Note 5 – Stock-based Payments

Equity incentive Plans

2013 Stock Incentive Plan

On January 23, 2014, the Company adopted the 2013 Stock Incentive Plan (“2013 Plan”). The 2013 Plan was amended by the Board on January 9, 2015 and September 30, 2016, and such amendments were ratified by shareholders on December 7, 2018. The 2013 Plan provides for the issuance of up to 73 shares of the Company’s Common Stock. As of December 31, 2023, grants of restricted stock and options to purchase 54 shares of Common Stock have been issued pursuant to the 2013 Plan, and 19 shares of Common Stock remain available for issuance.

2016 Stock Incentive Plan

On December 21, 2016, the shareholders approved, and the Company adopted the 2016 Stock Incentive Plan (“2016 Plan”). The 2016 Plan provides for the issuance of up to 50,000,000 shares of the Company’s Common Stock. As of December 31, 2023, grants of options to purchase 0 shares of Common Stock have been issued pursuant to the 2016 Plan, and 0 shares of Common Stock remain available for issuance.

2017 Stock Incentive Plan

On August 7, 2017, the shareholders approved, and the Company adopted the 2017 Stock Incentive Plan (“2017 Plan”). The 2017 Plan provides for the issuance of up to 118 shares of the Company’s Common Stock. As of December 31, 2023, grants of restricted stock and options to purchase 93 shares of Common Stock have been issued pursuant to the 2017 Plan, and 25 shares of Common Stock remain available for issuance.

2018 Stock Incentive Plan

On December 7, 2018, the shareholders approved, and the Company adopted the 2018 Stock Incentive Plan (“2018 Plan”). On August 27, 2020, the 2019 Plan was modified to increase the total authorized shares. The 2018 Plan, as amended, provides for the issuance of up to 18,670 shares of the Company’s Common Stock. As of December 31, 2023, grants of RSUs and restricted stock to purchase 8,769 shares of Common Stock have been issued pursuant to the 2018 Plan, and 9,901 shares of Common Stock remain available for issuance.

2021 Stock Incentive Plan

On April 15, 2021, the shareholders approved, and the Company adopted the 2021 Stock Incentive Plan (“2021 Plan”). The 2021 Plan provides for the issuance of up to 240,940 shares of the Company’s Common Stock. As of December 31, 2023, grants of RSUs and stock options to purchase 230,318 shares of Common Stock have been issued pursuant to the 2021 Plan, and 10,622 shares of Common Stock remain available for issuance.

Stock Options

The following table summarizes the activities for MyMD stock options for the year ended December 31, 2023:

Summary of Stock Options Activity

The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying awards and the closing stock price of $7.77 for the Company’s common shares on December 31, 2023 and the closing stock price of $34.50 for the Company’s common shares on December 31, 2022.

On January 28, 2022, the Company’s Compensation Committee approved the issuance of 6,668 stock options under the 2021 Stock Incentive Plan. These shares had a grant date fair value of $107.70 per share or a cumulative fair market value of $717,660 as calculated using Black-Scholes (exercise price $118.80 per share, stock price $118.80 per share, volatility of 124.43%, discount rate of 1.74% and seven-year term). The grant was segmented into four vesting tranches triggered by performance achievements and expire on January 28, 2029. The Company will amortize the expenses over the vesting cycles of the individual tranches when the performance achievement is probable.

On June 21, 2022, the Company granted 3,334 stock options under the 2021 Stock Incentive Plan to a third-party consultant in consideration of services rendered. These shares had a grant date fair value of $59.70 per share or a cumulative fair market value of $199,360 as calculated using Black-Scholes (exercise price $69.00 per share, stock price $69.00 per share, volatility of 130.51%, discount rate of 3.24% and five-year term). The grant vested immediately and expire on June 21, 2027. The Company is amortizing the expense over twelve months, the term of the consulting agreement.

On April 4, 2023, the Company issued 25,000 options to a key employee. These shares had a grant date fair value of $39.00 per share or a cumulative fair market value of $978,675 as calculated using Black-Scholes (exercise price $46.50 per share, stock price $46.50 per share, volatility of 122.12%, discount rate of 3.39% and a five-year term). 1/3 of the options vested on the grant date, 1/3 vest on the first anniversary of the grant and 1/3 vest on the second anniversary of the grant. The 1/3rd of the fair-market value of the options was expensed on the grant date and the remaining 2/3^rd is amortized over 24 month vesting.

