Quarterly report pursuant to Section 13 or 15(d)

Warrants

v3.8.0.1
Warrants
3 Months Ended
Mar. 31, 2018
Warrants  
Warrants

NOTE 9 – WARRANTS

 

The following is a summary of the Company’s warrant activity:

 

    Warrants     Weighted
average
exercise price
    Weighted average remaining contractual
term in
three-months
    Aggregate
intrinsic value
 
Outstanding January 1, 2017     88,365,036     $ 0.30       3.50     $ 543,770  
Exercisable January 1, 2017     88,365,036     $ 0.30       3.50     $ 543,770  
Canceled     -                          
Granted     40,259,133                          
Exercised     (798,000 )                        
Forfeited     (392,047 )                        
Outstanding December 31, 2017     127,434,122     $ 0.24       3.15     $ 3,957,689  
Exercisable December 31, 2017     127,434,122     $ 0.24       3.15     $ 3,957,689  
Canceled     -                          
Granted     -                          
Exercised     -                          
Forfeited     -                          
Outstanding March 31, 2018     127,434,122     $ 0.24       2.90     $ 13,733,627  
Exercisable March 31, 2018     127,434,122     $ 0.24       2.90     $ 13,733,627  

 

The Company estimates the fair value of warrants granted on each grant date using the Black-Scholes option valuation model. The expected volatility was calculated based on the historical volatilities of publicly traded peer companies, determined by the Company. The risk-free interest rate used was based on the U.S. Treasury constant maturity rate in effect at the time of grant for the expected term of the warrants to be valued. The expected dividend yield was zero, as the Company does not anticipate paying a dividend within the relevant timeframe. The expected warrant term is the life of the warrant.

 

The Company did not recognize any stock-based compensation expense related to warrants during the three-months ended March 31, 2018 and 2017, respectively.

 

Warrant exercise

 

During the year ended December 31, 2017, the Company issued 233,217 shares of common stock in connection with the cashless exercise of a warrant for 298,000 shares of common stock at $0.10 per share with 64,783 shares of common stock withheld with an aggregate fair market value equal to the aggregate exercise price.

 

During the year ended December 31, 2017, the Company issued 500,000 shares of common stock in connection with the exercise of a warrant for 500,000 shares of common stock at $0.08 per share in exchange for $40,000.

 

Warrant expiration

 

During the year ended December 31, 2017, warrants to purchase an aggregate of 392,047 shares of restricted common stock expired.