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NOTE 6 - STOCK OPTIONS AND WARRANTS

12 Months Ended

Jun. 30, 2016

Disclosure Text Block Supplement [Abstract]

Shareholders' Equity and Share-based Payments [Text Block]

NOTE 6 – STOCK OPTIONS AND WARRANTS

General Option Information

On July 6, 2011, the Board of Directors cancelled the “2004 Non-Employee Directors’ Stock Incentive Plan” and approved the "Directors’ 2011 Stock Option and Award Plan”. Under the 2011 Plan, a total of 3,300,000 shares are authorized for issuance.

The Company also maintained the 2005 Stock Option and Award Plan, which was previously approved by shareholders, for the purpose of granting option awards to its employees and consultants. This plan had a 10 year life and expired July 2015.

On August 10, 2015, the Board of Directors cancelled the “Directors’ 2011 Stock Option and Award Plan” as all options under this plan had been granted and adopted the “2015 Omnibus Stock Option and Award Plan” which contains provisions for up to 3,000,000 stock options to be granted to employees, consultants and directors. The 2015 Omnibus Stock Option and Award Plan did not obtain the necessary shareholder approval in the Company’s annual proxy process, resulting in certain U.S. Internal Revenue Service provisions to be ineffective.

Prior Issuances of options

During the year ended June 30, 2015, 100,000 options were granted to a consultant pursuant to a consulting agreement. Additionally 140,000 options related to this transaction vested (20,000 options monthly May – November 2014 at $0.10).

On December 1, 2014, 480,000 options were granted to the Company’s Chief Executive Officer (then our Chief Operating Officer) as part of his employment offer. The options have a strike price of $0.10, vest December 1, 2015 and expire December 1, 2020.

On January 21, 2015, 50,000 options were granted to the Company’s Chief Financial Officer as part of her employment offer. The options have a strike price of $0.10, vest ratably January 21, 2015 to December 1, 2015 and expire December 1, 2020.

Year to date expense related to these options is $23,706 as of June 30, 2015.

Option issuances and vesting during the period ending June 30, 2016

In the October 2015 Board meeting, the Board granted all non-executive Board members 100,000 options, with the audit committee chair receiving an additional 50,000 options, for Board services rendered for the fiscal year ended June 30, 2015. The options have a strike price of $0.10, vest at the end of the Board term on December 3, 2015 and expire December 3, 2017.

On December 1, 2015, 480,000 options were granted to the Company’s Chief Executive Officer (then our Chief Operating Officer) as part of his employment offer. The options have a strike price of $0.10, vest December 1, 2016 and expire December 1, 2020.

On January 19, 2016, the Board granted all non-executive Board members 100,000 options, with the audit committee chair receiving an additional 50,000 options, for Board services rendered for the Board term ending December 2016. The options have a strike price of $0.10, vest at the end of the Board term in December 2016 and expire December 2019.

On January 19, 2016, 50,000 options were granted to the Company’s Chief Financial Officer as part of renewal of her employment agreement. The options have a strike price of $0.10, vest ratably January 21, 2016 to December 1, 2016 and expire December 1, 2019. In addition to the option renewal $550 a month in health insurance reimbursement was included in the renewal. All other terms remain the same.

Year to date expense related to these options is $47,730 as of June 30, 2016.

As of June 30, 2016, there was $15,077 of unrecognized stock-based compensation expense related to stock options that will be recognized over the vest period (December 2016) of the underlying option.

We estimated the fair value of the stock options above at the grant date based on the following weighted average assumptions:

Risk-free interest rate	1.077	%
Expected life	2.0 – 4.5	years
Expected volatility	167.37 – 113.50	%
Dividend yield	0.00	%

A summary of the status of our outstanding stock options as of June 30, 2016 and June 30, 2015 and changes during the periods then ended is presented below:

	June 30, 2016							June 30, 2015
			Weight Average		Intrinsic						Weight Average			Intrinsic
	Shares		Exercise Price		Value			Shares			Exercise Price			Value
Outstanding beginning of period		2,270,000	$	0.14					1,754,000		$	0.17
Granted		1,530,000	$	0.10					670,000		$	0.10
Expired/Cancelled		-	$	0.00					(154,000	)	$	(0.29	)
Exercised		-	$	0.00					-		$	0.00
Outstanding end of period		3,800,000	$	0.13		$	-		2,270,000		$	0.14			$	-
Exercisable		3,070,000	$	0.13		$	-		1,752,500		$	0.16			$	-

The following table summarizes the range of outstanding and exercisable options as of June 30, 2016:

		Outstanding						Exercisable
Range of Exercise Prices		Number Outstanding at June 30, 2016		Weighted Average Remaining Contractual Life		Weighted Average Exercise Price		Number Exercisable at June 30, 2016		Weighted Average Remaining Contractual Life
$	0.08		150,000		5.67	$	0.08		150,000		5.67
$	0.10		2,200,000		3.09	$	0.10		1,470,000		3.09
$	0.17		1,450,000		4.67	$	0.17		1,450,000		4.67
			3,800,000						3,070,000

General Warrant Information

In September 2013, the Company obtained an extension on the remaining $100,000 secured convertible promissory note that was issued in the private placement that closed in a prior year. In exchange for the extension, the note holder received 500,000 common stock warrants and $6,500 in accrued interest and fees. The common stock warrants expire three years from the date of issuance, are exercisable at $0.13 per share, and vest on the next date the value of Amerityre common stock reaches $0.25 per share. As of June 30, 2016 the warrants have not vested. The related note was paid off as of June 30, 2014.