Ovid Therapeutics Inc.OVID
Ovid Therapeutics Inc. Stock Compensation Disclosure
STOCK-BASED COMPENSATION
The Company’s Board of Directors (the “Board”) adopted, and the Company’s stockholders approved, the 2017 Equity Incentive Plan (“2017 Plan”), which became effective on May 4, 2017. The initial reserve of shares of common stock under the 2017 Plan was 3,052,059 shares. The 2017 Plan provides for the grant of incentive stock options, nonstatutory stock options, restricted stock, restricted stock units (“RSUs”), stock appreciation rights, performance-based stock awards and other forms of stock-based awards. Additionally, the 2017 Plan provides for the grant of performance cash awards. The Company’s employees, officers, directors, consultants and advisors are eligible to receive awards under the 2017 Plan. Upon the adoption of the 2017 Plan, no further awards were granted under the prior plan. Pursuant to the terms of the 2017 Plan, on each January 1st, the plan limit shall be increased by the lesser of (x) 5% of the number of shares of common stock outstanding as of the immediately preceding December 31 and (y) such lesser number as the Board may determine in its discretion. An additional 6,509,217, 0, and 3,534,600 shares were reserved for issuance under the 2017 Plan on January 1, 2026, 2025, and 2024, respectively. As of December 31, 2025, there were 4,652,938 shares of the Company’s common stock reserved for issuance under the 2017 Plan.
The Board adopted, and the Company’s stockholders approved, the 2017 employee stock purchase plan (“ESPP”), which became effective on May 4, 2017. The initial reserve of shares of common stock that may be issued under the ESPP was 279,069 shares. The ESPP allows employees to purchase common stock of the Company at a 15% discount to the market price on designated purchase dates. During the years ended December 31, 2025 and 2024, 76,976 and 69,850 shares were purchased under the ESPP and the Company recorded expense of $38,000 and $65,000, respectively. The number of shares of common stock reserved for issuance under the ESPP will automatically increase on January 1 of each year, beginning on January 1, 2018 and continuing through and including January 1, 2027, by the lesser of (i) 1% of the total number of shares of the Company’s capital stock outstanding on December 31 of the preceding calendar year, (ii) 550,000 shares or (iii) such lesser number of shares determined by the Board. The Board acted prior to January 1, 2026, 2025 and 2024 to provide that there be no increase in the number of shares reserved for issuance under the ESPP. As of December 31, 2025 and 2024, there were 206,020 and 282,996 shares of the Company’s common stock reserved for issuance under the ESPP, respectively.
The Board adopted, and the Company’s stockholders approved, the 2014 Equity Incentive Plan (“2014 Plan”), which authorized the Company to grant shares of common stock in the form of incentive stock options, nonstatutory stock options, stock appreciation rights, restricted stock and restricted stock units. The 2014 Plan was terminated as to future awards in May 2017, although it continues to govern the terms of options that remain outstanding under the 2014 Plan. No additional stock awards will be granted under the 2014 Plan, and all outstanding stock awards granted under the 2014 Plan that are repurchased, forfeited, expire or are cancelled will become available for grant under the 2017 Plan in accordance with its terms. As of December 31, 2025 and 2024, options to purchase 793,833 and 1,328,715 shares of common stock were outstanding under the 2014 Plan, respectively.
Unless specified otherwise in an individual option agreement, stock options granted under the 2014 Plan and 2017 Plan have a ten-year term and a four-year graded vesting period. The vesting requirement is generally conditioned upon the grantee’s continued service with the Company during the vesting period. Once vested, all options granted are exercisable from the date of grant until they expire. The option grants are non-transferable. Vested options remain exercisable for 90 days under the 2017 Plan and 30 days under the 2014 Plan subsequent to the termination of the option holder’s service with the Company. In the event of the option holder’s death or disability while employed by or providing service to the Company, the exercisable period extends to 18 months or 12 months, respectively, under the 2017 Plan and 6 months under the 2014 Plan.
Performance-based option awards generally have similar vesting terms, with vesting occurring on the date the performance condition is achieved and expire in accordance with the specific terms of the agreement. At December 31, 2025 and 2024, there were no performance-based options outstanding and unvested that include options to vest upon the achievement of certain research and development milestones.
The fair value of options granted during the years ended December 31, 2025 and 2024 was estimated using the Black-Scholes option valuation model. The inputs for the Black-Scholes option valuation model require assumptions made by management and are detailed in the table below. The risk-free interest rates were based on the rate for U.S. Treasury securities at the date of grant with maturity dates approximately equal to the expected life at the grant date. The expected life was based on the simplified method in accordance with the SEC Staff Accounting Bulletin No. Topic 14D. The expected volatility was estimated based on the Company’s published historical stock prices.
