Quarterly report pursuant to Section 13 or 15(d)

Warrants

v3.8.0.1
Warrants
9 Months Ended
Sep. 30, 2017
Notes to Financial Statements  
Warrants

15. Warrants

 

On February 29, 2016, as per a Securities Purchase Agreement, the Company issued a warrant to purchase 130,435 shares of the Company’s common stock at $1.15 per share which may be exercised by the warrant holder between August 28, 2016 and February 28, 2019 (See Note 12). The warrant was issued in connection with the February 29, 2016 convertible Promissory Note. The fair value of the warrants of $106,583 was calculated using the Black-Scholes model on the date of issuance and was recorded as a debt discount, which has been amortized as interest expense over the life of the debt.

 

On April 4, 2016, the Company issued a warrant to purchase 32,609 shares of the Company’s common stock at $1.15 per share which may be exercised by the warrant holder until April 4, 2019 (See Note 12). The warrant was issued in connection with the April 4, 2016 Convertible Promissory Note. The fair value of the warrants of $27,901 was calculated using the Black-Scholes model on the date of issuance and was recorded as a debt discount, which has been amortized as interest expense over the life of the debt.

 

On April 4, 2016, the Company issued a warrant to purchase 62,220 shares of the Company’s common stock at $1.15 per share which may be exercised by the warrant holder until April 4, 2019. The warrant was issued to the placement agent in relation to securing the February 29, 2016 and April 4, 2016 convertible Promissory Notes (See Note 12). The fair value of the warrants of $53,236 was calculated using the Black-Scholes model on the date of issuance, and was recorded as a debt issuance cost, which has been amortized over the life of the debt.

 

On January 24, 2017, the Company issued a warrant to purchase 18,000 of the Company’s common stock at $1.00 per share which may be exercised by the warrant holder from June 24, 2017 until January 24, 2019. The warrant was issued in connection with the January 24, 2017 Debenture (See Note 12). The fair value of the warrants of $13,973 was calculated using the Black-Scholes model on the date of issuance and was recorded as a debt issuance cost, which has been amortized as interest expense over the life of the debt.

 

On March 27, 2017, the Company issued a warrant to purchase 15,000 of the Company’s common stock at $1.00 per share which may be exercised by the warrant holder from August 27, 2017 until March 27, 2019. The warrant was issued in connection with the March 27, 2017 Convertible Debenture (See Note 12). The fair value of the warrant of $11,923 was calculated using the Black-Scholes model on the date of issuance and was recorded as debt discount, which has been amortized as interest expense over the life of the debt.

 

On June 5, 2017, the Company issued a warrant to purchase 15,000 of the Company’s common stock at $1.00 per share which may be exercised by the holder from November 5, 2017 to June 5, 2019. The warrant was issued in connection with the June 5, 2017 Convertible Debenture (see Note 12). The fair value of the warrant of $14,826 was calculated using the Black-Scholes model on the date of issuance and was recorded as debt discount, which has been amortized as interest expense over the life of the debt.

 

On June 9, 2017, the Company issued a warrant to purchase 7,500 of the Company’s common stock at $1.00 per share which may be exercised from November 9, 2017 to June 9, 2019. The warrant was issued in connection with the June 9, 2017 Convertible Debenture (see Note 12). The fair value of the warrant of $7,489 was calculated using the Black-Scholes model on the date of issuance and was recorded as debt discount, which has been amortized as interest expense over the life of the debt.

 

The fair value of the warrants on the date of issuance as calculated using the Black-Scholes model was:

 

Warrant   Fair Value
At issuance
February 29, 2016   $ 106,583  
April 4, 2016   $ 53,236  
April 4, 2016   $ 27,901  
January 24, 2017   $ 13,973  
March 27, 2017   $ 11,923  
June 5, 2017   $ 14,826  
June 9, 2017   $ 7,489  

 

 

The following assumptions were used to calculate the fair value at issuance:

 

Warrant Date   Exercise Price/sh   Common Stock Price/sh   Volatility   Term   Dividend Yield   Interest Rate   Forfeiture Risk
February 29, 2016   $ 1.15     $ 0.90       200 %   3 yrs     0 %     0.91 %     0 %
April 4, 2016   $ 1.15     $ 0.95       195 %   3 yrs     0 %     0.91 %     0 %
April 4, 2016   $ 1.15     $ 0.95       195 %   3 yrs     0 %     0.91 %     0 %
January 24, 2017   $ 1.00     $ 0.78       404 %   2 yrs     0 %     0.91 %     0 %
March 27, 2017   $ 1.00     $ 0.80       390 %   2 yrs     0 %     0.91 %     0 %
June 5, 2017   $ 1.00     $ 0.99       445 %   2 yrs     0 %     0.91 %     0 %
June 9, 2017   $ 1.00     $ 0.99       445 %   2 yrs     0 %     0.91 %     0 %

 

A summary of warrant transactions during the nine months ended September 30, 2017 is as follows:

 

    Warrant Shares   Weighted Average Exercise Price Per Common Share   Weighted Average Life
Outstanding at December 31, 2016     233,964     $ 1.15       2.13  
Issued     55,500     $ 1.00       2.00  
Exercised     —         —         —    
Expired     (8,700 )     —         —    
Outstanding at September 30, 2017     280,764     $ 1.09       1.51  
Exercisable at September 30, 2017     258,264     $ 1.12       1.46  

 

The following assumptions were used to calculate the fair value of warrants at September 30, 2017:

 

Exercises price $1.00 - $1.15
Common stock price per share $1.09
Volatility 392%
Weighted average life 1.51 years
Dividend yield 0%
Interest rate 0.91%
Forfeiture risk 0%