UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM
For the quarterly period ended:
OR
For the transition period from to
COMMISSION FILE NUMBER:
(Exact name of Registrant as Specified in Its Charter)
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Securities registered pursuant to Section 12(b) of the Act:
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Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer | ☐ | Accelerated filer | ☐ |
☒ | Smaller reporting company | ||
Emerging growth company |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any news or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No
The number of outstanding shares of the registrant’s common stock was
EYENOVIA, INC.
FORM 10-Q
FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2022
TABLE OF CONTENTS
1
PART I – FINANCIAL INFORMATION
Item 1. Financial Statements.
EYENOVIA, INC.
Condensed Balance Sheets
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Assets |
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Current Assets: |
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Cash and cash equivalents | $ | | $ | | ||
Restricted cash | | | ||||
Deferred clinical supply costs | | — | ||||
License fee and expense reimbursements receivable | | | ||||
Prepaid expenses and other current assets |
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Total Current Assets |
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Property and equipment, net |
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Security deposits |
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Equipment deposits |
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Total Assets | $ | | $ | | ||
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Liabilities and Stockholders’ Equity |
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Current Liabilities: |
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Accounts payable | $ | | $ | | ||
Accrued compensation |
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Accrued expenses and other current liabilities |
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Deferred rent - current portion | | | ||||
Notes payable | | | ||||
Total Current Liabilities |
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Deferred rent - non-current portion |
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Total Liabilities |
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Commitments and contingencies (Note 7) |
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Stockholders’ Equity: |
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Preferred stock, $ |
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Common stock, $ |
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Additional paid-in capital |
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Accumulated deficit |
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Total Stockholders’ Equity | | | ||||
Total Liabilities and Stockholders’ Equity | $ | | $ | | ||
The accompanying notes are an integral part of these condensed financial statements.
2
EYENOVIA, INC.
Condensed Statements of Operations
(unaudited)
For the Three Months Ended | For the Nine Months Ended | |||||||||||
September 30, | September 30, | |||||||||||
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Operating Income | ||||||||||||
Revenue | $ | | $ | | $ | | $ | | ||||
Cost of revenue | | | | ( | ||||||||
Gross Profit | | | | | ||||||||
Operating Expenses: |
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General and administrative |
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Total Operating Expenses |
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Loss From Operations |
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Other Income (Expense): |
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Extinguishment of PPP 7(a) loan | — | | — | | ||||||||
Other income, net | | | | | ||||||||
Interest expense | ( |
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Interest income |
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Net Loss | $ | ( | $ | ( | $ | ( | $ | ( | ||||
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Net Loss Per Share - Basic and Diluted | ( | ( | ( | ( | ||||||||
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Weighted Average Number of Common Shares Outstanding - Basic and Diluted |
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The accompanying notes are an integral part of these condensed financial statements.
3
EYENOVIA, INC.
Condensed Statements of Changes in Stockholders’ Equity
(unaudited)
For the Three and Nine Months Ended September 30, 2022 | ||||||||||||||
Additional | Total | |||||||||||||
Common Stock | Paid-In | Accumulated | Stockholders’ | |||||||||||
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| Capital |
| Deficit |
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Balance - January 1, 2022 |
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Issuance of common stock and warrants in registered direct offering [1] |
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Issuance of common stock in At the Market offering [2] |
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Stock-based compensation |
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Issuance of common stock related to vested restricted stock units |
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Net loss | | | | ( | ( | |||||||||
Balance - March 31, 2022 | | $ | | $ | | $ | ( | $ | | |||||
Exercise of stock warrants | | | | | | |||||||||
Stock-based compensation | | | | | | |||||||||
Issuance of common stock related to vested restricted stock units | | | ( | | | |||||||||
Net loss | | | | ( | ( | |||||||||
Balance - June 30, 2022 | | $ | | $ | | $ | ( | $ | | |||||
Issuance of common stock in At the Market offering [3] | | | | — | | |||||||||
Stock-based compensation | | | | | | |||||||||
Issuance of common stock related to vested restricted stock units | | | ( | — | — | |||||||||
Net loss | | | | ( | ( | |||||||||
Balance - September 30, 2022 |
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[1] |
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For the Three and Nine Months Ended September 30, 2021 | ||||||||||||||
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Common Stock | Paid-In | Accumulated | Stockholders’ | |||||||||||
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| Deficit |
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Balance - January 1, 2021 | | $ | | $ | | $ | ( | $ | | |||||
Exercise of stock warrants | | | | | | |||||||||
Stock-based compensation | | | | | | |||||||||
Net loss | | | | ( | ( | |||||||||
Balance - March 31, 2021 | | $ | | $ | | $ | ( | $ | | |||||
Exercise of stock warrants | | | | | | |||||||||
Exercise of stock options | | | | | | |||||||||
Issuance of SVB warrants [1] | | | | | | |||||||||
Stock-based compensation | | | | | | |||||||||
Net loss | | | | ( | ( | |||||||||
Balance - June 30, 2021 | | $ | | $ | | $ | ( | $ | | |||||
Exercise of stock options | | | | | | |||||||||
Stock-based compensation | | | | | | |||||||||
Net loss | | | | ( | ( | |||||||||
Balance – September 30, 2021 | | $ | | $ | | $ | ( | $ | | |||||
[1] |
The accompanying notes are an integral part of these condensed financial statements.
