Stock Option Plans

6 Months Ended

Jun. 30, 2013

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Disclosure of Compensation Related Costs, Share-based Payments [Text Block]

Note 4. Stock Option Plans

The Company has approved stock options plans and agreements covering up to an aggregate of 9,763,833 shares of common stock. Plan options may be designated at the time of grant as either incentive stock options or nonqualified stock options. Stock based compensation includes expense charges related to all stock-based awards to employees, directors and consultants. Such awards consist of stock options.

The fair value of each option grant is estimated on the date of grant using the Black-Scholes option-pricing model. The following assumptions were used for the six months ended June 30, 2013 and 2012.

	2013		2012
Risk-free interest rate		.34% - .92%		.92% - 1.10%
Expected dividend yield		0%		0%
Expected stock price volatility		75%		75%
Expected life of options		3.25 - 5.75 years		5.75 years

The Company recorded expense for options issued to employees and independent service providers of $14,517 and $19,189 for the three months ended June 30, 2013 and 2012, respectively, and $50,916 and $39,261 for the six months ended June 30, 2013 and 2012, respectively.

The following is a summary of all stock option activity for the six months ended June 30, 2013.

	Number of Options		Weighted Average Exercise Price		Weighted- Average Remaining Contractual Term		Aggregate Intrinsic Value
Outstanding at December 31, 2012		6,884,500	$	.20		-
Options granted		1,825,000	$	.15		-
Options expired		(123,333)	$	.13		-
Options forfeited		(686,667)	$	.07		-
Outstanding at June 30, 2013		7,899,500	$	.20		5.3 years	$	232,000
						-
Exercisable at June 30, 2013		5,746,833	$	.22		5.0 years	$	178,000

The weighted average fair value of options granted during the six months ended June 30, 2013 was approximately $.08 ($.09 during the six months ended June 30, 2012). No options were exercised during the six months ended June 30, 2013 and 2012.

At June 30, 2013, there was approximately $32,000 of unrecognized compensation cost related to non-vested options. This cost is expected to be recognized over a weighted average period of approximately two years. The total fair value of shares that vested during the six months ended June 30, 2013 was approximately $16,000.

During the six months ended June 30, 2013, the Company issued 1,675,000 common stock options to independent consultants with an average exercise price of $.155 per share. At issuance, 225,000 options immediately vested. The balance of the options vest based on each independent consultant meeting specific sales performance criteria.