Shareholders' Equity and Share-based Payments [Text Block] | NOTE 7 – OPTIONS, RESTRICTED STOCK UNITS AND WARRANTS On October 19, 2012, the Company’s Board of Directors approved the 2012 Equity Incentive Plan (“the “2012 Plan) and terminated the Long-Term Incentive Plan (the “2011 Plan”). The Plan provides for the issuance of options to purchase up to 11,686,123,( as amended) shares of the Company’s common stock to officers, directors, employees and consultants of the Company (as amended). Under the terms of the Plan the Company may issue Incentive Stock Options as defined by the Internal Revenue Code to employees of the Company only and nonstatutory options. The Board of Directors of the Company determines the exercise price, vesting and expiration period of the grants under the Plan. However, the exercise price of an Incentive Stock Option should not be less than 110% of fair value of the common stock at the date of the grant for a 10% or more stockholder and 100% of fair value for a grantee who is not 10% stockholder. The fair value of the common stock is determined based on quoted market price or in absence of such quoted market price, by the Board of Directors in good faith. Additionally, the vesting period of the grants under the Plan will be determined by the Committee, in its sole discretion, and expiration period not more than ten years. The Company reserved 1,250,000 shares of its common stock for future issuance under the terms of the Plan. During the six months ended June 30, 2015, the Company granted an aggregate of 1,350,000 options to officers, directors and key consultants. The following table presents information related to stock options at June 30, 2015: Options Outstanding Options Exercisable Weighted Average Exercisable Exercise Number of Remaining Life Number of Price Options In Years Options $ 1.01-2.00 1,094,642 5.5 639,142 2.01-3.00 5,935,548 6.8 3,861,875 3.01-4.00 300,000 9.8 300,000 7,330,190 6.7 4,801,017 A summary of the stock option activity and related information for the 2012 Plan for the six months ended June 30, 2015 is as follows: Weighted-Average Weighted-Average Remaining Aggregate Shares Exercise Price Contractual Term Intrinsic Value Outstanding at January 1, 2015 5,990,190 $ 2.25 6.7 3,267,692 Grants 1,350,000 2.75 10.0 - Exercised (10,000 ) 2.09 Canceled - Outstanding at June 30, 2015 7,330,190 $ 2.26 6.7 $ 860,542 Exercisable at June 30, 2015 4,801,017 $ 2.25 6.2 $ 601,896 The aggregate intrinsic value in the preceding tables represents the total pretax intrinsic value, based on options with an exercise price less than the Company’s estimated market stock price of $2.30 as of June 30, 2015, which would have been received by the option holders had those option holders exercised their options as of that date. Option valuation models require the input of highly subjective assumptions. The fair value of stock-based payment awards was estimated using the Black-Scholes option model with a volatility figure derived from an index of historical stock prices of comparable entities until sufficient data exists to estimate the volatility using the Company’s own historical stock prices. Management determined this assumption to be a more accurate indicator of value. The Company accounts for the expected life of options based on the contractual life of options for non-employees. For employees, the Company accounts for the expected life of options in accordance with the “simplified” method, which is used for “plain-vanilla” options, as defined in the accounting standards codification. The risk-free interest rate was determined from the implied yields of U.S. Treasury zero-coupon bonds with a remaining life consistent with the expected term of the options. The fair value of stock-based payment awards during the six months ended June 30, 2015 was estimated using the Black-Scholes pricing model. In addition, the Company is required to estimate the expected forfeiture rate and only recognize expense for those shares expected to vest. In estimating the Company’s forfeiture rate, the Company analyzed its historical forfeiture rate, the remaining lives of unvested options, and the number of vested options as a percentage of total options outstanding. During the six months ended June 30, 2015, the Company granted an aggregate of 1,350,000 options to purchase the Company stock in connection with the services rendered at the exercise prices from $2.00 to $3.99 per share for a term of seven years. Vesting is as follows: 450,000 50% immediately, 50% at first year anniversary 130,000 1/4 per quarter, over one year 65,000 50%, immediately, 50% performance contingent 300,000 1/12 per month beginning first month