Equity-Based Compensation

3 Months Ended

Mar. 31, 2013

Equity-Based Compensation [Abstract]

Equity-Based Compensation

5. Equity-Based Compensation

On January 1, 2010, the Company's board of directors approved a stock plan. The stock plan known as the 2010 Stock Plan (the "Plan") reserves up to 15,000,000 shares of the Company's authorized common stock for issuance to officers, directors, employees and consultants under the terms of the Plan. The Plan permits the board of directors to issue stock options and restricted stock. The stock options were valued based on the Black Scholes option pricing model.

A summary of option activity for the three months ended March 31, 2013 is presented below:

	Options		Weighted Average Exercise Price	Weighted Average Remaining Contractual Life		Aggregate Intrinsic Value
Outstanding, December 31, 2012	10,261,000	$	0.16	2.20	$	112,200
Granted	2,500,000	$	0.06	3.90		-
Expired/Cancelled	-	$	-	-		-
Exercised	-	$	-	-		-
Outstanding, March 31, 2013	12,761,000	$	0.14	2.33	$	276,960
Exercisable	7,765,297	$	0.12	2.29	$	201,960

The aggregate intrinsic values in the table above represent the total pretax intrinsic value (the difference between Company's closing stock price on March 29, 2013 of $0.09 and the exercise price, multiplied by the number of in-the-money options) that would have been received by the option holders had all option holders exercised their options on March 31, 2013. The intrinsic value amount changes based on the fair market value of the Company's stock.

Option-based compensation expense totaled $46,666 and $56,375 for the three months ended March 31, 2013 and 2012, respectively. As of March 31, 2013 and December 31, 2012 the Company had $258,505 and $173,592 in unrecognized compensation costs related to non-vested stock options granted under the Plan, respectively.