Note 11. STOCK-BASED COMPENSATION

A summary of the options is presented in the table below:

	June 30, 2016				June 30, 2015
	Shares		Weighted Average Exercise Price		Shares		Weighted Average Exercise Price


Options outstanding, beginning of year		66,000	$	6.88		66,000	$	6.88
Granted		-		-		-		-
Canceled, forfeited or expired		-	$	-		-	$	-

Options outstanding, end of year		66,000	$	6.88		66,000	$	6.88

Options exercisable, end of year		62,000	$	7.19		60,000	$	7.37

Following is a summary of the status of options outstanding and exercisable at June 30, 2016:

Outstanding Options					Exercisable Options
Exercise Price		Number		Average Remaining Contractual Life	Average Exercise Price		Number		Average Remaining Contractual Life
$	7.75		56,000	2.0 years	$	7.75		56,000	2.0 years
$	2.01		10,000	1.6 years	$	2.01		6,000	1.6 years
			66,000					62,000

The issuance of the options is exempted from registration under the Securities Act of 1933, as amended (the “Act”). The options will vest at a rate of 20% per year, with 20% vesting initially when granted. The Common Stock underlying the Options granted may be sold in compliance with Rule 144 under the Act. The term of the Options is 10 years and the exercise price of the 2013 options is $2.01 (10,000 options). Each Option may be exercised to purchase one share of Common Stock. Payment for the Options may be made in cash or by exchanging shares of Common Stock at their Fair Market Value. The Fair Market Value will be equal to the average of the highest and lowest registered sales prices of Company Stock on the date of exercise.

The fair value of share-based compensation was estimated using the Black-Scholes option pricing model. The aggregate fair value of $3,880 and $7,760 at June 30, 2016 and 2015, respectively, is presented as “Unearned Stock-based Compensation”. The Company amortized stock option expenses of $3,880 and $3,880 for the years ended June 30, 2016 and 2015, respectively.

In connection with the initial public offering of the Company’s common stock on May 20, 2008, 139,032 warrants were issued to the underwriter as part of their compensation. Each warrant has the right to purchase one share of common stock for an exercise price of $9.30 per share with a term of 10 years.

Following is a summary of the status of warrants outstanding and exercisable at June 30, 2016:

Warrants Outstanding			Warrants Exercisable			Weighted Average Exercise Price			Average Remaining Contractual Life
	139,032			139,032		$	9.30		2.0 years