15. Share-Based Compensation

The Company accounts for all share-based payments to employees and directors, including grants of employee stock options, at fair value and expenses the benefit in the Consolidated Statements of Operations over the service period (generally the vesting period). The fair value of each stock option granted is estimated on the date of grant using the Black-Scholes pricing valuation model, which requires various assumptions including estimating stock price volatility, expected life of the stock option, risk free interest rate and estimated forfeiture rate.

On October 5, 2018, the Company granted 20,000 shares of Common Stock to the Company’s Chief Executive Officer. The closing share price on the date of the grant was $0.49 and there was no vesting period. The Company recorded compensation expense of $10,000 in 2018.

On December 29, 2017, the Company granted 451,500 shares of Common Stock to certain directors and executive management team members. The closing share price on the date of the grant was $0.75 and there was no vesting period. The Company recorded compensation expense of $338,000 in 2017.

The Company has two stock option plans. As of December 31, 2018, no shares of Common Stock were available for grant under the 2012 Long-Term Incentive Plan and 800 shares of Common Stock were available for grant under the Non-Employee Director Stock Option Plan.

Changes in the stock option plans are as follows:

	Number of Shares			Weighted Average Exercise Price
	Authorized	Granted	Available	Weighted Average Exercise Price
Balance January 1, 2017	200,800	-	200,800		N/A
Authorized	-	-	-
Expired	(200,000)	-	(200,000)
Granted	-	-	-
Balance December 31, 2017	800	-	800
Authorized	-	-	-
Expired	-	-	-
Granted	-	-	-
Balance December 31, 2018	800	-	800

Under the 2012 Long-Term Incentive Plan, option prices must be at least 100% of the market value of the Common Stock at the time of grant. Exercise periods are for ten years from the date of grant and terminate at a stipulated period of time after an employee’s termination of employment. During 2017, stock grants were awarded, causing the potential for stock options to be terminated. At December 31, 2018, no options were outstanding or exercisable. During 2018 and 2017, no options were granted or exercised.

Under the Non-Employee Director Stock Option Plan, option prices must be at least 100% of the market value of the Common Stock at the time of grant. No option may be exercised prior to one year after the date of grant and the optionee must be a director of the Company at the time of exercise, except in certain cases as permitted by the Compensation Committee. Exercise periods are for six years from the date of grant and terminate at a stipulated period of time after an optionee ceases to be a director. At December 31, 2018, there were no outstanding options to purchase shares.

As of December 31, 2018, there was no unrecognized compensation cost related to non-vested options granted under the Plans.