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COMMON STOCK OPTIONS
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6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2014
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| COMMON STOCK OPTIONS |
NOTE 6 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 2.25 to 5 years, exercise price of $1.50-$10.11, a risk free interest rate of 0.30-2.60 percent, a dividend yield of 0 percent and volatility of 56-277 percent.
On February 3, 2014, the Company granted 500,000 options, with an exercise price of $10.11 per share, to employees as part of its 2014 stock option plan. The Company calculated a fair value of $1,954,384 for the options. Of the 500,000 options issued, 125,000 vested upon issuance and the remaining 375,000 vest in 25 percent tranches on each anniversary of grant. As of March 31, 2014, 125,000 options have vested resulting in compensation expense of $563,490.
During the six month period ended March 31, 2014, the Company recognized $289,687 of expense related to vested options that were granted in prior years. Unamortized option expense as of March 31, 2014 for all options outstanding amounted to approximately $2,213,000.
Below is a table summarizing the options issued and outstanding as of March 31, 2014:
As of March 31, 2014, the outstanding options have an intrinsic value of approximately $14.6 million. |
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