4
EYENOVIA, INC.
Condensed Statements of Cash Flows
(unaudited)
For the Nine Months Ended | ||||||
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Cash Flows From Operating Activities |
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Net loss | $ | ( | $ | ( | ||
Adjustments to reconcile net loss to net cash used in operating activities: |
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Stock-based compensation | | | ||||
Depreciation of property and equipment |
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Amortization of debt discount | | | ||||
Write-off of property and equipment | | | ||||
Extinguishment of PPP 7(a) Loan |
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Changes in operating assets and liabilities: |
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Prepaid expenses and other current assets |
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License fee and expense reimbursements receivables | | | ||||
Deferred clinical supply costs | ( | | ||||
Deferred license costs | | | ||||
Security deposits | ( | | ||||
Accounts payable |
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Accrued compensation |
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Accrued expenses and other current liabilities |
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Deferred license fee | | ( | ||||
Deferred rent |
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Net Cash Used In Operating Activities |
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Cash Flows From Investing Activities | ||||||
Purchases of property and equipment | ( | ( | ||||
Vendor deposits for property and equipment | ( | | ||||
Net Cash Used In Investing Activities | ( | ( | ||||
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Cash Flows From Financing Activities |
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Proceeds from sale of common stock and warrants in registered direct offering [1] |
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Net issuance of common stock in At the Market Offering [2] | | | ||||
Proceeds from exercise of stock warrants | | | ||||
Proceeds from SVB loan | | | ||||
Repayments of notes payable | ( | ( | ||||
Payment of offering issuance costs | ( | | ||||
Payment of loan issuance costs | | ( | ||||
Proceeds from exercise of stock options | | | ||||
Net Cash Provided By Financing Activities |
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Net Decrease in Cash and Cash Equivalents and Restricted Cash |
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Cash, cash equivalents and restricted cash - Beginning of Period |
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Cash, cash equivalents and restricted cash - End of Period | $ | | $ | | ||
[1] |
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5
Cash, cash equivalents and restricted cash consisted of the following: |
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Cash and cash equivalents | $ | | $ | | ||
Restricted cash | | | ||||
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Supplemental Disclosure of Cash Flow Information: |
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Cash paid during the periods for: | ||||||
Interest | $ | | $ | | ||
Supplemental Disclosure of Non-Cash Investing and Financing Activities | ||||||
Purchase of insurance premium financed by note payable | $ | | $ | | ||
Issuance of SVB stock warrants | $ | — | $ | | ||
Issuance of common stock related to vested restricted stock units | $ | | $ | — |
The accompanying notes are an integral part of these condensed financial statements.
6
Note 1 – Business Organization, Nature of Operations and Basis of Presentation
Eyenovia, Inc. (“Eyenovia” or the “Company”) is a pre-commercial ophthalmic technology company developing the Optejet® delivery system for use both in combination with its own drug-device therapeutic programs as well as out-licensing for additional indications. The Company aims to achieve precision in ophthalmic drug delivery of novel and existing ophthalmic pharmaceutical agents. The precise delivery of a low-volume columnar spray by the Optejet® device also minimizes contamination with a non-protruding nozzle and self-closing shutter. The Company believes that this technology could ultimately replace eye droppers by advancing drug delivery beyond the limitations of patient coordination, drug overexposure, gravity, contamination potential, and discomfort towards a more precise, comfortable, and successful drug administration for improved patient care. The ergonomic and functional design of the Optejet® delivers microdroplets horizontally faster than the blink reflex to minimize instillation discomfort and overflow spillage, providing a more comfortable experience. In the clinic, the Optejet® has demonstrated that its targeted delivery achieves a significantly high rate of successful administration of
The accompanying unaudited condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 8 of Regulation S-X. Accordingly, they do not include all of the information and disclosures required by U.S. GAAP for complete financial statements. In the opinion of management, such statements include all adjustments (consisting only of normal recurring items) which are considered necessary for a fair presentation of the condensed financial statements of the Company as of September 30, 2022 and for the three and nine months ended September 30, 2022 and 2021. The results of operations for the nine months ended September 30, 2022 are not necessarily indicative of the operating results for the full year ending December 31, 2022 or any other period. These unaudited condensed financial statements should be read in conjunction with the audited financial statements and related disclosures of the Company as of December 31, 2021 and for the year then ended, which were included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission (“SEC”) on March 30, 2022.
