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<div> NOTE 5. STOCKHOLDERS’ EQUITY At June 30, 2016, the Company had a total of 150,000,000 shares of capital stock authorized for issuance, consisting of 145,000,000 shares of Common Stock, par value $0.001 per share, and 5,000,000 shares of Preferred Stock, par value $0.001 per share. At June 30, 2016, 60,429,405 shares of Common Stock were outstanding.  Additionally, 15,652 shares of Series C Preferred Stock were outstanding, which are convertible into 2,670,990 shares of Common Stock. At June 30, 2016, 8,742,453 shares of Common Stock were reserved for issuance upon exercise of options and vesting of restricted stock units granted or available for grant under Arrowhead’s 2004 Equity Incentive Plan and 2013 Incentive Plan, as well as for inducement grants made to new employees. The Preferred Stock is convertible to Common Stock by its holder at its stated conversion price, though it is not convertible to the extent the holder would beneficially own more than 9.99% of the number of shares of outstanding Common Stock immediately after the conversion.  The holders of Preferred Stock are eligible to vote with the Common Stock of the Company on an as-converted basis, but only to the extent they are eligible for conversion without exceeding the 9.99% ownership limitation. The Preferred Stock does not carry a coupon, but it is entitled to receive dividends on a pari passu basis with Common Stock, when and if declared.  In any liquidation or dissolution of the Company, the holders of Preferred Stock are entitled to participate in the distribution of the assets, to the extent legally available for distribution, on a pari passu basis with the Common Stock. The following table summarizes information about warrants outstanding at June 30, 2016:   <div> <table border="0" cellspacing="0" cellpadding="0" align="center" style="border-collapse:collapse; width:54%;"> <tr> <td colspan="3" valign="bottom" style="width:58.84%; border-bottom:solid 0.75pt #000000;"> Exercise prices</td> <td valign="top" style="width:1.38%;">  </td> <td colspan="2" valign="bottom" style="padding-left:0.7pt;padding-Right:0.7pt;padding-Top:0pt;padding-Bottom:0pt;width:17.8%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-size:8pt;font-family:Times New Roman;font-style:normal;text-transform:none;font-variant: normal;">Number of  Warrants</td> <td valign="bottom" style="width:1.44%;">  </td> <td valign="bottom" style="width:1.44%;"> <p style="text-align:center;margin-top:0pt;margin-bottom:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-style:normal;font-family:Times New Roman;font-size:10pt;text-transform:none;font-variant: normal;"> </td> <td colspan="2" valign="bottom" style="padding-left:0.7pt;padding-Right:0.7pt;padding-Top:0pt;padding-Bottom:0pt;width:17.78%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-size:8pt;font-family:Times New Roman;font-style:normal;text-transform:none;font-variant: normal;">Remaining Life in Years</td> <td valign="bottom" style="width:1.32%;">  </td> </tr> <tr> <td valign="top" bgcolor="#CFF0FC" style="width:1.96%; border-top:solid 0.75pt #000000;"> $</td> <td valign="top" bgcolor="#CFF0FC" style="width:8.56%; border-top:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:12pt;;text-indent:-12pt;;font-size:10pt;font-family:Times New Roman;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">70.60</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:48.3%; border-top:solid 0.75pt #000000;">  </td> <td valign="top" bgcolor="#CFF0FC" style="width:1.38%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.38%; border-top:solid 0.75pt #000000;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:16.42%; border-top:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">94,897</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.44%;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.44%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.36%; border-top:solid 0.75pt #000000;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:16.42%; border-top:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">0.9</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.32%;white-space:nowrap;">  </td> </tr> <tr> <td valign="top" style="width:1.96%;"> $</td> <td valign="top" style="width:8.56%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:12pt;;text-indent:-12pt;;font-size:10pt;font-family:Times New Roman;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">4.16</td> <td valign="bottom" style="width:48.3%;">  </td> <td valign="top" style="width:1.38%;">  </td> <td valign="bottom" style="width:1.38%;">  </td> <td valign="bottom" style="width:16.42%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">1,000</td> <td valign="bottom" style="width:1.44%;white-space:nowrap;">  </td> <td valign="bottom" style="width:1.44%;">  </td> <td valign="bottom" style="width:1.36%;">  </td> <td valign="bottom" style="width:16.42%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">0.5</td> <td valign="bottom" style="width:1.32%;white-space:nowrap;">  </td> </tr> <tr> <td valign="top" bgcolor="#CFF0FC" style="width:1.96%;"> $</td> <td valign="top" bgcolor="#CFF0FC" style="width:8.56%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:12pt;;text-indent:-12pt;;font-size:10pt;font-family:Times New Roman;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">3.25</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:48.3%;">  </td> <td valign="top" bgcolor="#CFF0FC" style="width:1.38%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.38%;">   </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:16.42%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">307,173 </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.44%;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.44%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.36%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:16.42%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">0.1</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.32%;white-space:nowrap;">  </td> </tr> <tr> <td valign="top" style="width:1.96%;"> $</td> <td valign="top" style="width:8.56%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:12pt;;text-indent:-12pt;;font-size:10pt;font-family:Times New Roman;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">2.12</td> <td valign="bottom" style="width:48.3%;">  </td> <td valign="top" style="width:1.38%;">  </td> <td valign="bottom" style="width:1.38%;">  </td> <td valign="bottom" style="width:16.42%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">75,000</td> <td valign="bottom" style="width:1.44%;white-space:nowrap;">  </td> <td valign="bottom" style="width:1.44%;">  </td> <td valign="bottom" style="width:1.36%;">  </td> <td valign="bottom" style="width:16.42%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">1.5</td> <td valign="bottom" style="width:1.32%;white-space:nowrap;">  </td> </tr> <tr> <td valign="top" bgcolor="#CFF0FC" style="width:1.96%;"> $</td> <td valign="top" bgcolor="#CFF0FC" style="width:8.56%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:12pt;;text-indent:-12pt;;font-size:10pt;font-family:Times New Roman;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">1.83</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:48.3%;">  </td> <td valign="top" bgcolor="#CFF0FC" style="width:1.38%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.38%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:16.42%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">277,284</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.44%;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.44%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.36%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:16.42%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">1.5</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.32%;white-space:nowrap;">  </td> </tr> <tr> <td valign="top" style="width:1.96%; border-bottom:solid 0.75pt transparent;"> $</td> <td valign="top" style="width:8.56%; border-bottom:solid 0.75pt transparent;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:12pt;;text-indent:-12pt;;font-size:10pt;font-family:Times New Roman;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">7.14</td> <td valign="bottom" style="width:48.3%; border-bottom:solid 0.75pt transparent;">  </td> <td valign="top" style="width:1.38%; border-bottom:solid 0.75pt transparent;">  </td> <td valign="bottom" style="width:1.38%; border-bottom:solid 0.75pt #000000;">  </td> <td valign="bottom" style="width:16.42%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">80,000</td> <td valign="bottom" style="width:1.44%; border-bottom:solid 0.75pt transparent;white-space:nowrap;">  </td> <td valign="bottom" style="width:1.44%; border-bottom:solid 0.75pt transparent;">  </td> <td valign="bottom" style="width:1.36%; border-bottom:solid 0.75pt transparent;">  </td> <td valign="bottom" style="width:16.42%; border-bottom:solid 0.75pt transparent;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">2.0</td> <td valign="bottom" style="width:1.32%; border-bottom:solid 0.75pt transparent;white-space:nowrap;">  </td> </tr> <tr> <td colspan="3" valign="top" bgcolor="#CFF0FC" style="width:58.84%; border-bottom:double 2.5pt transparent;"> Total warrants outstanding</td> <td valign="top" bgcolor="#CFF0FC" style="width:1.38%; border-bottom:double 2.5pt transparent;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.38%; border-top:solid 0.75pt #000000; border-bottom:double 2.5pt #000000;">   </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:16.42%; border-top:solid 0.75pt #000000; border-bottom:double 2.5pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">835,354 </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.44%; border-bottom:double 2.5pt transparent;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.44%; border-bottom:double 2.5pt transparent;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.36%; border-bottom:double 2.5pt transparent;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:16.42%; border-bottom:double 2.5pt transparent;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.32%; border-bottom:double 2.5pt transparent;white-space:nowrap;">  </td> </tr> </table></div>  </div>

<div> NOTE 6. COMMITMENTS AND CONTINGENCIES Leases The Company leases approximately 8,500 square feet of office space for its corporate headquarters in Pasadena, California.  The lease will expire in September 2019.   Rental costs are approximately $24,000 per month, increasing approximately 3% annually.       On January 8, 2016, the Company entered into a new lease for a Madison, Wisconsin research facility.  The 10-year office building lease between the Company’s subsidiary, Arrowhead Madison Inc., and University Research Park, Incorporated is for approximately 60,000 square feet of office and laboratory space located at 502 South Rosa Road, Madison, Wisconsin. This lease will replace the Company’s current research facility lease, also with University Research Park, Incorporated for property located at 465 Science Drive, Madison Wisconsin.  The larger facility is designed to accommodate increased research and development personnel for the Company’s expanding pipeline of current and future drug candidates.       The initial term of the lease commenced on January 1, 2016 with expected occupancy in late 2016, after certain leasehold improvements have been completed. The lease payments and payments against a note payable for a tenant improvement allowance, which begin on October 1, 2016, will total approximately $15.4 million over the initial 10-year term. The Company also estimates payments for the Company’s pro rata share of certain real estate taxes, operating expenses and common area maintenance expenses to be approximately $0.9 million for the first year of the lease, and these payments will continue throughout the initial 10-year term. The Company expects to pay approximately $7.3 million for leasehold improvements, net of tenant improvement allowances which are accounted for as deferred rent and a note payable on the Company’s Consolidated Balance Sheet.  Pursuant to the lease, within six months of the expiration of the initial 10-year term, the Company has the option to extend the lease for up to two additional five-year terms, with certain annual increases in base rent. Additionally, on January 8, 2016 and in conjunction with signing the new lease agreement as discussed above, the Company entered into an amendment to the Company’s current research facility lease for property located at 465 Science Drive, Madison, Wisconsin with University Research Park, Incorporated that provides for an early termination of such lease effective on October 31, 2016. Current rental expense is approximately $26,000. Other monthly rental expenses include common area maintenance and real estate taxes totaling approximately $20,000 per month. Utilities costs are approximately $18,000 per month. Total monthly costs are approximately $83,000 per month, including monthly payments recorded under a capital lease of approximately $19,000.   The Company leased additional research facility space in Middleton, Wisconsin, and this space is leased through December 2016.  Monthly rental expense for the additional space is approximately $13,000.  Other monthly rental expenses include common area maintenance and real estate taxes totaling approximately $4,000 per month. Facility rent expense for the three and nine months ended June 30, 2016 was $232,000 and $659,000, respectively.  Facility rent expense for the three and nine months ended June 30, 2015 was $182,000 and $544,000, respectively. As of June 30, 2016, future minimum lease payments due in fiscal years under capitalized leases are as follows:   <div> <table border="0" cellspacing="0" cellpadding="0" align="center" style="border-collapse:collapse; width:68%;"> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:82.3%;"> 2016 (remainder of)</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.56%;"> <p style="margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">$</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:14.68%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">57,105</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.44%;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" style="width:82.3%;"> 2017 </td> <td valign="bottom" style="width:1.56%;">  </td> <td valign="bottom" style="width:14.68%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">228,420</td> <td valign="bottom" style="width:1.44%;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:82.3%;"> 2018 </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.56%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:14.68%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">228,420</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.44%;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" style="width:82.3%;"> 2019 </td> <td valign="bottom" style="width:1.56%;">  </td> <td valign="bottom" style="width:14.68%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">95,175</td> <td valign="bottom" style="width:1.44%;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:82.3%;"> 2020 </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.56%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:14.68%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">-</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.44%;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" style="width:82.3%;"> 2021 and thereafter</td> <td valign="bottom" style="width:1.56%;">  </td> <td valign="bottom" style="width:14.68%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">-</td> <td valign="bottom" style="width:1.44%;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:82.3%; border-bottom:solid 0.75pt transparent;"> Less interest</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.56%; border-bottom:solid 0.75pt #000000;">   </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:14.68%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">(13,605 </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.44%; border-bottom:solid 0.75pt transparent;white-space:nowrap;"> <p style="margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">)</td> </tr> <tr> <td valign="bottom" style="width:82.3%;"> Principal</td> <td valign="bottom" style="width:1.56%;">  </td> <td valign="bottom" style="width:14.68%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">595,515</td> <td valign="bottom" style="width:1.44%;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:82.3%; border-bottom:solid 0.75pt transparent;"> Less current portion</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.56%; border-bottom:solid 0.75pt #000000;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:14.68%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">(216,653 </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.44%; border-bottom:solid 0.75pt transparent;white-space:nowrap;"> <p style="margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">)</td> </tr> <tr> <td valign="bottom" style="width:82.3%; border-bottom:double 2.5pt transparent;"> Noncurrent portion</td> <td valign="bottom" style="width:1.56%; border-bottom:double 2.5pt #000000;"> $</td> <td valign="bottom" style="width:14.68%; border-bottom:double 2.5pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">378,862</td> <td valign="bottom" style="width:1.44%; border-bottom:double 2.5pt transparent;white-space:nowrap;">  </td> </tr> </table></div> As of June 30, 2016, future minimum lease payments due in fiscal years under operating leases are as follows:   <div> <table border="0" cellspacing="0" cellpadding="0" align="center" style="border-collapse:collapse; width:68%;"> <tr> <td valign="top" bgcolor="#CFF0FC" style="width:82.3%;"> 2016 (remainder of)</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.56%;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:14.68%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">192,220</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.44%;white-space:nowrap;">  </td> </tr> <tr> <td valign="top" style="width:82.3%;"> 2017 </td> <td valign="bottom" style="width:1.56%;">  </td> <td valign="bottom" style="width:14.68%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">1,330,839</td> <td valign="bottom" style="width:1.44%;white-space:nowrap;">  </td> </tr> <tr> <td valign="top" bgcolor="#CFF0FC" style="width:82.3%;"> 2018 </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.56%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:14.68%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">1,303,345</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.44%;white-space:nowrap;">  </td> </tr> <tr> <td valign="top" style="width:82.3%;"> 2019 </td> <td valign="bottom" style="width:1.56%;">  </td> <td valign="bottom" style="width:14.68%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">1,340,234</td> <td valign="bottom" style="width:1.44%;white-space:nowrap;">  </td> </tr> <tr> <td valign="top" bgcolor="#CFF0FC" style="width:82.3%;"> 2020 </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.56%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:14.68%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">1,044,431 </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.44%;white-space:nowrap;">  </td> </tr> <tr> <td valign="top" style="width:82.3%; border-bottom:solid 0.75pt transparent;"> 2021 and thereafter</td> <td valign="bottom" style="width:1.56%; border-bottom:solid 0.75pt #000000;">  </td> <td valign="bottom" style="width:14.68%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">6,836,991 </td> <td valign="bottom" style="width:1.44%; border-bottom:solid 0.75pt transparent;white-space:nowrap;">  </td> </tr> <tr> <td valign="top" bgcolor="#CFF0FC" style="width:82.3%; border-bottom:double 2.5pt transparent;"> Total</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.56%; border-bottom:double 2.5pt #000000;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:14.68%; border-bottom:double 2.5pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">12,048,060</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.44%; border-bottom:double 2.5pt transparent;white-space:nowrap;">  </td> </tr> </table></div> Litigation The Company and certain of its officers and directors have been named as defendants in a consolidated class action pending before the United States District Court for the Central District of California regarding certain public statements in connection with the Company’s hepatitis B drug research.  The consolidated class action, initially filed as Wang v. Arrowhead Research Corp., et al., No. 2:14-cv-07890 (C.D. Cal., filed Oct. 10, 2014), and Eskinazi v. Arrowhead Research Corp., et al., No. 2:14-cv-07911 (C.D. Cal., filed Oct. 13, 2014),  asserts claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and seeks damages in an unspecified amount.  Additionally, three putative stockholder derivative actions captioned Weisman v. Anzalone et al., No. 2:14-cv-08982 (C.D. Cal., filed Nov. 20, 2014), Bernstein (Backus) v. Anzalone, et al., No. 2:14-cv-09247 (C.D. Cal., filed Dec. 2, 2014); and Johnson v. Anzalone, et al., No. 2:15-cv-00446 (C.D. Cal., filed Jan. 22, 2015), were filed in the United States District Court for the Central District of California, alleging breach of fiduciary duty by the Company’s Board of Directors in connection with the facts underlying the securities claims.  An additional consolidated derivative action asserting similar claims is pending in Los Angeles County Superior Court, initially filed as Bacchus v. Anzalone, et al., (L.A. Super., filed Mar. 5, 2015); and Jackson v. Anzalone, et al. (L.A. Super., filed Mar. 16, 2015).  Each of these suits seeks damages in unspecified amounts and some seek various forms of injunctive relief. The Company believes it has a meritorious defense and intends to vigorously defend itself in this matter.  The Company makes provisions for liabilities when it is both probable that a liability has been incurred and the amount can be reasonably estimated.  No such liability has been recorded related to this matter.  The Company does not expect this matter to have a material effect on its Consolidated Financial Statements. With regard to legal fees, such as attorney fees related to this matter or any other legal matters, the Company’s recognizes such costs as incurred. The Company and two of its former executives were named as defendants in a complaint filed on November 11, 2014 and captioned William Marsh Rice University vs. Unidym, Inc. and Arrowhead Research Corporation, No. 2014-66088, in the United States District Court for the Southern District of Texas relating to alleged breaches of a license agreement between Rice University and the Company’s former subsidiary, Unidym, Inc. The plaintiff alleged that the Company and its former executives acted fraudulently with respect to Unidym’s license from Rice University and sought injunctive relief, damages, including unspecified compensatory and punitive damages, and attorneys’ fees.  In May 2016, the Company and the plaintiff agreed to a settlement under which the Company admitted no liability and paid a confidential settlement amount and the plaintiff agreed to a permanent dismissal of claims.  The amount of the settlement was recorded during the three months ended March 31, 2016 and did not have a material effect on the Company’s Consolidated Financial Statements. Purchase Commitments In the normal course of business, we enter into various purchase commitments for the manufacture of drug components, for toxicology studies, and for clinical studies.  As of June 30, 2016, these future commitments were approximately $49.8 million, of which approximately $8.0 million is expected to be incurred in the remainder of fiscal 2016, and $41.8 million is expected to be incurred beyond fiscal 2016.  Technology License Commitments The Company has licensed from third parties the rights to use certain technologies for its research and development activities, as well as in any products the Company may develop using these licensed technologies. These agreements and other similar agreements often require milestone and royalty payments.  Milestone payments, for example, may be required as the research and development process progresses through various stages of development, such as when clinical candidates enter or progress through clinical trials, upon NDA and upon certain sales level milestones.  These milestone payments could amount to the mid to upper double digit millions of dollars.  In certain agreements, the Company may be required to make mid to high single digit percentage royalty payments based on a percentage of the sales of the relevant products.</div>

