<?xml version="1.0" encoding="us-ascii"?><InstanceReport xmlns:xsd="http://www.w3.org/2001/XMLSchema" xmlns:xsi="http://www.w3.org/2001/XMLSchema-instance"><Version>2.4.0.8</Version><ReportLongName>0016 - Disclosure - 9. Stock-Based Compensation</ReportLongName><DisplayLabelColumn>true</DisplayLabelColumn><ShowElementNames>false</ShowElementNames><RoundingOption /><HasEmbeddedReports>false</HasEmbeddedReports><Columns><Column FlagID="0"><Id>1</Id><IsAbstractGroupTitle>false</IsAbstractGroupTitle><LabelSeparator>

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</LabelSeparator><Level>1</Level><ElementName>us-gaap_EquityAbstract</ElementName><ElementPrefix>us-gaap_</ElementPrefix><IsBaseElement>true</IsBaseElement><BalanceType>na</BalanceType><PeriodType>duration</PeriodType><IsReportTitle>false</IsReportTitle><IsSegmentTitle>false</IsSegmentTitle><IsCalendarTitle>false</IsCalendarTitle><IsEquityPrevioslyReportedAsRow>false</IsEquityPrevioslyReportedAsRow><IsEquityAdjustmentRow>false</IsEquityAdjustmentRow><IsBeginningBalance>false</IsBeginningBalance><IsEndingBalance>false</IsEndingBalance><IsReverseSign>false</IsReverseSign><FootnoteIndexer /><Cells><Cell FlagID="0" ContextID="" UnitID=""><Id>1</Id><IsNumeric>false</IsNumeric><IsRatio>false</IsRatio><DisplayZeroAsNone>false</DisplayZeroAsNone><NumericAmount>0</NumericAmount><RoundedNumericAmount>0</RoundedNumericAmount><NonNumbericText /><FootnoteIndexer /><CurrencyCode /><CurrencySymbol /><IsIndependantCurrency>false</IsIndependantCurrency><ShowCurrencySymbol>false</ShowCurrencySymbol><DisplayDateInUSFormat>false</DisplayDateInUSFormat></Cell></Cells><ElementDataType>xbrli:stringItemType</ElementDataType><SimpleDataType>string</SimpleDataType><IsTotalLabel>false</IsTotalLabel><UnitID>0</UnitID><Label>Equity [Abstract]</Label></Row><Row FlagID="0"><Id>2</Id><IsAbstractGroupTitle>false</IsAbstractGroupTitle><LabelSeparator>

</LabelSeparator><Level>2</Level><ElementName>us-gaap_ShareholdersEquityAndShareBasedPaymentsTextBlock</ElementName><ElementPrefix>us-gaap_</ElementPrefix><IsBaseElement>true</IsBaseElement><BalanceType>na</BalanceType><PeriodType>duration</PeriodType><IsReportTitle>false</IsReportTitle><IsSegmentTitle>false</IsSegmentTitle><IsCalendarTitle>false</IsCalendarTitle><IsEquityPrevioslyReportedAsRow>false</IsEquityPrevioslyReportedAsRow><IsEquityAdjustmentRow>false</IsEquityAdjustmentRow><IsBeginningBalance>false</IsBeginningBalance><IsEndingBalance>false</IsEndingBalance><IsReverseSign>false</IsReverseSign><FootnoteIndexer /><Cells><Cell FlagID="0" ContextID="From2013-01-01to2013-06-30" UnitID=""><Id>1</Id><IsNumeric>false</IsNumeric><IsRatio>false</IsRatio><DisplayZeroAsNone>false</DisplayZeroAsNone><NumericAmount>0</NumericAmount><RoundedNumericAmount>0</RoundedNumericAmount><NonNumbericText>&lt;p style="font: 8pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;Although
the Company does not have a formal stock option plan, it issues stock options to directors, employees, advisors, and consultants.&lt;/font&gt;&lt;/p&gt;

&lt;p style="font: 8pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/p&gt;

&lt;p style="font: 8pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;A
summary of the Company&amp;#146;s stock options as of June 30, 2013, is as follows:&lt;/font&gt;&lt;/p&gt;

&lt;p style="font: 8pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/p&gt;

