NOTE 8 – Stock-Based Compensation

During the three and nine months ended June 30, 2025 and 2024, stock-based compensation expense related to stock-based awards was included in selling, general and administrative and research and development costs as follows in the accompanying condensed statements of operations.

2025 Equity Incentive Plan

On January 10, 2025, the Board of Directors of the Company adopted the NeuroOne Medical Technologies Corporation 2025 Equity Incentive Plan (the “2025 Plan”). On February 14, 2025, at the 2025 annual meeting of stockholders, the stockholders of the Company approved the 2025 Plan.

The 2025 Plan is the successor to and continuation of the Company’s 2017 Equity Incentive Plan (the “2017 Plan”) and to the Company’s 2016 Equity Incentive Plan (the “Prior Plans”). As of the Effective Date, (i) no additional awards may be granted under the Prior Plans; (ii) any Returning Shares will become available for issuance pursuant to Awards granted under the 2025 Plan; and (iii) all outstanding awards granted under the Prior Plans will remain subject to the terms of the Prior Plans (except to the extent such outstanding awards result in returning shares that become available for issuance pursuant to awards granted under the 2025 Plan.

Initially, the maximum number of shares of the Company’s Common Stock (the “Common Stock”), that may be issued under the 2025 Plan may not exceed (1) 3,000,000 and (2) any shares subject to outstanding stock awards under the NeuroOne Medical Technologies 2017 Equity Incentive Plan that are forfeited or otherwise returned to the share reserve.

Inducement Plan

In October 2021, the Company adopted the NeuroOne Medical Technologies Corporation 2021 Inducement Plan (the “Inducement Plan”), pursuant to which the Company reserved 420,350 shares of its common stock to be used exclusively for grants of awards to individuals who were not previously employees or directors of the Company, as an inducement material to the individual’s entry into employment with the Company within the meaning of Rule 5635(c)(4) of the Nasdaq Listing Rules. The Inducement Plan was approved by the Company’s Board of Directors without stockholder approval in accordance with such a rule. On November 9, 2023, the Company’s Board of Directors adopted the First Amendment to the Company’s Inducement Plan, increasing the aggregate number of shares of common stock that may be issued pursuant to equity incentive awards under the Inducement Plan by 150,000 shares, and on May 20, 2025, the Board adopted the Second Amendment to the Company’s Inducement Plan, increasing the aggregate number of shares of common stock that may be issued pursuant to equity incentive awards under the Inducement Plan by an additional 575,000 shares.

2017 Plan and Evergreen Provision

On January 1, 2025, 1,124,446 shares were added to the 2017 Plan as a result of the evergreen provision within the 2017 Plan. However, upon the adoption of the 2025 Plan, there will be no further issuance of grants under the 2017 Plan and any forfeitures of grants issued under the 2017 Plan will be added to the amount available for future issuance under the 2025 Plan. Grants issued under the 2017 Plan will continue to be governed under the terms of the 2017 Plan.

Stock Options

During the three months ended June 30, 2025 and 2024, the Company granted 3,285,496 and zero stock options, respectively, to its board of directors, officers, employees and consultants. During the nine months ended June 30, 2025 and 2024, the Company granted 3,336,571 and 1,225,669 stock options, respectively, to its board of directors, officers, employees and consultants. Vesting generally occurs over a 12 to 48 month period based on a time of service condition. The grant date fair value of the grants issued during the three months ended June 30, 2025 was $0.50 per share. The grant date fair value of the grants issued during the nine months ended June 30, 2025 and 2024 was $0.50 and $1.08 per share, respectively.

The total expense for the three months ended June 30, 2025 and 2024 related to stock options was $203,095 and $202,338, respectively. The total expense for the nine months ended June 30, 2025 and 2024 related to stock options was $534,426 and $603,957, respectively. The total number of stock options outstanding as of June 30, 2025 and September 30, 2024 was 6,131,448 and 2,814,096, respectively.

The weighted-average assumptions used in the Black-Scholes option-pricing model are as follows for the stock options granted during the three and nine months ended June 30, 2025 and 2024: 

During the three months ended June 30, 2025 and 2024, 136,589 and 127,583 stock options vested, respectively, and 19,219 and 65,000 stock options were forfeited, respectively. During the nine months ended June 30, 2025 and 2024, 640,573 and 232,494 stock options vested, respectively, and 19,219 and 120,000 stock options were forfeited during these periods, respectively. During the three and nine months ended June 30, 2025 and 2024, no options were exercised.

Restricted Stock Units

During the three and nine months ended June 30, 2025, the Company granted an aggregate of zero and 83,334 restricted stock units (“RSUs”) to non-employee directors under the 2025 Plan. The weighted average grant date fair value of the RSUs granted during the nine months ended June 30, 2025 was $1.20 per RSU. The RSUs granted vest over a one-year period in equal monthly installments, subject to the recipient’s continued service on such dates.

During the nine months ended June 30, 2024, the Company granted an aggregate of 1,006,725 RSUs to its officers, employees and consultants under the 2017 Plan, respectively. The weighted average grant date fair value of the RSUs granted during the nine months ended June 30, 2024 was $1.03 per unit. The RSUs granted vest over a four-year period in equal annual installments on the anniversary date of the grant, subject to the recipient’s continued service on such dates.

During the three months ended June 30, 2025 and 2024, 35,771 and 162,309 RSUs vested, respectively, and 2,500 and zero RSUs were forfeited during these periods, respectively. During the nine months ended June 30, 2025 and 2024, 362,129 and 232,523 RSUs vested, respectively, and 2,500 and zero RSUs were forfeited these periods, respectively. The total expense for the three months ended June 30, 2025 and 2024 related to these RSUs was $113,559 and $136,271, respectively. The total expense for the nine months ended June 30, 2025 and 2024 related to these RSUs was $371,622 and $400,148, respectively. The total number of RSUs outstanding as of June 30, 2025 and September 30, 2024 was 848,468 and 1,129,762, respectively.

General

As of June 30, 2025, 1,709,604 shares were available in the aggregate for future issuance under the 2025 Plan and Inducement Plan. Unrecognized stock-based compensation was $3,227,785 as of June 30, 2025. The unrecognized share-based expense is expected to be recognized over a weighted average period of 3.7 years.