XML 37 R18.htm IDEA: XBRL DOCUMENT

Share-Based Compensation

12 Months Ended

Dec. 31, 2016

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

12. Share-Based Compensation

On April 30, 2015, the Company entered into a Non-qualified Stock Option Agreement with Sophie Pibouin, a director of the Company, in accordance with the 2015 Plan. The agreement granted options to purchase 128,000 Shares prior to the expiration date of April 29, 2025 at an exercise price of $0.75. The options granted vested on a graded scale over a period of time through October 31, 2015. The unvested options will not be exercisable on or after the director’s termination of continuous service, as defined in the agreement.

On April 30, 2015, the Company entered into a Non-qualified Stock Option Agreement with Murray Gross, a director of the Company, in accordance with the 2015 Plan. The agreement granted options to purchase 640,000 Shares prior to the expiration date of April 29, 2025 at an exercise price of $0.75. 400,000 of the options granted are immediately vested on the date of grant, and the remaining 240,000 options granted will vest upon the date at which the Company first reports two consecutive fiscal quarters with revenues of One Million Dollars ($1,000,000) each. The unvested options will not be exercisable on or after the director’s termination of continuous service, as defined in the agreement.

On January 1, 2016, the Company granted employees stock options to purchase 250,000 Shares at an exercise price of $0.90 per Share in accordance with the 2015 Plan, with vesting continuing until 2019. The total fair value of $196,250 for these stock options will be recognized by the Company over the applicable vesting period.

On February 10, 2016, the Company granted employees stock options to purchase 210,000 Shares at an exercise price of $0.96 per Share in accordance with the 2015 Plan, with vesting continuing until 2020. The total fair value of $174,748 for these stock options will be recognized by the Company over the applicable vesting period.

On December 6, 2016, the Company granted one employee stock options to purchase 100,000 Shares at an exercise price of $0.76 per Share in accordance with the 2015 Plan, with vesting continuing until 2020. The total fair value of $63,937 for these stock options will be recognized by the Company over the applicable vesting period.

The weighted average estimated values of director and employee stock option grants, as well as the weighted average assumptions that were used in calculating such values during the twelve months ended December 31, 2016 and 2015, were based on estimates at the date of grant as follows:

	April 30,			January 1,			February 10,			December 6,
	2015 Grant			2016 Grant			2016 Grant			2016 Grant
Risk-free interest rate		1.43	%		1.76	%		1.15	%		1.84	%
Weighted average expected term		5 years			5 years			5 years			5 years
Expected volatility		143.10	%		134.18	%		132.97	%		123.82	%
Expected dividend yield		0.00	%		0.00	%		0.00	%		0.00	%

A summary of stock option activity during the twelve months ended December 31, 2016 and 2015 under our stock option agreements is as follows:

					Weighted-
			Weighted-		Average
	Shares		Average		Remaining		Aggregate
	Under		Exercise		Contractual		Intrinsic
	Option		Price		Life		Value
Outstanding at January 1, 2015		-
Granted		768,000	$	0.75
Exercised		-
Forfeited and expired		-

Outstanding at December 31, 2015		768,000	$	0.75		9 years	$	115,200

Exercisable at December 31, 2015		528,000	$	0.75		9 years	$	79,200

Outstanding at January 1, 2016		768,000	$	0.75
Granted		560,000		0.90
Exercised		-
Forfeited and expired		-

Outstanding at December 31, 2016		1,328,000	$	0.81		9 years	$	115,200

Exercisable at December 31, 2016		590,500	$	0.77		8 years	$	79,200

The weighted-average grant date fair value of options granted during the twelve months ended December 31, 2016 and 2015 was $0.78 and $0.81, respectively.

As of December 31, 2016, and 2015, there was $492,057 and $195,000, respectively, of total unrecognized compensation costs related to stock options granted under our stock option agreements. $297,057 of the unrecognized compensation cost is expected to be recognized over a weighted-average period of three years. $195,000 of the unrecognized compensation cost will be recognized upon satisfaction of the vesting contingency. The total fair value of stock options that vested during the twelve months ended December 31, 2016 and 2015 was $49,062 and $430,000, respectively.

- Definition

The entire disclosure for compensation-related costs for equity-based compensation, which may include disclosure of policies, compensation plan details, allocation of equity compensation, incentive distributions, equity-based arrangements to obtain goods and services, deferred compensation arrangements, employee stock ownership plan details and employee stock purchase plan details.

+ References + Details