• Filing Date: 2018-08-09
  • Form Type: 10-Q
  • Description: Quarterly report
v3.10.0.1
6. STOCK OPTION PLAN
6 Months Ended
Jun. 30, 2018
Retirement Benefits [Abstract]  
STOCK OPTION PLANS

NOTE 6: STOCK OPTION PLAN

 

In the first quarter of 2016, the Board approved, and stockholders ratified a 2016 Employee Benefit and Consulting Services Compensation Plan covering 10,000,000 shares (the “2016 Plan”) and approving moving all options which exceeded the 2009 Plan limits to the 2016 Plan.

 

All stock options under the Plans are granted at or above the fair market value of the common stock at the grant date. Employee and non-employee stock options vest over varying periods and generally expire either 5 or 10 years from the grant date. The fair value of options at the date of grant was estimated using the Black-Scholes option pricing model. For option grants, the Company will take into consideration payments subject to the provisions of ASC 718 "Stock Compensation", previously Revised SFAS No. 123 "Share-Based Payment" (“SFAS 123 (R)"). The fair values of these restricted stock awards are equal to the market value of the Company's stock on the date of grant, after taking into certain discounts. The expected volatility is based upon historical volatility of our stock and other contributing factors. The expected term is based upon observation of actual time elapsed between date of grant and exercise of options for all employees. Previously, such assumptions were determined based on historical data.

 

The weighted average assumptions made in calculating the fair values of options granted during the three and six months ended June 30, 2018 and 2017 are as follows:

 

    Three Months Ended
June 30
  Six Months Ended
June 30
    2018   2017   2018   2017
Expected volatility     0.00 %     0.00 %     173.00 %     146.77 %
Expected dividend yield     —         —         —         —    
Risk-free interest rate     0.00 %     0.00 %     2.43 %     1.89 %
Expected term (in years)     0       0       5.00       5.00  

 

    Share   Weighted
Average
Exercise
Price
  Weighted
Average
Remaining
Contractual
Term
  Aggregate
Intrinsic
Value
Outstanding, January 1, 2018     17,515,001       0.39       4.43     $ —    
Granted     19,250,000       0.05       4.50       577,500  
Exercised                                
Cancelled & Expired     (11,615,001 )                        
                                 
Outstanding, June 30, 2018     25,150,000       0.12       4.00     $ 599,500  
                                 
Options exercisable, June 30, 2018     25,150,000       0.12       4.00     $ 599,500  

 

The weighted-average grant-date fair value of options granted during the six months ended June 30, 2018 and 2017 was $0.05 and $0.05, respectively.

 

The aggregate intrinsic value of options outstanding and options exercisable at June 30, 2018 is calculated as the difference between the exercise price of the underlying options and the market price of the Company's common stock for the shares that had exercise prices, that were lower than the $0.08 closing price of the Company's common stock on June 30, 2018.

 

As of June 30, 2018, the fair value of unamortized compensation cost related to unvested stock option awards is $0.00.

 

  

The weighted average assumptions made in calculating the fair value of warrants granted during the three and six months ended June 30, 2018 and 2017 are as follows:

 

    Three Months Ended
June 30
  Six Months Ended
June 30
    2018   2017   2018   2017
Expected volatility     0.00 %     0.00 %     0.00 %     151.49 %
Expected dividend yield     —         —         —         —    
Risk-free interest rate     0.00 %     0.00 %     0.00 %     0.00 %
Expected term (in years)     —         —         —         4.75  

 

  Share  

Weighted

Average

Exercise

Price

Weighted

Average

Remaining Contractual

Term

Aggregate Intrinsic

Value

  Outstanding, January 1, 2018     11,814,167     $ 0.20     2.58   $ —    
  Granted     —       $ —       —       —    
  Exercised     —       $ —       —       —    
  Expired     (1,040,000 )                    
  Outstanding, June 30, 2018     10,774,167     $ 0.19     1.85     176,000  
  Warrants exercisable, June 30, 2018     10,774,167     $ 0.19     1.85     176,000