Annual report pursuant to Section 13 and 15(d)

Warrants (Tables)

Warrants (Tables)

12 Months Ended

Dec. 31, 2015

The following is a summary of activity in the number of warrants outstanding to purchase the Company’s common stock for the year ended December 31, 2015 (in thousands):

	Warrants accounted for as:							Warrants accounted for as:
	Equity							Liabilities
	January 2012 warrants		March 2013 warrants		April 2013 warrants			February 2012 warrants		August 2013 warrants			October 2013 warrants			October 2013 Series A warrants			January 2014 warrants			Total

Outstanding, January 1, 2014		-		-		-			-		-			-			-			-			-
Warrants acquired in merger with Biozone		650		455		1,864			1,000		10,000			200			7,000			-			21,169
Warrants issued		-		-		-			-		-			-			-			5,500			5,500
Outstanding, December 31, 2014		650		455		1,864			1,000		10,000			200			7,000			5,500			26,169

Warrants exercised		-		-		(364	)		-		(10,000	)		(200	)		(6,325	)		(1,500	)		(18,389	)
Outstanding, December 31, 2015		650		455		1,500			1,000		-			-			675			4,000			8,280

Expiration date	January 11, 2016		March 1, 2016		April 25, 2018			February 28, 2016		August 26, 2023			October 18, 2018			October 24, 2023			January 16, 2024

Fair value of each option award

The fair value of the warrants classified as liabilities is estimated using the Black-Scholes option-pricing model with the following inputs as of December 31, 2015:

	February 2012 warrants			August 2013 warrants			October 2013 warrants			October 2013 warrants			January 2014 warrants

Strike price	$	0.60		$	0.40		$	0.50		$	0.50		$	0.50

Expected term (years)		0.2			7.7			2.8			7.8			8.0
Cumulative volatility %		81	%		101	%		78	%		101	%		100	%
Risk-free rate %		0.49	%		2.18	%		1.26	%		2.14	%		2.15	%

- Definition

Tabular disclosure of warrants or rights issued. Warrants and rights outstanding are derivative securities that give the holder the right to purchase securities (usually equity) from the issuer at a specific price within a certain time frame. Warrants are often included in a new debt issue to entice investors by a higher return potential. The main difference between warrants and call options is that warrants are issued and guaranteed by the company, whereas options are exchange instruments and are not issued by the company. Also, the lifetime of a warrant is often measured in years, while the lifetime of a typical option is measured in months. Disclose the title of issue of securities called for by warrants and rights outstanding, the aggregate amount of securities called for by warrants and rights outstanding, the date from which the warrants or rights are exercisable, and the price at which the warrant or right is exercisable.

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