Note 2 – Summary of Significant Accounting Policies
Since the date of the Company’s Annual Report on Form 10-K for the year ended December 31, 2021, there have been no material changes to the Company’s significant accounting policies.
Liquidity and Going Concern
As of September 30, 2022, the Company had unrestricted cash of approximately $
7
The Company does not have recurring revenue and has not yet achieved profitability. The Company expects to continue to incur cash outflows from operations. The Company expects that its research and development and general and administrative expenses will continue to increase and, as a result, it will eventually need to generate significant product revenues to achieve profitability. These circumstances raise substantial doubt about the Company’s ability to continue as a going concern for at least one year from the date that these financial statements are issued. Implementation of the Company’s plans and its ability to continue as a going concern will depend upon the Company’s ability to commercialize its products and raise further capital, through licensing transactions, the sale of additional equity or debt securities or otherwise, to support its future operations.
The Company’s operating needs include the planned costs to operate its business, including amounts required to fund working capital and capital expenditures. The Company’s future capital requirements and the adequacy of its available funds will depend on many factors, including the Company’s ability to successfully commercialize its products and services, competing technological and market developments, and the need to enter into collaborations with other companies or acquire other companies or technologies to enhance or complement its product and service offerings. If the Company is unable to secure additional capital, it may be required to curtail its research and development initiatives and take additional measures to reduce general and administrative and sales and marketing costs in order to conserve its cash.
Cash and Cash Equivalents
The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents in the financial statements.
Cash and cash equivalents that are restricted as to withdrawal or use under the terms of certain executed agreements are recorded as Restricted Cash on the balance sheets, such as the collateralized money market account pursuant to the SVB Loan, as amended on September 29, 2021 by the First Amendment to the Loan and Security Agreement (the “First Amendment”). See Note 6 - Notes Payable. In connection with the First Amendment, the Company pledged to establish and maintain a collateralized money market account in the amount of $
The Company has cash deposits in a financial institution which, at times, may be in excess of Federal Deposit Insurance Corporation (“FDIC”) insurance limits. The Company has not experienced losses in such accounts and periodically evaluates the creditworthiness of its financial institutions. As of September 30, 2022 and December 31, 2021, the Company had cash balances in excess of FDIC insurance limits of $
Net Loss Per Common Share
Basic net loss per common share is computed by dividing net loss by the weighted average number of common shares outstanding during the period plus fully vested shares that are subject to issuance for little or no monetary consideration. Diluted earnings per share reflects the potential dilution that could occur if securities or other instruments to issue common stock were exercised or converted into common stock.
The following securities are excluded from the calculation of weighted average diluted common shares because their inclusion would have been anti-dilutive:
September 30, | ||||
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Options |
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8
Revenue Recognition
The Company’s revenues are generated primarily through research, development and commercialization agreements. The terms of such agreements may contain multiple promised goods and services, which may include (i) licenses to its intellectual property, and (ii) in certain cases, payment in connection with the manufacturing and delivery of clinical supply materials. Payments to us under these arrangements typically include one or more of the following: non-refundable, upfront license fees; milestone payments; payments for clinical product supply, and royalties on future product sales.
The Company analyzes its arrangements to assess whether such arrangements involve joint operating activities. For collaboration arrangements that are deemed to be within the scope of Accounting Standards Codification (“ASC”) Topic 808, “Collaborative Arrangements” (“ASC 808”), the Company allocates the contract consideration between such joint operating activities and elements that are reflective of a vendor-customer relationship and, therefore, within the scope of ASC Topic 606, “Revenue from Contracts with Customers” (“ASC 606”). The Company’s policy is to recognize amounts allocated to joint operating activities as a reduction in research and development expense.