<div> NOTE 7. STOCK-BASED COMPENSATION Arrowhead has two plans that provide for equity-based compensation. Under the 2004 Equity Incentive Plan and 2013 Incentive Plan, as of June 30, 2016, 2,534,518 and 5,616,651 shares, respectively, of Arrowhead’s Common Stock are reserved for the grant of stock options, stock appreciation rights, restricted stock awards and performance unit/share award to employees, consultants and others. No further grants may be made under the 2004 Equity Incentive Plan.  As of June 30, 2016, there were options granted and outstanding to purchase 2,534,518 and 3,638,916 shares of Common Stock under the 2004 Equity Incentive Plan and the 2013 Incentive Plan, respectively, and there were 1,323,334 restricted stock units granted and outstanding under the 2013 Incentive Plan. Also, as of June 30, 2016, there were 544,622 shares reserved for options and 46,666 restricted stock units issued as inducement grants to new employees outside of equity compensation plans. During the nine months ended June 30, 2016, no options or restricted stock units were granted under the 2004 Equity Incentive Plan, 1,387,000 options and 838,517 restricted stock units were granted under the 2013 Incentive Plan, and no options or restricted stock units were granted as inducement awards to new employees outside of equity incentive plans.   The following table summarizes information about stock options:   <div> <table border="0" cellspacing="0" cellpadding="0" align="center" style="border-collapse:collapse; width:92%;"> <tr> <td valign="bottom" style="width:53.2%;"> <p style="text-align:center;margin-top:0pt;margin-bottom:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-style:normal;font-family:Times New Roman;font-size:10pt;text-transform:none;font-variant: normal;"> </td> <td colspan="2" valign="bottom" style="padding-left:0.7pt;padding-Right:0.7pt;padding-Top:0pt;padding-Bottom:0pt;width:9.56%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-size:8pt;font-family:Times New Roman;font-style:normal;text-transform:none;font-variant: normal;">Number of Options Outstanding</td> <td valign="bottom" style="width:1.22%;">  </td> <td valign="bottom" style="width:0.96%;"> <p style="text-align:center;margin-top:0pt;margin-bottom:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-style:normal;font-family:Times New Roman;font-size:10pt;text-transform:none;font-variant: normal;"> </td> <td colspan="2" valign="bottom" style="padding-left:0.7pt;padding-Right:0.7pt;padding-Top:0pt;padding-Bottom:0pt;width:9.78%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-size:8pt;font-family:Times New Roman;font-style:normal;text-transform:none;font-variant: normal;">Weighted- Average Exercise Price Per Share</td> <td valign="bottom" style="width:1.14%;">  </td> <td valign="bottom" style="width:1.14%;"> <p style="text-align:center;margin-top:0pt;margin-bottom:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-style:normal;font-family:Times New Roman;font-size:10pt;text-transform:none;font-variant: normal;">  </td> <td colspan="2" valign="bottom" style="padding-left:0.7pt;padding-Right:0.7pt;padding-Top:0pt;padding-Bottom:0pt;width:9.6%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-size:8pt;font-family:Times New Roman;font-style:normal;text-transform:none;font-variant: normal;">Weighted- Average Remaining Contractual Term</td> <td valign="bottom" style="width:0.98%;">  </td> <td valign="bottom" style="width:1.14%;"> <p style="text-align:center;margin-top:0pt;margin-bottom:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-style:normal;font-family:Times New Roman;font-size:10pt;text-transform:none;font-variant: normal;">  </td> <td colspan="2" valign="bottom" style="padding-left:0.7pt;padding-Right:0.7pt;padding-Top:0pt;padding-Bottom:0pt;width:10.34%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-size:8pt;font-family:Times New Roman;font-style:normal;text-transform:none;font-variant: normal;">Aggregate Intrinsic Value</td> <td valign="bottom" style="width:0.9%;">  </td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:53.2%;"> Balance At September 30, 2015</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:0.96%; border-top:solid 0.75pt #000000;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:8.62%; border-top:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-size:10pt;font-family:Times New Roman;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">5,435,640</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.22%;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:0.96%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.16%;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:8.62%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">6.71</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.14%;white-space:nowrap;">   </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.14%;"> <p style="text-align:center;margin-top:0pt;margin-bottom:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-style:normal;font-family:Times New Roman;font-size:10pt;text-transform:none;font-variant: normal;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:0.98%;"> <p style="text-align:center;margin-top:0pt;margin-bottom:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-style:normal;font-family:Times New Roman;font-size:10pt;text-transform:none;font-variant: normal;"> </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:8.62%;"> <p style="text-align:center;margin-top:0pt;margin-bottom:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-style:normal;font-family:Times New Roman;font-size:10pt;text-transform:none;font-variant: normal;"> </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:0.98%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.14%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.14%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:9.2%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:0.9%;">  </td> </tr> <tr> <td valign="bottom" style="width:53.2%;"> Granted</td> <td valign="bottom" style="width:0.96%;">  </td> <td valign="bottom" style="width:8.62%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">1,387,000</td> <td valign="bottom" style="width:1.22%;white-space:nowrap;">  </td> <td valign="bottom" style="width:0.96%;">  </td> <td valign="bottom" style="width:1.16%;">  </td> <td valign="bottom" style="width:8.62%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">6.12</td> <td valign="bottom" style="width:1.14%;white-space:nowrap;">   </td> <td valign="bottom" style="width:1.14%;"> <p style="text-align:center;margin-top:0pt;margin-bottom:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-style:normal;font-family:Times New Roman;font-size:10pt;text-transform:none;font-variant: normal;">  </td> <td valign="bottom" style="width:0.98%;"> <p style="text-align:center;margin-top:0pt;margin-bottom:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-style:normal;font-family:Times New Roman;font-size:10pt;text-transform:none;font-variant: normal;"> </td> <td valign="bottom" style="width:8.62%;"> <p style="text-align:center;margin-top:0pt;margin-bottom:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-style:normal;font-family:Times New Roman;font-size:10pt;text-transform:none;font-variant: normal;"> </td> <td valign="bottom" style="width:0.98%;">  </td> <td valign="bottom" style="width:1.14%;">  </td> <td valign="bottom" style="width:1.14%;">  </td> <td valign="bottom" style="width:9.2%;">  </td> <td valign="bottom" style="width:0.9%;">  </td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:53.2%;"> Cancelled</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:0.96%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:8.62%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">(99,897)</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.22%;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:0.96%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.16%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:8.62%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">9.86</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.14%;white-space:nowrap;">   </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.14%;"> <p style="text-align:center;margin-top:0pt;margin-bottom:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-style:normal;font-family:Times New Roman;font-size:10pt;text-transform:none;font-variant: normal;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:0.98%;"> <p style="text-align:center;margin-top:0pt;margin-bottom:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-style:normal;font-family:Times New Roman;font-size:10pt;text-transform:none;font-variant: normal;"> </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:8.62%;"> <p style="text-align:center;margin-top:0pt;margin-bottom:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-style:normal;font-family:Times New Roman;font-size:10pt;text-transform:none;font-variant: normal;"> </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:0.98%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.14%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.14%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:9.2%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:0.9%;">  </td> </tr> <tr> <td valign="bottom" style="width:53.2%; border-bottom:solid 0.75pt transparent;"> Exercised</td> <td valign="bottom" style="width:0.96%; border-bottom:solid 0.75pt #000000;">  </td> <td valign="bottom" style="width:8.62%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">(4,687)</td> <td valign="bottom" style="width:1.22%; border-bottom:solid 0.75pt transparent;white-space:nowrap;">  </td> <td valign="bottom" style="width:0.96%; border-bottom:solid 0.75pt transparent;">  </td> <td valign="bottom" style="width:1.16%; border-bottom:solid 0.75pt #000000;">  </td> <td valign="bottom" style="width:8.62%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">5.45</td> <td valign="bottom" style="width:1.14%; border-bottom:solid 0.75pt transparent;white-space:nowrap;">   </td> <td valign="bottom" style="width:1.14%; border-bottom:solid 0.75pt transparent;"> <p style="text-align:center;margin-top:0pt;margin-bottom:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-style:normal;font-family:Times New Roman;font-size:10pt;text-transform:none;font-variant: normal;">  </td> <td valign="bottom" style="width:0.98%; border-bottom:solid 0.75pt transparent;">  </td> <td valign="bottom" style="width:8.62%; border-bottom:solid 0.75pt transparent;">  </td> <td valign="middle" style="width:0.98%; border-bottom:solid 0.75pt transparent;">  </td> <td valign="bottom" style="width:1.14%; border-bottom:solid 0.75pt transparent;">  </td> <td valign="bottom" style="width:1.14%; border-bottom:solid 0.75pt transparent;">  </td> <td valign="bottom" style="width:9.2%; border-bottom:solid 0.75pt transparent;">  </td> <td valign="middle" style="width:0.9%; border-bottom:solid 0.75pt transparent;">  </td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:53.2%; border-bottom:solid 0.75pt transparent;"> Balance At June 30, 2016</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:0.96%; border-top:solid 0.75pt #000000; border-bottom:solid 0.75pt #000000;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:8.62%; border-top:solid 0.75pt #000000; border-bottom:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">6,718,056</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.22%; border-bottom:solid 0.75pt transparent;white-space:nowrap;">   </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:0.96%; border-bottom:solid 0.75pt transparent;"> <p style="text-align:center;margin-top:0pt;margin-bottom:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-style:normal;font-family:Times New Roman;font-size:10pt;text-transform:none;font-variant: normal;"> </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.16%; border-top:solid 0.75pt #000000; border-bottom:solid 0.75pt #000000;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:8.62%; border-top:solid 0.75pt #000000; border-bottom:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">6.54</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.14%; border-bottom:solid 0.75pt transparent;white-space:nowrap;">   </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.14%; border-bottom:solid 0.75pt transparent;"> <p style="text-align:center;margin-top:0pt;margin-bottom:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-style:normal;font-family:Times New Roman;font-size:10pt;text-transform:none;font-variant: normal;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:0.98%; border-bottom:solid 0.75pt transparent;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:8.62%; border-bottom:solid 0.75pt transparent;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">7.6 years </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:0.98%; border-bottom:solid 0.75pt transparent;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.14%; border-bottom:solid 0.75pt transparent;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.14%; border-bottom:solid 0.75pt transparent;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:9.2%; border-bottom:solid 0.75pt transparent;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">4,073,899</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:0.9%; border-bottom:solid 0.75pt transparent;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" style="width:53.2%; border-bottom:double 2.5pt transparent;"> Exercisable At June 30, 2016</td> <td valign="bottom" style="width:0.96%; border-top:solid 0.75pt #000000; border-bottom:double 2.5pt #000000;">  </td> <td valign="bottom" style="width:8.62%; border-top:solid 0.75pt #000000; border-bottom:double 2.5pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">3,563,564</td> <td valign="bottom" style="width:1.22%; border-bottom:double 2.5pt transparent;white-space:nowrap;">  </td> <td valign="bottom" style="width:0.96%; border-bottom:double 2.5pt transparent;">  </td> <td valign="bottom" style="width:1.16%; border-top:solid 0.75pt #000000; border-bottom:double 2.5pt #000000;"> $</td> <td valign="bottom" style="width:8.62%; border-top:solid 0.75pt #000000; border-bottom:double 2.5pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">6.16</td> <td valign="bottom" style="width:1.14%; border-bottom:double 2.5pt transparent;white-space:nowrap;">  </td> <td valign="bottom" style="width:1.14%; border-bottom:double 2.5pt transparent;">  </td> <td valign="bottom" style="width:0.98%; border-bottom:double 2.5pt transparent;">  </td> <td valign="bottom" style="width:8.62%; border-bottom:double 2.5pt transparent;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">6.6 years</td> <td valign="bottom" style="width:0.98%; border-bottom:double 2.5pt transparent;white-space:nowrap;">  </td> <td valign="bottom" style="width:1.14%; border-bottom:double 2.5pt transparent;">  </td> <td valign="bottom" style="width:1.14%; border-bottom:double 2.5pt transparent;"> $</td> <td valign="bottom" style="width:9.2%; border-bottom:double 2.5pt transparent;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">3,304,194</td> <td valign="bottom" style="width:0.9%; border-bottom:double 2.5pt transparent;white-space:nowrap;">  </td> </tr> </table></div> Stock-based compensation expense related to stock options for the three and nine months ended June 30, 2016 was $1,476,384 and $4,205,413, respectively. Stock-based compensation expense related to stock options for the three and nine months ended June 30, 2015 was $1,289,037 and $3,469,327, respectively. The Company does not recognize an income tax benefit as the Company is currently operating at a loss and an actual income tax benefit may not be realized. For non-qualified stock options, the loss creates a timing difference, resulting in a deferred tax asset, which is fully reserved by a valuation allowance. The grant date fair value of the options granted by the Company for the three and nine months ended June 30, 2016 was estimated at $30,440 and $6,359,672, respectively. The grant date fair value of the options granted by the Company for the three and nine months ended June 30, 2015 was estimated at $285,828 and $7,100,339, respectively. The intrinsic value of the options exercised during the three and nine months ended June 30, 2016 was $0 and $3,515, respectively.  The intrinsic value of the options exercised during the three and nine months ended June 30, 2015 was $0 and $113,728, respectively. As of June 30, 2016, the pre-tax compensation expense for all outstanding unvested stock options in the amount of approximately $13,383,829 will be recognized in the Company’s results of operations over a weighted average period of 2.6 years. The fair value of each stock option award is estimated on the date of grant using the Black-Scholes option pricing model. The Black-Scholes option valuation model was developed for use in estimating the fair value of traded options, which do not have vesting restrictions and are fully transferable. The determination of the fair value of each stock option is affected by the Company’s stock price on the date of grant, as well as assumptions regarding a number of highly complex and subjective variables. Because the Company’s employee stock options have characteristics significantly different from those of traded options, and because changes in the subjective input assumptions can materially affect the fair value estimate, in management’s opinion, the existing models do not necessarily provide a reliable single measure of the fair value of its employee stock options. The assumptions used to value stock options are as follows:   <div> <table border="0" cellspacing="0" cellpadding="0" align="center" style="border-collapse:collapse; width:76%;"> <tr> <td valign="bottom" style="width:65.78%;"> <p style="text-align:center;margin-top:0pt;margin-bottom:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-style:normal;font-family:Times New Roman;font-size:10pt;text-transform:none;font-variant: normal;"> </td> <td valign="top" style="width:1.32%;">  </td> <td colspan="3" valign="bottom" style="padding-left:0.7pt;padding-Right:0.7pt;padding-Top:0pt;padding-Bottom:0pt;width:32.88%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-size:8pt;font-family:Times New Roman;font-style:normal;text-transform:none;font-variant: normal;">Nine months ended June 30,</td> </tr> <tr> <td valign="bottom" style="width:65.78%;"> <p style="text-align:center;margin-top:0pt;margin-bottom:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-style:normal;font-family:Times New Roman;font-size:10pt;text-transform:none;font-variant: normal;"> </td> <td valign="top" style="width:1.32%;">  </td> <td valign="bottom" style="padding-left:0.7pt;padding-Right:0.7pt;padding-Top:0pt;padding-Bottom:0pt;width:15.8%; border-top:solid 0.75pt #000000; border-bottom:solid 0.75pt #000000;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-size:8pt;font-family:Times New Roman;font-style:normal;text-transform:none;font-variant: normal;">2016 </td> <td valign="bottom" style="width:1.32%;">  </td> <td valign="bottom" style="padding-left:0.7pt;padding-Right:0.7pt;padding-Top:0pt;padding-Bottom:0pt;width:15.78%; border-top:solid 0.75pt #000000; border-bottom:solid 0.75pt #000000;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-size:8pt;font-family:Times New Roman;font-style:normal;text-transform:none;font-variant: normal;">2015 </td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:65.78%;"> Dividend yield</td> <td valign="top" bgcolor="#CFF0FC" style="width:1.32%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:15.8%; border-top:solid 0.75pt #000000;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.32%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:15.78%; border-top:solid 0.75pt #000000;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> </tr> <tr> <td valign="bottom" style="width:65.78%;"> Risk-free interest rate</td> <td valign="top" style="width:1.32%;">  </td> <td valign="bottom" style="width:15.8%;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">1.42 – 1.89%</td> <td valign="bottom" style="width:1.32%;">  </td> <td valign="bottom" style="width:15.78%;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">1.46 – 1.88%</td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:65.78%;"> Volatility</td> <td valign="top" bgcolor="#CFF0FC" style="width:1.32%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:15.8%;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">89%</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.32%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:15.78%;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">75%</td> </tr> <tr> <td valign="bottom" style="width:65.78%;"> Expected life (in years)</td> <td valign="top" style="width:1.32%;">  </td> <td valign="bottom" style="width:15.8%;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">6.25</td> <td valign="bottom" style="width:1.32%;">  </td> <td valign="bottom" style="width:15.78%;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">6 - 6.25</td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:65.78%;"> <p style="margin-bottom:0pt;margin-top:0pt;margin-left:12pt;;text-indent:-12pt;;font-size:10pt;letter-spacing:-0.2pt;font-family:Times New Roman;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">Weighted average grant date fair value per share of options granted</td> <td valign="top" bgcolor="#CFF0FC" style="width:1.32%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:15.8%;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">$4.59</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.32%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:15.78%;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">$4.25</td> </tr> </table></div> The dividend yield is zero as the Company currently does not pay a dividend. The risk-free interest rate is based on that of the U.S. Treasury bond. Volatility is estimated based on volatility average of the Company’s Common Stock price. Restricted Stock Units Restricted stock units (RSUs), including time-based and performance-based awards, were granted under the Company’s 2013 Incentive Plan and as inducement grants granted outside of the Plan.  During the nine months ended June 30, 2016, the Company issued 838,517 restricted stock units to certain members of management.  Of the restricted stock units granted during the nine months ended June 30, 2016, 0 were granted outside of the Plan as an inducement grant to a new employee. At vesting, each RSU will be exchanged for one share of the Company’s Common Stock. Restricted stock unit awards generally vest subject to the satisfaction of service requirements or the satisfaction of both service requirements and achievement of certain performance targets.   The following table summarizes the activity of the Company’s Restricted Stock Units:   <div> <table border="0" cellspacing="0" cellpadding="0" align="center" style="border-collapse:collapse; width:76%;"> <tr> <td valign="bottom" style="width:67.1%;">  </td> <td colspan="2" valign="bottom" style="width:14.42%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-size:8pt;font-family:Times New Roman;font-style:normal;text-transform:none;font-variant: normal;">Number of RSUs</td> <td valign="bottom" style="width:1.42%;white-space:nowrap;">  </td> <td valign="bottom" style="width:1.3%;">  </td> <td colspan="2" valign="bottom" style="width:14.44%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-size:8pt;font-family:Times New Roman;font-style:normal;text-transform:none;font-variant: normal;">Weighted- Average Grant Date Fair Value</td> <td valign="bottom" style="width:1.3%;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:67.1%;"> Unvested at September 30, 2015</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.3%; border-top:solid 0.75pt #000000;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:13.14%; border-top:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">934,167</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.42%;white-space:nowrap;">   </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.3%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.3%; border-top:solid 0.75pt #000000;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:13.14%; border-top:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">9.18</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.3%;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" style="width:67.1%;"> Granted</td> <td valign="bottom" style="width:1.3%;">  </td> <td valign="top" style="width:13.14%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">838,517</td> <td valign="bottom" style="width:1.42%;white-space:nowrap;">  </td> <td valign="bottom" style="width:1.3%;">  </td> <td valign="bottom" style="width:1.3%;">  </td> <td valign="top" style="width:13.14%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">6.15</td> <td valign="bottom" style="width:1.3%;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:67.1%;"> Vested</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.3%;">  </td> <td valign="top" bgcolor="#CFF0FC" style="width:13.14%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">(402,684</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.42%;white-space:nowrap;"> ) </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.3%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.3%;">  </td> <td valign="top" bgcolor="#CFF0FC" style="width:13.14%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">10.95</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.3%;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" style="width:67.1%; border-bottom:solid 0.75pt transparent;"> Forfeited</td> <td valign="bottom" style="width:1.3%; border-bottom:solid 0.75pt #000000;">  </td> <td valign="top" style="width:13.14%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> <td valign="bottom" style="width:1.42%; border-bottom:solid 0.75pt transparent;white-space:nowrap;">  </td> <td valign="bottom" style="width:1.3%; border-bottom:solid 0.75pt transparent;">  </td> <td valign="bottom" style="width:1.3%; border-bottom:solid 0.75pt #000000;">  </td> <td valign="top" style="width:13.14%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> <td valign="bottom" style="width:1.3%; border-bottom:solid 0.75pt transparent;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:67.1%; border-bottom:double 2.5pt transparent;"> <p style="margin-bottom:0pt;margin-top:0pt;margin-left:12.25pt;;text-indent:-12.25pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">Unvested at June 30, 2016</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.3%; border-top:solid 0.75pt #000000; border-bottom:double 2.5pt #000000;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:13.14%; border-top:solid 0.75pt #000000; border-bottom:double 2.5pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">1,370,000</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.42%; border-bottom:double 2.5pt transparent;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.3%; border-bottom:double 2.5pt transparent;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.3%; border-top:solid 0.75pt #000000; border-bottom:double 2.5pt #000000;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:13.14%; border-top:solid 0.75pt #000000; border-bottom:double 2.5pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">6.80</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.3%; border-bottom:double 2.5pt transparent;white-space:nowrap;">  </td> </tr> </table></div> The Company recorded $1,274,401 and $3,342,554 of expense relating to restricted stock units during the three and nine months ended June 30, 2016, respectively.  The Company recorded $1,197,037 and $3,236,682 of expense relating to restricted stock units during the three and nine months ended June 30, 2015, respectively.  Such expense is included in stock-based compensation expense in the Company’s Consolidated Statement of Operations and Comprehensive Loss.   For restricted stock units, the grant date fair value of the award is based on the Company’s closing stock price at the grant date, with consideration given to the probability of achieving performance conditions for performance based awards. As of June 30, 2016, the pre-tax compensation expense for all unvested restricted stock units in the amount of approximately $3,258,026 will be recognized in the Company’s results of operations over a weighted average period of 1.6 years. </div>

