7. STOCK OPTION PLANS (Tables)

12 Months Ended

Dec. 31, 2013

Schedule stock options under the 2009 Stock Option Plan

Assumptions	2009 Stock Option Plan and the 2009 Directors Stock Option Plan
Expected life	2.75 (yrs) - 3.5 (yrs)
Expected volatility	49.23% - 67.08%
Risk-free interest rate	0.35% - 1.88%
Expected dividend yield	0.00%

2009 Stock Option Plan

Plan Activity

	Number of shares			Weighted average exercise price
Balance as of January 1, 2012		970,000		$	0.51
Granted		––			––
Exercised		––			––
Expired		––			––
Balance as of December 31, 2012		970,000		$	0.51
Granted		1,505,000		$	0.25
Exercised		––			––
Expired		(160,000	)		0.25
Balance as of December 31, 2013		2,315,000		$	0.35

Schedule stock options under the Plan

		Options Outstanding						Options Exercisable
Exercise Prices		Number Outstanding		Weighted Average Remaining Contractual Life		Weighted Average Exercise Price		Number Exercisable		Weighted Average Exercise Price
$	0.53		555,000		.11	$	0.53		555,000	$	0.53
$	0.48		365,000		1.30	$	0.48		365,000	$	0.48
$	0.25		1,395,000		4.10	$	0.25		348,750	$	0.25
$	0.25 to 0.53		2,315,000		2.70	$	0.35		1,268,750	$	0.44

Directors Plan

Plan Activity

	Number of shares		Weighted average exercise price
Balance as of January 1, 2012		150,000		0.38
Granted		60,000		0.26
Exercised		––		––
Expired		––		––
Balance as of December 31, 2012		210,000		0.35
Granted		60,000		0.18
Exercised		––		––
Expired		––		––
Balance as of December 31, 2013		270,000	$	0.31

Schedule stock options under the Plan

		Options Outstanding						Options Exercisable
Exercise Prices		Number Outstanding		Weighted Average Remaining Contractual Life		Weighted Average Exercise Price		Number Exercisable		Weighted Average Exercise Price
$	0.16-0.20		60,000		4.40	$	0.18		60,000	$	0.18
$	0.25-0.26		60,000		3.40	$	0.26		60,000	$	0.26
$	0.27-0.41		60,000		1.40	$	0.34		60,000	$	0.34
$	0.35-0.36		60,000		2.40	$	0.36		60,000	$	0.36
$	0.53		30,000		1.00	$	0.53		30,000	$	0.53
$	0.16-0.53		270,000		2.7	$	0.35		270,000	$	0.31