27.

Share-based compensation expenses

The Company granted 100,000 shares of the Company’s restricted common stock to its investor relations services provider, in exchange for its services to the Company for the years ended December 31, 2016 and 2015. These shares were valued at US$1.20 per share, the closing bid price of the Company’s common stock on the date of grant. Total compensation expense recognized for the service was US$30,000 for the six months ended June 30, 2016 and 2015, and US$15,000 for the three months ended June 30, 2016 and 2015.

The Company granted 350,000 shares of the Company’s restricted common stock to a management consulting service provider in exchange for its services to the Company for a 24-month period commencing on May 1, 2015. These shares were valued at US$1.57 per share, the closing bid price of the Company’s common stock on the date of grant. Total compensation expense recognized for the six months ended June 30, 2016 and 2015 was approximately US$137,400 and US$45,800, respectively. Total compensation expense recognized for the three months ended June 30, 2016 and 2015 was approximately US$68,700 and US$45,800, respectively.

The Company granted 300,000 shares of the Company’s restricted common stock to a technical service provider in exchange for its services to the Company for a 12-month period commencing on August 1, 2014. These shares were valued at US$0.67 per share, the closing bid price of the Company’s common stock on the date of grant. Total compensation expense recognized for the six and three months ended June 30, 2015 was approximately US$100,500 and US$50,250, respectively.

On December 30, 2014, the Company issued 4,200,000 shares of the Company’s restricted common stock to its executive officers, of which 1,533,333 restricted shares were vested upon issuance, 1,333,333 restricted shares were vested on December 30, 2015 and the remaining 1,333,334 restricted shares will be vested on December 30, 2016. The restricted stock was valued at $1.17 per share, the closing bid price of the Company’s common stock on the date of grant. Total compensation expenses recognized for the six months ended June 30, 2016 and 2015 was US$780,000. Total compensation expenses recognized for the three months ended June 30, 2016 and 2015 was US$390,000.

On September 14, 2015, under its 2015 Omnibus Securities and Incentive Plan, the Company granted its employees in the aggregate of 665,592 shares of the Company’s restricted common stock, which will be vested on the third anniversary of the date of the grant. These shares were valued at $0.84 per share, the closing bid price of the Company’s common stock on the date of grant. The Company adopted a 5% forfeiture rate for recognition of the related compensation expenses of these unvested shares, total compensation expenses recognized for the six and three months ended June 30, 2016 was approximately US$88,200 and US$44,100, respectively.

On September 14, 2015, under its 2015 Omnibus Securities and Incentive Plan, the Company also granted 5-year common stock purchase options to its employees, in the aggregate, to purchase up to 1,193,100 shares of the Company’s restricted common stock at an exercise price of US$0.84 per share, of which 397,700 options was vested upon the date of grant, 397,700 options will be vested on September 14, 2016 and the remaining 397,700 options will be vested on September 14, 2017. These options were valuated at US$0.41-US$0.56 per option. The Company adopted a 5% forfeiture rate for recognition of the related compensation expenses of the unvested part of options, total compensation expenses recognized for these options for the six and three months ended June 30, 2016 was approximately US$92,500 and US$46,250, respectively.

On April 1, 2016, the Company granted 40,000 shares of the Company’s restricted common stock in aggregate to two marketing service providers in exchange for their services to the Company for a 12-month period commencing on April 1, 2016. These shares were valued at US$0.69 per share, the closing bid price of the Company’s common stock on the date of grant. Total compensation expense recognized for the six and three months ended June 30, 2016 was approximately US$6,900.

Options issued and outstanding at June 30, 2016 and their movements during the six months then ended are as follows:

	Option Outstanding						Option Exercisable
	Number of underlying shares		Weighted Average Remaining Contractual Life (Years)		Weighted Average Exercise Price		Number of underlying shares		Weighted Average Remaining Contractual Life (Years)		Weighted Average Exercise Price

Balance, December 31, 2015 (audited)		2,088,040		5.04	$	1.00		1,292,640		5.24	$	1.09
Granted/Vested		-						-
Forfeited		-						-
Exercised		-						-
Balance, June 30, 2016 (unaudited)		2,088,040		4.54	$	1.00		1,292,640		4.75	$	1.09

The aggregate unrecognized share-based compensation expenses as of June 30, 2016 and 2015 is approximately US$1,693,000 and US$2,890,000, respectively.