<div> NOTE 8. FAIR VALUE MEASUREMENTS The Company measures its financial assets and liabilities at fair value. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (i.e., exit price) in an orderly transaction between market participants at the measurement date. Additionally, the Company is required to provide disclosure and categorize assets and liabilities measured at fair value into one of three different levels depending on the assumptions (i.e., inputs) used in the valuation. Level 1 provides the most reliable measure of fair value while Level 3 generally requires significant management judgment. Financial assets and liabilities are classified in their entirety based on the lowest level of input significant to the fair value measurement. The fair value hierarchy is defined as follows: Level 1—Valuations are based on unadjusted quoted prices in active markets for identical assets or liabilities. Level 2—Valuations are based on quoted prices for similar assets or liabilities in active markets, or quoted prices in markets that are not active for which significant inputs are observable, either directly or indirectly. Level 3—Valuations are based on prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement. Inputs reflect management’s best estimate of what market participants would use in valuing the asset or liability at the measurement date. The following table summarizes fair value measurements at June 30, 2016 and September 30, 2015 for assets and liabilities measured at fair value on a recurring basis: June 30, 2016:   <div> <table border="0" cellspacing="0" cellpadding="0" align="center" style="border-collapse:collapse; width:92%;"> <tr> <td valign="bottom" style="width:44.58%;"> <p style="text-align:center;margin-top:0pt;margin-bottom:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-style:normal;font-family:Times New Roman;font-size:10pt;text-transform:none;font-variant: normal;"> </td> <td colspan="2" valign="bottom" style="padding-left:0.7pt;padding-Right:0.7pt;padding-Top:0pt;padding-Bottom:0pt;width:12.14%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-size:8pt;font-family:Times New Roman;font-style:normal;text-transform:none;font-variant: normal;">Level 1</td> <td valign="bottom" style="width:1.08%;">  </td> <td valign="bottom" style="width:1.08%;">  </td> <td colspan="2" valign="bottom" style="padding-left:0.7pt;padding-Right:0.7pt;padding-Top:0pt;padding-Bottom:0pt;width:12.02%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-size:8pt;font-family:Times New Roman;font-style:normal;text-transform:none;font-variant: normal;">Level 2</td> <td valign="bottom" style="width:1.08%;">  </td> <td valign="bottom" style="width:1.08%;">  </td> <td colspan="2" valign="bottom" style="padding-left:0.7pt;padding-Right:0.7pt;padding-Top:0pt;padding-Bottom:0pt;width:11.96%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-size:8pt;font-family:Times New Roman;font-style:normal;text-transform:none;font-variant: normal;">Level 3</td> <td valign="bottom" style="width:1.08%;">  </td> <td valign="bottom" style="width:1.08%;">  </td> <td colspan="2" valign="bottom" style="padding-left:0.7pt;padding-Right:0.7pt;padding-Top:0pt;padding-Bottom:0pt;width:11.96%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-size:8pt;font-family:Times New Roman;font-style:normal;text-transform:none;font-variant: normal;">Total</td> <td valign="bottom" style="width:0.88%;">  </td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:44.58%;"> Cash and cash equivalents</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.1%; border-top:solid 0.75pt #000000;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:11.02%; border-top:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">43,616,543</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%; border-top:solid 0.75pt #000000;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:10.94%; border-top:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%; border-top:solid 0.75pt #000000;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:10.88%; border-top:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%; border-top:solid 0.75pt #000000;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:10.88%; border-top:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">43,616,543</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:0.88%;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" style="width:44.58%;"> Derivative liabilities</td> <td valign="bottom" style="width:1.1%;"> $</td> <td valign="bottom" style="width:11.02%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> <td valign="bottom" style="width:1.08%;white-space:nowrap;">  </td> <td valign="bottom" style="width:1.08%;">  </td> <td valign="bottom" style="width:1.08%;"> $</td> <td valign="bottom" style="width:10.94%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> <td valign="bottom" style="width:1.08%;white-space:nowrap;">  </td> <td valign="bottom" style="width:1.08%;">  </td> <td valign="bottom" style="width:1.08%;"> $</td> <td valign="bottom" style="width:10.88%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">1,068,552</td> <td valign="bottom" style="width:1.08%;white-space:nowrap;">  </td> <td valign="bottom" style="width:1.08%;">  </td> <td valign="bottom" style="width:1.08%;"> $</td> <td valign="bottom" style="width:10.88%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">1,068,552</td> <td valign="bottom" style="width:0.88%;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:44.58%;"> Acquisition-related contingent consideration obligations</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.1%;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:11.02%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:10.94%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:10.88%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">5,862,464</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:10.88%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">5,862,464</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:0.88%;white-space:nowrap;">  </td> </tr> </table></div> September 30, 2015:   <div> <table border="0" cellspacing="0" cellpadding="0" align="center" style="border-collapse:collapse; width:92%;"> <tr> <td valign="bottom" style="width:44.58%;">  </td> <td colspan="2" valign="bottom" style="padding-left:0.7pt;padding-Right:0.7pt;padding-Top:0pt;padding-Bottom:0pt;width:12.12%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-size:8pt;font-family:Times New Roman;font-style:normal;text-transform:none;font-variant: normal;">Level 1</td> <td valign="bottom" style="width:1.08%;">  </td> <td valign="bottom" style="width:1.08%;">  </td> <td colspan="2" valign="bottom" style="padding-left:0.7pt;padding-Right:0.7pt;padding-Top:0pt;padding-Bottom:0pt;width:12.02%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-size:8pt;font-family:Times New Roman;font-style:normal;text-transform:none;font-variant: normal;">Level 2</td> <td valign="bottom" style="width:1.08%;">  </td> <td valign="bottom" style="width:1.08%;">  </td> <td colspan="2" valign="bottom" style="padding-left:0.7pt;padding-Right:0.7pt;padding-Top:0pt;padding-Bottom:0pt;width:11.96%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-size:8pt;font-family:Times New Roman;font-style:normal;text-transform:none;font-variant: normal;">Level 3</td> <td valign="bottom" style="width:1.08%;">  </td> <td valign="bottom" style="width:1.08%;">  </td> <td colspan="2" valign="bottom" style="padding-left:0.7pt;padding-Right:0.7pt;padding-Top:0pt;padding-Bottom:0pt;width:11.96%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-size:8pt;font-family:Times New Roman;font-style:normal;text-transform:none;font-variant: normal;">Total</td> <td valign="bottom" style="width:0.9%;">  </td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:44.58%;"> Cash and cash equivalents</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.1%; border-top:solid 0.75pt #000000;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:11%; border-top:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">81,214,354</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%; border-top:solid 0.75pt #000000;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:10.94%; border-top:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%; border-top:solid 0.75pt #000000;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:10.88%; border-top:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%; border-top:solid 0.75pt #000000;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:10.88%; border-top:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">81,214,354</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:0.9%;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" style="width:44.58%;"> Derivative liabilities</td> <td valign="bottom" style="width:1.1%;"> $</td> <td valign="bottom" style="width:11%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> <td valign="bottom" style="width:1.08%;white-space:nowrap;">  </td> <td valign="bottom" style="width:1.08%;">  </td> <td valign="bottom" style="width:1.08%;"> $</td> <td valign="bottom" style="width:10.94%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> <td valign="bottom" style="width:1.08%;white-space:nowrap;">  </td> <td valign="bottom" style="width:1.08%;">  </td> <td valign="bottom" style="width:1.08%;"> $</td> <td valign="bottom" style="width:10.88%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">1,301,604</td> <td valign="bottom" style="width:1.08%;white-space:nowrap;">  </td> <td valign="bottom" style="width:1.08%;">  </td> <td valign="bottom" style="width:1.08%;"> $</td> <td valign="bottom" style="width:10.88%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">1,301,604</td> <td valign="bottom" style="width:0.9%;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:44.58%;"> <p style="margin-bottom:0pt;margin-top:0pt;margin-left:12.25pt;;text-indent:-12.25pt;;font-size:10pt;font-family:Times New Roman;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">Acquisition-related contingent consideration obligations</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.1%;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:11%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:10.94%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:10.88%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">5,862,464</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:10.88%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">5,862,464</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:0.9%;white-space:nowrap;">  </td> </tr> </table></div> The Company invests its excess cash balances in short- and long-term corporate bonds, generally with remaining maturities of less than one year.  At June 30, 2016, the Company had short-term investments of $1,030,556.  The fair value of its investments at June 30, 2016 was $1,003,840.  The Company expects to hold such investments until maturity, and thus unrealized gains and losses from the fluctuations in the fair value of the securities are not likely to be realized. As part of a financing in December 2012, Arrowhead issued warrants to purchase up to 912,543 shares of Common Stock (the “2012 Warrants”) of which 265,161 warrants were outstanding at June 30, 2016.  Further, as part of a financing in January 2013, Arrowhead issued warrants to purchase up to 833,530 shares of Common Stock (the “2013 Warrants” and, together with the 2012 Warrants, the “Warrants”) of which 12,123 warrants were outstanding at June 30, 2016.  Each of the Warrants contains a mechanism to adjust the strike price upon the issuance of certain dilutive equity securities. If during the terms of the Warrants, the Company issues Common Stock at a price lower than the exercise price for the Warrants, the exercise price would be reduced to the amount equal to the issuance price of the Common Stock.  As a result of these features, the Warrants are subject to derivative accounting as prescribed under ASC 815. Accordingly, the fair value of the Warrants on the date of issuance was estimated using an option pricing model and recorded on the Company’s Consolidated Balance Sheet as a derivative liability. The fair value of the Warrants is estimated at the end of each reporting period and the change in the fair value of the Warrants is recorded as a non-operating gain or loss as change in value of derivatives in the Company’s Consolidated Statement of Operations and Comprehensive Loss. During the three and nine months ended June 30, 2016, the Company recorded a non-cash gain/(loss) from the change in fair value of the derivative liability of $(110,859) and $230,082, respectively.  During the three and nine months ended June 30, 2015, the Company recorded a non-cash gain/(loss) from the change in fair value of the derivative liability of $(102,763) and $2,268,798, respectively.  Additionally, as part of an equity financing in June 2010, Arrowhead issued warrants to purchase up to 329,649 shares of Common Stock (the “2010 Warrants”), of which warrants to exercise 24,324 shares remained unexercised and were cancelled at their expiration during fiscal 2016.   The assumptions used in valuing the derivative liability were as follows:   <div> <table border="0" cellspacing="0" cellpadding="0" align="center" style="border-collapse:collapse; width:76%;"> <tr> <td valign="bottom" style="width:42.76%;"> 2012 Warrants</td> <td valign="bottom" style="width:1.04%;">  </td> <td valign="bottom" style="width:28%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">June 30, 2016</td> <td valign="bottom" style="width:1.04%;white-space:nowrap;">  </td> <td valign="bottom" style="width:1.04%;">  </td> <td valign="bottom" style="width:26.12%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">September 30, 2015</td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:42.76%;"> Risk-free interest rate</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.04%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:28%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">0.52%</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.04%;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.04%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:26.12%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">0.6%</td> </tr> <tr> <td valign="bottom" style="width:42.76%;"> Expected life</td> <td valign="bottom" style="width:1.04%;">  </td> <td valign="bottom" style="width:28%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:36pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">1.5 Years</td> <td valign="bottom" style="width:1.04%;">  </td> <td valign="bottom" style="width:1.04%;">  </td> <td valign="bottom" style="width:26.12%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">2.2 Years</td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:42.76%;"> Dividend yield</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.04%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:28%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.04%;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.04%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:26.12%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> </tr> <tr> <td valign="bottom" style="width:42.76%;"> Volatility</td> <td valign="bottom" style="width:1.04%;">  </td> <td valign="bottom" style="width:28%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">89%</td> <td valign="bottom" style="width:1.04%;white-space:nowrap;">  </td> <td valign="bottom" style="width:1.04%;">  </td> <td valign="bottom" style="width:26.12%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">75%</td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:42.76%;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;"> </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.04%;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;"> </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:28%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.04%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.04%;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;"> </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:26.12%;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;"> </td> </tr> <tr> <td valign="bottom" style="width:42.76%;"> 2013 Warrants</td> <td valign="bottom" style="width:1.04%;">  </td> <td valign="bottom" style="width:28%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">June 30, 2016</td> <td valign="bottom" style="width:1.04%;white-space:nowrap;">  </td> <td valign="bottom" style="width:1.04%;">  </td> <td valign="bottom" style="width:26.12%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">September 30, 2015</td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:42.76%;"> Risk-free interest rate</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.04%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:28%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">0.52%</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.04%;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.04%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:26.12%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">0.6%</td> </tr> <tr> <td valign="bottom" style="width:42.76%;"> Expected life</td> <td valign="bottom" style="width:1.04%;">  </td> <td valign="bottom" style="width:28%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:36pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">1.6 Years</td> <td valign="bottom" style="width:1.04%;">  </td> <td valign="bottom" style="width:1.04%;">  </td> <td valign="bottom" style="width:26.12%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">2.3 Years</td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:42.76%;"> Dividend yield</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.04%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:28%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.04%;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.04%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:26.12%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> </tr> <tr> <td valign="bottom" style="width:42.76%;"> Volatility</td> <td valign="bottom" style="width:1.04%;">  </td> <td valign="bottom" style="width:28%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">89%</td> <td valign="bottom" style="width:1.04%;white-space:nowrap;">  </td> <td valign="bottom" style="width:1.04%;">  </td> <td valign="bottom" style="width:26.12%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">75%</td> </tr> </table></div> The following is a reconciliation of the derivative liability related to these warrants:   <div> <table border="0" cellspacing="0" cellpadding="0" align="center" style="border-collapse:collapse; width:76%;"> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:80.28%;"> Value at September 30, 2015</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.32%;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:17.1%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">1,272,802</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.3%;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" style="width:80.28%;"> Issuance of instruments</td> <td valign="bottom" style="width:1.32%;">  </td> <td valign="bottom" style="width:17.1%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> <td valign="bottom" style="width:1.3%;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:80.28%;"> Change in value</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.32%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:17.1%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">(230,852</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.3%;white-space:nowrap;"> )</td> </tr> <tr> <td valign="bottom" style="width:80.28%; border-bottom:solid 0.75pt transparent;"> Net settlements</td> <td valign="bottom" style="width:1.32%; border-bottom:solid 0.75pt #000000;">  </td> <td valign="bottom" style="width:17.1%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> <td valign="bottom" style="width:1.3%; border-bottom:solid 0.75pt transparent;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:80.28%; border-bottom:double 2.5pt transparent;"> Value at June 30, 2016</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.32%; border-top:solid 0.75pt #000000; border-bottom:double 2.5pt #000000;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:17.1%; border-top:solid 0.75pt #000000; border-bottom:double 2.5pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">1,041,950</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.3%; border-bottom:double 2.5pt transparent;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" style="width:80.28%;">  </td> <td valign="bottom" style="width:1.32%; border-top:double 2.5pt #000000;">  </td> <td valign="bottom" style="width:17.1%; border-top:double 2.5pt #000000;">  </td> <td valign="bottom" style="width:1.3%;white-space:nowrap;">  </td> </tr> </table></div> In conjunction with the financing of Ablaris in fiscal 2011, Arrowhead sold exchange rights to certain investors whereby the investors have the right to exchange their shares of Ablaris for a prescribed number of Arrowhead shares of Common Stock based upon a predefined ratio. The exchange rights have a seven-year term and a current exchange ratio of 0.01. Exchange rights for 675,000 Ablaris shares were sold in fiscal 2011, and 500,000 remain outstanding at June 30, 2016. The exchange rights are subject to derivative accounting as prescribed under ASC 815. Accordingly, the fair value of the exchange rights on the date of issuance was estimated using an option pricing model and recorded on the Company’s Consolidated Balance Sheet as a derivative liability. The fair value of the exchange rights is estimated at the end of each reporting period and the change in the fair value of the exchange rights is recorded as a non-operating gain or loss in the Company’s Consolidated Statement of Operations and Comprehensive Loss. During the three and nine months ended June 30, 2016, the Company recorded a non-cash gain/(loss) from the change in fair value of the derivative liability of $(2,500) and $2,200, respectively.  During the three and nine months ended June 30, 2015, the Company recorded a non-cash loss and gain from the change in fair value of the derivative liability of $(1,950) and $177,605, respectively.   The assumptions used in valuing the derivative liability were as follows:   <div> <table border="0" cellspacing="0" cellpadding="0" align="center" style="border-collapse:collapse; width:76%;"> <tr> <td valign="bottom" style="width:72.36%;"> <p style="text-align:center;margin-top:0pt;margin-bottom:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-style:normal;font-family:Times New Roman;font-size:10pt;text-transform:none;font-variant: normal;"> </td> <td valign="bottom" style="padding-left:0.7pt;padding-Right:0.7pt;padding-Top:0pt;padding-Bottom:0pt;width:13.16%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-size:8pt;font-family:Times New Roman;font-style:normal;text-transform:none;font-variant: normal;">June 30, <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-size:8pt;font-family:Times New Roman;font-style:normal;text-transform:none;font-variant: normal;">2016</td> <td valign="bottom" style="width:1.32%;">  </td> <td valign="bottom" style="padding-left:0.7pt;padding-Right:0.7pt;padding-Top:0pt;padding-Bottom:0pt;width:13.16%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-size:8pt;font-family:Times New Roman;font-style:normal;text-transform:none;font-variant: normal;">September 30,  2015</td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:72.36%;"> Risk-free interest rate</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:13.16%; border-top:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">0.52%</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.32%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:13.16%; border-top:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">1.00%</td> </tr> <tr> <td valign="bottom" style="width:72.36%;"> Expected life</td> <td valign="bottom" style="width:13.16%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">1.6 Years</td> <td valign="bottom" style="width:1.32%;">  </td> <td valign="bottom" style="width:13.16%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">2.5 Years</td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:72.36%;"> Dividend yield</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:13.16%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.32%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:13.16%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> </tr> <tr> <td valign="bottom" style="width:72.36%;"> Volatility</td> <td valign="bottom" style="width:13.16%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">89%</td> <td valign="bottom" style="width:1.32%;">  </td> <td valign="bottom" style="width:13.16%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">75%</td> </tr> </table></div>   The following is a reconciliation of the derivative liability related to these exchange rights:   <div> <table border="0" cellspacing="0" cellpadding="0" align="center" style="border-collapse:collapse; width:76%;"> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:80.22%;"> Value at September 30, 2015</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.38%;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:17.08%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">28,802</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.3%;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" style="width:80.22%;"> Issuance of instruments</td> <td valign="bottom" style="width:1.38%;">  </td> <td valign="bottom" style="width:17.08%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> <td valign="bottom" style="width:1.3%;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:80.22%;"> Change in value</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.38%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:17.08%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">(2,200</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.3%;white-space:nowrap;"> )</td> </tr> <tr> <td valign="bottom" style="width:80.22%; border-bottom:solid 0.75pt transparent;"> Net settlements</td> <td valign="bottom" style="width:1.38%; border-bottom:solid 0.75pt #000000;">  </td> <td valign="bottom" style="width:17.08%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> <td valign="bottom" style="width:1.3%; border-bottom:solid 0.75pt transparent;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:80.22%; border-bottom:double 2.5pt transparent;"> Value at June 30, 2016</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.38%; border-top:solid 0.75pt #000000; border-bottom:double 2.5pt #000000;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:17.08%; border-top:solid 0.75pt #000000; border-bottom:double 2.5pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">26,602</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.3%; border-bottom:double 2.5pt transparent;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" style="width:80.22%;">  </td> <td valign="bottom" style="width:1.38%; border-top:double 2.5pt #000000;">  </td> <td valign="bottom" style="width:17.08%; border-top:double 2.5pt #000000;">  </td> <td valign="bottom" style="width:1.3%;white-space:nowrap;">  </td> </tr> </table></div> The derivative assets/liabilities are estimated using option pricing models that are based on the individual characteristics of the warrants or instruments on the valuation date, as well as assumptions for expected volatility, expected life and risk-free interest rate. Changes in the assumptions used could have a material impact on the resulting fair value. The primary input affecting the value of the Company’s derivatives liabilities is the Company’s stock price. Other inputs have a comparatively insignificant effect. As of June 30, 2016, the Company has liabilities for contingent consideration related to its acquisition of the Roche RNAi business completed in 2011. The fair value measurement of the contingent consideration obligations is determined using Level 3 inputs. The fair value of contingent consideration obligations is based on a discounted cash flow model using a probability-weighted income approach. The measurement is based upon unobservable inputs supported by little or no market activity based on the Company’s assumptions and experience. Estimating timing to complete the development and obtain approval of products is difficult, and there are inherent uncertainties in developing a product candidate, such as obtaining U.S. Food and Drug Administration (FDA) and other regulatory approvals. In determining the probability of regulatory approval and commercial success, the Company utilizes data regarding similar milestone events from several sources, including industry studies and its own experience. These fair value measurements represent Level 3 measurements as they are based on significant inputs not observable in the market. Significant judgment is employed in determining the appropriateness of these assumptions as of the acquisition date and for each subsequent period. Accordingly, changes in assumptions could have a material impact on the amount of contingent consideration expense the Company records in any given period. Changes in the fair value of the contingent consideration obligations are recorded in the Company’s Consolidated Statement of Operations and Comprehensive Loss. The following is a reconciliation of contingent consideration fair value.   <div> <table border="0" cellspacing="0" cellpadding="0" align="center" style="border-collapse:collapse; width:76%;"> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:80.22%;"> Value at September 30, 2015</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.38%;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:17.08%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-size:10pt;font-family:Times New Roman;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">5,862,464</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.3%;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" style="width:80.22%;"> Purchase price contingent consideration</td> <td valign="bottom" style="width:1.38%;">  </td> <td valign="bottom" style="width:17.08%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> <td valign="bottom" style="width:1.3%;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:80.22%;"> Contingent consideration payments</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.38%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:17.08%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.3%;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" style="width:80.22%; border-bottom:solid 0.75pt transparent;"> Change in fair value of contingent consideration</td> <td valign="bottom" style="width:1.38%; border-bottom:solid 0.75pt #000000;">  </td> <td valign="bottom" style="width:17.08%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> <td valign="bottom" style="width:1.3%; border-bottom:solid 0.75pt transparent;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:80.22%; border-bottom:double 2.5pt transparent;"> Value at June 30, 2016</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.38%; border-top:solid 0.75pt #000000; border-bottom:double 2.5pt #000000;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:17.08%; border-top:solid 0.75pt #000000; border-bottom:double 2.5pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">5,862,464</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.3%; border-bottom:double 2.5pt transparent;white-space:nowrap;">  </td> </tr> </table></div> The fair value of contingent consideration obligations is estimated through valuation models designed to estimate the probability of such contingent payments based on various assumptions and incorporating estimated success rates.  Estimated payments are discounted using present value techniques to arrive at estimated fair value at the balance sheet date.  Changes in the fair value of the contingent consideration obligations can result from changes to one or multiple inputs, including adjustments to the discount rates, changes in the amount or timing of expected expenditures associated with product development, changes in the amount or timing of cash flows from products upon commercialization, changes in the assumed achievement or timing of any development milestones, changes in the probability of certain clinical events and changes in the assumed probability associated with regulatory approval. Each of these assumptions can have a significant impact on the calculation of contingent consideration. The carrying amounts of the Company’s other financial instruments, which include accounts receivable, accounts payable, and accrued expenses approximate their respective fair values due to the relatively short-term nature of these instruments. The carrying value of the Company’s other long-term liabilities approximates fair value based on market interest rates. </div>

