9. Stock Option Plans and Agreements

6 Months Ended

Jun. 30, 2017

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 9,782,000 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 June 30, 2017 and 2016.

	2017	2016
Risk-free interest rate	1.50%		1.07% -1.50%
Expected dividend yield	0%		0%
Expected stock price volatility	100%		100%
Expected life of options	2.75 years		2.50 years

The Company recorded expense for options issued to employees and independent service providers of $2,784 and $1,173 for the three months ended June 30, 2017 and 2016, respectively, and $9,905 and $7,937 for the six months ended June 30, 2017 and 2016, respectively.

At June 30, 2017, there was approximately $9,400 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 six months ended June 30, 2017 was approximately $4,000. The weighted average fair value of options granted during the six months ended June 30, 2017 was approximately $.03 ($.06 during the six months ended June 30, 2016). No options were exercised during the six months ended June 30, 2017 and 2016.

A summary of all stock option activity for the six months ended June 30, 2017 follows.

	Number of Options Outstanding			Weighted Average Exercise Price		Remaining Contractual Term	Aggregate Intrinsic Value
Outstanding at December 31, 2016		8,583,000		$	.12
Granted		150,000		$	.045
Expired		(26,500	)	$	.26
Forfeited		(12,500	)	$	.04
Outstanding at June 30, 2017		8,694,000		$	.12	3.8 years	$	5,100
At June 30, 2017:
Vested or expected to vest		6,306,000		$	.09	4.9 years	$	5,100
Exercisable		6,116,000		$	.09	4.9 years	$	5,100