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VITAE PHARMACEUTICALS, INC filed this Form S-1 on 08/12/2014
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grant date. Calculating the fair value of share-based awards requires that we make highly subjective assumptions.

        The fair value of stock options granted were calculated using the following weighted-average assumptions in the Black-Scholes option pricing model for the years ended December 31, 2013 and 2012 and the six months ended June 30, 2014 and 2013:

  Year Ended
December 31,
  Six Months
Ended June 30,
  2013   2012   2014   2013  

Expected stock price volatility

    85.00 %   86.16 %   83.00 %   87.00 %

Expected term of options (in years)

    6.25     6.25     6.15     6.25  

Weighted-average risk-free interest Rate

    1.42 %   0.90 %   1.96 %   1.05 %

Expected dividend yield

    0 %   0 %   0 %   0 %

        The per share estimated fair value of our common stock in the table below represents the determination by our board of directors of the fair value of our common stock as of the date of grant, taking into consideration the various objective and subjective factors described above, including the conclusions, if applicable, of independent third-party valuations of our common stock as discussed below. We computed the per share weighted average estimated fair value for stock option grants based on the Black-Scholes option pricing model. During 2013 and 2012, our board of directors granted stock options, each having an exercise price based on the grant date fair value of our common stock. The following table sets forth information about our stock grants during the years ended December 31, 2013 and 2012 and the six months ended June 30, 2014:

Date of Issuance
  Number of Stock
Options Granted
  Per Share
Exercise Price

June 25, 2014

    7,627,279   $ 0.23  

March 26, 2014

    285,000   $ 0.16  

September 25, 2013

    10,000   $ 0.16  

March 27, 2013

    10,000   $ 0.27  

September 26, 2012

    75,000   $ 0.27  

May 23, 2012

    20,000   $ 0.33  

        The above per share exercise prices were supported by valuations of our common stock with the assistance of an independent third-party valuation firm.

        We have historically granted stock options at exercise prices not less than the fair market value of our common stock as determined by our board of directors, with input from management. In the absence of a public trading market for our common stock, our board of directors was required to estimate the fair value of our common stock at each option grant date. The board of directors, in making its independent determination, utilized a number of different sources, including the assistance of an independent valuation firm. We obtained third party valuations of our common stock as of June 30, 2011, June 30, 2012, June 30, 2013 and June 24, 2014, which resulted in valuations of our common stock of $0.33, $0.27, $0.16 and $0.23 per share, respectively, as of those dates. Our board of director's determination of the fair market values was consistent with the results and conclusions of the independent third party valuation. We used methodologies, approaches and assumptions consistent with the American Institute of Certified Public Accountants Practice Guide Practice Guide, Valuation of Privately-Held-Company Equity Securities Issued as Compensation, considering numerous objective and subjective factors to determine common stock fair market value at each option grant date, including third party valuations of the common stock, external market conditions affecting the life sciences industry sector, the prices at which we sold shares of convertible preferred stock, the superior rights and preferences of securities senior to our common stock at the time of each grant, our results of operations and financial position, the status of our research and