8.	Stock Options

Employee Stock Options

A summary of employee stock option activity as of September 30, 2017 and changes during the nine months then ended are presented below:

	Shares		Weighted Average Fair Value Per Share		Weighted Average Exercise Price Per Share		Weighted Average Remaining Terms (in years)		Aggregate Intrinsic Value

Outstanding - December 31, 2016		295,051	$	1.25	$	3.00		9.86		-
Granted		598,552		1.22		4.28		-		-
Exercised		-		-		-		-		-
Cancelled		-		-		-		-		-
Outstanding – September 30, 2017		893,603	$	1.23	$	3.86		9.41	$	736,937

Exercisable – December 31, 2016		128,299	$	1.25	$	3.00		9.86	$	-
Exercisable – September 30, 2017		670,153	$	1.22	$	4.15		9.46	$	450,921

For the three months ended September 30, 2017, the Company recognized stock-based compensation expense of $439,821. For the nine months ended September 30, 2017 and 2016, the Company recognized stock-based compensation expense of $649,204 and $119,146, respectively. This expense is included in payroll and related expenses in the accompanying condensed consolidated statements of operations.

As of September 30, 2017, the Company had $260,773 of total unrecognized compensation costs related to non-vested stock options, which will be expensed over a weighted average period of 1.39 years. The intrinsic value is calculated as the difference between the fair value of the stock price at year end and the exercise price of each of the outstanding stock options. The fair value of the stock price at September 30, 2017 was $4.28 per share.

In March 2017, Paul Galvin, the Company’s Chief Executive Officer, and Mahesh Shetty, the Company’s Chief Financial Officer, were granted options to purchase 185,425 and 132,446 shares of the Company’s common stock, respectively, the exercise price of which was contingent on the offering price of the Public Offering. 185,425 of such options have an exercise price of $5.00 per share and 132,446 have an exercise price of $6.00 per share. These options vested during the three months ended September 30, 2017, when certain performance conditions were met. The fair value of these options upon issuance amounted to $370,558.

Non-Employee Stock Options

In September 2017, in connection with an advisory agreement entered into by the Company (the “Advisory Agreement”), a consultant was granted options to purchase 50,000 shares of the Company’s common stock, with an exercise price of $6.25. The options vest when certain performance conditions are met. These performance conditions consist of the purchase of fifty modular units from the Company. As of September 30, 2017, these options have not vested.