NOTE 6 – EQUITY

Common stock:

The Company issued 5,031,730 common shares of stock for proceeds of $210,346 between July 1, 2016 and September 30, 2016. For the period from January 1, 2016 through September 30, 2016, the Company issued 7,152,288 common shares of stock for proceeds of $637,113. The Company sold 225,000 shares of common stock subsequent to September 30, 2016 for proceeds or $9,000.

Stock options:

The stock-based compensation cost related to options that have been included as a charge to general and administrative expense in the condensed consolidated statements of loss was approximately $121,500, $236,300, $109,100 and $263,900 for the three and nine months ended September 30, 2016 and 2015, respectively. As of September 30, 2016 there was approximately $494,600 of unrecognized compensation cost related to non-vested stock options. The cost is expected to be recognized over a weighted-average period of less than four years.

The following tables set forth the activity in the Company's Plan for the nine months ended September 30, 2016:

						Weighted
				Weighted		average
	Shares			average		remaining		Aggregate
	under			exercise		contractual		intrinsic
	option			price		life		value
Outstanding at January 1, 2016		2,867,876		$	0.30
Granted		5,400,000			0.05
Exercised		(182,426	)		0.00
Forfeited/cancelled		(1,468,950	)		0.25
Outstanding at September 30, 2016		6,616,500			0.11	4.48	$	-
Exercisable at September 30, 2016		2,104,000		$	0.23	4.40	$	-

The following table summarizes the activity and value of non-vested options as of and for the nine months ended September 30, 2016:

				Weighted
				average
	Number of			grant date
	options			fair value
Non-vested options outstanding at January 1, 2016		1,365,926			$	0.18
Granted		5,400,000				0.05
Vested		(1,907,426	)			0.15
Forfeited/cancelled		(346,000	)			0.46
Non-vested options outstanding at September 30, 2016		4,512,500			$	0.05

Warrants:

The following table sets forth the activity regarding warrants for the nine months ended September 30, 2016:

						Weighted
				Weighted		Average
	Shares			Average		Remaining			Aggregate
	Underlying			Exercise		Contractual			Intrinsic
	Warrants			Price		Life			Value
Outstanding at January 1, 2016		27,717,614		$	0.25		2.96
Granted		3,010,554			0.30
Exercised		(5,000,000	)
Forfeited/cancelled		(250,000	)		0.90
Outstanding at September 30, 2016		25,478,168			0.28		1.85	$	-
Exercisable at September 30, 2016		24,623,168		$	0.29		1.85	$	-

The following table sets for the activity regarding non-vested warrants for the nine months ended September 30, 2016:

	Non-vested			Weighted		Weighted
	Shares			Average		Average
	Underlying			Exercise		Grant Date
	Warrants			Price		Fair Value
Non-vested at January 1, 2016		173,000		$	0.18	$	0.24
Granted		3,010,554			0.30	$	-
Vested		(2,328,554	)		0.39		-
Forfeited/cancelled		-			-	$	-
Non-vested at September		855,000		$	0.06	$	0.07