Activity in stock options is summarized below:
| Weighted | |||||||||||
| Weighted | Average | ||||||||||
| Number of | Average | Remaining | Aggregate | ||||||||
| Subject to | Exercise | Contractual | Intrinsic | ||||||||
| Option | Price | Term (Years) | Value | ||||||||
| Balance at January 1, 2011 | 1,734,199 | $ | 11.64 | 4.3 | $ | 281,600 | |||||
| Granted | - | $ | 20.43 | ||||||||
| Cancelled | (379,550 | ) | $ | 3.72 | |||||||
| Exercised | (85,000 | ) | $ | 9.48 | |||||||
| Balance at December 31, 2011 | 1,269,649 | $ | 11.64 | 4.2 | $ | - | |||||
| Granted | (151,750 | ) | $ | 12.76 | |||||||
| Cancelled | - | $ | - | ||||||||
| Exercised | - | $ | - | ||||||||
| Balance at December 31, 2012 | 1,117,899 | $ | 9.03 | 3.7 | $ | 4,250 | |||||
| Granted | 499,700 | $ | 5.26 | ||||||||
| Cancelled | (64,500 | ) | $ | 12.81 | |||||||
| Exercised | (72,500 | ) | $ | 4.83 | |||||||
| Balance at December 31, 2013 | 1,480,599 | $ | 7.80 | 5.2 | $ | 399,000 | |||||
Activity in warrants is summarized below:
| Number of Shares Underlying | ||||||
| Warrants and Non-Employee | Weighted Average | |||||
| Options Granted | Exercise Price | |||||
| Balance at January 1, 2011 | 708,909 | $ | 5.00 - 9.00 | |||
| Exercised | (4,652 | ) | 5.64 | |||
| Terminated | - | - | ||||
| Issued | - | - | ||||
| Balance at December 31, 2011 | 704,257 | $ | 5.00 - 9.00 | |||
| Exercised | - | - | ||||
| Terminated | - | - | ||||
| Issued | 807,846 | 5.12 | ||||
| Balance at December 31, 2012 | 1,512,103 | $ | 5.56 | |||
| Exercised | (107,483 | ) | 4.45 | |||
| Terminated | (25,000 | ) | 9.00 | |||
| Issued | - | - | ||||
| Balance at December 31, 2013 | 1,379,620 | $ | 5.58 | |||
The Company valued these 2013 grants using the Black-Scholes option pricing model with the following weighted average assumptions:
| Fair value on grant date | $ | 2.86 | |
| Expected dividend yield | -- | ||
| Expected volatility | 64 | % | |
| Risk free interest rate | 1.62 | % | |
| Expected term of the option | 5 years |
During 2012 the Company sold, pursuant to the Company's effective registration statement filed with the SEC, equity in the Company as follows:
| Date | Shares issued | Warrants issued | Unit price | Proceeds | |||||||
| July 30, 2012 | 589,227 | 117,846 | $ | 2.97 | $ | 1,745,549 | * | ||||
| August 28, 2012 | 1,900,000 | 380,000 | $ | 2.97 | $ | 5,229,201 | ** | ||||
| October 3, 2012 | 1,250,000 | 250,000 | $ | 4.49 | $ | 5,275,750 | *** | ||||
| Total | 3,739,227 | 747,846 | $ | 12,250,500 | |||||||
| (*) | Net of fees of $4,455 |
| (**) | Net of fees of $413,719 |
| (***) | Net of fees of $336,750 |