Annual report pursuant to Section 13 and 15(d)

STOCK OPTIONS AND WARRANTS

v3.22.1
STOCK OPTIONS AND WARRANTS
12 Months Ended
Dec. 31, 2021
STOCK OPTIONS AND WARRANTS  
NOTE 15 - STOCK OPTIONS AND WARRANTS

NOTE 15 - STOCK OPTIONS AND WARRANTS

 

Options

 

On November 13, 2014, our Board of Directors authorized and approved the adoption of the Plan effective November 13, 2014 (2014 Stock Option Plan) under which an aggregate of 20% (290,879 shares) of the issued and outstanding shares may be issued. The plan shall terminate ten years after the plan’s adoption by the board of directors. We granted an aggregate 145,000 stock options. As of December 31, 2021, an aggregate total of 145,879 can still be granted under the plan.

 

On June 15, 2016, our board of Directors authorized and approved the adoption of the Equity Incentive Plan effective June 15, 2016 (2016 Equity Incentive Plan) under which an aggregate of 656,250 shares may be issued. The plan shall terminate ten years after the plan’s adoption by the board of directors. We granted an aggregate of 330,350 stock options. As of December 31, 2021 an aggregate total of 325,900 options can still be granted under the plan.

 

On May 15, 2018, the Board of Directors approved and adopted the BioCorRx Inc. 2018 Equity Incentive Plan (2018 Stock Option Plan) under which an aggregate of 450,000 shares may be issued. The plan shall terminate ten years after the plan’s adoption by the board of directors. The Company has granted an aggregate of 363,281 stock options. As of December 31, 2021 an aggregate total of 86,719 options can still be granted under the plan.

 

No options were granted during the year ended December 31, 2021.

 

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 using the Company’s historical stock prices. The Company accounts for the expected life of options 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.

 

In applying the Black-Scholes option pricing model, the Company used the following assumptions in 2020: 

 

 

 

2020

 

Risk-free interest rate

 

0.27%-0.29

Expected term (years)

 

3 - 5

 

Expected volatility

 

112.97%-137.27

Expected dividends

 

 

0.00

 

The following table summarizes the stock option activity for the year ended December 31, 2021 and 2020:

 

 

 

Shares

 

 

Weighted-

Average

Exercise

Price

 

 

Weighted-

Average

Remaining

Contractual

Term

 

 

Aggregate

Intrinsic

Value

 

Outstanding at January 1, 2020

 

 

822,797

 

 

 

8.03

 

 

 

6.5

 

 

 

244,603

 

Grants

 

 

15,834

 

 

 

2.53

 

 

 

3.5

 

 

 

-

 

Expired

 

 

(10,000 )

 

 

15.00

 

 

 

-

 

 

 

-

 

Outstanding at December 31, 2020

 

 

828,631

 

 

$ 7.84

 

 

 

5.8

 

 

$ -

 

Expired

 

 

(13,280 )

 

 

7.15

 

 

 

-

 

 

 

-

 

Outstanding at December 31, 2021

 

 

815,351

 

 

 

7.85

 

 

 

4.9

 

 

 

795,115

 

Exercisable at December 31, 2021

 

 

815,351

 

 

$ 7.85

 

 

 

4.9

 

 

$ 795,115

 

 

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 $4.33 as of December 31, 2021, which would have been received by the option holders had those option holders exercised their options as of that date.

 

The following table presents information related to stock options at December 31, 2021:

 

Options Outstanding

 

 

Options Exercisable

 

 

 

 

 

 

Weighted

 

 

 

 

Weighted

 

 

 

 

 

 

Average

 

 

Exercisable

 

 

Average

 

 

Exercise

 

Number of

 

 

Remaining Life

 

 

Number of

 

 

Remaining Life

 

 

Price

 

Options

 

 

In Years

 

 

Options

 

 

In Years

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$0.01-2.50

 

 

337,850

 

 

 

4.4

 

 

 

337,850

 

 

 

4.4

 

 

2.51-5.00

 

 

43,334

 

 

 

3.1

 

 

 

43,334

 

 

 

3.1

 

 

5.01 and up

 

 

434,167

 

 

 

5.4

 

 

 

434,167

 

 

 

5.4

 

 

 

 

 

815,351

 

 

 

4.9

 

 

 

815,351

 

 

 

4.9

 

 

The stock-based compensation expense related to option grants was $8,715 and $76,760 during the year end December 31, 2021 and 2020, respectively.

 

Warrants

 

The outstanding Warrants contain provisions, often referred to as “down-round protection” that has led to adjustments of the exercise price and number of underlying warrant shares with respect to future issuances by the Company of its securities, including its common stock or convertible securities or debt securities.

 

During the year ended December 31, 2021, two holders of the warrants elected to exercise their warrants on a cashless basis. Due to the “down-round protection”, the warrant exercise price and number of warrants were adjusted to $2.00 and 100,000, respectively. As a result, an aggregate of 47,086 shares of common stock were issued to these two holders. As of December 31, 2021, no warrants were outstanding. 

 

The Company recognized the effect of the down round feature as deemed dividend, which equals to the difference between the fair value of the warrants (without the down round feature) immediately before and after the exercise price is adjusted. The deemed dividend was presented as a reduction of income available to common stockholders in net loss per common share on the consolidated statements of operations.

The following table summarizes the warrant activity for the year ended December 31, 2021:

 

 

 

Number of

Shares

 

 

Weighted

Average

Exercise

Price Per

Share

 

Outstanding at January 1, 2020

 

 

72,500

 

 

$ 89.00

 

Issued

 

 

-

 

 

 

-

 

Exercised

 

 

-

 

 

 

-

 

Expired

 

 

-

 

 

 

-

 

Outstanding at December 31, 2020

 

 

72,500

 

 

$ 89.00

 

Issued

 

 

-

 

 

 

-

 

Exercised (1)

 

 

10,000

 

 

 

20.00

 

Expired

 

 

(62,500 )

 

 

100.00

 

Outstanding at December 31, 2021

 

 

-

 

 

$ -

 

 

(1) Due to the “down-round protection”, the warrant exercise price and number of warrants when exercised were adjusted to $2.00 and 100,000, respectively.