Quarterly report pursuant to Section 13 or 15(d)

OPTIONS, RESTRICTED STOCK UNITS AND WARRANTS

v3.22.1
OPTIONS, RESTRICTED STOCK UNITS AND WARRANTS
3 Months Ended
Mar. 31, 2022
Disclosure Text Block Supplement [Abstract]  
Shareholders' Equity and Share-Based Payments [Text Block]

NOTE 8 OPTIONS, RESTRICTED STOCK UNITS AND WARRANTS

 

BioSig Technologies, Inc.

 

2012 Equity Incentive Plan

 

On October 19, 2012, the Board of Directors of BioSig Technologies, Inc. approved the 2012 Equity Incentive Plan (the “Plan”) and terminated the Long-Term Incentive Plan (the “2011 Plan”). The Plan (as amended) provides for the issuance of options, stock appreciation rights, restricted stock and restricted stock units to purchase up to 14,474,450 shares of the Company’s common stock to officers, directors, employees and consultants of the Company. Under the terms of the Plan the Company may issue Incentive Stock Options as defined by the Internal Revenue Code to employees of the Company only and nonstatutory options. The Board of Directors of the Company or a committee thereof administers the Plan and determines the exercise price, vesting and expiration period of the grants under the Plan.

 

However, the exercise price of an Incentive Stock Option should not be less than 110% of fair value of the common stock at the date of the grant for a 10% or more stockholder and 100% of fair value for a grantee who is not 10% stockholder. The fair value of the common stock is determined based on the quoted market price or in absence of such quoted market price, by the administrator in good faith.

 

Additionally, the vesting period of the grants under the Plan will be determined by the administrator, in its sole discretion, with an expiration period of not more than ten years. There are 2,612,523 shares remaining available for future issuance of awards under the terms of the Plan as of March 31, 2022.

 

Options

 

Option valuation models require the input of highly subjective assumptions. The fair value of stock-based payment awards was estimated using the Black-Scholes option model with a volatility figure derived from historical stock prices of the Company. The Company accounts for the expected life of options using the based on the contractual life of options for non-employees.

 

For employees, the Company accounts for the expected life of options in accordance with the “simplified” method, which is used for “plain-vanilla” options, as defined in the accounting standards codification. The risk-free interest rate was determined from the implied yields of U.S. Treasury zero-coupon bonds with a remaining life consistent with the expected term of the options.

 

During the three months ended March 31, 2022, the Company granted an aggregate of 736,000 options to officers, directors and key consultants.

 

The following table presents information related to stock options at March 31, 2022:

 

 

Options Outstanding

 

 

Options Exercisable

 

 

 

 

 

 

 

 

 

 

Weighted

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average

 

 

Exercisable

 

 

Exercise

 

 

Number of

 

 

Remaining Life

 

 

Number of

 

 

Price

 

 

Options

 

 

In Years

 

 

Options

 

 

$

Under 2.00

 

 

 

736,000

 

 

 

9.9

 

 

 

75,000

 

 

 

2.00-2.99

 

 

 

1,000,375

 

 

 

9.4

 

 

 

549,375

 

 

 

3.00-3.99

 

 

 

587,466

 

 

 

4.1

 

 

 

387,466

 

   

4.00-4.99

     

1,547,916

     

6.2

     

1,136,573

 

 

 

5.00-5.99

 

 

 

156,132

 

 

 

6.9

 

 

 

124,046

 

 

 

6.00-6.99

 

 

 

461,542

 

 

 

5.0

 

 

 

389,515

 

 

 

7.00-7.99

 

 

 

186,720

 

 

 

6.6

 

 

 

176,721

 

 

 

Over 8.00

 

 

 

193,333

 

 

 

7.6

 

 

 

168,461

 

 

 

 

 

 

 

4,869,484

 

 

 

7.2

 

 

 

3,007,157

 

 

A summary of the stock option activity and related information for the Plan for the three months ended March 31, 2022 is as follows:

 

                   

Weighted-Average

         
           

Weighted-Average

   

Remaining

   

Aggregate

 
   

Shares

   

Exercise Price

   

Contractual Term

   

Intrinsic Value

 

Outstanding at December 31, 2021

    4,568,484     $ 4.57       6.9     $ -  

Grants

    736,000     $ 1.47       10.0     $ -  

Forfeited/expired

    (435,000

)

  $ 5.36                  

Outstanding at March 31, 2022

    4,869,484     $ 4.03       7.2     $ -  

Exercisable at March 31, 2022

    3,007,157     $ 4.68       6.4     $ -  

 

The aggregate intrinsic value in the preceding tables represents the total pretax intrinsic value, based on options with an exercise price less than the stock price of BioSig Technologies, Inc. of $1.15 as of March 31, 2022, which would have been received by the option holders had those option holders exercised their options as of that date.

