NOTE G —WARRANTS AND STOCK OPTIONS

Warrants

The following table summarizes the changes in warrants outstanding. These warrants were granted in lieu of cash compensation for services performed or as financing expenses in connection with the sales of the Company’s Common Stock.

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


		Weighted
		Average
		Exercise
	Number of	Price Per
	Shares	Share
Balance at October 1, 2020	1,038,919	$	10.83
Granted	259,000		7.14
Exercised	(518,551)		5.25
Cancelled or expired	(1,250)		160.54
Balance at December 31, 2020	778,118	$	13.08

Stock Options

For the three-month period ended December 31, 2020, the Company issued an aggregate of 73,143 options to employees, officers and non-employee board of director members.

The fair value of options granted during the three months ended December 31, 2020 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 during the three months ended December 31, 2020 was calculated using the following weighted average assumptions: stock price $7.52; exercise price $7.52; expected term 5.22 years; dividend yield 0; volatility 142%; and risk-free rate of 0.33%.

Subsequent to the three months ended December 31, 2020, the Company granted an aggregate of 80,000 options to its Chief Executive Officer.These options have an exercise price of $5.44, a term of ten years and vest immediately.