Under ASC 606, we recognize revenue when our customers obtain control of promised goods or services, in an amount that reflects the consideration which we expect to receive in exchange for those goods or services. To determine revenue recognition for arrangements that we determine are within the scope of ASC 606, we perform the following five steps:
| ● | Step 1: Identify the contract with the customer; |
| ● | Step 2: Identify the performance obligations in the contract; |
| ● | Step 3: Determine the transaction price; |
| ● | Step 4: Allocate the transaction price to the performance obligations in the contract; and |
| ● | Step 5: Recognize revenue when the company satisfies a performance obligation. |
The Company must make significant judgments in its revenue recognition process, including identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price and allocating the transaction price to each performance obligation. In addition, arrangements that include rights to additional goods or services that are exercisable at a customer’s discretion are generally considered discretionary purchase options. The Company assesses whether these options provide a material right to the customer and if so, they are considered performance obligations.
For upfront license fees, the Company must consider how many performance obligations are in the contract and, if more than one, how to allocate the fee to those performance obligations upon satisfaction of the performance obligation(s). Milestone payments represent variable consideration that will be recognized when the performance obligation is achieved. Sales-based royalty payments derived from usage of intellectual property are recognized when those sales occur.
During 2020, the Company entered into a license agreement (the “Arctic Vision License Agreement”) with Arctic Vision (Hong Kong) Limited (“Arctic Vision”) and a license agreement (the “Bausch License Agreement”) with Bausch + Lomb, Inc. (“Bausch + Lomb”). Each license has three revenue components:
| 1) | an upfront license fee; |
| 2) | milestone payments and |
| 3) | royalty payments. |
Deferred License Fee
The Company enters into license agreements which provide for the receipt of non-refundable, upfront licensing payments. These payments are recorded as deferred license fees and will be earned and recognized as revenue upon the satisfaction of performance obligations. See Note 7 – Commitments and Contingencies for additional details.
9
Clinical Supply Arrangements
Bausch + Lomb and Arctic Vision have contracted with the Company to manufacture and supply them with the appropriate drug-device combination products to conduct their clinical trials on a cost plus
Reclassifications
Certain prior period balances have been reclassified in order to conform to current period presentation. These reclassifications have no effect on previously reported results of operations or loss per share.
Recently Adopted Accounting Standards
On May 3, 2021, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) No. 2021-04, “Earnings Per Share (Topic 260), Debt—Modifications and Extinguishments (Subtopic 470-50), Compensation—Stock Compensation (Topic 718), and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Issuer’s Accounting for Certain Modifications or Exchanges of Freestanding Equity-Classified Written Call Options.” This new standard provides clarification and reduces diversity in an issuer’s accounting for modifications or exchanges of freestanding equity-classified written call options (such as warrants) that remain equity classified after modification or exchange. This standard is effective for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. Issuers should apply the new standard prospectively to modifications or exchanges occurring after the effective date of the new standard. The Company adopted ASU 2021-04 effective January 1, 2022. This standard did not have a material impact on the Company’s financial position, results of operations or cash flow.