<div> Principles of Consolidation—The consolidated financial statements include the accounts of Arrowhead and its Subsidiaries.  Arrowhead’s primary operating subsidiary is Arrowhead Madison, which is located in Madison, Wisconsin, where the Company’s research and development facilities are located.  All significant intercompany accounts and transactions are eliminated in consolidation. </div>

<div> Basis of Presentation and Use of Estimates—The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  In the opinion of management, all adjustments, consisting of normal recurring accruals, considered necessary for a fair presentation have been included.  Actual results could materially differ from those estimates. Additionally, certain reclassifications have been made to prior period financial statements to conform to the current period presentation. </div>

<div> Cash and Cash Equivalents—The Company considers all liquid debt instruments purchased with a maturity of three months or less to be cash equivalents.  The Company had no restricted cash at June 30, 2016 and September 30, 2015.</div>

<div> Concentration of Credit Risk—The Company maintains several bank accounts at two financial institutions for its operations. These accounts are insured by the Federal Deposit Insurance Corporation (FDIC) for up to $250,000 per institution. Management believes the Company is not exposed to significant credit risk due to the financial position of the depository institutions in which these deposits are held. </div>

<div> Investments—The Company may invest excess cash balances in short-term and long-term marketable debt securities. Investments may consist of certificates of deposits, money market accounts, government-sponsored enterprise securities, corporate bonds and/or commercial paper. The Company accounts for its investment in marketable securities in accordance with FASB ASC 320, Investments – Debt and Equity Securities. This statement requires certain securities to be classified into three categories: Held-to-maturity—Debt securities that the entity has the positive intent and ability to hold to maturity are reported at amortized cost. Trading Securities—Debt and equity securities that are bought and held primarily for the purpose of selling in the near term are reported at fair value, with unrealized gains and losses included in earnings. Available-for-Sale—Debt and equity securities not classified as either securities held-to-maturity or trading securities are reported at fair value with unrealized gains or losses excluded from earnings and reported as a separate component of shareholders’ equity. The Company classifies its investments in marketable debt securities based on the facts and circumstances present at the time of purchase of the securities. At June 30, 2016, the Company classified all of its investments as held-to-maturity. Held-to-maturity investments are measured and recorded at amortized cost on the Company’s Consolidated Balance Sheet. Discounts and premiums to par value of the debt securities are amortized to interest income/expense over the term of the security. No gains or losses on investment securities are realized until they are sold or a decline in fair value is determined to be other-than-temporary. </div>

<div> Property and Equipment—Property and equipment are recorded at cost, which may equal fair market value in the case of property and equipment acquired in conjunction with a business acquisition. Depreciation of property and equipment is recorded using the straight-line method over the respective useful lives of the assets ranging from three to seven years. Leasehold improvements are amortized over the lesser of the expected useful life or the remaining lease term. Long-lived assets, including property and equipment are reviewed for impairment whenever events or circumstances indicate that the carrying amount of these assets may not be recoverable. </div>

<div> Intangible Assets Subject to Amortization—Intangible assets subject to amortization include certain patents and license agreements. Intangible assets subject to amortization are reviewed for impairment whenever events or circumstances indicate that the carrying amount of these assets may not be recoverable.</div>

<div> In-Process Research & Development (IPR&D)—IPR&D assets represent capitalized on-going research projects that were acquired through business combinations. Such assets are initially measured at their acquisition date fair values. The amounts capitalized are being accounted for as indefinite-lived intangible assets, subject to impairment testing until completion or abandonment of R&D efforts associated with the project. Upon successful completion of a project, Arrowhead will make a determination as to the then remaining useful life of the intangible asset and begin amortization. Arrowhead tests its indefinite-lived assets for impairment at least annually, through a two-step process. The first step is a qualitative assessment to determine if it is more likely than not that the indefinite lived assets are impaired. Arrowhead considers relevant events and circumstances that could affect the inputs used to determine the fair value of the intangible assets. If the qualitative assessment indicates that it is more likely than not that the intangible assets are impaired, a second step is performed which is a quantitative test to determine the fair value of the intangible asset. If the carrying amount of the intangible assets exceeds its fair value, an impairment loss is recorded in the amount of that excess. If circumstances determine that it is appropriate, the Company may also elect to bypass step one, and proceed directly to the second step. </div>

<div> Contingent Consideration - The consideration for the Company’s acquisitions often includes future payments that are contingent upon the occurrence of a particular event.  For example, milestone payments might be based on the achievement of various regulatory approvals or future sales milestones, and royalty payments might be based on drug product sales levels. The Company records a contingent consideration obligation for such contingent payments at fair value on the acquisition date. The Company estimates the fair value of contingent consideration obligations through valuation models designed to estimate the probability of such contingent payments based on various assumptions and incorporating estimated success rates.  Estimated payments are discounted using present value techniques to arrive at an estimated fair value at the balance sheet date. Changes in the fair value of the contingent consideration obligations are recognized within the Company’s Consolidated Statements of Operations and Comprehensive Loss. Changes in the fair value of the contingent consideration obligations can result from changes to one or multiple inputs, including adjustments to the discount rates, changes in the amount or timing of expected expenditures associated with product development, changes in the amount or timing of cash flows from products upon commercialization, changes in the assumed achievement or timing of any development milestones, changes in the probability of certain clinical events and changes in the assumed probability associated with regulatory approval. These fair value measurements are based on significant inputs not observable in the market. Substantial judgment is employed in determining the appropriateness of these assumptions as of the acquisition date and for each subsequent period. Accordingly, changes in assumptions could have a material impact on the amount of contingent consideration expense the Company records in any given period.</div>

<div> Revenue Recognition— Revenue from product sales is recorded when persuasive evidence of an arrangement exists, title has passed and delivery has occurred, a price is fixed and determinable, and collection is reasonably assured. The Company may generate revenue from technology licenses, collaborative research and development arrangements, research grants and product sales. Revenue under technology licenses and collaborative agreements typically consists of nonrefundable and/or guaranteed technology license fees, collaborative research funding, and various milestone and future product royalty or profit-sharing payments. Revenue associated with research and development funding payments under collaborative agreements is recognized ratably over the relevant periods specified in the agreement, generally the research and development period. Revenue from up-front license fees, milestones and product royalties are recognized as earned based on the completion of the milestones and product sales, as defined in the respective agreements. Payments received in advance of recognition as revenue are recorded as deferred revenue.  </div>

<div> Allowance for Doubtful Accounts—The Company accrues an allowance for doubtful accounts based on estimates of uncollectible revenues by analyzing historical collections, accounts receivable aging and other factors. Accounts receivable are written off when all collection attempts have failed. </div>

<div> Research and Development—Costs and expenses that can be clearly identified as research and development are charged to expense as incurred in accordance with FASB ASC 730-10.  Included in research and development costs are operating costs, facilities, supplies, external services, clinical trial and manufacturing costs, overhead directly related to the Company’s research and development operations, and costs to acquire technology licenses.</div>

<div> Earnings (Loss) per Share—Basic earnings (loss) per share is computed using the weighted-average number of common shares outstanding during the period. Diluted earnings (loss) per share are computed using the weighted-average number of common shares and dilutive potential common shares outstanding during the period. Dilutive potential common shares primarily consist of stock options and restricted stock units issued to employees and warrants to purchase Common Stock of the Company.  All outstanding stock options, restricted stock units and warrants for the three and nine months ended June 30, 2016 and 2015 have been excluded from the calculation of Diluted earnings (loss) per share due to their anti-dilutive effect.    </div>

<div> Stock-Based Compensation—The Company accounts for share-based compensation arrangements in accordance with FASB ASC 718, which requires the measurement and recognition of compensation expense for all share-based payment awards to be based on estimated fair values. The Company uses the Black-Scholes option valuation model to estimate the fair value of its stock options at the date of grant. The Black-Scholes option valuation model requires the input of subjective assumptions to calculate the value of stock options. For restricted stock units, the value of the award is based on the Company’s stock price at the grant date.  For performance-based restricted stock unit awards, the value of the award is based on the Company’s stock price at the grant date, with consideration given to the probability of the performance condition being achieved.  The Company uses historical data and other information to estimate the expected price volatility for stock option awards and the expected forfeiture rate for all awards.  Expense is recognized over the vesting period for all awards, and commences at the grant date for time-based awards and upon the Company’s determination that the achievement of such performance conditions is probable for performance-based awards. This determination requires significant judgment by management. </div>

<div> Derivative Assets and Liabilities – The Company accounts for warrants and other derivative financial instruments as either equity or assets/liabilities based upon the characteristics and provisions of each instrument. Warrants classified as equity are recorded as additional paid-in capital on the Company’s Consolidated Balance Sheet. Some of the Company’s warrants were determined to be ineligible for equity classification due to provisions that may result in an adjustment to their exercise price. Warrants classified as derivative liabilities and other derivative financial instruments that require separate accounting as assets or liabilities are recorded on the Company’s Consolidated Balance Sheet at their fair value on the date of issuance and are revalued on each subsequent balance sheet date until such instruments are exercised or expire, with any changes in the fair value between reporting periods recorded as other income or expense. The Company estimates the fair value of these assets/liabilities using option pricing models that are based on the individual characteristics of the warrants or instruments on the valuation date, as well as assumptions for expected volatility, expected life and risk-free interest rate. </div>

<div> Income Taxes—The Company accounts for income taxes under the liability method, which requires the recognition of deferred income tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred income taxes are recognized for the tax consequences in future years of differences between the tax bases of assets and liabilities and their financial reporting amounts at each period end based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established, when necessary, to reduce deferred income tax assets to the amount expected to be realized. The provision for income taxes, if any, represents the tax payable for the period and the change in deferred income tax assets and liabilities during the period.  </div>

<div> Recent Accounting Pronouncements        In March 2016, the FASB issued ASU No. 2016-02, Leases.  Under ASU 2016-02, lessees will be required to recognize a right-of-use asset and a lease liability for virtually all of their leases (other than leases that meet the definition of a short-term lease). For income statement purposes, a dual model was retained, requiring leases to be classified as either operating or finance. Operating leases will result in straight-line expense (similar to current operating leases) while finance leases will result in a front-loaded expense pattern (similar to current capital leases). ASU 2016-02 becomes effective for the Company in the first quarter of fiscal 2020. The Company expects the adoption of this update to have a material effect on the classification and disclosure of its leased facilities in Madison, Wisconsin.         In March 2016, the FASB issued ASU No. 2016-09, Compensation - Stock Compensation: Improvements to Employee Share-Based Payment Accounting. ASU 2016-09 eliminates additional paid in capital ("APIC") pools and requires excess tax benefits and tax deficiencies to be recorded in the income statement when the awards vest or are settled. The accounting for an employee's use of shares to satisfy the employer's statutory income tax withholding obligation and the accounting for forfeitures is also changing. ASU 2016-09 becomes effective for the Company in the first quarter of 2018. The Company early adopted ASU 2016-09 during the three months ended March 31, 2016, and the adoption of this update is not expected to have a material effect on its Consolidated Financial Statements. </div>

<div> The following table summarizes the Company’s major classes of property and equipment:   <div> <table border="0" cellspacing="0" cellpadding="0" align="center" style="border-collapse:collapse; width:76%;"> <tr> <td valign="bottom" style="padding-left:0pt;padding-Right:0.75pt;padding-Top:0.75pt;padding-Bottom:0pt;width:67.14%;">  </td> <td colspan="6" valign="bottom" style="padding-left:0pt;padding-Right:0.75pt;padding-Top:0.75pt;padding-Bottom:0pt;width:31.58%;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-size:1pt;font-family:Times New Roman;font-style:normal;text-transform:none;font-variant: normal;"> </td> <td valign="bottom" style="padding-left:0pt;padding-Right:0.75pt;padding-Top:0.75pt;padding-Bottom:0pt;width:1.28%;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" style="padding-left:0pt;padding-Right:0.75pt;padding-Top:0.75pt;padding-Bottom:0pt;width:67.14%;">  </td> <td colspan="2" valign="bottom" style="padding-left:0pt;padding-Right:0.75pt;padding-Top:0.75pt;padding-Bottom:0pt;width:14.48%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-size:8pt;font-family:Times New Roman;font-style:normal;text-transform:none;font-variant: normal;">June 30, <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-size:8pt;font-family:Times New Roman;font-style:normal;text-transform:none;font-variant: normal;">2016</td> <td valign="bottom" style="padding-left:0pt;padding-Right:0.75pt;padding-Top:0.75pt;padding-Bottom:0pt;width:1.32%;white-space:nowrap;">  </td> <td valign="bottom" style="padding-left:0pt;padding-Right:0.75pt;padding-Top:0.75pt;padding-Bottom:0pt;width:1.32%;">  </td> <td colspan="2" valign="bottom" style="padding-left:0pt;padding-Right:0.75pt;padding-Top:0.75pt;padding-Bottom:0pt;width:14.48%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-size:8pt;font-family:Times New Roman;font-style:normal;text-transform:none;font-variant: normal;">September 30, 2015</td> <td valign="bottom" style="padding-left:0pt;padding-Right:0.75pt;padding-Top:0.75pt;padding-Bottom:0pt;width:1.28%;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="padding-left:0pt;padding-Right:0.75pt;padding-Top:0.75pt;padding-Bottom:0pt;width:67.14%;"> Computers, office equipment and furniture</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.32%; border-top:solid 0.75pt #000000;white-space:nowrap;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:13.16%; border-top:solid 0.75pt #000000;white-space:nowrap;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">445,797</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.32%;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.32%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.32%; border-top:solid 0.75pt #000000;white-space:nowrap;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:13.16%; border-top:solid 0.75pt #000000;white-space:nowrap;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">404,964</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.28%;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" style="padding-left:0pt;padding-Right:0.75pt;padding-Top:0.75pt;padding-Bottom:0pt;width:67.14%;"> Research equipment</td> <td valign="bottom" style="width:1.32%;white-space:nowrap;">  </td> <td valign="bottom" style="width:13.16%;white-space:nowrap;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">7,299,105</td> <td valign="bottom" style="width:1.32%;white-space:nowrap;">  </td> <td valign="bottom" style="width:1.32%;">  </td> <td valign="bottom" style="width:1.32%;white-space:nowrap;">  </td> <td valign="bottom" style="width:13.16%;white-space:nowrap;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">6,354,584</td> <td valign="bottom" style="width:1.28%;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="padding-left:0pt;padding-Right:0.75pt;padding-Top:0.75pt;padding-Bottom:0pt;width:67.14%;"> Software</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.32%;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:13.16%;white-space:nowrap;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">121,568</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.32%;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.32%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.32%;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:13.16%;white-space:nowrap;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">110,428</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.28%;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" style="padding-left:0pt;padding-Right:0.75pt;padding-Top:0.75pt;width:67.14%; border-bottom:solid 0.75pt transparent;"> Leasehold improvements</td> <td valign="bottom" style="width:1.32%; border-bottom:solid 0.75pt #000000;white-space:nowrap;">  </td> <td valign="bottom" style="width:13.16%; border-bottom:solid 0.75pt #000000;white-space:nowrap;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">10,988,715</td> <td valign="bottom" style="width:1.32%; border-bottom:solid 0.75pt transparent;white-space:nowrap;">  </td> <td valign="bottom" style="width:1.32%; border-bottom:solid 0.75pt transparent;">  </td> <td valign="bottom" style="width:1.32%; border-bottom:solid 0.75pt #000000;white-space:nowrap;">  </td> <td valign="bottom" style="width:13.16%; border-bottom:solid 0.75pt #000000;white-space:nowrap;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">3,117,537</td> <td valign="bottom" style="width:1.28%; border-bottom:solid 0.75pt transparent;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="padding-left:0pt;padding-Right:0.75pt;padding-Top:0.75pt;padding-Bottom:0pt;width:67.14%;"> Total gross fixed assets </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.32%; border-top:solid 0.75pt #000000;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:13.16%; border-top:solid 0.75pt #000000;white-space:nowrap;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">18,855,185</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.32%;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.32%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.32%; border-top:solid 0.75pt #000000;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:13.16%; border-top:solid 0.75pt #000000;white-space:nowrap;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">9,987,513</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.28%;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" style="padding-left:0pt;padding-Right:0.75pt;padding-Top:0.75pt;width:67.14%; border-bottom:solid 0.75pt transparent;"> Less:   Accumulated depreciation and amortization</td> <td valign="bottom" style="width:1.32%; border-bottom:solid 0.75pt #000000;white-space:nowrap;">  </td> <td valign="bottom" style="width:13.16%; border-bottom:solid 0.75pt #000000;white-space:nowrap;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">(6,580,364</td> <td valign="bottom" style="width:1.32%; border-bottom:solid 0.75pt transparent;white-space:nowrap;"> )</td> <td valign="bottom" style="width:1.32%; border-bottom:solid 0.75pt transparent;">  </td> <td valign="bottom" style="width:1.32%; border-bottom:solid 0.75pt #000000;white-space:nowrap;">  </td> <td valign="bottom" style="width:13.16%; border-bottom:solid 0.75pt #000000;white-space:nowrap;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">(5,460,665</td> <td valign="bottom" style="width:1.28%; border-bottom:solid 0.75pt transparent;white-space:nowrap;"> )</td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="padding-left:0pt;padding-Right:0.75pt;padding-Top:0.75pt;width:67.14%; border-bottom:double 2.5pt transparent;"> Property and equipment, net </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.32%; border-top:solid 0.75pt #000000; border-bottom:double 2.5pt #000000;white-space:nowrap;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:13.16%; border-top:solid 0.75pt #000000; border-bottom:double 2.5pt #000000;white-space:nowrap;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">12,274,821</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.32%; border-bottom:double 2.5pt transparent;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.32%; border-bottom:double 2.5pt transparent;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.32%; border-top:solid 0.75pt #000000; border-bottom:double 2.5pt #000000;white-space:nowrap;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:13.16%; border-top:solid 0.75pt #000000; border-bottom:double 2.5pt #000000;white-space:nowrap;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">4,526,848</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.28%; border-bottom:double 2.5pt transparent;white-space:nowrap;">  </td> </tr> </table></div>  </div>