anniversary 405,000 Exercisable immediately 1,350,000 The fair value of the granted options for six months ended June 30, 2015 was determined using the Black Scholes option pricing model with the following assumptions: Dividend yield: -0- % Volatility 129.54% to 130.30 % Risk free rate: 1.19% to 2.37 % Expected life: 7 to 10 Estimated fair value of the Company’s common stock $ 1.99 to $3.99 Estimated forfeiture rate 0 % On April 22, 2015, the Company issued 10,000 shares of common stock in exchange for options exercised at $2.09 per share. The fair value of all options vesting during the three and six months ended June 30, 2015 of $2,157,938 and $2,956,727, respectively, and during the three and six months ended June 30, 2014 of $212,495 and $556,332, respectively, was charged to current period operations. Unrecognized compensation expense of $2,674,190 at June 30, 2015 will be expensed in future periods. Restricted Stock The following table summarizes the restricted stock activity for the six months ended June 30, 2015: Restricted shares issued as of January 1, 2015 - Granted 175,000 Total Restricted Shares Issued at June 30, 2015 175,000 Vested at December 31, 2014 (- ) Unvested restricted shares as of June 30, 2015 175,000 Stock based compensation expense related to restricted stock grants was $137,630 for the three and six months ended June 30, 2015; $-0- for the three and six months ended June 30, 2014. As of June 30, 2015, the stock-based compensation relating to restricted stock of $254,370 remains unamortized. Warrants The following table summarizes information with respect to outstanding warrants to purchase common stock of the Company, all of which were exercisable, at June 30, 2015: Exercise Number Expiration Price Outstanding Date $ 0.001 383,320 January 2020 $ 1.50 3,940,057 February 2018 to September 2018 $ 1.84 35,076 January 2020 $ 2.02 30,755 January 2020 $ 2.50 1,599,600 July 2015 $ 2.75 228,720 August 2019 to September 2019 $ 3.67 214,193 December 2018 to January 2019 $ 3.75 1,340,556 April 2019 to March 2020 7,772,277 On January 23, 2015, the Company issued an aggregate of 428,400 and 321,300 warrants to purchase the Company’s common stock at $2.50 and $3.75 per share, respectively, expiring on July 31, 2015 and March 31, 2020, respectively, in connection with the sale of the Company’s common stock. On February 10, 2015, the Company issued an aggregate of 337,000 and 252,750 warrants to purchase the Company’s common stock at $2.50 and $3.75 per share, respectively, expiring on July 31, 2015 and March 31, 2020, respectively, in connection with the sale of the Company’s common stock. On February 27, 2015, the Company issued an aggregate of 223,000 and 167,250 warrants to purchase the Company’s common stock at $2.50 and $3.75 per share, respectively, expiring on July 31, 2015 and March 31, 2020, respectively, in connection with the sale of the Company’s common stock. On March 31, 2015, the Company issued an aggregate of 410,360 and 307,770 warrants to purchase the Company’s common stock at $2.50 and $3.75 per share, respectively, expiring on July 31, 2015 and March 31, 2020, respectively, in connection with the sale of the Company’s common stock. On April 15, 2015, the Company issued 99,552 shares of common stock in exchange for 156,102 warrants exercised on a cashless basis. On May 5, 2015, the Company issued 4,082 shares of common stock in exchange for 4,082 warrants exercised at $3.67 per share. On May 8, 2015, the Company issued 4,000 shares of common stock in exchange for 4,000 warrants exercised at $2.50 per share. On May 11, 2015, the Company issued an aggregate of 374,641 warrants to purchase the Company’s common stock at $1.50 per share expiring on May 11, 2020 in connection with the sale of the Company’s Series A 9% Convertible Preferred stock. A summary of the warrant activity for the six months ended June 30, 2015 is as follows: Weighted-Average Weighted-Average Remaining Aggregate Shares Exercise Price Contractual Term Intrinsic Value Outstanding at January 1, 2015 5,113,990 $ 1.71 3.6 6,041,436 Grants 2,822,471 2.45 2.4 - Exercised (164,184 ) 1.58 Canceled Outstanding at June 30, 2015 7,772,277 $ 2.14 3.0 $ 4,058,045 Vested and expected to vest at June 30, 2015 7,772,277 $ 2.14 2.8 $ 4,058,045 Exercisable at June 30, 2015 7,772,277 $ 2.14 2.8 $ 4,058,045 The aggregate intrinsic value in the preceding tables represents the total pretax intrinsic value, based on options with an exercise price less than the Company’s estimated market stock price of $2.30 as of June 30, 2015, which would have been received by the option holders had those option holders exercised their options as of that date. |