Stockholders' Equity

3 Months Ended

Oct. 31, 2016

Stockholders' Equity Note [Abstract]

Stockholders' Equity

5. Stockholders’ Equity

Common Stock

During the three months ended October 31, 2016 the Company did not issue any shares of Common Stock. 

Stock Options

As required by the Stock Compensation Topic, ASC 718, the Company measures and recognizes compensation expense for all share based payment awards made to the officers and directors based on estimated fair values at the grant date and over the requisite service period.

On October 6, 2016, the Company granted options to purchase a total of 50,000 shares of Common Stock exercisable on a cashless basis to two employees. These options all have an exercise price of $10.00 and a term of 10 years. The options vest as follows: 1,388 shares vest upon each of the first through twentieth month anniversaries of the grant date; 1,390 shares vest upon each of the twenty-first through thirty-sixth month anniversaries of the grant date. The Company has valued these options using the Black-Scholes option pricing model which resulted in a fair market value of $425,000, of which $49,261 has been recognized as expense for the three months ended October 31, 2016.

The Company also recognized stock based compensation expense of $131,706 in connection with vested options granted in prior periods. 

The assumptions used in the valuation for all of the options granted for the three months ended October 31, 2016 and 2015 were as follows:

	2016			2015
Market value of stock on measurement date	$	7.52 to 8.71		$	7.00
Risk-free interest rate		0.88-1.75	%		2.05	%
Dividend yield		0	%		0	%
Volatility factor		114-348	%		373	%
Term		3.03-10.00 years			10 years

Stock option activity for three months ended October 31, 2016 and is presented in the table below:

	Number of Shares		Weighted- average Exercise Price		Weighted- average Remaining Contractual Term (years)		Aggregate Intrinsic Value
Outstanding at July 31, 2016		4,635,000		8.79		7.39		2,731,250
Granted		50,000		10.00
Outstanding at October 31, 2016		4,685,000		8.80		7.16	$	2,053,125
Exercisable at October 31, 2016		4,285,833		8.37		7.56	$	2,053,125

A summary of the status of the Company’s non-vested options as of October 31, 2016 and changes during the three months ended October 31, 2016 are presented below:

Non-vested options	Number of Options		Weighted Average Grant Date Fair Value
Non-vested at July 31, 2016		90,833	$	7.27
Granted		50,000		8.50
Vested		(4,167)		5.64
Non-vested at October 31, 2016		136,666	$	7.83

At October 31, 2016, there was $681,767 of unrecognized compensation costs related to non-vested stock options.

Warrants

Warrant activity for the three months ended October 31, 2016 is presented in the table below:

	Number of Shares		Weighted- average Exercise Price		Weighted- average Remaining Contractual Term (years)		Aggregate Intrinsic Value
Outstanding at July 31, 2016		1,215,385	$	17.90		2.86	$	-
Expired		(63,100)		50.00
Outstanding at October 31, 2016		1,152,285	$	16.15		2.76	$	-
Exercisable at October 31, 2016		427,285	$	18.09		5.46	$	-