Note 10 - Stock options and awards:

On June 3, 2011, the Company’s shareholders approved the Ocean Bio-Chem, Inc. Omnibus Equity Compensation Plan (the “Plan”). The Plan is designed (i) to meet the Nasdaq listing requirements, (ii) to enable compensation attributable to grants under the Plan to qualify for an exemption from the deduction limit under section 162(m) of the Internal Revenue Code of 1986, as amended, and the regulations promulgated thereunder (the “Code”) and (iii) to enable incentive stock options to meet the requirements of the Code.

As a result of the adoption of the Plan, no further stock option grants will be made under the Company’s 2002 Non-Qualified Stock Option Plan, 2002 Incentive Stock Option Plan, 2007 Incentive Stock Option Plan, 2008 Non-Qualified Stock Option Plan and 2008 Incentive Stock Option Plan.

The Plan authorizes 750,000 shares of the Company’s common stock for issuance, subject to antidilution adjustments upon the occurrence of certain events affecting the common stock. On June 3, 2011, the Company issued stock awards under the Plan to officers, key employees and a consultant totaling 139,000 shares of common stock. As a result, 611,000 shares remained available for future issuance under the Plan. Compensation expense related to the stock awards was $321,000.

On May 4, 2011, stock options with respect to 5,000 shares were exercised.

On November 9, 2011, stock options with respect to 153,500 shares were exercised. Following the surrender of 44,227 shares in connection with a net exercise feature of the options, the Company issued an aggregate of 109,273 shares.

The following tables provide information at December 31, 2011 and 2010 regarding outstanding options under the Company’s stock option plans as well as a grant made outside of the Company’s stock option plans. As used in the table below, “2002 ISO” refers to the Company’s 2002 Incentive Stock Option Plan, “2007 ISO” refers to the Company’s 2007 Incentive Stock Option Plan, “2008 ISO” refers to the Company’s 2008 Incentive Stock Option Plan, “2002 NQ” refers to the Company’s 2002 Non-Qualified Stock Option Plan and “2008 NQ” refers to the Company’s 2008 Non-Qualified Stock Option Plan.

December 31, 2011									Weighted
	Date	Options		Exercisable		Exercise		Expiration	Average
Plan	granted	outstanding		options		Price		date	Remaining life
Non Plan	3/25/09		115,000		115,000		$ 0.55	3/24/14		2.3
2007 ISO	5/17/07		136,500		106,000		1.66	5/16/12		.4
2007 ISO	10/8/07		2,500		2,000		1.87	10/07/12		.8
2007 ISO	12/17/07		142,600		111,300		1.32	12/16/12		1.0
2008 ISO	8/25/08		144,100		81,500		0.97	8/21/13		1.7
2002 NQ	10/22/02		30,000		30,000		1.26	10/21/12		.8
2002 NQ	6/20/03		30,000		30,000		1.03	6/19/13		1.5
2002 NQ	5/25/04		30,000		30,000		1.46	5/24/14		2.4
2002 NQ	4/3/06		40,000		40,000		1.08	4/2/16		4.3
2002 NQ	12/17/07		50,000		50,000		1.32	12/16/17		6.0
2008 NQ	1/11/09		50,000		50,000		0.69	1/10/19		7.1
2008 NQ	4/26/10		25,000		25,000		2.07	4/25/20		8.4
			795,700		670,800		$ 1.17			2.4

December 31, 2010									Weighted
	Date	Options		Exercisable		Exercise		Expiration	Average
Plan	granted	outstanding		options		price		date	Remaining life
Non Plan	3/25/09		115,000		115,000		$ 0.55	3/24/14		3.3
2002 ISO	11/6/06		113,500		90,800		0.93	11/5/11		0.9
2007 ISO	5/17/07		167,500		100,500		1.66	5/16/12		1.4
2007 ISO	10/8/07		2,500		1,500		1.87	10/07/12		1.8
2007 ISO	12/17/07		154,600		92,760		1.32	12/16/12		2.0
2008 ISO	8/25/08		156,100		62,440		0.97	8/21/13		2.7
2002 NQ	10/22/02		35,000		35,000		1.26	10/21/12		1.8
2002 NQ	6/20/03		30,000		30,000		1.03	6/19/13		2.5
2002 NQ	5/25/04		30,000		30,000		1.46	5/24/14		3.4
2002 NQ	4/3/06		40,000		40,000		1.08	4/2/16		5.3
2002 NQ	12/17/07		50,000		50,000		1.32	12/16/17		7.1
2008 NQ	1/11/09		50,000		50,000		0.69	1/10/19		8.1
2008 NQ	4/26/10		25,000		25,000		2.07	4/25/20		9.5
			969,200		723,000		$ 1.16			3.0

The following table shows the number of options outstanding under each stock option plan at December 31, 2011:

Plan		Options Outstanding
Non Plan		115,000
2007 ISO		281,600
2008 ISO		144,100
2002 NQ		180,000
2008 NQ		75,000
Totals		795,700

The following table provides information relating to stock option transactions during the years ended December 31, 2011 and 2010:

	2011					2010
				Weighted					Weighted
				Average					Average
				Exercise					Exercise
	Shares			Price		Shares			Price
Options outstanding beginning of the year		854,200		$	1.24		839,000		$	1.21

Options granted		-			-		25,000			2.07
Options exercised		(158,500	)		1.05		(6,800	)		1.04
Options forfeited or expired		(15,000	)		1.66		(3,000	)		.97
Options outstanding end of the year		680,700			1.27		854,200			1.24
Non plan options		115,000			0.55		115,000			0.55
Totals		795,700		$	1.17		969,200		$	1.16

Stock options may be awarded as part of compensation to executives, employees, directors and others, pursuant to the terms of the Company’s Omnibus Equity Compensation Plan, but no options were awarded under the plan in 2011. Grants of stock options or other equity awards are made at the discretion of the Equity Grant Committee of the Board of Directors. Options previously were granted under the Company’s other stock option plans. Qualified options previously granted typically have a five-year term with vesting in equal 20% increments on each anniversary of the date of grant. Non-qualified options previously granted to outside directors have a 10-year term and are immediately exercisable. The last tranche of non-qualified options previously granted terminate on January 10, 2019. Compensation cost recognized during the year ended December 31, 2011 and 2010 attributable to stock options amounted to approximately $74,000 and $132,000, respectively.

At December 31, 2011 and 2010, there was approximately $68,000 and $163,000 of unrecognized compensation cost related to unvested share based compensation arrangements, which will be charged against operations as the options vest through the year ending December 31, 2013.