(6) STOCK-BASED COMPENSATION PLANS

In June 2017, our stockholders approved the 2017 Stock Incentive Plan (the “2017 Stock Plan”) with a maximum of 5,000,000 shares reserved for issuance. Awards permitted under the 2017 Stock Plan include: Stock Options and Restricted Stock. Awards issued under the 2017 Stock Plan are at the discretion of the Board of Directors. As applicable, awards are granted with an exercise price equal to the closing price of our common stock on the date of grant and generally vest over four years. During the year ended December 31, 2017, 0.4 million awards have been granted under the 2017 Stock Plan. At December 31, 2017, 0.4 million remain Issued and outstanding.

During the years ended December 2017 and 2016, the Company awarded 15,000 and 0 shares of restricted stock to management, respectively. During the year ended December 31, 2017 and 2016, no shares of restricted stock vested or were forfeited.

The Company previously reserved 3,000,000 shares of common stock for issuance under its 2005 Stock Option Plan (the “2005 Stock Plan”). The 2005 Stock Plan expired as of December 31, 2014. Vesting provisions of the expired plan were to be determined by the Board of Directors. All stock options under the 2005 Stock Plan expire no later than ten years from the date of grant. Options granted in 2015, 2016 and through May 2017 prior to the approval of the 2017 Stock Incentive Plan were approved by and certified by the board of directors on September 6, 2017 under the existing 2005 stock option plan.

For the years ended December 31, 2017 and 2016, the Company recorded compensation expense related to stock options, restricted stock and warrants of $0.3 million and $0.2 million, respectively, in selling, general and administrative expenses.

The Company uses the Black Scholes option pricing model to determine the fair value of stock option grants, using the following assumptions during the years ended December 31, 2017 and 2016:

	2017			2016
Weighted average expected term		6.25 years			6.25 years
Weighted average volatility		124	%		122	%
Weighted average risk-free interest rate		1.83	%		1.48	%
Dividend yield		0	%		0	%

The weighted average expected term of stock options represents the period of time that the stock options granted are expected to be outstanding based on historical exercise trends. The weighted average expected volatility is based on the historical price volatility of the Company’s common stock. The weighted average risk-free interest rate represents the U.S. Treasury bill rate for the expected term of the related stock options. The dividend yield represents the Company’s anticipated cash dividend over the expected term of the stock options. Forfeitures are accounted for as they occur.

A summary of activity under the 2005 and 2017 Stock Plans for the years ended December 31, 2017 and 2016 are presented below:

	Number of Shares (in thousands)		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (Years)		Aggregate Intrinsic Value (in thousands)
Outstanding at December 31, 2015		1,685	$	0.46			$	235
Granted		877	$	0.26
Exercised		(1)		0.15
Forfeited		(330)	$	0.36
Outstanding at December 31, 2016		2,231	$	0.40		6.7	$	135

Outstanding at December 31, 2016		2,231	$	0.40
Granted		662	$	0.86
Exercised		(38)	$	1.02
Forfeited/Canceled		(803)	$	0.33
Outstanding at December 31, 2017		2,052	$	0.56		6.5	$	5,334
Exercisable at December 31, 2017		1,460	$	0.40		5.3

The following is a summary of stock options outstanding under the plans as of December 31, 2017:

Range	Outstanding Number of Shares (in thousands)		WA Remaining Contractual Life (years)		WA Outstanding Strike Price		Exercisable Number of Shares (in thousands)		Remaining Exercisable Contractual Life (years)		WA Exercisable Strike Price
$0 to $.50		1,540		6.96	$	0.27		1,155		6.25	$	0.24
$.51 to $1.00		283		3.59	$	0.89		233		2.29	$	0.93
$1.01 to $1.50		69		3.09	$	1.24		54		1.19	$	1.19
$1.51 to $2.00		30		4.19	$	1.73		18		0.49	$	1.68
$2.00 to $3.00		130		9.95	$	2.65		-		0.00	$	-
		2,052		6.52	$	0.56		1,460		5.36	$	0.40

A summary of status of the Company’s non-vested share awards as of and for the years ended December 31, 2017 and 2016 are presented below:

	Non-vested Shares Under Option		Weighted Average Grant Date Fair Value
Non-vested at December 31, 2016		572	$	0.24
Granted		897	$	0.70
Vested		(267)	$	0.25
Exercised		-	$	-
Forfeited		(610)	$	0.29
Non-vested at December 31, 2017		592	$	0.88

The weighted-average grant-date fair value of stock options granted during the years ended December 31, 2017 and 2016 were $0.70, and $0.32 respectively.

As of December 31, 2017, there were approximately $0.5 million of total unrecognized compensation costs related to unvested stock options and restricted stock. These costs are expected to be recognized over a weighted average period of 3.3 years.

The total intrinsic value of stock option exercises for the years ended December 31, 2017 and 2016 was $0.1 million and $0, respectively. The total fair value of stock awards vested during the years ended December 31, 2017, and 2016 was $0.1 million and $0.2 million, respectively.

Cash received from stock option exercises was $39,000 and $0 for the years ended December 31, 2017 and 2016, respectively