On June 7, 2023, the Company issued 66,503 options to the directors and key employees. These shares had a grant date fair value of $47.10 per share or a cumulative fair market value of $3,128,759 as calculated using Black-Scholes (exercise price $49.00 per share, stock price $49.00 per share, volatility of 115.94%, discount rate of 3.79% and a ten-year term). 1/3 of the options vested on the grant date, 1/3 vest on the first anniversary of the grant and 1/3 vest on the second anniversary of the grant. The 1/3^rd of the fair-market value of the options was expensed on the grant date and the remaining 2/3^rd is amortized over 24 month vesting.

On July 19, 2023, the Company issued 1,667 options to a consultant for services. These shares had a grant date fair value of $29.18 per share or a cumulative fair market value of $48,643 as calculated using Black-Scholes (exercise price $34.80 per share, stock price $34.80 per share, volatility of 120.30%, discount rate of 3.98% and a five-year term). The options vested on the grant date. The fair-market value of the options was recorded immediately for services previously performed.

On September 6, 2023, the Company issued 33,334 options to a key employee. These shares had a grant date fair value of $23.10 per share or a cumulative fair market value of $769,700 as calculated using Black-Scholes (exercise price $24.30 per share, stock price $24.30 per share, volatility of 117.90%, discount rate of 4.44% and a ten-year term). The options will vest upon the achievement of specific performance goals. The fair-market value of the options will be recognized in the period the vesting event is achieved. As of December 31, 2023, none of the vesting events have occurred.

On September 6, 2023, the Company issued 3,334 options to a key employee. These shares had a grant date fair value of $23.10 per share or a cumulative fair market value of $76,970 as calculated using Black-Scholes (exercise price $24.30 per share, stock price $24.30 per share, volatility of 117.90%, discount rate of 4.44% and a ten-year term). ½ of the options vested on the grant date, ½ vest on the first anniversary of the grant. The fair-market value of the vested options was amortized upon the issuance of the grant and the remaining options will be amortized over the 12-month vesting cycle.

During the years ended December 31, 2023 and 2022, the Company recognized stock option expenses totaling $3,049,537 and $444,342, respectively.

The unamortized stock option expenses as of December 31, 2023 and 2022 totaled $2,418,338 and $113,847, respectively.

Restricted Stock Units

During the year ended December 31, 2023, the Company converted 261 vested RSUs issued in March 2019 and 7,600 vested RSUs issued in September 2020 to members of the Board of Directors into 7,861 common shares of the Company. Expenses related to these RSUs had been recognized by pre-merger Akers Biosciences, Inc in 2021 and prior years.

On October 14, 2021, the Compensation Committee of the Board of Directors approved grants totaling 93,169 Restricted Stock Units to the Company’s six directors and seven key employees. Each RSU had a grant date fair value of $242.70 which will be amortized upon vesting into administrative expenses within the Consolidated Statement of Comprehensive Loss. Such RSUs were granted under the 2021 Plan. Vesting of each RSU is:

As of December 31, 2023, none of the vesting milestones have been met.

On January 28, 2022, the Compensation Committee of the Board of Directors approved a grant of 135 RSUs to a sub-contractor with a grant date fair value of $15,998 and vested immediately. Such RSUs were granted under the 2021 Plan. The Company recorded expenses of $15,998 which is included Stock Based Compensation on the Consolidated Statement of Comprehensive Loss during the year ended December 31, 2022.

On July 7, 2022, the Compensation Committee of the Board of Directors approved a grant of 1,673 RSUs to a sub-contractor with a grant date fair value of $150,000 and vested immediately. Such RSUs were granted under the 2021 Plan. The Company recorded expenses of $138,587 which is included Stock Based Compensation on the Consolidated Statement of Comprehensive Loss during the year ended December 31, 2022.

The following is the status of outstanding unvested restricted stock units outstanding as of December 31, 2023 and the changes for the year ended December 31, 2023:

 Summary of Restricted Stock Units Activity

As of December 31, 2023 and 2022, the unamortized value of the RSUs was $21,600,300 and $22,611,550, respectively.