The Company periodically issues stock options and warrants to employees and non-employees in capital raising transactions, for services and for financing costs. Options vest and expire according to terms established at the grant date.

Options

Options vest according to the terms of the specific grant and expire from 2 to 10 years from date of grant. The weighted-average remaining contractual life of employee and non-employee options outstanding at September 30, 2019 was 5.0 years. Stock option activity for the period January 1, 2019 up to September 30, 2019, was as follows:

The weighted average exercise prices, remaining contractual lives for options granted, exercisable, and expected to vest as of September 30, 2019 were as follows:

During the nine-month period ending September 30, 2019, and pursuant to the Company’s Board Compensation policy approved by the Board September 19, 2015, the Company granted options to purchase 4,687,500 shares of common stock to members of the Company’s Board of Directors. The options are exercisable at $0.08 share, vest monthly over a twelve-month period, and expire ten years from the date granted. Total fair value of these options at grant date was $328,000 using the Black-Scholes Option Pricing model with the following assumptions: life of 5 years; risk free interest rate of 2.5%; volatility of 122% and dividend yield of 0%.

During the nine-month periods ended September 30, 2019 and 2018, the Company recognized compensation costs based on the fair value of options that vested of $265,000 and $340,000 respectively. During the three-month periods ended September 30, 2019 and 2018, the Company recognized compensation costs based on the fair value of options that vested of $82,000 and $95,000 respectively.

At September 30, 2019, the Company’s closing stock price was $0.10 per share. The aggregate intrinsic value of the options outstanding at September 30, 2019 was $453,000. Future unamortized compensation expense on the unvested outstanding options at September 30, 2019 is approximately $82,000 to be recognized through December 2019.

Warrants

The following table summarizes certain information about the Company’s stock purchase warrants activity for the period starting January 1, 2019 up to September 30, 2019.

The weighted average exercise prices, remaining contractual lives for warrants granted, exercisable, and expected to vest as of September 30, 2019 were as follows:

In the nine-month period ending September 30, 2019, pursuant to terms of convertible notes issued, the Company granted warrants to purchase 10,823,062 shares of common stock with an exercise price of $.05 to $0.18 per share, vesting immediately upon grant and expiring one year from the date of grant (see Note 5, above).

In the nine-month period ending September 30, 2019, the Company issued warrants to purchase 99,999 shares of common stock with an exercise price of $0.24 per share, vesting over three months and expiring two years from the date of grant as compensation under an independent consulting agreement. Total fair value of the warrants at grant date was $17,000 using the Black-Scholes model with the following assumptions: life of 2.3 years; risk free interest rate of 1.75%; volatility of 153% and dividend yield of 0%.

During the nine-month period ended September 30, 2019, warrants to acquire 3,501,493 shares of common stock were exercised resulting in net proceeds to the Company of $221,000.

At September 30, 2019, the aggregate intrinsic value of the warrants outstanding was $1,060,000.