ClearPoint Neuro, Inc. Annual report pursuant to Section 13 and 15(d)

Annual report pursuant to Section 13 and 15(d)

Stockholders' Equity (Tables)

Stockholders' Equity (Tables)

12 Months Ended

Dec. 31, 2018

Schedule of stock options issued by the Company

Activity with respect to stock options issued by the Company is summarized as follows:

	Options Outstanding			Options Exercisable		Range of Exercise Prices				Weighted- average Exercise price per share		Intrinsic Value (1)
Outstanding at January 1, 2017		337,441				$	5.00	$	385.60	$	42.07		—
Exercisable at January 1, 2017					245,989	$	5.00	$	385.60	$	38.71		—
Activity during the year ended December 31, 2017
Granted		940,875				$	1.95	$	6.40	$	2.58	$	78,486
Cancelled or forfeited		(40,117	)			$	5.00	$	385.60	$	35.74		—
Outstanding at December 31, 2017		1,238,199				$	1.95	$	385.60	$	12.47	$	78,486
Exercisable at December 31, 2017					567,210								—
Activity during the year ended December 31, 2018
Granted		167,500				$	1.40	$	2.18	$	1.81	$	11,050
Cancelled or forfeited		(19,303	)			$	1.95	$	385.60	$	18.77
Outstanding at December 31, 2018		1,386,396				$	1.40	$	385.60	$	11.09	$	11,050
Exercisable at December 31, 2018					1,006,113

(1)

Intrinsic value is calculated as the estimated fair value of the Company’s stock at the end of the related period less the option exercise price of in-the-money options.

Schedule of stock options (contractual life expressed in years)

The following table summarizes information about stock options at December 31, 2018 (contractual life expressed in years):

				Options Outstanding						Options Exercisable
Range of Exercise Prices				Number Outstanding		Weighted - Average Remaining Contractual Life		Weighted - Average Exercise Price		Number Exercisable		Weighted - Average Remaining Contractual Life		Weighted - Average Exercise Price
$	1.40	$	45.20		1,310,489		8.36	$	7.70		930,300		8.09	$	16.08
$	46.40	$	83.60		75,771		2.88	$	69.09		75,677		2.88	$	69.11
$	128.00	$	385.60		136		0.88	$	385.60		136		0.88	$	363.21
					1,386,396		9.18	$	12.47		1,006,113		7.70	$	16.08

Schedule of company's nonvested stock options during the years

The weighted average grant date fair value of options granted during the years ended December 31, 2018 and 2017 was $0.95 and $0.85, respectively. A summary of the status of the Company’s nonvested stock options during the years ended December 31, 2018 and 2017 is presented below:

Nonvested Stock Options	Shares			Weighted - Average Grant Date Fair Value
Nonvested, January 1, 2017		91,452		$	10.53
Activity during the year ended December 31, 2017
Granted		940,875		$	0.85
Forfeited		(17,619	)	$	16.50
Vested		(343,719	)	$	3.09
Nonvested, December 31, 2017		670,989		$	1.45
Activity during the year ended December 31, 2018
Granted		167,500		$	0.95
Forfeited		(15,327	)	$	25.22
Vested		(442,879	)	$	1.71
Nonvested, December 31, 2018		380,283		$	0.94

Schedule of share-based compensation expense

The Company records share-based compensation expense on a straight-line basis over the related vesting period. For the years ended December 31, 2018 and 2017, share-based compensation expense was:

Years Ended December 31,
2018		2017
$	1,231,379	$	1,245,601

Schedule of assumptions used in calculating the fair value under the Black-Scholes option-pricing model

The assumptions used in calculating the fair value under the Black-Scholes option-pricing model are as follows:

	Years Ended December 31,
	2018		2017
Dividend yield		0%		0%
Expected Volatility		51.58% to 54.21%		51.77% to 52.98%
Risk free Interest rates		2.77% to 3.00%		2.04% to 2.25%
Expected lives (in years)		5.8		6.0

Schedule of common stock warrant activity

Warrants have generally been issued in connection with financing transactions and for terms of up to five years. Common stock warrant activity for the years ended December 31, 2018 and 2017 is as follows:

	Shares			Weighted - Average Exercise Price
Outstanding at January 1, 2017		1,991,293		$	13.00
Activity during the year ended December 31, 2017
Issued		7,134,200		$	2.20
Exercised		(8,207	)	$	2.00
Terminated		(168,208	)	$	17.64
Outstanding at December 31, 2017		8,949,078		$	4.12	(1)
Activity during the year ended December 31, 2018
Issued		—			—
Exercised		(221,773	)	$	2.15
Terminated		(50,824	)	$	6.64
Outstanding at December 31, 2018		8,676,481		$	4.17

(1)

The weighted-average exercise price reflects exercise price adjustments triggered by the 2017 PIPE.

Schedule of information regarding outstanding warrants

Information regarding outstanding warrants at December 31, 2018 is as follows (contractual life expressed in years):

Exercise Price		Number Outstanding		Weighted - Average Remaining Contractual Life		Intrinsic Value (1)
$	1.83		1,540		1.96	$	—
$	2.20		6,953,848		3.40		—
$	5.50		1,123,705		2.67		—
$	16.23		242,021		1.96		—
$	21.10		152,084		1.96		—
$	34.32		185,779		0.98		—
$	40.00		875		1.07		—
$	70.00		16,629		0.23		—
			8,676,481		3.18	$	—

(1)

Intrinsic value is calculated as the estimated fair value of the Company’s stock at December 31, 2018 less the warrant exercise price of in-the-money warrants.

- Definition

Tabular disclosure of warrants or rights issued. Warrants and rights outstanding are derivative securities that give the holder the right to purchase securities (usually equity) from the issuer at a specific price within a certain time frame. Warrants are often included in a new debt issue to entice investors by a higher return potential. The main difference between warrants and call options is that warrants are issued and guaranteed by the company, whereas options are exchange instruments and are not issued by the company. Also, the lifetime of a warrant is often measured in years, while the lifetime of a typical option is measured in months. Disclose the title of issue of securities called for by warrants and rights outstanding, the aggregate amount of securities called for by warrants and rights outstanding, the date from which the warrants or rights are exercisable, and the price at which the warrant or right is exercisable.

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