7. STOCK PURCHASE OPTIONS AND WARRANTS

3 Months Ended

Sep. 30, 2019

Share-based Payment Arrangement, Noncash Expense [Abstract]

7. STOCK PURCHASE OPTIONS AND WARRANTS

The Board of Directors on June 10, 2009 approved the 2009 Long-Term Stock Incentive Plan.  The purpose of the 2009 Long-term Stock Incentive Plan is to advance the interests of the Company by encouraging and enabling acquisition of a financial interest in the Company by employees and other key individuals.  The 2009 Long-Term Stock Incentive Plan is intended to aid the Company in attracting and retaining key employees, to stimulate the efforts of such individuals and to strengthen their desire to remain with the Company.  A maximum of 1,500,000 shares of the Company’s Common Stock is reserved for issuance under stock options to be issued under the 2009 Long-Term Stock Incentive Plan.  The Plan permits the grant of incentive stock options, nonstatutory stock options and restricted stock awards.  The 2009 Long-Term Stock Incentive Plan is administered by the Board of Directors or, at its direction, a Compensation Committee comprised of officers of the Company.

Stock Purchase Options

During the three months ended September 30, 2019, the Company did not issue any stock purchase options.  

During the three months ended September 30, 2018, the Company did not issue any stock purchase options, and 25,000 expired.

The following table summarizes the changes in options outstanding of the Company during the three months ended September 30, 2019.

Date Issued	Number of Options		Weighted Average Exercise Price		Weighted Average Grant Date Fair Value		Expiration Date (yrs)		Value if Exercised
Balance June 30, 2019		500,000	$	0.05	$	0.17		3.00	$	25,000
Granted		-		-		-		-		-
Exercised		-		-		-		-		-
Cancelled/Expired		-		-		-		-		-
Outstanding as of September 30, 2019		500,000	$	0.05	$	0.16		2.75	$	25,000

During the three months ended September 30, 2019, the Company issued three-year warrants to purchase a total of 100,000 with an exercise price of $0.10 per shares into the Company’s Common Stock, in conjunction with issuance of a promissory notes, valued at $648. The Company also issue 75,600,000 five-year warrants with exercise prices of $0.02 and $0.05 per shares into the Company’s Common Stock, in conjunction with issuance of 17 private placements, valued at $755,117. The warrants are considered derivative liabilities under ASC 815-40 under the Company’s sequencing policy and were valued using the multinomial lattice model.

The following table presents the assumptions used to estimate the fair values of the stock warrants and options granted:

	September 30, 2019
Expected volatility		149-222%
Expected dividends		0%
Expected term		0-5 Years
Risk-free interest rate		1.32-1.97%

The following table summarizes the changes in warrants outstanding issued to employees and non-employees of the Company during the three months ended September 30, 2019.

	Number of			Weighted Average		Weighted Average		Expiration Date
	Warrants			Exercise Price		Grant Date Fair Value		(yrs)		Value if Exercised
Balance as of June 30, 2019		41,900,718		$	0.15	$	0.36		3.43	$	6,308,991
Granted		75,700,000			0.04		0.01		5.00		2,656,000
Exercised		-			-		-		-		-
Cancelled/Expired		(1,115,000	)		0.36		-		-		(403,250	)
Outstanding as of September 30, 2019		116,485,718		$	0.07	$	0.13		4.34	$	8,561,741