13. STOCK-BASED COMPENSATION AWARDS

In April 2014, the Company adopted the Corbus Pharmaceuticals Holdings, Inc. 2014 Equity Incentive Plan (the “2014 Plan”). Pursuant to the 2014 Plan, the board of directors may grant incentive and nonqualified stock options and restricted stock to employees, officers, directors, consultants, and advisors. On March 14, 2024, the board of directors adopted the 2024 Equity Compensation Plan (the “2024 Plan”), subject to stockholder approval at the annual meeting of stockholders scheduled for May 16, 2024.

Pursuant to the terms of an annual evergreen provision in the 2014 Plan, the number of shares of common stock available for issuance under the 2014 Plan automatically increased on January 1 of each year by at least seven percent (7%) of the total number of shares of common stock outstanding on December 31st of the preceding calendar year, or, pursuant to the terms of the 2014 Plan, in any year, the board of directors may determine that such increase will provide for a lesser number of shares.

In accordance with the terms of the 2014 Plan, and pursuant to the annual evergreen provision contained in the 2014 Plan, effective as of January 1, 2023, the number of shares of common stock available for issuance under the 2014 Plan increased by 291,991 shares, which was seven percent (7%) of the outstanding shares of common stock on December 31, 2022. As of January 1, 2023, there was a total reserve of 1,436,558 shares and 741,870 shares available for future grants. As of March 31, 2023, there were 510,671 shares available for future grants.

In accordance with the terms of the 2014 Plan, effective as of January 1, 2024, the number of shares of common stock available for issuance under the 2014 Plan increased by 309,658 shares, which was seven percent (7%) of the outstanding shares of common stock on December 31, 2023. As of January 1, 2024, there was a total reserve of 1,746,215 shares and 899,015 shares available for future grants. On March 14, 2024, the board of directors approved the 2024 Plan and determined to cease the grant of any new awards under the 2014 Plan.

Stock-based Compensation Expense

Stock Options

The fair value of each option award is estimated on the date of grant using the Black-Scholes option pricing model that uses the assumptions noted in the following table, except for the expected term for non-employees as noted in the following paragraph. The expected term of employee options granted under the 2014 Plan, all of which qualify as “plain vanilla” per SEC Staff Accounting Bulletin 107, is determined based on the simplified method due to the Company’s limited operating history and is 6.25 years based on the average between the vesting period and the contractual life of the option. For non-employee options, the Company has elected to utilize the contractual term as the expected term. The risk-free rate is based on the yield of a U.S. Treasury security with a term consistent with that used to value the option.

The weighted average grant-date fair value of stock options granted during the three months ended March 31, 2024 and 2023 was $21.25 and $3.44 per share, respectively. The aggregate intrinsic value of options exercised during the three months ended March 31, 2024 and 2023 was $724,213 and $92,689, respectively. As of March 31, 2024, there was $6,107,211 of total unrecognized compensation expense related to unvested stock-based option compensation arrangements, which are expected to be recognized over a weighted average period of 1.63 years.

Restricted Stock Units

A RSU represents the right to receive one share of our common stock upon vesting of the RSU. The fair value of each RSU is based on the closing price of our common stock on the date of grant. Pursuant to the 2014 Plan, the Company grants RSUs with service conditions that vest in four equal annual installments provided that the employee remains employed with the Company on the vesting date.

As of March 31, 2024, there was $4,648,917 of unrecognized compensation expense related to unvested RSUs, which are expected to be recognized over a weighted average period of 2.42 years.