9. Stock Option Plans and Agreements

9 Months Ended

Sep. 30, 2015

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

Stock Option Plans and Agreements

The Company has approved stock options plans and agreements covering up to an aggregate of 8,792,500 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 consists of charges for stock option awards to employees, directors and consultants.

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 September 30, 2015 and 2014.

	2015			2014
Risk-free interest rate		1.49% - 1.78	%		.77% -1.98	%
Expected dividend yield		0	%		0	%
Expected stock price volatility		100	%		100	%
Expected life of options	5.75 years			3.25 - 5.75 years

The Company recorded expense for options issued to employees and independent service providers of $12,191 and $11,331 for the three months ended September 30, 2015 and 2014, respectively, and $42,843 and $86,226 for the nine months ended September 30, 2015 and 2014, respectively.

At September 30, 2015, there was approximately $34,000 of unrecognized compensation cost related to non-vested options.  This cost is expected to be recognized over a weighted average period of approximately one year.  The total fair value of shares that vested during the nine months ended September 30, 2015 was approximately $58,000.  The weighted average fair value of options granted during the nine months ended September 30, 2015 was approximately $.03 ($.08 during the nine months ended September 30, 2014).  No options were exercised during the nine months ended September 30, 2015 and 2014.

A summary of all stock option activity for the nine months ended September 30, 2015 follows.

	Number of Options			Weighted Average Exercise Price		Weighted-Average Remaining Contractual Term	Aggregate Intrinsic Value
Outstanding at December 31, 2014		10,899,500		$	.16
Options granted		150,000		$	.05
Options expired		(1,773,333	)	$	.16
Options forfeited		(651,667	)	$	.13
Outstanding at September 30, 2015		8,624,500		$	.16	4.9 years	$	88,200
Vested or expected to vest at September 30, 2015		6,874,500		$	.17	5.5 years	$	88,200
Exercisable at September 30, 2015		6,251,167		$	.18	5.3 years	$	66,800