 

On February 7, 2022, the Company granted 150,000 options to purchase the company’s common stock in connection with the services rendered at the exercise price of $1.72 per share for a term of ten years with 75,000 vesting immediately and 75,000 vesting upon achieving certain performance conditions.

 

On February 7, 2022, the Company granted an aggregate of 100,000 options to purchase the company’s common stock in connection with the services rendered at the exercise price of $1.72 per share for a term of ten years with vesting on the quarterly for one year.

 

On February 17, 2022, the Company granted an aggregate of 66,000 options to purchase the company’s common stock in connection with the services rendered at the exercise price of $1.58 per share for a term of ten years with one-third vesting on the one-year anniversary and two-thirds vesting quarterly thereafter beginning February 17, 2023 for two years.

 

On March 15, 2022, the Company granted an aggregate of 70,000 options to purchase the company’s common stock in connection with the services rendered at the exercise price of $1.28 per share for a term of ten years with one-third vesting on the one-year anniversary and two-thirds vesting quarterly thereafter beginning March 15, 2023 for two years.

 

On March 30, 2022, the Company granted 350,000 options to purchase the company’s common stock in connection with the services rendered at the exercise price of $1.30 per share for a term of ten years with one-third vesting on the one-year anniversary and two-thirds vesting quarterly thereafter beginning March 30, 2023 for two years.

 

The following assumptions were used in determining the fair value of options during the three months ended March 31, 2022:

 

Risk-free interest rate

 

 

1.17% - 2.43

%

Dividend yield

 

 

0

%

Stock price volatility

 

 

83.83% to 92.93

%

Expected life

 

6 to 10 years

 

Weighted average grant date fair value

 

$

1.06

 

 

On March 16, 2022, in connection with the termination of a Company executive, the Company extended the life of 100,000 previously issued options from the contractual 90 days from termination of service to the earlier of the initial life or March 16, 2024. The change in estimated fair value of the modified options of $15,181 was charged to current period operations.

 

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The following assumptions were used in determining the change in fair value of the modified options at March 16, 2022:

 

Risk-free interest rate

 

 

0.44% - 1.95

%

Dividend yield

 

 

0

%

Stock price volatility

 

 

83.86

%

Expected life

 

0.25 – 2 years

 

 

The fair value of all options vesting during the three months ended March 31, 2022 and 2021 of $649,992 and $576,885, respectively, was charged to current period operations. Unrecognized compensation expense of $3,183,159 at March 31, 2022 will be expensed in future periods.

 

Warrants

 

The following table summarizes information with respect to outstanding warrants to purchase common stock of BioSig Technologies, Inc. at March 31, 2022:

 

 

Exercise

 

 

Number

 

Expiration

 

Price

 

 

Outstanding

 

Date

 

$

1.40

     

2,613,130

 

September 2025

 

$

4.80

 

 

 

250,000

 

February 2025 to July 2026

 

$

6.16

 

 

 

568,910

 

November 2027

 

 

 

 

 

 

3,432,040

 

 

 

On March 21, 2022, the Company issued warrants to purchase 2,613,130 shares of its common stock at $1.40 per share, that are exercisable six months after the date of issuance and will expire three and one-half years following the date of issuance in connection with the sale of the Company’s common stock.

 

A summary of the warrant activity for the three months ended March 31, 2022 is as follows:

 

                   

Weighted-Average

         
           

Weighted-Average

   

Remaining

   

Aggregate

 
   

Shares

   

Exercise Price

   

Contractual Term

   

Intrinsic Value

 

Outstanding at December 31, 2021

    818,910     $ 5.74       5.3     $ -  

Issued

    2,613,130     $ 1.40       3.5       -  

Outstanding at March 31, 2022

    3,432,040     $ 2.44       3.8     $ -  
                                 

Vested and expected to vest at March 31, 2022

    3,432,040     $ 2.44       3.8     $ -  

Exercisable at March 31, 2022

    818,910     $ 5.74       5.0     $ -  

 

The aggregate intrinsic value in the preceding tables represents the total pretax intrinsic value, based on options with an exercise price less than the company’s stock price of $1.15 of March 31, 2022, which would have been received by the option holders had those option holders exercised their options as of that date.