The Company granted 4,152,650 and 4,699,810 stock options during the years ended December 31, 2025 and 2024, respectively. There were 6,570,487 and 5,688,743 unvested options outstanding as of December 31, 2025 and 2024, respectively. Total expense recognized related to the stock options for the years ended December 31, 2025 and 2024 was $3.2 million and $6.2 million, respectively. Total unrecognized compensation expense related to stock options was $8.3 million and $9.1 million as of December 31, 2025 and 2024, respectively.
The Company granted 327,326 and 348,575 RSUs during the years ended December 31, 2025 and 2024. The RSUs vest in equal installments over three years on the grant date anniversary for all executive awards and 2025 non-executive awards and annually on January 1st for the 2024 non-executive awards.
The Company’s stock-based compensation expense was recognized in operating expenses as follows:
| For the Year Ended December 31, | |||||||||||
| (in thousands) | 2025 | 2024 | |||||||||
| Research and development | $ | 1,497 | $ | 1,631 | |||||||
| General and administrative | 3,310 | 4,645 | |||||||||
| Total | $ | 4,807 | $ | 6,276 | |||||||
| For the Year Ended December 31, | |||||||||||
| (in thousands) | 2025 | 2024 | |||||||||
| Stock options and RSUs | $ | 4,769 | $ | 6,212 | |||||||
ESPP | 38 | 64 | |||||||||
| Total | $ | 4,807 | $ | 6,276 | |||||||
The fair value of stock options granted during the years ended December 31, 2025 and 2024, respectively, was estimated by utilizing the following assumptions:
| For the Year Ended December 31, | |||||||||||
| 2025 | 2024 | ||||||||||
| Weighted Average | Weighted Average | ||||||||||
| Volatility | 97.02 | % | 87.18 | % | |||||||
| Expected term in years | 6.02 | 5.93 | |||||||||
| Dividend rate | 0.00 | % | 0.00 | % | |||||||
| Risk-free interest rate | 4.29 | % | 4.18 | % | |||||||
| Fair value of option on grant date | $ | 0.55 | $ | 1.88 | |||||||
The following table summarizes the number of options outstanding and the weighted average exercise price:
| Number of Shares | Weighted Average Exercise Price | Weighted Average Remaining Contractual Life in Years | Aggregate Intrinsic Value (in thousands) | ||||||||||||||||||||
| Options outstanding December 31, 2023 | 15,124,546 | $ | 3.87 | 6.90 | $ | 5,213 | |||||||||||||||||
| Vested and exercisable December 31, 2023 | 9,649,094 | $ | 4.47 | 5.97 | $ | 2,465 | |||||||||||||||||
| Granted | 4,699,810 | 2.58 | 5.87 | ||||||||||||||||||||
| Exercised | (248,024) | 3.13 | |||||||||||||||||||||
| Forfeited or expired | (4,234,976) | 3.77 | |||||||||||||||||||||
| Options outstanding December 31, 2024 | 15,341,356 | $ | 3.49 | 5.87 | $ | — | |||||||||||||||||
| Vested and exercisable December 31, 2024 | 9,652,613 | $ | 4.07 | 5.87 | $ | — | |||||||||||||||||
| Granted | 4,152,650 | 0.64 | |||||||||||||||||||||
| Exercised | (60,372) | 1.05 | |||||||||||||||||||||
| Forfeited or expired | (1,820,282) | 4.32 | |||||||||||||||||||||
| Options outstanding December 31, 2025 | 17,613,352 | $ | 2.68 | 6.56 | $ | 5,332 | |||||||||||||||||
| Vested and exercisable December 31, 2025 | 11,042,865 | $ | 3.49 | 5.25 | $ | 1 | |||||||||||||||||
At December 31, 2025, there was $8.3 million of unamortized stock-based compensation expense, which is expected to be recognized over a remaining average vesting period of 2.39 years. At December 31, 2024, there was $9.1 million of unamortized stock-based compensation expense, which is expected to be recognized over a remaining average vesting period of 2.23 years.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Mar 18, 2026 | Showing above |
| 2024 | Mar 11, 2025 | |
| 2023 | Mar 8, 2024 | |
| 2022 | Mar 13, 2023 | |
About Stock Compensation Disclosures
Stock-based compensation disclosures detail the equity awards granted to employees and executives — including stock options, restricted stock units (RSUs), and performance shares — along with the valuation methods and assumptions used to expense them. This section reveals the true cost of talent retention and the alignment between management incentives and shareholder interests.
Key signals: total unrecognized compensation expense and its expected recognition period signal future earnings headwinds from already-granted awards. For stock options, examine Black-Scholes assumptions — expected volatility, risk-free rate, and expected term — as understating any of these reduces reported compensation expense. Compare stock compensation expense as a percentage of revenue against peers to assess dilution cost. Watch vesting schedules for acceleration clauses tied to change-of-control events. Performance-based awards with undemanding targets may indicate weak governance. Add back stock compensation to operating cash flow to calculate a more conservative free cash flow figure.