<div> The following table provides details on the Company’s intangible asset balances:   <div> <table border="0" cellspacing="0" cellpadding="0" align="center" style="border-collapse:collapse; width:86.42%;"> <tr> <td valign="bottom" style="width:55.24%;"> <p style="text-align:center;margin-top:0pt;margin-bottom:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-style:normal;font-family:Times New Roman;font-size:10pt;text-transform:none;font-variant: normal;"> </td> <td colspan="2" valign="bottom" style="padding-left:0.7pt;padding-Right:0.7pt;padding-Top:0pt;padding-Bottom:0pt;width:13.24%;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-size:8pt;font-family:Times New Roman;font-style:normal;text-transform:none;font-variant: normal;">Intangible assets not subject to amortization</td> <td valign="bottom" style="width:1.08%;">  </td> <td valign="bottom" style="width:1.08%;"> <p style="text-align:center;margin-top:0pt;margin-bottom:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-style:normal;font-family:Times New Roman;font-size:10pt;text-transform:none;font-variant: normal;">  </td> <td colspan="2" valign="bottom" style="padding-left:0.7pt;padding-Right:0.7pt;padding-Top:0pt;padding-Bottom:0pt;width:13.02%;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-size:8pt;font-family:Times New Roman;font-style:normal;text-transform:none;font-variant: normal;">Intangible assets subject to amortization</td> <td valign="bottom" style="width:1.08%;">  </td> <td valign="bottom" style="width:1.08%;"> <p style="text-align:center;margin-top:0pt;margin-bottom:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-style:normal;font-family:Times New Roman;font-size:10pt;text-transform:none;font-variant: normal;"> </td> <td colspan="2" valign="bottom" style="padding-left:0.7pt;padding-Right:0.7pt;padding-Top:0pt;padding-Bottom:0pt;width:13%;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-size:8pt;font-family:Times New Roman;font-style:normal;text-transform:none;font-variant: normal;">Total Intangible assets</td> <td valign="bottom" style="width:1.18%;">  </td> </tr> <tr style="height:11.5pt;"> <td valign="bottom" style="width:55.24%;"> Balance at September 30, 2015</td> <td valign="bottom" style="width:1.08%;"> <p style="margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">$</td> <td valign="bottom" style="width:12.16%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">944,935</td> <td valign="bottom" style="width:1.08%;white-space:nowrap;">  </td> <td valign="bottom" style="width:1.08%;">  </td> <td valign="bottom" style="width:1.08%;"> <p style="margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">$</td> <td valign="bottom" style="width:11.94%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-size:10pt;font-family:Times New Roman;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">23,879,181</td> <td valign="bottom" style="width:1.08%;white-space:nowrap;">  </td> <td valign="bottom" style="width:1.08%;">  </td> <td valign="bottom" style="width:1.08%;"> <p style="margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">$</td> <td valign="bottom" style="width:11.92%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-size:10pt;font-family:Times New Roman;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">24,824,116</td> <td valign="bottom" style="width:1.18%;white-space:nowrap;">  </td> </tr> <tr style="height:11.5pt;"> <td valign="bottom" bgcolor="#CFF0FC" style="width:55.24%; border-bottom:solid 0.75pt transparent;"> <p style="margin-bottom:0pt;margin-top:0pt;margin-left:12pt;;text-indent:-12pt;;color:#000000;font-size:10pt;font-family:Times New Roman;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">Amortization</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%; border-bottom:solid 0.75pt #000000;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:12.16%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">-</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%; border-bottom:solid 0.75pt transparent;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%; border-bottom:solid 0.75pt transparent;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%; border-bottom:solid 0.75pt #000000;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:11.94%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">(1,289,206</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%; border-bottom:solid 0.75pt transparent;white-space:nowrap;"> )</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%; border-bottom:solid 0.75pt transparent;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%; border-bottom:solid 0.75pt #000000;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:11.92%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">(1,289,206</td> <td valign="bottom" style="width:1.18%; border-bottom:solid 0.75pt transparent;white-space:nowrap;"> )</td> </tr> <tr> <td valign="top" style="width:55.24%; border-bottom:double 2.5pt transparent;"> <p style="margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-size:10pt;font-family:Times New Roman;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">Balance at June 30, 2016</td> <td valign="bottom" style="width:1.08%; border-top:solid 0.75pt #000000; border-bottom:double 2.5pt #000000;"> <p style="margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">$</td> <td valign="bottom" style="width:12.16%; border-top:solid 0.75pt #000000; border-bottom:double 2.5pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">944,935</td> <td valign="bottom" style="width:1.08%; border-bottom:double 2.5pt transparent;white-space:nowrap;">  </td> <td valign="bottom" style="width:1.08%; border-bottom:double 2.5pt transparent;"> <p style="text-align:center;margin-top:0pt;margin-bottom:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-style:normal;font-family:Times New Roman;font-size:10pt;text-transform:none;font-variant: normal;"> </td> <td valign="bottom" style="width:1.08%; border-top:solid 0.75pt #000000; border-bottom:double 2.5pt #000000;"> <p style="margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">$</td> <td valign="bottom" style="width:11.94%; border-top:solid 0.75pt #000000; border-bottom:double 2.5pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">22,589,975</td> <td valign="bottom" style="width:1.08%; border-bottom:double 2.5pt transparent;white-space:nowrap;">  </td> <td valign="bottom" style="width:1.08%; border-bottom:double 2.5pt transparent;"> <p style="text-align:center;margin-top:0pt;margin-bottom:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-style:normal;font-family:Times New Roman;font-size:10pt;text-transform:none;font-variant: normal;"> </td> <td valign="bottom" style="width:1.08%; border-top:solid 0.75pt #000000; border-bottom:double 2.5pt #000000;"> <p style="margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">$</td> <td valign="bottom" style="width:11.92%; border-top:solid 0.75pt #000000; border-bottom:double 2.5pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">23,534,910</td> <td valign="bottom" style="width:1.18%; border-bottom:double 2.5pt transparent;white-space:nowrap;">  </td> </tr> </table></div>  </div>

<div> As of June 30, 2016, future minimum lease payments due in fiscal years under capitalized leases are as follows:   <div> <table border="0" cellspacing="0" cellpadding="0" align="center" style="border-collapse:collapse; width:68%;"> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:82.3%;"> 2016 (remainder of)</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.56%;"> <p style="margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">$</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:14.68%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">57,105</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.44%;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" style="width:82.3%;"> 2017 </td> <td valign="bottom" style="width:1.56%;">  </td> <td valign="bottom" style="width:14.68%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">228,420</td> <td valign="bottom" style="width:1.44%;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:82.3%;"> 2018 </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.56%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:14.68%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">228,420</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.44%;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" style="width:82.3%;"> 2019 </td> <td valign="bottom" style="width:1.56%;">  </td> <td valign="bottom" style="width:14.68%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">95,175</td> <td valign="bottom" style="width:1.44%;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:82.3%;"> 2020 </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.56%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:14.68%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">-</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.44%;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" style="width:82.3%;"> 2021 and thereafter</td> <td valign="bottom" style="width:1.56%;">  </td> <td valign="bottom" style="width:14.68%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">-</td> <td valign="bottom" style="width:1.44%;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:82.3%; border-bottom:solid 0.75pt transparent;"> Less interest</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.56%; border-bottom:solid 0.75pt #000000;">   </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:14.68%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">(13,605 </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.44%; border-bottom:solid 0.75pt transparent;white-space:nowrap;"> <p style="margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">)</td> </tr> <tr> <td valign="bottom" style="width:82.3%;"> Principal</td> <td valign="bottom" style="width:1.56%;">  </td> <td valign="bottom" style="width:14.68%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">595,515</td> <td valign="bottom" style="width:1.44%;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:82.3%; border-bottom:solid 0.75pt transparent;"> Less current portion</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.56%; border-bottom:solid 0.75pt #000000;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:14.68%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">(216,653 </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.44%; border-bottom:solid 0.75pt transparent;white-space:nowrap;"> <p style="margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">)</td> </tr> <tr> <td valign="bottom" style="width:82.3%; border-bottom:double 2.5pt transparent;"> Noncurrent portion</td> <td valign="bottom" style="width:1.56%; border-bottom:double 2.5pt #000000;"> $</td> <td valign="bottom" style="width:14.68%; border-bottom:double 2.5pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">378,862</td> <td valign="bottom" style="width:1.44%; border-bottom:double 2.5pt transparent;white-space:nowrap;">  </td> </tr> </table></div>  </div>

<div> As of June 30, 2016, future minimum lease payments due in fiscal years under operating leases are as follows:   <div> <table border="0" cellspacing="0" cellpadding="0" align="center" style="border-collapse:collapse; width:68%;"> <tr> <td valign="top" bgcolor="#CFF0FC" style="width:82.3%;"> 2016 (remainder of)</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.56%;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:14.68%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">192,220</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.44%;white-space:nowrap;">  </td> </tr> <tr> <td valign="top" style="width:82.3%;"> 2017 </td> <td valign="bottom" style="width:1.56%;">  </td> <td valign="bottom" style="width:14.68%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">1,330,839</td> <td valign="bottom" style="width:1.44%;white-space:nowrap;">  </td> </tr> <tr> <td valign="top" bgcolor="#CFF0FC" style="width:82.3%;"> 2018 </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.56%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:14.68%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">1,303,345</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.44%;white-space:nowrap;">  </td> </tr> <tr> <td valign="top" style="width:82.3%;"> 2019 </td> <td valign="bottom" style="width:1.56%;">  </td> <td valign="bottom" style="width:14.68%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">1,340,234</td> <td valign="bottom" style="width:1.44%;white-space:nowrap;">  </td> </tr> <tr> <td valign="top" bgcolor="#CFF0FC" style="width:82.3%;"> 2020 </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.56%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:14.68%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">1,044,431 </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.44%;white-space:nowrap;">  </td> </tr> <tr> <td valign="top" style="width:82.3%; border-bottom:solid 0.75pt transparent;"> 2021 and thereafter</td> <td valign="bottom" style="width:1.56%; border-bottom:solid 0.75pt #000000;">  </td> <td valign="bottom" style="width:14.68%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">6,836,991 </td> <td valign="bottom" style="width:1.44%; border-bottom:solid 0.75pt transparent;white-space:nowrap;">  </td> </tr> <tr> <td valign="top" bgcolor="#CFF0FC" style="width:82.3%; border-bottom:double 2.5pt transparent;"> Total</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.56%; border-bottom:double 2.5pt #000000;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:14.68%; border-bottom:double 2.5pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">12,048,060</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.44%; border-bottom:double 2.5pt transparent;white-space:nowrap;">  </td> </tr> </table></div>  </div>

