From time to time, the Company issues warrants to purchase its common stock. These warrants are valued using the Black-Scholes model and using the volatility, market price, exercise price, risk-free interest rate and dividend yield appropriate at the date the warrants were issued.

On May 15, 2017, Jerash Holdings issued warrants to the designees of the placement agent in the above private placement to purchase 48,600 units, with each unit consisting of one share of Jerash Holdings common stock and one warrant (with each such warrant being immediately exercisable for one-tenth of one share of its common stock at an exercise price of $6.25 per share for a period of five years from the issuance date), at an exercise price of $5.50 per unit. The fair value of these units was $107,990 and was included in offering costs of the private placement in May 2017.

On May 15, 2017, Jerash Holdings also issued a five-year warrant to purchase up to 50,000 shares of its common stock pursuant to a letter agreement with one of its board advisors. The warrant has an exercise price of $5.00 per share and may be converted by means of “cashless” exercise during the term of the warrant. This warrant may be exercised any time after issuance through and including the five-year anniversary of the issuance date. Stock-based compensation expense was recognized during the quarter ended June 30, 2017 was $116,578

for this warrant. No compensation expense was recognized in connection with this warrant during the three and six months ended September 30, 2018

On August 1, 2017, warrants to purchase 18,000 units became issuable by Jerash Holdings to the designees of the placement agent in the above private placement, with each unit consisting of one share of Jerash Holdings common stock and one warrant (with each such warrant being immediately exercisable for one-tenth of one share of its common stock at an exercise price of $6.25 per share for a period of five years from the issuance date), at an exercise price of $5.50 per unit. The fair value of these units was $43,122 and was included in offering costs of the private placement in August 2017.

On September 27, 2017, warrants to purchase 4,500 units became issuable by Jerash Holdings to the designees of the placement agent in the above private placement, with each unit consisting of one share of Jerash Holdings common stock and one warrant (with each such warrant being immediately exercisable for one-tenth of one share of its common stock at an exercise price of $6.25 per share for a period of five years from the issuance date), at an exercise price of $5.50 per unit. The fair value of these units was $10,814 and was included in offering costs of the private placement in September 2017.

Simultaneous with the closing of the IPO, the Company issued to the underwriter and its affiliates warrants to purchase 57,200 shares of common stock (“IPO Underwriter Warrants”) at an exercise price of $8.75 per share with an expiration date of May 2, 2023. The shares underlying the IPO Underwriter Warrants were subject to a 180-day lock-up.

During the period ended September 30, 2018, all of the outstanding warrants were fully vested and exercisable other than the 57,200 IPO Underwriter Warrants noted above subject to a 180-day lock-up.

	Common Stock Warrants September 30, 2018
Expected term (in years)		5.0
Risk-free interest rate (%)		1.8% - 2.8	%
Expected volatility (%)		50.3% - 52.2	%
Dividend yield (%)		0.0	%

	Shares		Weighted Average Exercise Price
Warrants outstanding at March 31, 2018		207,210	$	5.69
Granted (Underwriter Warrants for the IPO)		57,200	$	8.75
Exercised		-		-
Cancelled		-		-
Warrants outstanding at September 30, 2018		264,410	$	6.35

On March 21, 2018 the Board of Directors adopted the Jerash Holdings (US), Inc. 2018 Stock Incentive Plan (the “Plan”), pursuant to which the Company may grant various types of equity awards

. 1,484,250 shares of common stock were reserved for issuance under the Plan. On April 9, 2018, the

Board of Directors

approved the issuance of 989,500 nonqualified stock options under the Plan in accordance with the Plan at an exercise price of $7.00 per share, and a term of five years.

As of September 30, 2018, all of these outstanding stock options were

fully vested and exercisable.

The fair value of the options granted on April 9, 2018 was estimated as of the grant date using the Black-Scholes model with the following assumptions.

	Stock Options September 30, 2018
Expected term (in years)		5.0
Risk-free interest rate (%)		2.6	%
Expected volatility (%)		50.3	%
Dividend yield (%)		0.0	%

On August 3, 2018,

the Board of Directors granted the Company’s Chief Financial Officer and Head of U.S. Operations a total of

150,000 nonqualified stock options under the Plan in accordance with the Plan at an exercise price of $6.12

per share and a term of ten years. The options vest in three equal six-month installments, with the first one-third having vested on August 3, 2018 and the remaining amounts vesting on February 3

and August 3, 2019.

The fair value of the options granted on August 3, 2018 was estimated as of the grant date using the Black-Scholes model with the following assumptions.

	Stock Options September 30, 2018
Expected term (in years)		10.0
Risk-free interest rate (%)		2.95	%
Expected volatility (%)		50.3	%
Dividend yield (%)		0.0	%

	Shares		Weighted Average Exercise Price
Stock options outstanding at March 31, 2018		-		-
Granted		1,139,500	$	6.88
Exercised		-		-
Cancelled		-		-
Stock options outstanding at September 30, 2018		1,139,500	$	6.88

Total expense related to the stock options issued was $193,954 for the three months ended September 30, 2018 and $3,399,934 for the six months ended September 30, 2018. There were $387,909 of unrecognized compensation costs at September 30, 2018

relating to unvested awards.