Soon To Be Adopted Accounting Standards
In February 2016, the FASB issued ASU 2016-02 “Leases (Topic 842)” (“ASU 2016-02”). ASU 2016-02 requires that a lessee recognize the assets and liabilities that arise from operating leases. A lessee should recognize in the statement of financial position a liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying asset for the lease term. ASU 2016-02, as amended, is now effective for emerging growth companies for fiscal years beginning after December 15, 2021, and interim periods within fiscal years beginning after December 15, 2022. The Company plans to adopt ASU 2016-02 on December 31, 2022 and expects that the adoption of this ASU will have a material impact on the Company’s financial statements, primarily as a result of recording right-of-use assets and lease liabilities for its operating leases in the approximate amounts of $
Note 3 – Prepaid Expenses and Other Current Assets
As of September 30, 2022 and December 31, 2021, prepaid expenses and other current assets consisted of the following:
| September 30, |
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| 2021 | |||
Payroll tax receivable | | | ||||
Prepaid insurance expenses | | | ||||
Prepaid general and administrative expenses |
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Prepaid conference expenses | | | ||||
Prepaid patent expenses | | | ||||
Other |
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Prepaid board of directors fees | | | ||||
Total prepaid expenses and other current assets | $ | | $ | | ||
10
Note 4 – Accrued Compensation
As of September 30, 2022 and December 31, 2021, accrued compensation consisted of the following:
| September 30, |
| December 31, | |||
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| 2021 | |||
Accrued bonus expenses | $ | | $ | | ||
Accrued payroll expenses |
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Total accrued compensation | $ | | $ | | ||
Note 5 – Accrued Expenses and Other Current Liabilities
As of September 30, 2022 and December 31, 2021, accrued expenses and other current liabilities consisted of the following:
| September 30, |
| December 31, | |||
| 2022 |
| 2021 | |||
Accrued research and development expenses | $ | | $ | | ||
Accrued consulting and professional services | | | ||||
Accrued interest | | | ||||
Credit card payable |
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Accrued franchise tax |
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Other |
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Accrued travel and entertainment expenses | | | ||||
Total accrued expenses and other current liabilities | $ | | $ | | ||
Note 6 – Notes Payable
As of September 30, 2022 and December 31, 2021, notes payable consisted of the following:
September 30, 2022 |
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| Notes Payable |
| Debt Discount |
| Net |
| Notes Payable |
| Debt Discount |
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Silicon Valley Bank loan | $ | | $ | ( | $ | | $ | | $ | ( | $ | | ||||||
On February 24, 2022, the Company issued a note payable for the purchase of directors and officers liability insurance policy (the “D&O Loan”). The D&O Loan had an aggregate principal balance of $
During the three months ended September 30, 2022, the Company recorded interest expense of $
SVB Loan Amendment
On May 6, 2022, the Company and SVB agreed to amend the terms of the SVB Loan dated May 7, 2021. Pursuant to the amendment, the repayment term of the SVB Loan is reduced to 24 consecutive calendar months and the date that the first payment is due by the Company is extended to June 1, 2023. The amendment did not result in a
11
The SVB Loan was repaid in full in November 2022. See Note 10 – Subsequent Events.
Note 7 – Commitments and Contingencies
Employment Agreements
On February 14, 2022, the Compensation Committee of the Board of Directors of the Company (the “Board”) approved amendments to the Employment Agreements with its executive officers (the “Employment Agreement Addendums”). Each of the Employment Agreement Addendums provides that if the executive’s employment is terminated by the Company without “Cause” or the executive suffers an “Involuntary Termination” (each as defined in the employment agreements), provided that the executive has signed a full release of all claims, the executive will be entitled to receive: (i) severance pay equal to twelve months of his or her then-current base salary (estimated at approximately $
Transition of Chief Executive Officer
On July 27, 2022, the Company announced the appointment of Michael Rowe as its new Chief Executive Officer, effective August 1, 2022, with Dr. Tsontcho Ianchulev becoming Executive Chairman of the Board. Mr. Rowe is also serving as a member of the Board.
On July 26, 2022, the Company entered into an Employment Agreement (the “Employment Agreement”) with Mr. Rowe under which he will serve as Chief Executive Officer of the Company. Under the terms of the Employment Agreement, Mr. Rowe will receive an annual salary of $
The Company also entered into an agreement with Dr. Ianchulev (the “Executive Chairman Agreement”) pursuant to which Dr. Ianchulev will provide medical expertise and consultation related to the Company’s research and development programs, and such other matters as reasonably requested by the Company for an initial period of
Operating Leases
The Company leased
On April 8, 2022, the Company agreed to enter into a lease agreement for a new office space of
12
On May 19, 2022, the Company agreed to enter into a lease agreement with a non-related party for a new office space located in Reno, Nevada of
Litigations, Claims and Assessments
The Company may be involved in legal proceedings, claims and assessments arising in the ordinary course of business. The Company records legal costs associated with loss contingencies as incurred and accrues for all probable and estimable settlements.
Note 8 – Stockholders’ Equity
At-The-Market Offerings
December 2021 Sales Agreement
On December 14, 2021, the Company entered into a Sales Agreement (the “December 2021 Sales Agreement”) with SVB Leerink under which the Company may offer and sell, from time to time at its sole discretion, shares of common stock for gross proceeds of up to $
Subject to the terms and conditions of the December 2021 Sales Agreement, SVB Leerink may sell the common stock by any method permitted by law deemed to be an “at –the- market offering” as defined in Rule 415(a)(4) of the Securities Act of 1933, as amended. SVB Leerink will use commercially reasonable efforts to sell the common stock from time to time, based upon instructions from the Company (including any price, time or size limits or other customary parameters or conditions the Company may impose). The Company will pay SVB Leerink a commission equal to three percent (
Securities Purchase Agreement
On March 3, 2022, the Company entered into a securities purchase agreement (the “Purchase Agreement”) with an institutional and accredited investor (the “Purchaser”), relating to the issuance and sale of
The offering price for the Shares was $
13
The March 2022 Offering was made pursuant to an effective registration statement on Form S-3 (Registration Statement No. 333-261638), as previously filed with and declared effective by the Securities and Exchange Commission and a related prospectus.
