		-
Outstanding at September 30		1,989	$	71.76		47,211	$	48.54

On January 23, 2014, upon effectiveness of the registration statement filed with the SEC, the Company adopted the 2013 Stock Incentive Plan (the “Plan”) which will provide for the issuance of up to 400,000 shares. The purpose of the Plan is to provide additional incentive to those officers, employees, consultants and non-employee directors of the Company and its parents, subsidiaries and affiliates whose contributions are essential to the growth and success of the Company’s business.

The 2013 Plan may be administered by the board or a board-appointed committee. Eligible recipients of option awards are employees, officers, consultants or directors (including non-employee directors) of the Company or of any parent, subsidiary or affiliate of the Company. The board has the authority to grant to any eligible recipient any options, restricted stock or other awards valued in whole or in part by reference to, or otherwise based on, our common stock.

(b)

Stock options

Qualified option holders may exercise their options at their discretion. Each option granted may be exchanged for a prescribed number of shares of common stock.

Employee's Plan	2014				2013
			Weighted				Weighted
			Average				Average
	Options		Exercise Price		Options		Exercise Price

Outstanding at January 1		-	$	-		1,579	$	42.12
Forfeited during period		-		-		-		-
Expired during period		-		-		(1,579)		42.12
Outstanding at September 30		-	$	-		-	$	-

Director's Plan	2014			2013
		Weighted			Weighted
		Average			Average
	Options	Exercise Price		Options	Exercise Price

Outstanding at January 1	-	$	-	352	$	312.00
Cancelled during period	-		-	-		-
Expired during period	-		-	-		-
Outstanding at September 30	-	$	-	352	$	312.00

2013 Incentive Stock &	2014				2013
Award Plan			Weighted				Weighted
			Average				Average
	Options		Exercise Price		Options		Exercise Price

Outstanding at January 1		-	$	-		-	$	-
Granted during period		175,000		4.98		-		-
Cancelled during period		-		-		-		-
Expired during period		-		-		-		-
Outstanding at September 30		175,000	$	4.98		-	$	-

On June 10, 2014 the Company approved issuance of 115,000 options to purchase common shares to Directors and Officers at an exercise price of $5.50 per common share and 60,000 options to purchase common shares to key employees at an exercise price of $3.98 per common share. These options were issued under the 2013 Incentive Stock and Award Plan, in which an aggregate of up to 400,000 shares of the Company’s common shares are reserved for issuance. All options are immediately exercisable and carry a five year expiration.

The calculated fair value of these options was distributed to the following categories on the Statement of Operations:

	Fair
Expense Category	Value
Cost of Goods	$	24,040
General & Administrative		357,276
Sales & Marketing		48,081
Research & Development		120,203
	$	549,600

The options and warrants issued under the above four plans were valued using a Black Scholes option pricing model. The assumptions utilized in calculating the value of the issued options under Black Scholes are as follows:

		2014
Expected option term		5 yrs
Expected volatility		127.32%
Expected divident yeild		0.00%
Risk free interest rate		1.71%

A summary of warrants and stock options outstanding and exercisable as of September 30, 2014 follows:

							Outstanding					Exercisable
								Wgtd Avg		Wgtd Avg				Wtgt Avg
								Life		Exercise				Exercise
	Low		High		Shares			Remaining		Price		Shares		Price
2013 Stock Incentive Plan	$	3.98	$	5.50		175,000			4.75	$	4.98		175,000	$	4.98
Warrants		71.76		71.76		1,989			0.46		71.76		1,989		71.76

- Definition

The entire disclosure for compensation-related costs for equity-based compensation, which may include disclosure of policies, compensation plan details, allocation of equity compensation, incentive distributions, equity-based arrangements to obtain goods and services, deferred compensation arrangements, employee stock ownership plan details and employee stock purchase plan details.

+ References + Details