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Note 5. Stock Options

9 Months Ended

Sep. 30, 2012

Notes to Financial Statements

Note 5. Stock Options

Increase in number of shares authorized under the 2010 Equity Incentive Plan (the “Plan”)

On January 20, 2012, the Company’s Board of Directors approved an increase in the number of shares authorized under the Plan from 220,416 to 420,416.This increase was ratified by the shareholders of the Company on June 29, 2012.

Issuance of stock options

The Company issued non-qualified stock options to purchase 10,000 shares of common stock to a consultant on January 1, 2012, which were vested immediately with an exercise price of $2.30 per share. The Company issued non-qualified stock options to purchase a total of 105,000 shares of common stock with an exercise price of $0.01 per share on January 20, 2012 to four former employees and consultants of SECCS. The options will vest through December 31, 2012 upon the achievement of specified milestones related to the execution of annual contracts for XBRL services or revenue targets. The Company issued incentive stock options to employees to purchase 31,000 shares of common stock on April 2, 2012 with an exercise price of $3.33 per share, and a vesting period of one year. The Company also issued non-qualified stock options to purchase 5,000 shares of common stock to a consultant on July 1, 2012, which were vested immediately with an exercise price of $2.81 per share.

On July 6, 2012, the Company elected Andre Boisvert to its Board of Directors. The Company granted Mr. Boisvert a non-qualified option to purchase 40,000 shares of common stock with an exercise price of $2.81 per share and a vesting period of four years. Furthermore, in the event of a Change of Control (as such term is defined in the Plan) of the Company while Mr. Boisvert is a member of the Board of Directors, he will receive compensation equal to two percent of the amount of cash, equity, or combination thereof received by the Company as of the closing of the Change of Control.

The following table summarizes information about stock options outstanding and exercisable at September 30, 2012:

		Options Outstanding				Options Exercisable
Exercise Price		Number		Weighted Average Remaining Contractual Life (in Years)		Number
$0.01		105,000		9.31		0
$1.70		16,000		8.65		16,000
$1.87		3,000		8.65		3,000
$2.10		66,500		7.86		40,250
$2.30		15,000		9.23		15,000
$2.31		16,500		7.86		16,500
$2.81		45,000		5.32		7,500
$3.33		28,500		9.50		0
Total		295,500		8.26		98,250

Tabular disclosure of components of a stock option or other award plan under which equity-based compensation is awarded to employees, typically comprised of the amount of unearned compensation (deferred compensation cost), compensation expense, and changes in the quantity and fair value of the shares (or other type of equity) granted, exercised, forfeited, and issued and outstanding pertaining to that plan. Disclosure may also include nature and general terms of such arrangements that existed during the period and potential effects of those arrangements on shareholders, effect of compensation cost arising from equity-based payment arrangements on the income statement, method of estimating the fair value of the goods or services received, or the fair value of the equity instruments granted, during the period, cash flow effects resulting from equity-based payment arrangements and, for registrants that accelerate vesting of out of the money share options, reasons for the decision to accelerate.

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