Quarterly report pursuant to Section 13 or 15(d)

Stock-Based Compensation

Stock-Based Compensation
6 Months Ended
Dec. 31, 2022
Share-Based Payment Arrangement [Abstract]  
Stock-Based Compensation

Note 7. Stock-Based Compensation


In June 2020, the Board of Directors adopted the 2020 Stock Incentive Plan, which provided for the grant of qualified incentive stock options and nonqualified stock options or other awards to the Company’s employees, officers, directors, advisors, and outside consultants for the purchase of up to 1,650,000 shares of the Company’s common stock. On October 22, 2021, the Company’s stockholders approved an increase of the total authorized shares to 3,650,000 shares. Other awards include restricted stock, restricted stock units, stock appreciation rights and other stock-based awards. Other stock-based awards are awards valued in whole or in part by reference to, or are otherwise based on, shares of common stock. Stock options generally vest over a four-year period, at achievement of a performance requirement, or upon change of control (as defined in the applicable plan). The awards expire in five to ten years from the date of grant. In September 2020, the Company awarded 982,500 shares of restricted common stock to its former Chief Executive Officer. As of December 31, 2022, the Company had 583,387 shares available for future issuance under the 2020 Stock Incentive Plan.


The Company estimates the fair value of stock-based compensation utilizing the Black-Scholes option pricing model, which is dependent upon several variables, such as assumptions the Company makes for the volatility of its common stock, the expected term of the stock options, the risk-free interest rate for a period that approximates the expected term, and expected dividend yield. Each of these inputs is subjective and generally requires significant judgement to determine. Stock-based compensation is measured at the grant date based on the fair value of the award and is recognized as expense over the requisite service period, which is generally the vesting period of the respective award.


The following table summarizes the range of key assumptions used to determine the fair value of stock options granted during the three and six months ended December 30, 2022 and 2021.



Three Months Ended

December 31,


Six Months Ended

December 31,

    2022     2021     2022     2021  
Risk-free interest rate     3.72%4.32 %     %     2.87%4.32 %     0.79%1.1 %
Expected term (in years)     4.56.25             4.56.25       3.04.5  
Expected volatility     60.0 %     %     50.060.0 %     50 %
Expected dividend yield                      


The following table summarizes stock option activity for the six months ended December 31, 2022:








Average Exercise













Outstanding at June 30, 2022     1,911,459     $ 4.63       4.4       -  
Granted     172,654     $ 3.31                  
Exercised     (24,000 )   $ 2.18                  
Forfeited     -     $ -                  
Outstanding at December 31, 2022     2,060,113     $ 4.55       4.2     $ 137,362  
Options exercisable at December 31, 2022     373,476     $ 2.86       3.2       75,625  


The weighted-average grant date fair value of options awarded during the six months ended December 31, 2022 was approximately $1.86 per share. As of December 31, 2022, unrecognized stock-based compensation expense related to unvested stock options totaled approximately $2.9 million which is expected to be recognized over a weighted average period of 3.1 years.



The Company recorded stock-based compensation expenses for the following periods:


    2022     2021     2022     2021  
    Three Months Ended     Six Months Ended  
    December 31,     December 31,  
    2022     2021     2022     2021  
Research and development   $ -     $ 2,108     $ -     $ 11,988  
General and administrative     225,621       92,174       437,521       116,467  
Total stock-based compensation expense   $ 225,621     $ 94,282     $ 437,521     $ 128,455