Quarterly report pursuant to Section 13 or 15(d)

Stockholders' Equity

v3.5.0.2
Stockholders' Equity
 9 Months Ended
Sep. 30, 2016
Stockholders' Equity [Abstract]  
Stockholders' Equity

Note 6 - Stockholders’ Equity

 

Stock Options

 

The Company has one incentive stock plan, the Amended and Restated 2011 Equity Incentive Plan (the “2011 Plan”), and has granted stock options to employees, non-employee directors and consultants from the 2011 Plan. Options granted under the 2011 Plan may be Incentive Stock Options or Non-statutory Stock Options, as determined by the Administrator at the time of grant. In January 2016, the Company issued a warrant to purchase 125,000 shares of the Company’s common stock to an investor relations firm as partial compensation for consulting services it will provide to the Company over a two year period.   Pursuant to applicable policies of the TSX-V, the shares issuable under the warrant will be counted against the limit of shares authorized for issuance under the 2011 Plan, notwithstanding that the warrant was not issued under the 2011 Plan. After giving effect to this limitation there were 1,665,572 shares remaining available for issuance under the 2011 Plan at September 30, 2016.

 

During the nine months ended September 30, 2016, the Company granted stock options to employees to purchase 1,696,000 shares of the Company’s common stock. The stock options have exercise prices that range from $1.10 to $1.55 per share, are subject to vesting over four years, have terms of ten years and have an aggregate grant date fair value of approximately $1,418,000.

 

During the nine months ended September 30, 2016, 10,000 stock options were exercised for cash proceeds of $2,600.

 

The Company recorded $190,816 and $94,389 of stock based compensation in the three months ended September 30, 2016 and 2015, respectively. The Company recorded $524,118 and $310,594 of stock-based compensation in the nine months ended September 30, 2016 and 2015, respectively.

 

The following table represents stock option activity for the nine months ended September 30, 2016:

 

                Weighted Average        
    Stock Options     Exercise Price     Fair     Contractual     Aggregate  
    Outstanding     Exercisable     Outstanding     Exercisable     Value
Vested		     Life
(Years)		     Intrinsic
Value		  
Balance – December 31, 2015     3,724,083       1,963,948     $ 0.67     $ 0.34     $ 0.34       7.09     $     -  
Granted     1,696,000       -       1.50       -       -       6.25          -  
Exercised     (741,100 )     -       -       -       -       -          -  
Cancelled     (26,486 )     -       -       -       -       -           -  
Balance – September 30, 2016     4,652,497       1,762,984     $ 0.92     $ 0.37     $ 0.37       8.49     $ 5,468,318  

 

The table above includes 731,100 compensation options in the exercised balance that were exercised by agents that took part in the IPO.

 

Agent’s Compensation Options

 

In connection with the closing of its Initial Public Offering (“IPO”) in January 2015 the Company issued 786,696 compensation options (“Compensation Options”) to the agents that took part in the offering. Each Compensation Option was exercisable for a unit consisting of one share of common stock and one-half of one common stock purchase warrant at an exercise price of $1.00 per unit. During the nine months ended September 30, 2016, the agents that took part in the Company’s IPO exercised a total of 731,100 Compensation Options into shares of common stock for net cash proceeds of $731,085. The unexercised Compensation Options expired on July 6, 2016. Each whole warrant issuable upon exercise of Compensation Options is exercisable to acquire one share of common stock at an exercise price of $2.00 per share at any time up to January 6, 2017, subject to the Company’s right to accelerate the expiration time of the warrants if at any time the volume-weighted average trading price of its common stock is equal to or exceeds $3.00 per share for twenty (20) consecutive trading days. Because the Compensation Options were considered a cost of the IPO, the resulting value is recognized as both an increase and decrease to the equity section of the accompanying condensed balance sheets.

 

The following table summarizes information on stock options outstanding and exercisable as of September 30, 2016:

 

            Weighted   Weighted           Weighted  
Exercise     Number     Average Remaining   Average     Number     Average  
Price     Outstanding     Contractual Term   Exercise Price     Exercisable     Exercise Price  
                               
$ 0.05       72,876     5.51 years   $ 0.05       72,876     $ 0.05  
$ 0.26       1,024,810     7.53 years   $ 0.26       889,690     $ 0.26  
$ 0.73       1,475,687     8.12 years   $ 0.73       676,357     $ 0.73  
$ 1.00       313,124     8.81 years   $ 1.00       106,457     $ 1.00  
$ 1.10       10,000     9.27 years   $ 1.10       -     $ 1.10  
$ 1.17       70,000     9.12 years   $ 1.17       17,604     $ 1.17  
$ 1.22       190,000     9.35 years   $ 1.22       -     $ 1.22  
$ 1.50       40,000     9.42 years   $ 1.50       -     $ 1.50  
$ 1.55       1,456,000     9.44 years   $ 1.55       -     $ 1.55  
  Totals       4,652,497                   1,762,984          

 

Warrants

 

In January 2016, the Company issued a warrant to purchase 125,000 shares of the Company’s common stock to an investor relations firm as partial compensation for consulting services to be provided over a two-year period.  The warrant is exercisable at $1.15 per share, has a term of three years and is subject to vesting over the two-year service period.

 

During the nine months ended September 30, 2016, the Company issued 365,550 common stock purchase warrants to agents that exercised their Compensation Options.

 

During the nine months ended September 30, 2016, a total of 370,523 common stock purchase warrants were exercised into shares of common stock for cash proceeds of $741,046.

 

The following table represents warrant activity for the nine months ended September 30, 2016:

 

                Weighted Average        
    Warrants     Exercise Price     Fair     Contractual     Aggregate  
    Outstanding     Exercisable     Outstanding     Exercisable     Value
Vested		     Life
(Years)		     Intrinsic Value  
Balance – December 31, 2015     7,936,391       7,936,391     $ 1.80     $ 1.80     $ 0.41       1.80     $ -  
Granted     490,550       360,465       -       -       -       -       -  
Exercised     (370,523 )     -       -       -       -       -       -  
Cancelled     -       -       -       -       -       -       -  
Balance – September 30, 2016     8,056,418       7,978,293     $ 1.79     $ 1.79     $ 0.41       1.32     $ 2,519,973