Stockholder’s Equity | 8. Stockholder’s Equity Preferred Stock The Company has 10,000,000 0.00001 5,500,000 734,492 73,449 10 4.99 315,000 Common Stock The Company has 100,000,000 0.00001 ● Exchanged 734,429 ● Issued 205,984 226,138 ● Cancelled 112,225 ● Issued 38,879 189,828 After the Company signed two licenses for two drug programs from universities in the first half of 2022 it engaged an independent valuation firm to perform an Enterprise-Equity valuation. The results of this engagement resulted in an increase in the value per share of common stock used in the Black Scholes option pricing model employed to value the Company’s equity grants and warrant issuances. In February 2023, the Company completed its IPO for the sale of 1,297,318 6.50 8.4 Each Unit consisted of one share of the Company’s common stock, one tradeable warrant (each, a “Tradeable Warrant,” collectively, the “Tradeable Warrants”) to purchase one share of common stock at an exercise price of $ 7.80 non-tradeable warrant (each, a “Non-tradeable Warrant,” collectively, the “Non-tradeable Warrants”; together with the Tradeable Warrants, each, a “Warrant,” collectively, the “Warrants”) to purchase one share of the Company’s common stock at an exercise price of $ 8.125 In connection with the completion of its IPO, the Company issued an aggregate of 331,166 In connection with the IPO, in February 2023, the Company completed a 1-for-7 reverse split of our common stock. In February 2023, the Company issued 7,692 50,000 In the second quarter of 2023, we issued 436,533 436,533 1,494,658 Dilutive securities are excluded from the diluted earnings per share calculation because their effect is anti-dilutive. As of September 30, 2023, 3,796,164 507,717 5,270,617 484,525 2022 Equity Incentive Plan In November 2022, the Company’s Board of Directors adopted, and its shareholders approved the 2022 Equity Incentive Plan (the “Plan”). The Plan provides for the granting of equity-based awards to employees, directors, and consultants. The Plan provides for equity-based awards including incentive stock options, non-qualified stock options, stock appreciation rights, performance share awards, cash awards and other equity-based awards. Awards are limited to a maximum term of 10 900,000 15 461,500 Stock Options The following table summarizes the stock option activity for the nine months ended September 30, 2023: Schedule of Stock Options Activity Number of Shares Weighted-Average Exercise Price Weighted-Average Remaining Contractual Term (Years) Aggregate Intrinsic Value Outstanding at December 31, 2022 69,217 $ 3.06 7.08 $ 117,669 Granted 438,500 $ 4.41 - $ - Exercised - $ - - $ - Forfeited / canceled - $ - - $ - Outstanding at September 30, 2023 507,717 $ 4.23 9.17 $ 102,441 Vested at September 30, 2023 215,623 $ 3.97 8.64 $ 52,644 The fair value of options granted in the nine months ended September 30, 2023 were estimated using the Black-Scholes option pricing model based on the assumptions in the table below: Schedule of Black Scholes Option Pricing Model 2023 Expected dividend yield 0% Expected volatility 87 92% Risk-free interest rate 3.4 4.1 Expected life (in years) 5.0 6.0 The weighted-average grant-date fair value of options granted during the nine months ended September 30, 2023 was $ 3.20 No options were exercised in any of the periods presented. During the three and nine months ended September 30, 2023, the Company recognized $ 116,410 475,465 51,536 290,876 As of September 30, 2023, the total unrecognized compensation expense related to unvested stock options, was approximately $ 936,000 2.1 Warrants During the nine months ended September 30, 2023 and 2022, the Company granted a total of 3,195,906 56,623 The warrants have an original life of ten years and vest immediately and over 12 months. 22,939 35,712 174,105 337,269 51,941 11,097 42,057 1,883 During the year ended December 31, 2021, the Company granted a total of 431,659 200,000 12,462 0 200,000 138,929 28,683 The warrants have an original life of ten years and vest at different rates over as much as 36 months. During the year ended December 31, 2021, the Company issued 92,859 12,980 five years 50,735 11,097 99,000 115,185 2.50 1 15,412 195,000 225,000 2.50 64,978 The 92,859 During the nine months ended September 30, 2023, the Company issued the following warrants: ● In February 2023, in connection with the completion of the initial public offering, the Company issued 276,452 4.27 5 ● In February 2023, in connection with the completion of the initial public offering, the Company issued 18,000 8.125 4 ● As part of the sale of units in the Company’s initial public offering the Company issued 1,297,318 7.80 5 1,297,318 8.125 5 ● In February 2023, as part of the Company’s initial public offering, the Company issued 153,409 7.80 5 153,409 8.125 5 During the three and nine months ended September 30, 2023, the Company recognized $ 5,050 35,712 51,086 289,317 6,556 0.4 The following table provides details over the Company’s outstanding warrants as of September 30, 2023: Schedule of Outstanding Warrants Exercise Price Expiration Number of Warrants $ 0.0007 2030 274,286 $ 2.10 2.66 2026 2032 460,445 $ 3.36 4.27 2028 2029 115,277 $ 6.51 7.80 2026 2032 1,484,929 $ 8.125 2027 2028 1,461,227 3,796,164 |