The Company’s Common Stock activity for the nine months ended March 31, 2019 is as follows:

Common Stock

Shares Issued for Services – During the period ended March 31, 2019, the Company issued 39,998 shares of Common Stock to vendors for services rendered with a fair value of $388,000. These shares of Common Stock were valued based on the market value of the Company’s stock price at the grant date or the date the Company entered into the agreement related to the issuance.

Shares Issued Upon Issuance of Convertible Note – In February 2019, the Company granted a note holder 16,667 shares of Common Stock with a fair value of $128,000 as an inducement for the issuance of a note payable. For additional information, please see Note 6, Convertible Notes Payable, to these unaudited consolidated financial statements.

Stock Options

Effective October 16, 2014, the Company adopted the 2014 Stock Option Plan (the “Plan”) under the administration of the board of directors to retain the services of valued key employees and consultants of the Company.

At its discretion, the Company grants share option awards to certain employees and non-employees, as defined by ASC 718, Compensation—Stock Compensation, under the 204 Stock Option Plan (the “Plan”) and accounts for its share-based compensation in accordance with ASC 718.

A summary of option activity for the three months ended March 31, 2019 is presented below.

During the three months ended March 31, 2019, the Company granted stock options to employees and consultants to purchase a total of 160,667 shares of Common Stock for services to be rendered. The options have an average exercise price of $7.84 per share, expire in five years, and either (i) vest 50% on the grant date and the remaining 50% on the 12-month anniversary of the grant date or (ii) vest in three equal installments during the three years from the grant date. The total fair value of these options at the grant date was approximately $1,170,000 using the Black-Scholes Option pricing model.

The total stock compensation expense recognized relating to vesting of stock options for the three months ended March 31, 2019 amounted to $463,000. As of March 31, 2019, total unrecognized stock-based compensation expense was $4.6 million, which is expected to be recognized as part of operating expense through February 2021.

The fair value of share option award is estimated using the Black-Scholes option pricing method based on the following weighted-average assumptions:

The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of measurement corresponding with the expected term of the share option award; the expected term represents the weighted-average period of time that share option awards granted are expected to be outstanding giving consideration to vesting schedules and historical participant exercise behavior; the expected volatility is based upon historical volatility of the Company’s Common Stock; and the expected dividend yield is based on the fact that the Company has not paid dividends in the past and does not expect to pay dividends in the future.

Warrants

The Company has the following warrants outstanding as of March 31, 2019, all of which are exercisable:

During the three months ended March 31, 2019, a total of 161,969 warrants were exercised in cashless exercises for 148,714 shares of common stock at a weighted average exercise price of $1.05.