Equity Incentive Plan
On June 16, 2022, the stockholders approved an amendment to the Company’s Amended and Restated 2018 Omnibus Stock Incentive Plan, reserving an additional
Stock-Based Compensation Expense
The Company records stock-based compensation expense related to stock options and restricted stock units (“RSUs”). For the three months ended September 30, 2022 and 2021, the Company recorded expense of $
Restricted Stock Units
A summary of the restricted stock units activity during the nine months ended September 30, 2022 is presented below:
Weighted | |||||
Average | |||||
Number of | Grant Date Value | ||||
| RSUs |
| Per Share | ||
RSUs non-vested January 1, 2022 |
| | $ | | |
Granted |
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Vested |
| ( |
| | |
Forfeited |
| ( |
| | |
RSUs non-vested September 30, 2022 |
| | $ | | |
|
| ||||
Vested RSUs undelivered September 30, 2022 |
| | $ | | |
To date, the RSUs have only been granted to directors in accordance with the Company’s Amended and Restated 2018 Omnibus Stock Incentive Plan. The Company’s policy is not to deliver shares underlying the RSUs until the termination of service.
As of September 30, 2022, there was $
14
Stock Options
In applying the Black-Scholes option pricing model to stock options granted, the Company used the following approximate assumptions:
For the Three Months Ended | For the Nine Months Ended | |||||||
September 30, | September 30, | |||||||
| 2022 |
| 2021 |
| 2022 |
| 2021 | |
Expected term (years) |
|
|
| |||||
Risk free interest rate | ||||||||
Expected volatility | ||||||||
Expected dividends | ||||||||
The Company has computed the fair value of stock options granted using the Black-Scholes option pricing model. Option forfeitures are accounted for at the time of occurrence. The expected term is the estimated period of time that options granted are expected to be outstanding. The Company utilizes the “simplified” method to develop an estimate of the expected term of “plain vanilla” employee option grants. The Company uses a blended volatility calculation, the components of which are the Company’s historical volatility for the period from its initial public offering through the valuation date and the average peer-group data of six comparable entities to supplement the Company’s own historical data for the preceding years in computing the expected volatility. Accordingly, the Company is utilizing an expected volatility figure based on a review of the historical volatility of comparable entities over a period of time equivalent to the expected life of the instrument being valued. The risk-free interest rate was determined from the implied yields from U.S. Treasury zero-coupon bonds with a remaining term consistent with the expected term of the instrument being valued.
The weighted average estimated grant date fair value of the stock options granted for the three months ended September 30, 2022 and 2021 was approximately $
A summary of the option activity during the nine months ended September 30, 2022 is presented below:
|
|
|
|
| Weighted |
|
| |||
| Weighted |
| Average | |||||||
| Average |
| Remaining |
| Aggregate | |||||
| Number of |
| Exercise |
| Life |
| Intrinsic | |||
| Options |
| Price |
| In Years |
| Value | |||
Outstanding, January 1, 2022 |
| | |
|
|
|
| |||
Granted |
| |
| |
|
|
|
| ||
Forfeited |
| ( |
| |
|
|
|
| ||
Outstanding, September 30, 2022 |
| | $ | |
| $ | | |||
|
|
|
| |||||||
Exercisable, September 30, 2022 |
| | $ | |
| $ | | |||
15
The following table presents information related to stock options as of September 30, 2022:
Options Outstanding |
| Options Exercisable | |||||
| Weighted | ||||||
| Outstanding |
| Average |
| Exercisable | ||
Exercise |
| Number of |
| Remaining Life |
| Number of | |
Price |
| Options |
| In Years |
| Options | |
$ |
| |
| | |||
$ |
| |
| | |||
$ |
| |
| | |||
$ |
| |
| | |||
$ |
| |
| | |||
$ |
| |
| | |||
$ |
| |
| | |||
| | ||||||
As of September 30, 2022, there was $
Warrants
A summary of the warrant activity for the nine months ended September 30, 2022 is presented below: