Stock Options and Warrants
 12 Months Ended
Jun. 30, 2015
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]  
Stock-Based Compensation

NOTE 9 – STOCK OPTIONS AND WARRANTS

 

Stock Options

 

A summary of stock options as of June 30, 2015 and for the two years then ended is as follows:

 

    Number of   Weighted - Average
    Shares   Exercise Price
                     
Outstanding at June 30, 2013       3,165,653     $ 0.42    
Granted       —       $ 0.00    
Forfeited       (109,153 )   $ 0.00    
Outstanding at June 30, 2014       3,056,500     $ 0.42    
Granted       —       $ 0.00    
Forfeited       (536,500 )   $ 0.42    
Outstanding at June 30, 2015       2,520,000     $ 0.42    
Exercisable at June 30, 2015       2,520,000     $ 0.42    

 

The Company has agreements with certain employees that provide for five years of annual grants of options, on each employment anniversary date, to purchase shares of the Company’s common stock. The option price is determined based on the market price on the date of grant, the options vest one year from the date of grant, and the options expire five years after vesting. The Company granted 2,500,000 options under this arrangement during fiscal year 2013. There were no options granted in 2015 and 2014 under this agreement. The Company recognized no stock-based compensation expense related to stock options during the years ended June 30, 2015 and 2014, respectively. As of June 30, 2015, there was no remaining unrecognized compensation costs related to stock options. Based upon the trading value of the common shares, there was no intrinsic value of these options as of June 30, 2015.

 

The fair value of each option award is estimated on the date of grant using the Black-Scholes option pricing model that uses the weighted-average assumptions noted in the following table. The risk-free rate for periods within the contractual life of the options is based on the U. S. Treasury yield in effect at the time of the grant. Volatility was based on the historical volatility of the Company’s common stock. The Company estimated the expected life of options based on historical experience and other averaging methods.

                 

Additional information regarding options outstanding as of June 30, 2015 is as follows:

 

Options Outstanding at June 30, 2015   Options Exercisable at June 30, 2015
  Range of Exercise       Number of Shares Outstanding       Weighted Average Remaining Contractual Life (Years)       Weighted Average Exercise Price       Number of Shares Exercisable       Weighted Average Exercise Price  
                                             
     $0.13 - $1.45       2,520,000       4.64     $ 0.42       2,520,000     $ 4.64  
          2,520,000                       2,520,000          

 

Stock Warrant

 

A summary of stock warrants as of June 30, 2015 and for the two years then ended is as follows:

 

    Number of Shares     Weighted - Average Exercise Price
                   
Outstanding at June 30, 2013       275,000   $ 2.0    
Granted       —            
Forfeited       (275,000 ) $ 2.0    
Outstanding at June 30, 2014       —            
Granted       —            
Forfeited       —            
Outstanding at June 30, 2015       —            

 

The Company issued 275,000 warrants related to notes payable issued in fiscal year 2009. The warrants are fully vested as of the issue date, and were exercisable at $2.00 per share. The weighted average contractual life of the warrants was 5 years, and the warrants expired in March 2014 and May 2014.