Note 5 - Options

3 Months Ended

Mar. 31, 2018

NOTE 5 – OPTIONS

The Company maintains a stock option plan under which certain employees are awarded option grants based on a combination of performance and tenure. The stock option plan provides for the grant of up to 2,000,000 shares. All options may be exercised for a period up to four 1/2 years following the grant date, after which they expire. Options are vested up to 5 years from the grant date.

For the three-month period ended March 31, 2018, no options were issued and 10,000 options were forfeited or expired due to employee resignation. For the options not vested, the option expense reversed was $462.

The Company uses the Black-Scholes option pricing model to estimate the fair value of stock-based awards on the date of grant.

Total compensation cost related to stock options was $37,456 for the three months ended March 31, 2018. As of March 31, 2018, there was $54,132 of unrecognized compensation costs related to stock options, which is expected to be recognized over a weighted average period of 4.0 to 5.0 years. The following table represents stock option activity for the three-month period ended March 31, 2018:

	Number of Options		Average Exercise Price	Contractual Life in Years		Intrinsic Value
Outstanding at December 31, 2017	1,197,846	$	0.97	6.96	$	-
Exercisable at December 31, 2017	781,300	$	1.02	6.30	$	-

Forfeited	10,000	$	0.42	9.51
Granted	-	$	-	-
Expired	-	$	-	-

Outstanding at March 31, 2018	1,187,846	$	0.96	6.64	$	-
Exercisable at March 31, 2018	887,050	$	1.03	6.08	$	-