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14. STOCK-BASED COMPENSATION | 12 Months Ended
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Dec. 31, 2013
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] |
14. STOCK-BASED COMPENSATION | Pursuant to the Company’s Amended and Restated 2007 Equity Incentive Plan, the aggregate number shares of the Company’s common stock available for grant of stock options and issuance is 4,341,989 shares. The fair value of each option award below is estimated on the date of grant using the Black-Scholes option-pricing model. The risk free rate is based on the yield-to-maturity in continuous compounding of the US Government Bonds with the time-to-maturity similar to the expected tenor of the option granted, volatility is based on the annualized historical stock price volatility of the Company, and the expected life is based on the estimated average of the life of options using the “simplified” method, as prescribed in FASB ASC 718, due to insufficient historical exercise activity during recent years as a basis from which to estimate future exercise patterns. In early March 2012, the Company granted to an independent director an option to purchase 12,500 shares of the Company’s common stock at an exercise price of $2.77 per share and the options vested immediately. The options were valued at $15,300 fair value, with assumed 95.89% volatility, a three-year expiration term with expected tenor of 1.49 years, a risk free rate of 0.21% and no dividend yield. On May 7, 2012, the Company entered into a service agreement with an independent director in which he would be entitled to receive stock option grants of 12,500 shares of common stock on the date of the agreement and on each anniversary date from that date through May 7, 2014. The exercise price of the options, which will equal or exceed the fair market value of a share of the Company’s common stock on the day before the grant date, shall be determined by the Board of Directors and the options shall vest immediately upon the grant date. This agreement remains effective as long as the director continues to serve as a non-employee director of the Company. Pursuant to this agreement, on May 7, 2012, the Company granted to this independent director an option to purchase 12,500 shares of the Company’s common stock at an exercise price of $2.06 per share and the options vested immediately. The options were valued at $11,000 fair value, with assumed 95.21% volatility, a three-year expiration term with expected tenor of 1.49 years, a risk free rate of 0.21% and no dividend yield. On July 2, 2012, the Company granted to an independent director an option to purchase 12,500 shares of the Company’s common stock at an exercise price of $1.22 per share and the options vested immediately. The options were valued at $7,000 fair value, with assumed 94.92% volatility, a three-year expiration term with expected tenor of 1.49 years, a risk free rate of 0.24% and no dividend yield. On July 17, 2012, the Company granted to 3 executive officers and 18 management staff options to purchase 600,000 shares and 218,000 shares of the Company’s common stock, respectively, at an exercise price of $0.952 per share and the options vested immediately. The options to executive officers and management staff were valued at $344,743 and $125,257 fair value, respectively, both with assumed 88.03% volatility, a four-year expiration term with expected tenor of 2 years, a risk free rate of 0.24% and no dividend yield. On November 8, 2012, the Company granted to an independent director an option to purchase 12,500 shares of the Company’s common stock at an exercise price of $1.37 per share and the options vested immediately. The options were valued at $7,200 fair value, with assumed 94.88% volatility, a three-year expiration term with expected tenor of 1.50 years, a risk free rate of 0.21% and no dividend yield. In early March 2013, the Company granted to an independent director an option to purchase 12,500 shares of the Company’s common stock at an exercise price of $1.12 per share and the options vested immediately. The options were valued at $4,900 fair value, with assumed 74.73% volatility, a three-year expiration term with expected tenor of 1.49 years, a risk free rate of 0.19% and no dividend yield. For the three-month period ended March 31, 2013, $4,900 was recognized as general and administrative expenses. On May 30, 2013, the Company granted to 3 executive officers and 17 management staff options to purchase 600,000 shares and 203,000 shares of the Company’s common stock, respectively, at an exercise price of $0.952 per share and the options vested immediately. The options were valued at $394,100 and $133,300 fair value, respectively, both with assumed 80.76% volatility, a four-year expiration term with expected tenor of 2 years, a risk free rate of 0.29% and no dividend yield. On July 2, 2013, the Company granted to an independent director an option to purchase 12,500 shares of the Company’s common stock at an exercise price of $1.17 per share and the options vested immediately. The options were valued at $4,100 fair value, with assumed 61.56% volatility, a three-year expiration term with expected tenor of 1.49 years, a risk free rate of 0.24% and no dividend yield. On November 8, 2013, the Company granted to an independent director an option to purchase 12,500 shares of the Company’s common stock at an exercise price of $2.12 per share and the options vested immediately. The options were valued at $8,500 fair value, with assumed 66.49% volatility, a three-year expiration term with expected tenor of 1.50 years, a risk free rate of 0.21% and no dividend yield. During the year ended December 31, 2013, 213,131 shares of common stock were issued upon cashless exercise of 344,000 options. The following table summarizes all Company stock option transactions between January 1, 2012 and December 31, 2013.
|  | Number of Option and Warrants Outstanding and exercisable |  | Weighted- Average Exercise price of Option and Warrants |  |  | Range of Exercise Price per Common Share |
Balance, December 31, 2011 |  |  | 1,144,471 |  |  | $6.30 |  |  |  | $2.41 - $12.60 |
Granted and vested during the year ended December 31, 2012 |  |  | 868,000 |  |  | $1.00 |  |  |  | $0.95 - $2.77 |
Forfeited during the year ended December 31, 2012 |  |  | (38,000 | ) |  | $4.97 |  |  |  | $4.97 |
Balance, December 31, 2012 |  |  | 1,974,471 |  |  | $4.00 |  |  |  | $0.95 - $12.60 |
Balance, January 1, 2013 |  |  | 1,974,471 |  |  | $4.00 |  |  |  | $0.95 - $12.60 |
Granted and vested during the year ended December 31, 2013 |  |  | 840,500 |  |  | $0.98 |  |  |  | $0.95 - $2.12 |
Exercised during the year ended December 31, 2013 |  |  | (344,000 | ) |  | $0.95 |  |  |  | $0.95 |
Expired during the year ended December 31, 2013 |  |  | (12,500 | ) |  | $10.43 |  |  |  | $10.43 |
Balance, December 31, 2013 |  |  | 2,458,471 |  |  | $3.36 |  |  |  | $0.95 - $12.60 |
|  | Stock and Warrants Options Exercisable and Outstanding
|  |  |  |  |  | Weighted Average |  | Weighted Average
|  | Outstanding |  |  |  | Remaining |  | Exercise Price of
|  | at December 31, 2013 |  | Range of Exercise Prices |  | Contractual Life (Years) |  | Options Currently Outstanding
Exercisable and outstanding |  | 2,458,471 |  | $0.95 - $12.60 |  | 2.22 |  | $3.36
The aggregate intrinsic value of options outstanding and exercisable as of December 31, 2013 was $1,682,136. The total intrinsic value of options exercised during the year ended December 31, 2013 and 2012 was $64,672 and $0.

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- Definition Tabular disclosure of components of a stock option or other award plan under which equity-based compensation is awarded to employees, typically comprised of the amount of unearned compensation (deferred compensation cost), compensation expense, and changes in the quantity and fair value of the shares (or other type of equity) granted, exercised, forfeited, and issued and outstanding pertaining to that plan. Disclosure may also include nature and general terms of such arrangements that existed during the period and potential effects of those arrangements on shareholders, effect of compensation cost arising from equity-based payment arrangements on the income statement, method of estimating the fair value of the goods or services received, or the fair value of the equity instruments granted, during the period, cash flow effects resulting from equity-based payment arrangements and, for registrants that accelerate vesting of out of the money share options, reasons for the decision to accelerate. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6415400&loc=d3e5047-113901 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6415400&loc=d3e5070-113901 + Details
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