NOTE I – STOCK OPTIONS AND WARRANTS

Warrants

Transactions involving warrants (see Note H) are summarized as follows:


		Weighted Average
	Number of	Exercise Price Per
	Shares	Share
Balance at October 1, 2019	263,592	$	131.12
Granted	2,636,125		5.25
Exercised	(1,649,786)		(5.25)
Cancelled or expired	(211,012)		(135.01)
Balance, September 30, 2020	1,038,919	$	10.83

Stock Options

During June 2020, the Board of Directors and subsequently during September 2020, the holders of a majority of the outstanding shares of common stock approved the 2020 Equity Incentive Plan (the “2020 Incentive Plan”). The 2020 Incentive Plan, among other things, reserves an additional 3,500,000 shares of the Company’s common stock for issuance in the form of equity-based awards to employees, directors, consultants, and other service providers, and those of the Company’s affiliates. The maximum total grant date fair value of awards granted under the 2020 Incentive Plan to individuals in their capacity as non-employee directors may not exceed $250,000 in any single calendar year. The 2020 Incentive Plan’s expiration date is September 15, 2030.

The 2020 Incentive Plan is designed to retain directors, executives, and selected employees and consultants by rewarding them for making contributions to the Company's success with an award of options to purchase shares of common stock. As of September 30, 2020, a total of 6,894 shares have been issued and options to purchase 303,911 shares have been granted under the Company’s Incentive Plans.

In 2005, the Board of Directors and the holders of a majority of the outstanding shares of common stock approved the 2005 Incentive Stock Plan, as amended and restated as of January 21, 2015 (the “2005 Incentive Plan”, collectively with the 2020 Incentive Plan, the “Company’s Incentive Plans”). Effective as of September 16, 2020, no further awards will be made under the Company’s 2005 Incentive Stock Plan, as amended and restated.

Transactions involving stock options issued are summarized as follows:


						Weighted
		Weighted Average		Aggregate		Average
	Number of	Exercise Price Per		Intrinsic		Contractual
	Shares	Share		Value		Life (years)
Outstanding at October 1, 2019	199,395	$	99.68
Granted	155,395		8.45
Exercised	—		—
Cancelled or expired	(63,755)		42.08
Outstanding at September 30, 2020	291,035	$	63.25
Vested at September 30, 2020	200,407	$	87.22	$	—	6.67
Non-vested at September 30, 2020	90,628	$	10.25	$	—	9.61

For the fiscal year ended September 30, 2020, the Company issued an aggregate of 155,395 options to employees and non-employee board of director members and consultants.

For the fiscal year ended September 30, 2019, the Company issued an aggregate of 86,349 (including award modifications of 35,040) options to employees, consultants, members of the strategic advisory board and non-employee board of director members.

The fair value of options granted during the fiscal years ended September 30, 2020 and 2019 was determined using the Black Scholes Option Pricing Model. For the purposes of the valuation model, the Company used the simplified method for determining the granted options expected lives. The simplified method is used since the Company does not have adequate historical data to utilize in calculating the expected term of options. The fair value for options granted was calculated using the following weighted average assumptions:


	2020			2019
Stock price	$	8.40		$	32.82
Exercise price	$	8.45		$	100.65
Expected term		6.85			4.40
Dividend yield		—			—
Volatility		136	%		89	%
Risk free rate		0.86	%		2.43	%

The Company recorded $1,001,082 and $1,129,110 as stock compensation expense within selling, general and administrative for fiscal years ended September 30, 2020 and 2019, respectively. Included in this amount is $221,046 for the fiscal year ended September 30, 2019 for employee stock option modifications. As of September 30, 2020, unrecorded compensation cost related to non-vested awards was $540,594 which is expected to be recognized over a weighted average period of approximately 0.79 years. The weighted average grant date fair value per share for options granted during the fiscal years ended September 30, 2020 and 2019 was $7.49 and $11.51, respectively.