STOCKHOLDERS' EQUITY

12 Months Ended

Dec. 31, 2014

Stockholders Equity Note [Abstract]

Stockholders Equity Note Disclosure [Text Block]

NOTE H – STOCKHOLDERS’ EQUITY

[1]          Stock option plans: The Company currently has three non-statutory stock option plans; the Fiscal 2000 Non-statutory Stock Option Plan (the “2000 Plan”), the Fiscal 2001 Non-statutory Stock Option Plan (the “2001 Plan”) and the 2013 Equity Compensation Plan (the “2013 Plan”). All three plans have been adopted by the Company’s Board of Director and approved by shareholders. Any common shares issued as a result of the exercise of stock options would be new common shares issued from our authorized issued shares.

[2]          Stock options: During Fiscal 2014 and Fiscal 2013, the Company issued options to purchase 80,000 and 902,000 common shares of common stock, respectively. All options issued in Fiscal 2014 were issued under the 2001 Plan and were issued to non-employee members of our Board of Directors. All options issued in Fiscal 2013 were also issued under the 2001 Plan and were issued to employees and consultants.

As of December 31, 2014, all options issued and outstanding, or 1,295,000, were issued under the 2001 Plan. As of December 31, 2013, there were 2,422,000 options available for issuance under the 2001 Plan and 4,000,000 options available for issuance under the 2013 Plan. 

Stock option activity for Fiscal 2014 and Fiscal 2013 is summarized as follows: (the figures contained within the tables below have been rounded to the nearest thousand)

	Year Ended December 31,2014						Year Ended December 31, 2013
					Aggregate						Aggregate
			Weighted		Intrinsic				Weighted		Intrinsic Value
			Average		Value as of				Average		as of
			Exercise		December				Exercise		December 31,
	Shares		Price		31, 2014		Shares		Price		2013
Options outstanding at beginning of year		3,316,000	$	0.44				2,939,000	$	0.69
Granted		80,000	$	0.12				902,000	$	0.13
Exercised		0		NA				0		NA
Cancelled/expired		(2,101,000)	$	0.53				(525,000)	$	0.64
Options outstanding at end of year		1,295,000	$	0.27	$	9,400		3,316,000	$	0.44	$	17,000
Options exercisable at end of year		946,000	$	0.31				2,747,000	$	0.49

The following table presents information relating to stock options outstanding as of December 31, 2014:

	Options Outstanding						Options Exercisable
			Weighted		Weighted				Weighted
			Average		Average				Average
Range of Exercise			Exercise		Remaining				Exercise
Price	Shares		Price		Life in Years		Shares		Price
$0.07 - $0.14		635,000	$	0.11		7.32		408,000	$	0.10
$0.16 - $0.26		457,000	$	0.20		7.41		335,000	$	0.26
$0.85 - $1.09		203,000	$	0.90		0.41		203,000	$	0.90
TOTAL		1,295,000	$	0.27		6.27		946,000	$	0.31

The following table summarizes weighted-average assumptions using the Black-Scholes option-pricing model used on the date of the grants issued during Fiscal 2014 and Fiscal 2013:

	Year Ended December 31
	2014		2013
Volatility		73%		74% – 82%
Expected term (years)		10 yrs		10 yrs
Risk-free interest rate		2.64%		1.70% - 2.60%
Dividend yield		0%		0%

The Company recognized $40,000 in share based payment expense related to stock options in Fiscal 2014, and $166,000 in share based payment expense in Fiscal 2013. As of December 31, 2014, there was approximately $50,000 of total unrecognized share based payment expense related to stock options. This cost is expected to be recognized over a period ranging from 3 to 17 months.

[3] Warrants:

Warrant activity for Fiscal 2014 and Fiscal 2013 is summarized as follows. Any common shares issued as a result of the exercise of warrants would be new common shares issued from our authorized issued shares.

	Year Ended December 31,2014						Year Ended December 31, 2013
					Aggregate						Aggregate
			Weighted		Intrinsic Value				Weighted		Intrinsic Value
			Average		as of				Average		as of
			Exercise		December 31,				Exercise		December 31,
	Shares		Price		2014		Shares		Price		2013
Warrants outstanding at beginning of year		3,303,000	$	0.				375,000	$	0.16
Granted		0		NA				2,928,000	$	0.17
Exercised		0		NA				0		NA
Cancelled/expired		0	$	0.17				0		NA
Warrants outstanding at end of year		3,303,000	$	0.17		None		3,303,000	$	0.17		None
Warrants exercisable at end of year		3,303,000	$	0.17				3,303,000	$	0.17

The Company recognized $144,000 in debt issuance and deferred finance costs related to the issuance of the above warrants outstanding in Fiscal 2014, and $131,000 in debt issuance costs in Fiscal 2013. As of December 31, 2014, there was approximately $99,000 of total unrecognized debt issuance costs associated with the issuance of the above warrants outstanding, which will be expensed ratably over the next 12 months.