On August 26, 2009, the Company granted options for the purchase of 1,500,000 shares of common stock to an outside consultant for services rendered, with an exercise price of $0.10 per share, exercisable for up to five years, but including vesting provisions as follows: (i) options for 500,000 shares vested immediately on the date of grant, (ii) options for 500,000 additional shares vested in September 2012, the date certified by the Company as the date the Company’s hospital disinfection program completed its beta-testing, and (iii) options for the remaining 500,000 shares will vest on the date certified by the Company as the date that the Company’s process has been commercialized and a minimum of 50 units or devices have been sold to third parties by the Company. As of June 30, 2014, 500,000 shares had not yet vested and represent a deferred expense of $48,698.

In May 2012, the Company granted options for the purchase of 1,000,000 shares of common stock to an individual for services. Options for 550,000 shares have vested and the remaining options will vest on the date certified by the Company as the date that certain milestones are achieved. The options have an exercise price of $0.17 per share, and are exercisable for up to five years. The value of these options at the date of grant was $153,997, in connection with which the Company recognized $0 and $69,298 during the six months ended June 30, 2014 and 2013, respectively. The Company will recognize the remaining expense, totaling $69,300, when the achievement of the required milestones becomes probable.

In May 2012, the Company granted options for the purchase of 1,000,000 shares of common stock to an individual for medical consulting support services already performed. Options for 500,000 shares vested immediately on the grant date and 500,000 shares vested upon completion of certain milestones as of March 31, 2013 and September 30, 2013. The options have an exercise price of $0.17 per share and are exercisable for up to five years. The grant date fair value of these options was $149,460, in connection with which the Company recognized $25,409 during the six months ended June 30, 2013 and the final $23,913 during the three months ended September 30, 2013.

In August 2013, the Company granted options for the purchase of 250,000 shares of common stock to a consultant. These options are exercisable at $0.10 per share for five years from the date of grant. Options for 50,000 shares vested immediately and options for the remaining 200,000 shares will vest upon the achievement of certain milestones. The value of these options on the date of grant was $22,075, of which the Company recognized $4,416 during the three months ended September 30, 2013. As of June 30, 2014, options for 200,000 shares had not yet vested and represent deferred expense of $17,659 to be recognized when the achievement of the required milestones becomes probable.

In August 2013, the Company granted options for the purchase of 100,000 shares of common stock to an employee for services performed. The options vested upon grant, have an exercise price of $0.10 per share, and are exercisable for up to five years. The value of the options at the date of grant was $8,829, which the Company recognized as an expense during the three months ended September 30, 2013.

On February 26, 2014, the Company granted to a new director options for the purchase of 2,000,000 shares of common stock, with an exercise price of $0.1095 per share. Of these options, 1,000,000 will vest on February 26, 2015 and the remaining 1,000,000 options will vest upon the successful achievement of certain milestones. Unvested options would vest immediately in the event of a change in control of the Company. The options are exercisable for five years. The grant date fair value of the options was $192,184. The Company recognized $32,030 of expense during the six months ended June 30, 2014, with $64,062 to be recognized over the remaining vesting period in connection with those options that vest on February 26, 2015. Also, the Company will recognize an expense totaling $96,092 when the achievement of the required milestones becomes probable.

On February 26, 2014, the Company granted options to six consultants and service providers for the purchase of a total of 250,000 shares of common stock at an exercise price of $0.1095 per share. Options for 200,000 shares vested immediately upon grant and options for the remaining 50,000 shares will vest on January 9, 2015. The options are exercisable for five years. The grant date fair value of these options was $24,023. The Company recognized expense of $21,621 during the six months ended June 30, 2014 and the remaining expense of $2,402 will be recognized over the remaining vesting period in connection with those options that vest on January 9, 2015.

On April 30, 2014, the Company granted options for the purchase of a total of 1,350,000 shares of common stock for services rendered, as follows: 250,000 shares to each of four directors of the Company, 100,000 shares to each of two consultants, and 75,000 shares each to a consultant and an employee of the Company. All options vested upon grant, have an exercise price of $0.163 per share, and are exercisable for up to five years. The total value of these options at the date of grant was $193,234, which the Company recognized as an expense during the three months ended June 30, 2014.

On May 6, 2014, the Company granted options to a consultant for the purchase of 100,000 shares of common stock at an exercise price of $0.19 per share. Options for 50,000 shares vested immediately upon grant and options for the remaining 50,000 shares will vest when certain required milestones are achieved. The options are exercisable for five years. The grant date fair value of these options was $16,684. The Company recognized expense of $8,342 during the three months ended June 30, 2014 and the remaining expense of $8,342 will be recognized when the achievement of the required milestones becomes probable.

The options granted in April and May were made under the Company’s new 2014 Equity Compensation Plan (the 2014 Plan) adopted on April 30, 2014 by the Board of Directors. The Company filed a registration statement on Form S-8 on July 17, 2014, to register 6,000,000 shares of common stock that may be issued under the 2014 Plan.

The Company estimates the fair value of each stock option award by using the Black-Scholes option-pricing model, which model requires the use of exercise behavior data and the use of a number of assumptions including volatility of the Company’s stock price, the weighted average risk-free interest rate, and the weighted average expected life of the options. Because the Company does not pay dividends, the dividend rate variable in the Black-Scholes option-pricing model is zero. Expense of $255,227 and $94,707 related to stock options was recorded for the six-months ended June 30, 2014 and 2013, respectively. As of June 30, 2014, the Company had various unvested outstanding options with related unrecognized expense of $306,555. The Company will recognize this expense as these options vest over their remaining useful lives, which range from 5 to 59 months.