 

Restricted Stock Units

 

The following table summarizes the restricted stock activity for the three months ended March 31, 2022:

 

Restricted shares issued as of December 31, 2021

    141,250  

Granted

    37,500  

Vested and issued

    (66,249

)

Forfeited

    (30,001

)

Vested restricted shares as of March 31, 2022

    -  

Unvested restricted shares as of March 31, 2022

    82,500  

 

On March 18, 2022, the Company granted an aggregate of 37,500 restricted stock units for services with 12,500 vesting upon achievement of certain performance conditions and 25,000 vesting quarterly for one year.

 

Stock based compensation expense related to restricted stock grants was $69,754 and $99,120 for the three months ended March 31, 2022 and 2021, respectively. As of March 31, 2022, the stock-based compensation relating to restricted stock of $197,050 remains unamortized.

 

ViralClear Pharmaceuticals, Inc.

 

2019 Long-Term Incentive Plan

 

On September 24, 2019, ViralClear’s Board of Directors approved the 2019 Long-Term Incentive Plan (as subsequently amended, the “ViralClear Plan”). The ViralClear Plan was approved by BioSig as ViralClear’s majority stockholder. The ViralClear Plan provides for the issuance of options, stock appreciation rights, restricted stock and restricted stock units to purchase up to 4,000,000 shares of ViralClear’s common stock to officers, directors, employees and consultants of the ViralClear. Under the terms of the ViralClear Plan, ViralClear may issue Incentive Stock Options as defined by the Internal Revenue Code to employees of ViralClear only and nonstatutory options. The Board of Directors of ViralClear or a committee thereof administers the ViralClear Plan and determines the exercise price, vesting and expiration period of the grants under the ViralClear Plan.

 

However, the exercise price of an Incentive Stock Option should not be less than 110% of fair market value of the common stock at the date of the grant for a 10% or more stockholder and 100% of fair market value for a grantee who is not 10% stockholder. The fair market value of the common stock is determined based on the quoted market price or in absence of such quoted market price, by the administrator in good faith.

 

Additionally, the vesting period of the grants under the ViralClear Plan will be determined by the administrator, in its sole discretion, with an expiration period of not more than ten years. There are 2,390,071 shares remaining available for future issuance of awards under the terms of the ViralClear Plan.

 

ViralClear Options

 

The following table presents information related to stock options at March 31, 2022:

 

Options Outstanding

 

 

Options Exercisable

 

 

 

 

 

 

 

 

 

Weighted

 

 

 

 

 

 

 

 

 

 

 

 

 

Average

 

 

Exercisable

 

Exercise

 

 

Number of

 

 

Remaining Life

 

 

Number of

 

Price

 

 

Options

 

 

In Years

 

 

Options

 

$

5.00

 

 

 

125,000

 

 

 

6.9

 

 

 

91,664

 

 

The fair value of the stock-based payment awards was estimated using the Black-Scholes option model with a volatility figure derived from an index of historical stock prices of comparable entities with the market value of stock price based on recent sales. The Company accounts for the expected life of options in accordance with the “simplified” method, which is used for “plain-vanilla” options, as defined in the accounting standards codification. The risk-free interest rate was determined from the implied yields of U.S. Treasury zero-coupon bonds with a remaining life consistent with the expected term of the options.

 

The fair value of all options vesting during the three months ended March 31, 2022 and 2021 of $36,520 and $36,521, respectively, was charged to current period operations. Unrecognized compensation expense of $146,082 at March 31, 2022 will be expensed in future periods.

 

Warrants (ViralClear)

 

The following table presents information related to warrants (ViralClear) at March 31, 2022:

 

 

Exercise

 

 

Number

 

Expiration

 

Price

 

 

Outstanding

 

Date

 

$

5.00

 

 

 

473,772

 

November 2027

 

 

10.00

 

 

 

6,575

 

May 2025

 

 

 

 

 

 

480,347

 

 

 

Restricted stock units (ViralClear)

 

The following table summarizes the restricted stock activity for the three months ended March 31, 2022:

 

Restricted shares outstanding at December 31, 2021:

    1,318,679  

Forfeited

    (80,000

)

Total restricted shares outstanding at March 31, 2022:

    1,238,679  
         

Comprised of:

       

Vested restricted shares as of March 31, 2022

    678,679  

Unvested restricted shares as of March 31, 2022

    560,000  

Total

    1,238,679  

 

Stock based compensation expense related to restricted stock unit grants of ViralClear was $(356,396) and $29,151 for the three months ended March 31, 2022 and 2021, respectively. As of March 31, 2022, the stock-based compensation relating to restricted stock of $142,443 remains unamortized.