COMMON STOCK OPTIONS
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Jun. 30, 2013
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COMMON STOCK OPTIONS |
NOTE 8 COMMON STOCK OPTIONS
The Company has determined the estimated value of the options granted to employees and non-employees in exchange for services and financing expenses using the Black-Scholes pricing model and the following assumptions: stock price at valuation, $1.20-4.71; expected term of five years, exercise price of $1.50-4.74, a risk free interest rate of 0.68-2.60 percent, a dividend yield of 0 percent and volatility of 191-277 percent.
On April 30, 2013, the Company granted 116,667 options to a board member. The Company calculated a fair value of $4.59 per option. Of the 116,667 options issued, 29,167 vested upon issuance and the remaining 87,500 vest in 33 percent tranches on the next three anniversary dates. As of June 30, 2013, 29,167 options have vested resulting in compensation expense of $147,233.
On May 17, 2013, the Company granted 116,667 options to a board member. The Company calculated a fair value of $4.50 per option. Of the 116,667 options issued, 29,167 vested upon issuance and the remaining 87,500 vest in 33 percent tranches on the next three anniversary dates. As of June 30, 2013, 29,167 options have vested resulting in compensation expense of $140,775.
During the nine months ended June 30, 2013, the Company recognized $156,154 of expense related to vested options that were granted in prior years. Unamortized option expense as of June 30, 2013 for all options outstanding amounted to approximately $1,414,000.
Below is a table summarizing the options issued and outstanding as of June 30, 2013:
As of June 30, 2013, the outstanding options have an intrinsic value of approximately $6.47 million.
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