<div> The following table summarizes information about stock options:   <div> <table border="0" cellspacing="0" cellpadding="0" align="center" style="border-collapse:collapse; width:92%;"> <tr> <td valign="bottom" style="width:53.2%;"> <p style="text-align:center;margin-top:0pt;margin-bottom:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-style:normal;font-family:Times New Roman;font-size:10pt;text-transform:none;font-variant: normal;"> </td> <td colspan="2" valign="bottom" style="padding-left:0.7pt;padding-Right:0.7pt;padding-Top:0pt;padding-Bottom:0pt;width:9.56%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-size:8pt;font-family:Times New Roman;font-style:normal;text-transform:none;font-variant: normal;">Number of Options Outstanding</td> <td valign="bottom" style="width:1.22%;">  </td> <td valign="bottom" style="width:0.96%;"> <p style="text-align:center;margin-top:0pt;margin-bottom:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-style:normal;font-family:Times New Roman;font-size:10pt;text-transform:none;font-variant: normal;"> </td> <td colspan="2" valign="bottom" style="padding-left:0.7pt;padding-Right:0.7pt;padding-Top:0pt;padding-Bottom:0pt;width:9.78%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-size:8pt;font-family:Times New Roman;font-style:normal;text-transform:none;font-variant: normal;">Weighted- Average Exercise Price Per Share</td> <td valign="bottom" style="width:1.14%;">  </td> <td valign="bottom" style="width:1.14%;"> <p style="text-align:center;margin-top:0pt;margin-bottom:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-style:normal;font-family:Times New Roman;font-size:10pt;text-transform:none;font-variant: normal;">  </td> <td colspan="2" valign="bottom" style="padding-left:0.7pt;padding-Right:0.7pt;padding-Top:0pt;padding-Bottom:0pt;width:9.6%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-size:8pt;font-family:Times New Roman;font-style:normal;text-transform:none;font-variant: normal;">Weighted- Average Remaining Contractual Term</td> <td valign="bottom" style="width:0.98%;">  </td> <td valign="bottom" style="width:1.14%;"> <p style="text-align:center;margin-top:0pt;margin-bottom:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-style:normal;font-family:Times New Roman;font-size:10pt;text-transform:none;font-variant: normal;">  </td> <td colspan="2" valign="bottom" style="padding-left:0.7pt;padding-Right:0.7pt;padding-Top:0pt;padding-Bottom:0pt;width:10.34%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-size:8pt;font-family:Times New Roman;font-style:normal;text-transform:none;font-variant: normal;">Aggregate Intrinsic Value</td> <td valign="bottom" style="width:0.9%;">  </td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:53.2%;"> Balance At September 30, 2015</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:0.96%; border-top:solid 0.75pt #000000;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:8.62%; border-top:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-size:10pt;font-family:Times New Roman;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">5,435,640</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.22%;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:0.96%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.16%;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:8.62%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">6.71</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.14%;white-space:nowrap;">   </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.14%;"> <p style="text-align:center;margin-top:0pt;margin-bottom:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-style:normal;font-family:Times New Roman;font-size:10pt;text-transform:none;font-variant: normal;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:0.98%;"> <p style="text-align:center;margin-top:0pt;margin-bottom:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-style:normal;font-family:Times New Roman;font-size:10pt;text-transform:none;font-variant: normal;"> </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:8.62%;"> <p style="text-align:center;margin-top:0pt;margin-bottom:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-style:normal;font-family:Times New Roman;font-size:10pt;text-transform:none;font-variant: normal;"> </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:0.98%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.14%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.14%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:9.2%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:0.9%;">  </td> </tr> <tr> <td valign="bottom" style="width:53.2%;"> Granted</td> <td valign="bottom" style="width:0.96%;">  </td> <td valign="bottom" style="width:8.62%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">1,387,000</td> <td valign="bottom" style="width:1.22%;white-space:nowrap;">  </td> <td valign="bottom" style="width:0.96%;">  </td> <td valign="bottom" style="width:1.16%;">  </td> <td valign="bottom" style="width:8.62%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">6.12</td> <td valign="bottom" style="width:1.14%;white-space:nowrap;">   </td> <td valign="bottom" style="width:1.14%;"> <p style="text-align:center;margin-top:0pt;margin-bottom:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-style:normal;font-family:Times New Roman;font-size:10pt;text-transform:none;font-variant: normal;">  </td> <td valign="bottom" style="width:0.98%;"> <p style="text-align:center;margin-top:0pt;margin-bottom:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-style:normal;font-family:Times New Roman;font-size:10pt;text-transform:none;font-variant: normal;"> </td> <td valign="bottom" style="width:8.62%;"> <p style="text-align:center;margin-top:0pt;margin-bottom:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-style:normal;font-family:Times New Roman;font-size:10pt;text-transform:none;font-variant: normal;"> </td> <td valign="bottom" style="width:0.98%;">  </td> <td valign="bottom" style="width:1.14%;">  </td> <td valign="bottom" style="width:1.14%;">  </td> <td valign="bottom" style="width:9.2%;">  </td> <td valign="bottom" style="width:0.9%;">  </td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:53.2%;"> Cancelled</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:0.96%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:8.62%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">(99,897)</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.22%;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:0.96%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.16%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:8.62%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">9.86</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.14%;white-space:nowrap;">   </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.14%;"> <p style="text-align:center;margin-top:0pt;margin-bottom:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-style:normal;font-family:Times New Roman;font-size:10pt;text-transform:none;font-variant: normal;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:0.98%;"> <p style="text-align:center;margin-top:0pt;margin-bottom:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-style:normal;font-family:Times New Roman;font-size:10pt;text-transform:none;font-variant: normal;"> </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:8.62%;"> <p style="text-align:center;margin-top:0pt;margin-bottom:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-style:normal;font-family:Times New Roman;font-size:10pt;text-transform:none;font-variant: normal;"> </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:0.98%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.14%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.14%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:9.2%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:0.9%;">  </td> </tr> <tr> <td valign="bottom" style="width:53.2%; border-bottom:solid 0.75pt transparent;"> Exercised</td> <td valign="bottom" style="width:0.96%; border-bottom:solid 0.75pt #000000;">  </td> <td valign="bottom" style="width:8.62%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">(4,687)</td> <td valign="bottom" style="width:1.22%; border-bottom:solid 0.75pt transparent;white-space:nowrap;">  </td> <td valign="bottom" style="width:0.96%; border-bottom:solid 0.75pt transparent;">  </td> <td valign="bottom" style="width:1.16%; border-bottom:solid 0.75pt #000000;">  </td> <td valign="bottom" style="width:8.62%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">5.45</td> <td valign="bottom" style="width:1.14%; border-bottom:solid 0.75pt transparent;white-space:nowrap;">   </td> <td valign="bottom" style="width:1.14%; border-bottom:solid 0.75pt transparent;"> <p style="text-align:center;margin-top:0pt;margin-bottom:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-style:normal;font-family:Times New Roman;font-size:10pt;text-transform:none;font-variant: normal;">  </td> <td valign="bottom" style="width:0.98%; border-bottom:solid 0.75pt transparent;">  </td> <td valign="bottom" style="width:8.62%; border-bottom:solid 0.75pt transparent;">  </td> <td valign="middle" style="width:0.98%; border-bottom:solid 0.75pt transparent;">  </td> <td valign="bottom" style="width:1.14%; border-bottom:solid 0.75pt transparent;">  </td> <td valign="bottom" style="width:1.14%; border-bottom:solid 0.75pt transparent;">  </td> <td valign="bottom" style="width:9.2%; border-bottom:solid 0.75pt transparent;">  </td> <td valign="middle" style="width:0.9%; border-bottom:solid 0.75pt transparent;">  </td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:53.2%; border-bottom:solid 0.75pt transparent;"> Balance At June 30, 2016</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:0.96%; border-top:solid 0.75pt #000000; border-bottom:solid 0.75pt #000000;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:8.62%; border-top:solid 0.75pt #000000; border-bottom:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">6,718,056</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.22%; border-bottom:solid 0.75pt transparent;white-space:nowrap;">   </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:0.96%; border-bottom:solid 0.75pt transparent;"> <p style="text-align:center;margin-top:0pt;margin-bottom:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-style:normal;font-family:Times New Roman;font-size:10pt;text-transform:none;font-variant: normal;"> </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.16%; border-top:solid 0.75pt #000000; border-bottom:solid 0.75pt #000000;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:8.62%; border-top:solid 0.75pt #000000; border-bottom:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">6.54</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.14%; border-bottom:solid 0.75pt transparent;white-space:nowrap;">   </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.14%; border-bottom:solid 0.75pt transparent;"> <p style="text-align:center;margin-top:0pt;margin-bottom:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-style:normal;font-family:Times New Roman;font-size:10pt;text-transform:none;font-variant: normal;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:0.98%; border-bottom:solid 0.75pt transparent;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:8.62%; border-bottom:solid 0.75pt transparent;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">7.6 years </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:0.98%; border-bottom:solid 0.75pt transparent;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.14%; border-bottom:solid 0.75pt transparent;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.14%; border-bottom:solid 0.75pt transparent;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:9.2%; border-bottom:solid 0.75pt transparent;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">4,073,899</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:0.9%; border-bottom:solid 0.75pt transparent;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" style="width:53.2%; border-bottom:double 2.5pt transparent;"> Exercisable At June 30, 2016</td> <td valign="bottom" style="width:0.96%; border-top:solid 0.75pt #000000; border-bottom:double 2.5pt #000000;">  </td> <td valign="bottom" style="width:8.62%; border-top:solid 0.75pt #000000; border-bottom:double 2.5pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">3,563,564</td> <td valign="bottom" style="width:1.22%; border-bottom:double 2.5pt transparent;white-space:nowrap;">  </td> <td valign="bottom" style="width:0.96%; border-bottom:double 2.5pt transparent;">  </td> <td valign="bottom" style="width:1.16%; border-top:solid 0.75pt #000000; border-bottom:double 2.5pt #000000;"> $</td> <td valign="bottom" style="width:8.62%; border-top:solid 0.75pt #000000; border-bottom:double 2.5pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">6.16</td> <td valign="bottom" style="width:1.14%; border-bottom:double 2.5pt transparent;white-space:nowrap;">  </td> <td valign="bottom" style="width:1.14%; border-bottom:double 2.5pt transparent;">  </td> <td valign="bottom" style="width:0.98%; border-bottom:double 2.5pt transparent;">  </td> <td valign="bottom" style="width:8.62%; border-bottom:double 2.5pt transparent;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">6.6 years</td> <td valign="bottom" style="width:0.98%; border-bottom:double 2.5pt transparent;white-space:nowrap;">  </td> <td valign="bottom" style="width:1.14%; border-bottom:double 2.5pt transparent;">  </td> <td valign="bottom" style="width:1.14%; border-bottom:double 2.5pt transparent;"> $</td> <td valign="bottom" style="width:9.2%; border-bottom:double 2.5pt transparent;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">3,304,194</td> <td valign="bottom" style="width:0.9%; border-bottom:double 2.5pt transparent;white-space:nowrap;">  </td> </tr> </table></div>  </div>

<div> The assumptions used to value stock options are as follows:   <div> <table border="0" cellspacing="0" cellpadding="0" align="center" style="border-collapse:collapse; width:76%;"> <tr> <td valign="bottom" style="width:65.78%;"> <p style="text-align:center;margin-top:0pt;margin-bottom:0pt;margin-left:0pt;;;font-weight:bold;font-style:normal;font-family:Times New Roman;font-size:10pt;text-transform:none;font-variant: normal;text-indent:0pt;;"> </td> <td valign="top" style="width:1.32%;">  </td> <td colspan="3" valign="bottom" style="padding-left:0.7pt;padding-Right:0.7pt;padding-Top:0pt;padding-Bottom:0pt;width:32.88%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-size:8pt;font-family:Times New Roman;font-style:normal;text-transform:none;font-variant: normal;">Nine months ended June 30,</td> </tr> <tr> <td valign="bottom" style="width:65.78%;"> <p style="text-align:center;margin-top:0pt;margin-bottom:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-style:normal;font-family:Times New Roman;font-size:10pt;text-transform:none;font-variant: normal;"> </td> <td valign="top" style="width:1.32%;">  </td> <td valign="bottom" style="padding-left:0.7pt;padding-Right:0.7pt;padding-Top:0pt;padding-Bottom:0pt;width:15.8%; border-top:solid 0.75pt #000000; border-bottom:solid 0.75pt #000000;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-size:8pt;font-family:Times New Roman;font-style:normal;text-transform:none;font-variant: normal;">2016 </td> <td valign="bottom" style="width:1.32%;">  </td> <td valign="bottom" style="padding-left:0.7pt;padding-Right:0.7pt;padding-Top:0pt;padding-Bottom:0pt;width:15.78%; border-top:solid 0.75pt #000000; border-bottom:solid 0.75pt #000000;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-size:8pt;font-family:Times New Roman;font-style:normal;text-transform:none;font-variant: normal;">2015 </td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:65.78%;"> Dividend yield</td> <td valign="top" bgcolor="#CFF0FC" style="width:1.32%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:15.8%; border-top:solid 0.75pt #000000;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.32%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:15.78%; border-top:solid 0.75pt #000000;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> </tr> <tr> <td valign="bottom" style="width:65.78%;"> Risk-free interest rate</td> <td valign="top" style="width:1.32%;">  </td> <td valign="bottom" style="width:15.8%;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">1.42 – 1.89%</td> <td valign="bottom" style="width:1.32%;">  </td> <td valign="bottom" style="width:15.78%;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">1.46 – 1.88%</td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:65.78%;"> Volatility</td> <td valign="top" bgcolor="#CFF0FC" style="width:1.32%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:15.8%;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">89%</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.32%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:15.78%;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">75%</td> </tr> <tr> <td valign="bottom" style="width:65.78%;"> Expected life (in years)</td> <td valign="top" style="width:1.32%;">  </td> <td valign="bottom" style="width:15.8%;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">6.25</td> <td valign="bottom" style="width:1.32%;">  </td> <td valign="bottom" style="width:15.78%;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">6 - 6.25</td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:65.78%;"> <p style="margin-bottom:0pt;margin-top:0pt;margin-left:12pt;;text-indent:-12pt;;font-size:10pt;letter-spacing:-0.2pt;font-family:Times New Roman;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">Weighted average grant date fair value per share of options granted</td> <td valign="top" bgcolor="#CFF0FC" style="width:1.32%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:15.8%;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">$4.59</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.32%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:15.78%;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">$4.25</td> </tr> </table></div>  </div>

