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C. STOCKHOLDERS EQUITY

3 Months Ended

Dec. 31, 2017

Stock options, stock bonuses and compensation granted by the Company as of December 31, 2017 are as follows:

Name of Plan	Total Shares Reserved Under Plans		Shares Reserved for Outstanding Options		Shares Issued		Remaining Options/Shares Under Plans

Incentive Stock Options Plans		138,400		124,758		N/A		454
Non-Qualified Stock Option Plans		1,187,200		1,107,054		N/A		46,798
Stock Bonus Plans		383,760		N/A		222,574		161,153
Stock Compensation Plan		134,000		N/A		115,590		18,410
Incentive Stock Bonus Plan		640,000		N/A		624,000		16,000

Stock options, stock bonuses and compensation granted by the Company as of September 30, 2017 are as follows:

Name of Plan	Total Shares Reserved Under Plans		Shares Reserved for Outstanding Options		Shares Issued		Remaining Options/Shares Under Plans

Incentive Stock Option Plans		138,400		124,758		N/A		454
Non-Qualified Stock Option Plans		1,187,200		1,115,086		N/A		42,830
Bonus Plans		383,760		N/A		206,390		177,337
Stock Compensation Plan		134,000		N/A		115,590		18,410
Incentive Stock Bonus Plan		640,000		N/A		624,000		16,000

Stock option activity:

	Three Months Ended December 31,
	2017		2016
Granted		10,300		-
Expired		17,523		15,081
Forfeited		809		-

Stock-Based Compensation Expense

	Three months Ended December 31,
	2017		2016
Employees	$	1,448,098	$	312,375
Non-employees	$	42,342	$	78,553

Employee compensation expense includes the expense related to options issued or vested and restricted stock. The increase in employee's expense in 2017 is primarily due to an increase of approximately $1.1 million in equity based compensation related to the Company's shareholder approved 2014 Incentive Stock Bonus Plan. Nonemployee expense includes the expense related to options and stock issued to consultants expensed over the period of their service contracts. Stock based compensation expense is included in general and administrative expenses on the statements of operations.

Warrants and Non-employee Options

The following chart presents the outstanding warrants and non-employee options, listed by expiration date at December 31, 2017:

Warrant	Issue Date	Shares Issuable upon Exercise of Warrants	Exercise Price	Expiration Date	Reference

Series DD	12/8/2016	1,360,960	$4.50	3/1/2018	1
Series EE	12/8/2016	1,360,960	$4.50	3/1/2018	1
Series N	8/18/2008	85,339	$3.00	8/18/2018	-
Series S	10/11/13- 10/24/14	1,037,120	$31.25	10/11/2018	1
Series V	5/28/2015	810,127	$19.75	5/28/2020	1
Series W	10/28/2015	688,930	$16.75	10/28/2020	1
Series X	1/13/2016	120,000	$9.25	1/13/2021	-
Series Y	2/15/2016	26,000	$12.00	2/15/2021	-
Series ZZ	5/23/2016	20,000	$13.75	5/18/2021	1
Series BB	8/26/2016	16,000	$13.75	8/22/2021	1
Series Z	5/23/2016	264,000	$13.75	11/23/2021	1
Series FF	12/8/2016	68,048	$3.91	12/1/2021	1
Series CC	12/8/2016	680,480	$5.00	12/8/2021	1
Series HH	2/23/2017	20,000	$3.13	2/16/2022	1
Series AA	8/26/2016	200,000	$13.75	2/22/2022	1
Series JJ	3/14/2017	30,000	$3.13	3/8/2022	1
Series LL	4/30/2017	26,398	$3.59	4/30/2022	1
Series MM	6/22/2017	893,491	$1.86	6/22/2022	-
Series NN	7/24/2017	539,300	$2.52	7/24/2022	-
Series OO	7/31/2017	60,000	$2.52	7/31/2022	-
Series QQ	8/22/2017	87,500	$2.50	8/22/2022	-
Series GG	2/23/2017	400,000	$3.00	8/23/2022	1
Series II	3/14/2017	600,000	$3.00	9/14/2022	1
Series RR	10/30/2017	583,057	$1.65	10/30/2022	2
Series KK	5/3/2017	395,970	$3.04	11/3/2022	1
Series SS	12/19/2017	1,289,478	$2.09	12/18/2022	2
Series PP	8/28/2017	1,750,000	$2.30	2/28/2023	-
Consultants	3/30/15- 7/28/17	40,000	$2.18- $25.50	3/29/18- 7/27/27	3

1.	Derivative Liabilities

The table below presents the warrant liabilities and their respective balances at the balance sheet dates:

	December 31, 2017		September 30, 2017

Series S warrants	$	19,705	$	32,773
Series V warrants		171,225		72,912
Series W warrants		213,221		83,754
Series Z warrants		132,751		77,216
Series ZZ warrants		8,096		4,753
Series AA warrants		112,447		65,087
Series BB warrants		6,953		4,322
Series CC warrants		591,041		394,220
Series DD warrants		9		5,492
Series EE warrants		9		5,492
Series FF warrants		65,201		47,154
Series GG warrants		457,305		342,173
Series HH warrants		21,676		16,014
Series II warrants		690,442		511,636
Series JJ warrants		32,745		24,203
Series KK warrants		460,747		345,720
Series LL warrants		28,059		20,481

Total warrant liabilities	$	3,011,632	$	2,053,402

The table below presents the gains and (losses) on the warrant liabilities for the three months ended December 31:

	2017			2016
Series S Warrants	$	13,068		$	2,621,321
Series V warrants		(98,313	)		1,417,721
Series W warrants		(129,467	)		1,667,604
Series Z warrants		(55,535	)		868,787
Series ZZ warrants		(3,343	)		63,884
Series AA warrants		(47,360	)		679,569
Series BB warrants		(2,631	)		52,672
Series CC warrants		(196,821	)		604,492
Series DD warrants		5,483			370,919
Series EE warrants		5,483			514,603
Series FF warrants		(18,047	)		66,740
Series GG warrants		(115,132	)		-
Series HH warrants		(5,662	)		-
Series II warrants		(178,806	)		-
Series JJ warrants		(8,542	)		-
Series KK warrants		(115,027	)		-
Series LL warrants		(7,578	)		-
Net (loss) gain on warrant liabilities	$	(958,230	)	$	8,928,312

The Company reviews all outstanding warrants in accordance with the requirements of ASC 815. This topic provides that an entity should use a two-step approach to evaluate whether an equity-linked financial instrument (or embedded feature) is indexed to its own stock, including evaluating the instrument’s contingent exercise and settlement provisions. The warrant agreements provide for adjustments to the exercise price for certain dilutive events. Under the provisions of ASC 815, the warrants are not considered indexed to the Company’s stock because future equity offerings or sales of the Company’s stock are not an input to the fair value of a “fixed-for-fixed” option on equity shares, and equity classification is therefore precluded.

In accordance with ASC 815, derivative liabilities must be measured at fair value upon issuance and re-valued at the end of each reporting period through expiration. Any change in fair value between the respective reporting dates is recognized as a gain or loss.

2. Issuance of Equity Warrants

Series SS Warrants

On December 19, 2017 the Company received subscription agreements for the purchase of 1,289,478 shares of CEL-SCI common stock at a price of $1.90 in the principal amount of $2.45 million. The purchasers of the common stock also received Series SS warrants which entitle the purchasers to acquire up to 1,289,478 shares of the Company’s common stock. The warrants are exercisable at a fixed price of $2.09 per share, are exercisable on June 20, 2018 and will expire on December 18, 2022. Shares issuable upon the exercise of the warrants will be restricted securities unless registered. The Company allocated the proceeds received to the shares and the Series SS warrants on a relative fair value basis. As a result of such allocation, the Company determined the initial carrying value of the Series SS warrants to be approximately $1.0 million. The Series SS warrants qualify for equity treatment in accordance with ASC 815.

Series RR Warrants

On October 30, 2017, holders of convertible notes in the principal amount of $1.1 million issued in June 2017 and holders of convertible notes in the principal amount of $1.2 million issued in July 2017 agreed to extend the maturity date of these notes to September 21, 2018. In consideration for the extension of the maturity date of the convertible notes, the Company issued a total of 583,057 Series RR warrants to the convertible note holders that agreed to the extension. Each Series RR warrant entitles the holder to purchase one share of the Company’s common stock. The Series RR warrants may be exercised at any time on or before October 30, 2022 at an exercise price of $1.65 per share. The Series RR warrants were recorded at the fair value on the date of issuance of approximately $0.7 million, as described in Note F.

Expiration of Warrants

On October 17, 2017, 17,821 Series U warrants, with an exercise price of $43.75 expired. The fair value of the Series U warrants was $0 on the date of expiration.

On December 6, 2016, 105,000 Series R warrants, with an exercise price of $100.00, expired. The fair value of the Series R warrants was $0 on the date of expiration.

3.	Options and shares issued to Consultants

The Company typically enters into consulting arrangements in exchange for common stock or stock options. During the three months ended December 31, 2017, the Company issued 13,705 shares of common stock, of which 13,705 were restricted shares. During the three months ended December 31, 2016, the Company issued 14,900 shares of common stock, of which 10,800 were restricted shares. The weighted average grant value of the shares issued to consultants was $1.85 and $4.98 during the three months ended December 31, 2017 and 2016, respectively. The aggregate values of the issuances of restricted common stock and common stock options are recorded as prepaid expenses and are charged to general and administrative expenses over the periods of service.

During the three months ended December 31, 2017 and 2016, the Company recorded total expense of approximately $42,000 and $79,000, respectively, relating to these consulting agreements. At December 31, 2017 and September 30, 2017, approximately $28,000 and $45,000, respectively, are included in prepaid expenses. As of December 31, 2017, the Company had 40,000 options outstanding, which were issued to consultants as payment for services. All off these options were vested and all were issued from the Non-Qualified Stock Option plans.

Other Equity Transactions

On August 15, 2017, the Company entered into a Securities Purchase Agreement with Ergomed plc, the Company’s Clinical Research Provider, to facilitate a partial payment of the accounts payable balances due Ergomed. Under the Agreement, the Company issued Ergomed 480,000 shares, with a fair market value of approximately $1.3 million, as a forbearance fee in exchange for Ergomed’s agreement to provisionally forbear collection of the payables in an amount equal to the net proceeds from the resales of the shares issued to Ergomed. During the year ended September 30, 2017, the Company recorded the full amount of the expense upon issuance, offset by amounts realized through the resale of 64,792 shares and the corresponding reduction of the payables, for a net expense of $1.2 million. During the quarter ended December 31, 2017, the Company realized approximately $0.7 million through the resale of the remaining 415,208 shares and reduced the payables and interest expense by that amount.