9.	Stock-Based Compensation

Stock Compensation Plans

Our stock-based compensation programs are long-term retention programs that are intended to attract, retain and provide incentives for talented employees, officers and directors, and to align stockholder and employee interests. We have the following stock-based compensation plans and programs:

During 1998, we adopted the 1998 Stock Option Plan (the “1998 Plan”). An aggregate of 285,714 shares of common stock were reserved for issuance upon the exercise of options granted under the 1998 Plan. In September 2005, the shareholders approved an increase in the number of shares available for issuance to 714,285 shares. The 1998 Plan expired on August 31, 2008. The options are exercisable for up to ten years from the grant date. As of December 31, 2016, there were outstanding options to purchase 209,997 share of Company common stock under the 1998 Plan.

Subsequent to the expiration of the 1998 Plan, the Company issued, outside of the 1998 Plan, non-incentive stock options for an aggregate of 1,243,584 shares of Company common stock. Of this amount, 672,247 remain outstanding at December 31, 2016.

During 2013, we adopted the 2013 Performance Incentive Plan (the “2013 Plan”), which allows us to grant options or restricted stock units to all employees, including executive officers, outside consultants and non-employee directors. An aggregate of 3.1 million shares of common stock are reserved for issuance upon the exercise of options granted under the 2013 Plan. Option vesting periods are generally four years for the 2013 Plan. Options granted under this plan generally expire ten years from the effective date of grant. As of December 31, 2016, there were outstanding options to purchase 1,631,617 shares of Company common stock and 98,439 unvested restricted stock awards outstanding under the 2013 Plan.

Issuance of Shares

When options and warrants are exercised, it is the Company’s policy to issue new shares.

Stock Option Activity

The following is a summary of stock option activity under our stock option plans for 2016 and 2015, and the status of stock options outstanding at December 31, 2016 and 2015:

	Year Ended				Year Ended
	December 31, 2016				December 31, 2015
			Wtd. Avg.				Wtd. Avg.
			Exercise				Exercise
	Shares		Price		Shares		Price
Outstanding at beginning of year		2,555,263	$	1.80		1,390,770	$	1.50
Granted		739,000		1.80		1,300,881		2.06
Exercised		(103,308)		1.22		(131,388)		1.23
Forfeited		(469,856)		2.15		(3,438)		3.77
Expired - vested		(207,238)		1.50		(1,562)		3.77
Outstanding at end of year		2,513,861	$	1.78		2,555,263	$	1.80

Stock options exercisable at year end		1,329,392	$	1.66		1,185,582	$	1.42

We recognized stock compensation expense of $612,440 and $511,457 related to options during the year ended December 31, 2016 and 2015, respectively. Weighted average fair value of options granted was $1.26 and $1.75 per share for the years ended December 31, 2016 and 2015, respectively.

During the year ended December 31, 2016, stock options covering 103,308 shares of common stock with a total intrinsic value of $51,302 were exercised. During the year ended December 31, 2015, stock options covering 131,388 shares of common stock with a total intrinsic value of $127,312 were exercised.

As of December 31, 2016, there was $361,408 of aggregate intrinsic value of outstanding stock options, including $358,777 of aggregate intrinsic value of exercisable stock options. Intrinsic value is the total pretax intrinsic value for all “in-the-money” options (i.e., the difference between the Company’s closing stock price on the last trading day of 2016 and the exercise price, multiplied by the number of shares) that would have been received by the option holders had all option holders exercised their options as of December 31, 2016. This amount will change based on the fair market value of the Company’s stock.

The following table summarizes information about stock options outstanding at December 31, 2016:

Range of		Number Outstanding at		Weighted Average Remaining		Weighted Average
Exercise Prices		December 31, 2016		Contractual Life		Exercise Price
$	0.49-$1.00		17,855		2.17	$	0.60
$	1.01-$1.30		631,366		2.80	$	1.14
$	1.31-$2.00		942,739		7.85	$	1.71
$	2.01-$10.75		921,901		8.19	$	2.31
			2,513,861		6.66	$	1.78

The weighted average remaining contractual life of exercisable options at December 31, 2016, is 4.6 years. Total unrecognized compensation cost at December 31, 2016 of $1,533,242 is expected to be recognized over a weighted average period of 2.7 years.

Restricted Stock

The following is a summary of unvested restricted stock activity for 2016 (none in 2015), and the status of unvested restricted stock outstanding at December 31, 2016 and 2015:

	Year Ended
	December 31, 2016
			Wtd. Avg.
			Grant Date
	Shares		Fair Value
Outstanding at beginning of year		––	$	––
Granted		200,000		1.90
Vested		(84,894)		1.90
Forfeited		(16,667)		1.90
Non-vested at end of year		98,439	$	1.90

The aggregate fair value of the awards granted during the year ended December 31, 2016 was $380,000, which represents the market value of BioLife common stock on the date that the restricted stock awards were granted. The aggregate fair value of the restricted stock awards that vested during the year ended December 31, 2016 was $156,564.

We recognized stock compensation expense of $164,554 related to restricted stock awards during the year ended December 31, 2016. As of December 31, 2016, there was $183,779 in unrecognized compensation costs related to restricted stock awards. We expect to recognize those costs over 2.2 years.

We recorded stock compensation expense for the years ended December 31, 2016 and 2015, as follows:

	Year Ended December 31,
	2016		2015
Research and development costs	$	151,849	$	80,925
Sales and marketing costs		176,878		78,387
General and administrative costs		426,035		249,331
Cost of product sales		2,794		102,814
Joint venture restructuring charges		19,438		––
Total	$	776,994	$	511,457