<div> The following table summarizes the activity of the Company’s Restricted Stock Units:   <div> <table border="0" cellspacing="0" cellpadding="0" align="center" style="border-collapse:collapse; width:76%;"> <tr> <td valign="bottom" style="width:67.1%;">  </td> <td colspan="2" valign="bottom" style="width:14.42%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-size:8pt;font-family:Times New Roman;font-style:normal;text-transform:none;font-variant: normal;">Number of RSUs</td> <td valign="bottom" style="width:1.42%;white-space:nowrap;">  </td> <td valign="bottom" style="width:1.3%;">  </td> <td colspan="2" valign="bottom" style="width:14.44%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-size:8pt;font-family:Times New Roman;font-style:normal;text-transform:none;font-variant: normal;">Weighted- Average Grant Date Fair Value</td> <td valign="bottom" style="width:1.3%;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:67.1%;"> Unvested at September 30, 2015</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.3%; border-top:solid 0.75pt #000000;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:13.14%; border-top:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">934,167</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.42%;white-space:nowrap;">   </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.3%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.3%; border-top:solid 0.75pt #000000;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:13.14%; border-top:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">9.18</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.3%;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" style="width:67.1%;"> Granted</td> <td valign="bottom" style="width:1.3%;">  </td> <td valign="top" style="width:13.14%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">838,517</td> <td valign="bottom" style="width:1.42%;white-space:nowrap;">  </td> <td valign="bottom" style="width:1.3%;">  </td> <td valign="bottom" style="width:1.3%;">  </td> <td valign="top" style="width:13.14%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">6.15</td> <td valign="bottom" style="width:1.3%;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:67.1%;"> Vested</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.3%;">  </td> <td valign="top" bgcolor="#CFF0FC" style="width:13.14%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">(402,684</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.42%;white-space:nowrap;"> ) </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.3%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.3%;">  </td> <td valign="top" bgcolor="#CFF0FC" style="width:13.14%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">10.95</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.3%;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" style="width:67.1%; border-bottom:solid 0.75pt transparent;"> Forfeited</td> <td valign="bottom" style="width:1.3%; border-bottom:solid 0.75pt #000000;">  </td> <td valign="top" style="width:13.14%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> <td valign="bottom" style="width:1.42%; border-bottom:solid 0.75pt transparent;white-space:nowrap;">  </td> <td valign="bottom" style="width:1.3%; border-bottom:solid 0.75pt transparent;">  </td> <td valign="bottom" style="width:1.3%; border-bottom:solid 0.75pt #000000;">  </td> <td valign="top" style="width:13.14%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> <td valign="bottom" style="width:1.3%; border-bottom:solid 0.75pt transparent;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:67.1%; border-bottom:double 2.5pt transparent;"> <p style="margin-bottom:0pt;margin-top:0pt;margin-left:12.25pt;;text-indent:-12.25pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">Unvested at June 30, 2016</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.3%; border-top:solid 0.75pt #000000; border-bottom:double 2.5pt #000000;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:13.14%; border-top:solid 0.75pt #000000; border-bottom:double 2.5pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">1,370,000</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.42%; border-bottom:double 2.5pt transparent;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.3%; border-bottom:double 2.5pt transparent;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.3%; border-top:solid 0.75pt #000000; border-bottom:double 2.5pt #000000;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:13.14%; border-top:solid 0.75pt #000000; border-bottom:double 2.5pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">6.80</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.3%; border-bottom:double 2.5pt transparent;white-space:nowrap;">  </td> </tr> </table></div>  </div>

<div> The following table summarizes fair value measurements at June 30, 2016 and September 30, 2015 for assets and liabilities measured at fair value on a recurring basis: June 30, 2016:   <div> <table border="0" cellspacing="0" cellpadding="0" align="center" style="border-collapse:collapse; width:92%;"> <tr> <td valign="bottom" style="width:44.58%;"> <p style="text-align:center;margin-top:0pt;margin-bottom:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-style:normal;font-family:Times New Roman;font-size:10pt;text-transform:none;font-variant: normal;"> </td> <td colspan="2" valign="bottom" style="padding-left:0.7pt;padding-Right:0.7pt;padding-Top:0pt;padding-Bottom:0pt;width:12.14%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-size:8pt;font-family:Times New Roman;font-style:normal;text-transform:none;font-variant: normal;">Level 1</td> <td valign="bottom" style="width:1.08%;">  </td> <td valign="bottom" style="width:1.08%;">  </td> <td colspan="2" valign="bottom" style="padding-left:0.7pt;padding-Right:0.7pt;padding-Top:0pt;padding-Bottom:0pt;width:12.02%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-size:8pt;font-family:Times New Roman;font-style:normal;text-transform:none;font-variant: normal;">Level 2</td> <td valign="bottom" style="width:1.08%;">  </td> <td valign="bottom" style="width:1.08%;">  </td> <td colspan="2" valign="bottom" style="padding-left:0.7pt;padding-Right:0.7pt;padding-Top:0pt;padding-Bottom:0pt;width:11.96%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-size:8pt;font-family:Times New Roman;font-style:normal;text-transform:none;font-variant: normal;">Level 3</td> <td valign="bottom" style="width:1.08%;">  </td> <td valign="bottom" style="width:1.08%;">  </td> <td colspan="2" valign="bottom" style="padding-left:0.7pt;padding-Right:0.7pt;padding-Top:0pt;padding-Bottom:0pt;width:11.96%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-size:8pt;font-family:Times New Roman;font-style:normal;text-transform:none;font-variant: normal;">Total</td> <td valign="bottom" style="width:0.88%;">  </td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:44.58%;"> Cash and cash equivalents</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.1%; border-top:solid 0.75pt #000000;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:11.02%; border-top:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">43,616,543</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%; border-top:solid 0.75pt #000000;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:10.94%; border-top:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%; border-top:solid 0.75pt #000000;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:10.88%; border-top:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%; border-top:solid 0.75pt #000000;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:10.88%; border-top:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">43,616,543</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:0.88%;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" style="width:44.58%;"> Derivative liabilities</td> <td valign="bottom" style="width:1.1%;"> $</td> <td valign="bottom" style="width:11.02%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> <td valign="bottom" style="width:1.08%;white-space:nowrap;">  </td> <td valign="bottom" style="width:1.08%;">  </td> <td valign="bottom" style="width:1.08%;"> $</td> <td valign="bottom" style="width:10.94%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> <td valign="bottom" style="width:1.08%;white-space:nowrap;">  </td> <td valign="bottom" style="width:1.08%;">  </td> <td valign="bottom" style="width:1.08%;"> $</td> <td valign="bottom" style="width:10.88%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">1,068,552</td> <td valign="bottom" style="width:1.08%;white-space:nowrap;">  </td> <td valign="bottom" style="width:1.08%;">  </td> <td valign="bottom" style="width:1.08%;"> $</td> <td valign="bottom" style="width:10.88%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">1,068,552</td> <td valign="bottom" style="width:0.88%;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:44.58%;"> Acquisition-related contingent consideration obligations</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.1%;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:11.02%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:10.94%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:10.88%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">5,862,464</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:10.88%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">5,862,464</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:0.88%;white-space:nowrap;">  </td> </tr> </table></div> September 30, 2015:   <div> <table border="0" cellspacing="0" cellpadding="0" align="center" style="border-collapse:collapse; width:92%;"> <tr> <td valign="bottom" style="width:44.58%;">  </td> <td colspan="2" valign="bottom" style="padding-left:0.7pt;padding-Right:0.7pt;padding-Top:0pt;padding-Bottom:0pt;width:12.12%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-size:8pt;font-family:Times New Roman;font-style:normal;text-transform:none;font-variant: normal;">Level 1</td> <td valign="bottom" style="width:1.08%;">  </td> <td valign="bottom" style="width:1.08%;">  </td> <td colspan="2" valign="bottom" style="padding-left:0.7pt;padding-Right:0.7pt;padding-Top:0pt;padding-Bottom:0pt;width:12.02%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-size:8pt;font-family:Times New Roman;font-style:normal;text-transform:none;font-variant: normal;">Level 2</td> <td valign="bottom" style="width:1.08%;">  </td> <td valign="bottom" style="width:1.08%;">  </td> <td colspan="2" valign="bottom" style="padding-left:0.7pt;padding-Right:0.7pt;padding-Top:0pt;padding-Bottom:0pt;width:11.96%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-size:8pt;font-family:Times New Roman;font-style:normal;text-transform:none;font-variant: normal;">Level 3</td> <td valign="bottom" style="width:1.08%;">  </td> <td valign="bottom" style="width:1.08%;">  </td> <td colspan="2" valign="bottom" style="padding-left:0.7pt;padding-Right:0.7pt;padding-Top:0pt;padding-Bottom:0pt;width:11.96%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-size:8pt;font-family:Times New Roman;font-style:normal;text-transform:none;font-variant: normal;">Total</td> <td valign="bottom" style="width:0.9%;">  </td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:44.58%;"> Cash and cash equivalents</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.1%; border-top:solid 0.75pt #000000;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:11%; border-top:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">81,214,354</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%; border-top:solid 0.75pt #000000;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:10.94%; border-top:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%; border-top:solid 0.75pt #000000;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:10.88%; border-top:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%; border-top:solid 0.75pt #000000;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:10.88%; border-top:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">81,214,354</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:0.9%;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" style="width:44.58%;"> Derivative liabilities</td> <td valign="bottom" style="width:1.1%;"> $</td> <td valign="bottom" style="width:11%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> <td valign="bottom" style="width:1.08%;white-space:nowrap;">  </td> <td valign="bottom" style="width:1.08%;">  </td> <td valign="bottom" style="width:1.08%;"> $</td> <td valign="bottom" style="width:10.94%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> <td valign="bottom" style="width:1.08%;white-space:nowrap;">  </td> <td valign="bottom" style="width:1.08%;">  </td> <td valign="bottom" style="width:1.08%;"> $</td> <td valign="bottom" style="width:10.88%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">1,301,604</td> <td valign="bottom" style="width:1.08%;white-space:nowrap;">  </td> <td valign="bottom" style="width:1.08%;">  </td> <td valign="bottom" style="width:1.08%;"> $</td> <td valign="bottom" style="width:10.88%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">1,301,604</td> <td valign="bottom" style="width:0.9%;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:44.58%;"> <p style="margin-bottom:0pt;margin-top:0pt;margin-left:12.25pt;;text-indent:-12.25pt;;font-size:10pt;font-family:Times New Roman;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">Acquisition-related contingent consideration obligations</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.1%;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:11%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:10.94%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:10.88%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">5,862,464</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.08%;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:10.88%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">5,862,464</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:0.9%;white-space:nowrap;">  </td> </tr> </table></div>  </div>

<div> The assumptions used in valuing the derivative liability were as follows:   <div> <table border="0" cellspacing="0" cellpadding="0" align="center" style="border-collapse:collapse; width:76%;"> <tr> <td valign="bottom" style="width:42.76%;"> 2012 Warrants</td> <td valign="bottom" style="width:1.04%;">  </td> <td valign="bottom" style="width:28%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">June 30, 2016</td> <td valign="bottom" style="width:1.04%;white-space:nowrap;">  </td> <td valign="bottom" style="width:1.04%;">  </td> <td valign="bottom" style="width:26.12%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">September 30, 2015</td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:42.76%;"> Risk-free interest rate</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.04%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:28%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">0.52%</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.04%;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.04%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:26.12%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">0.6%</td> </tr> <tr> <td valign="bottom" style="width:42.76%;"> Expected life</td> <td valign="bottom" style="width:1.04%;">  </td> <td valign="bottom" style="width:28%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:36pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">1.5 Years</td> <td valign="bottom" style="width:1.04%;">  </td> <td valign="bottom" style="width:1.04%;">  </td> <td valign="bottom" style="width:26.12%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">2.2 Years</td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:42.76%;"> Dividend yield</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.04%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:28%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.04%;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.04%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:26.12%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> </tr> <tr> <td valign="bottom" style="width:42.76%;"> Volatility</td> <td valign="bottom" style="width:1.04%;">  </td> <td valign="bottom" style="width:28%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">89%</td> <td valign="bottom" style="width:1.04%;white-space:nowrap;">  </td> <td valign="bottom" style="width:1.04%;">  </td> <td valign="bottom" style="width:26.12%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">75%</td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:42.76%;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;"> </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.04%;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;"> </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:28%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.04%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.04%;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;"> </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:26.12%;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;"> </td> </tr> <tr> <td valign="bottom" style="width:42.76%;"> 2013 Warrants</td> <td valign="bottom" style="width:1.04%;">  </td> <td valign="bottom" style="width:28%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">June 30, 2016</td> <td valign="bottom" style="width:1.04%;white-space:nowrap;">  </td> <td valign="bottom" style="width:1.04%;">  </td> <td valign="bottom" style="width:26.12%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">September 30, 2015</td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:42.76%;"> Risk-free interest rate</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.04%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:28%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">0.52%</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.04%;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.04%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:26.12%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">0.6%</td> </tr> <tr> <td valign="bottom" style="width:42.76%;"> Expected life</td> <td valign="bottom" style="width:1.04%;">  </td> <td valign="bottom" style="width:28%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:36pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">1.6 Years</td> <td valign="bottom" style="width:1.04%;">  </td> <td valign="bottom" style="width:1.04%;">  </td> <td valign="bottom" style="width:26.12%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">2.3 Years</td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:42.76%;"> Dividend yield</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.04%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:28%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.04%;white-space:nowrap;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.04%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:26.12%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> </tr> <tr> <td valign="bottom" style="width:42.76%;"> Volatility</td> <td valign="bottom" style="width:1.04%;">  </td> <td valign="bottom" style="width:28%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">89%</td> <td valign="bottom" style="width:1.04%;white-space:nowrap;">  </td> <td valign="bottom" style="width:1.04%;">  </td> <td valign="bottom" style="width:26.12%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">75%</td> </tr> </table></div>  </div>

<div> The following is a reconciliation of the derivative liability related to these warrants:   <div> <table border="0" cellspacing="0" cellpadding="0" align="center" style="border-collapse:collapse; width:76%;"> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:80.28%;"> Value at September 30, 2015</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.32%;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:17.1%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">1,272,802</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.3%;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" style="width:80.28%;"> Issuance of instruments</td> <td valign="bottom" style="width:1.32%;">  </td> <td valign="bottom" style="width:17.1%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> <td valign="bottom" style="width:1.3%;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:80.28%;"> Change in value</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.32%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:17.1%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">(230,852</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.3%;white-space:nowrap;"> )</td> </tr> <tr> <td valign="bottom" style="width:80.28%; border-bottom:solid 0.75pt transparent;"> Net settlements</td> <td valign="bottom" style="width:1.32%; border-bottom:solid 0.75pt #000000;">  </td> <td valign="bottom" style="width:17.1%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> <td valign="bottom" style="width:1.3%; border-bottom:solid 0.75pt transparent;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:80.28%; border-bottom:double 2.5pt transparent;"> Value at June 30, 2016</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.32%; border-top:solid 0.75pt #000000; border-bottom:double 2.5pt #000000;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:17.1%; border-top:solid 0.75pt #000000; border-bottom:double 2.5pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">1,041,950</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.3%; border-bottom:double 2.5pt transparent;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" style="width:80.28%;">  </td> <td valign="bottom" style="width:1.32%; border-top:double 2.5pt #000000;">  </td> <td valign="bottom" style="width:17.1%; border-top:double 2.5pt #000000;">  </td> <td valign="bottom" style="width:1.3%;white-space:nowrap;">  </td> </tr> </table></div>  </div>

<div> The assumptions used in valuing the derivative liability were as follows:   <div> <table border="0" cellspacing="0" cellpadding="0" align="center" style="border-collapse:collapse; width:76%;"> <tr> <td valign="bottom" style="width:72.36%;"> <p style="text-align:center;margin-top:0pt;margin-bottom:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-style:normal;font-family:Times New Roman;font-size:10pt;text-transform:none;font-variant: normal;"> </td> <td valign="bottom" style="padding-left:0.7pt;padding-Right:0.7pt;padding-Top:0pt;padding-Bottom:0pt;width:13.16%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-size:8pt;font-family:Times New Roman;font-style:normal;text-transform:none;font-variant: normal;">June 30, <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-size:8pt;font-family:Times New Roman;font-style:normal;text-transform:none;font-variant: normal;">2016</td> <td valign="bottom" style="width:1.32%;">  </td> <td valign="bottom" style="padding-left:0.7pt;padding-Right:0.7pt;padding-Top:0pt;padding-Bottom:0pt;width:13.16%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:center;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-weight:bold;font-size:8pt;font-family:Times New Roman;font-style:normal;text-transform:none;font-variant: normal;">September 30,  2015</td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:72.36%;"> Risk-free interest rate</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:13.16%; border-top:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">0.52%</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.32%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:13.16%; border-top:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">1.00%</td> </tr> <tr> <td valign="bottom" style="width:72.36%;"> Expected life</td> <td valign="bottom" style="width:13.16%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">1.6 Years</td> <td valign="bottom" style="width:1.32%;">  </td> <td valign="bottom" style="width:13.16%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">2.5 Years</td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:72.36%;"> Dividend yield</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:13.16%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.32%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:13.16%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> </tr> <tr> <td valign="bottom" style="width:72.36%;"> Volatility</td> <td valign="bottom" style="width:13.16%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">89%</td> <td valign="bottom" style="width:1.32%;">  </td> <td valign="bottom" style="width:13.16%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">75%</td> </tr> </table></div>  </div>

<div> The following is a reconciliation of the derivative liability related to these exchange rights:   <div> <table border="0" cellspacing="0" cellpadding="0" align="center" style="border-collapse:collapse; width:76%;"> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:80.22%;"> Value at September 30, 2015</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.38%;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:17.08%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">28,802</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.3%;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" style="width:80.22%;"> Issuance of instruments</td> <td valign="bottom" style="width:1.38%;">  </td> <td valign="bottom" style="width:17.08%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> <td valign="bottom" style="width:1.3%;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:80.22%;"> Change in value</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.38%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:17.08%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">(2,200</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.3%;white-space:nowrap;"> )</td> </tr> <tr> <td valign="bottom" style="width:80.22%; border-bottom:solid 0.75pt transparent;"> Net settlements</td> <td valign="bottom" style="width:1.38%; border-bottom:solid 0.75pt #000000;">  </td> <td valign="bottom" style="width:17.08%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> <td valign="bottom" style="width:1.3%; border-bottom:solid 0.75pt transparent;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:80.22%; border-bottom:double 2.5pt transparent;"> Value at June 30, 2016</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.38%; border-top:solid 0.75pt #000000; border-bottom:double 2.5pt #000000;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:17.08%; border-top:solid 0.75pt #000000; border-bottom:double 2.5pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">26,602</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.3%; border-bottom:double 2.5pt transparent;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" style="width:80.22%;">  </td> <td valign="bottom" style="width:1.38%; border-top:double 2.5pt #000000;">  </td> <td valign="bottom" style="width:17.08%; border-top:double 2.5pt #000000;">  </td> <td valign="bottom" style="width:1.3%;white-space:nowrap;">  </td> </tr> </table></div>  </div>

<div> The following is a reconciliation of contingent consideration fair value.   <div> <table border="0" cellspacing="0" cellpadding="0" align="center" style="border-collapse:collapse; width:76%;"> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:80.22%;"> Value at September 30, 2015</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.38%;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:17.08%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-size:10pt;font-family:Times New Roman;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">5,862,464</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.3%;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" style="width:80.22%;"> Purchase price contingent consideration</td> <td valign="bottom" style="width:1.38%;">  </td> <td valign="bottom" style="width:17.08%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> <td valign="bottom" style="width:1.3%;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:80.22%;"> Contingent consideration payments</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.38%;">  </td> <td valign="bottom" bgcolor="#CFF0FC" style="width:17.08%;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.3%;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" style="width:80.22%; border-bottom:solid 0.75pt transparent;"> Change in fair value of contingent consideration</td> <td valign="bottom" style="width:1.38%; border-bottom:solid 0.75pt #000000;">  </td> <td valign="bottom" style="width:17.08%; border-bottom:solid 0.75pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">—</td> <td valign="bottom" style="width:1.3%; border-bottom:solid 0.75pt transparent;white-space:nowrap;">  </td> </tr> <tr> <td valign="bottom" bgcolor="#CFF0FC" style="width:80.22%; border-bottom:double 2.5pt transparent;"> Value at June 30, 2016</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.38%; border-top:solid 0.75pt #000000; border-bottom:double 2.5pt #000000;"> $</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:17.08%; border-top:solid 0.75pt #000000; border-bottom:double 2.5pt #000000;"> <p style="text-align:right;margin-bottom:0pt;margin-top:0pt;margin-left:0pt;;text-indent:0pt;;color:#000000;font-family:Times New Roman;font-size:10pt;font-weight:normal;font-style:normal;text-transform:none;font-variant: normal;">5,862,464</td> <td valign="bottom" bgcolor="#CFF0FC" style="width:1.3%; border-bottom:double 2.5pt transparent;white-space:nowrap;">  </td> </tr> </table></div>  </div>

less than 12 months

45000000

250000

P3Y

P7Y

445797

404964

7299105 6354584

121568

110428

10988715

3117537

18855185

9987513

6580364

5460665

26716

1003840

304942

17234960

P21Y

197874

P4Y

230000

P14Y

2069365

425107

1289206

438770

607801

425107

1700429

1700429 13662723

944935

23879181

22589975

150000000

2670990

15652

8742453

0.0999

70.60

4.16

3.25

2.12

1.83

7.14

94897

1000

307173

75000

277284

80000

835354

P10M24D P6M P1M6D P1Y6M P1Y6M P2Y

24000

2019-09 0.03

8500

P10Y

60000

2016-01-01 late 2016 15400000 900000 7300000 2

P5Y

26000

20000 4000

18000

13000

19000 83000 2016-12 232000 659000 182000 544000

57105

228420

95175

13605

595515

192220

1330839

1303345

1340234

1044431

6836991

12048060

49800000

8000000

41800000

2534518

5616651

2534518

3638916

1323334

544622

46666

1387000

838517

5435640

1387000

99897

4687

6718056

3563564

6.71

6.12

9.86

5.45

6.54

6.16

P7Y7M6D

P6Y7M6D

4073899

3304194

1476384

4205413

1289037

3469327

30440 6359672 285828 7100339

3515

113728

13383829

P2Y7M6D

0.0142

0.0146

0.0189

0.0188

0.89

0.75

P6Y3M

P6Y

P6Y3M

4.59

4.25

0.00

838517

At vesting, each RSU will be exchanged for one share of the Company’s Common Stock. Restricted stock unit awards generally vest subject to the satisfaction of service requirements or the satisfaction of both service requirements and achievement of certain performance targets.

934167

402684

1370000

9.18

6.15

10.95

6.80

1274401

3342554

1197037

3236682

3258026

P1Y7M6D

43616543

1068552

5862464

81214354

1301604

5862464

1003840

912543

265161

833530

12123

-110859

230082

-102763

2268798

329649 24324

0.0052

0.006

P1Y6M

P2Y2M12D

0.89

0.75

0.0052

0.006

P1Y7M6D

P2Y3M18D

0.89

0.75

1272802

-230852

1041950

P7Y 0.01 675000

500000

-2500

2200

-1950

177605

0.0052

0.0100

P1Y7M6D

P2Y6M

0.89

0.75

28802

-2200

26602

7630000

0.001

5.90

43200000

2016-08-12