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&lt;tr style="font: 8pt Times New Roman, Times, Serif"&gt;
    &lt;td style="vertical-align: top; width: 65%; padding-right: 0.05in; padding-left: 0.05in; text-align: center; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: top; width: 1%; padding-right: 0.05in; padding-left: 0.05in; text-align: justify; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; width: 16%; padding-right: 0.05in; padding-left: 0.05in; text-align: center; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&lt;b&gt;Number
    of &lt;/b&gt;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; width: 1%; padding-right: 0.05in; padding-left: 0.05in; text-align: justify; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; width: 17%; padding-right: 0.05in; padding-left: 0.05in; text-align: right; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&lt;b&gt;Weighted
    Average &lt;/b&gt;&lt;/font&gt;&lt;/td&gt;&lt;/tr&gt;
&lt;tr style="font: 8pt Times New Roman, Times, Serif"&gt;
    &lt;td style="vertical-align: top; padding-right: 0.05in; padding-left: 0.05in; text-align: center; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: top; padding-right: 0.05in; padding-left: 0.05in; text-align: justify; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; border-bottom: black 1pt solid; font: 8pt/12pt Times New Roman, Times, Serif; padding-right: 0.05in; padding-left: 0.05in; text-align: center"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&lt;b&gt;Options&lt;/b&gt;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 0.05in; padding-left: 0.05in; text-align: justify; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; border-bottom: black 1pt solid; font: 8pt/12pt Times New Roman, Times, Serif; padding-right: 0.05in; padding-left: 0.05in; text-align: right"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&lt;b&gt;Exercise
    Price&lt;/b&gt;&lt;/font&gt;&lt;/td&gt;&lt;/tr&gt;
&lt;tr style="font: 8pt Times New Roman, Times, Serif"&gt;
    &lt;td style="vertical-align: top; padding-right: 0.05in; padding-left: 0.05in; text-align: justify; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: top; padding-right: 0.05in; padding-left: 0.05in; text-align: justify; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 0.05in; padding-left: 0.05in; text-align: right; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 0.05in; padding-left: 0.05in; text-align: justify; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 0.05in; padding-left: 0.05in; text-align: right; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;&lt;/tr&gt;
&lt;tr style="font: 8pt Times New Roman, Times, Serif"&gt;
    &lt;td style="vertical-align: top; padding-right: 0.05in; padding-left: 0.05in; text-align: justify; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;Outstanding
    at June 30, 2012&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: top; padding-right: 0.05in; padding-left: 0.05in; text-align: justify; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; border-top: windowtext 1pt solid; font: 8pt/12pt Times New Roman, Times, Serif; padding-right: 0.05in; padding-left: 0.05in; text-align: right"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;216,132,393&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 0.05in; padding-left: 0.05in; text-align: justify; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 0.05in; padding-left: 0.05in; text-align: right; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;$0.0013&lt;/font&gt;&lt;/td&gt;&lt;/tr&gt;
&lt;tr style="font: 8pt Times New Roman, Times, Serif"&gt;
    &lt;td style="vertical-align: top; padding-right: 0.05in; padding-left: 0.05in; text-align: justify; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;Options
    issued&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: top; padding-right: 0.05in; padding-left: 0.05in; text-align: justify; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; border-bottom: windowtext 1pt solid; font: 8pt/12pt Times New Roman, Times, Serif; padding-right: 0.05in; padding-left: 0.05in; text-align: right"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;175,140,000&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 0.05in; padding-left: 0.05in; text-align: justify; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 0.05in; padding-left: 0.05in; text-align: right; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;0.0009&lt;/font&gt;&lt;/td&gt;&lt;/tr&gt;
&lt;tr style="font: 8pt Times New Roman, Times, Serif"&gt;
    &lt;td style="vertical-align: top; padding-right: 0.05in; padding-left: 0.05in; text-align: justify; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;Outstanding
    at December 31, 2012 and June 30, 2013&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: top; padding-right: 0.05in; padding-left: 0.05in; text-align: justify; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; border-bottom: windowtext 1pt solid; font: 8pt/12pt Times New Roman, Times, Serif; padding-right: 0.05in; padding-left: 0.05in; text-align: right"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;391,272,393&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 0.05in; padding-left: 0.05in; text-align: justify; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 0.05in; padding-left: 0.05in; text-align: right; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;$0.0011&lt;/font&gt;&lt;/td&gt;&lt;/tr&gt;
&lt;/table&gt;
&lt;p style="font: 8pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&amp;#160;&lt;/font&gt;&lt;/p&gt;

&lt;p style="font: 8pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;The
following table summarizes stock options outstanding at June 30, 2013:&lt;/font&gt;&lt;/p&gt;

&lt;p style="font: 8pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/p&gt;

&lt;table cellspacing="0" cellpadding="0" style="font: 8pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse"&gt;
&lt;tr style="font: 8pt Times New Roman, Times, Serif"&gt;
    &lt;td style="vertical-align: bottom; width: 24%; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; width: 2%; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; width: 17%; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&lt;b&gt;Number
    &lt;/b&gt;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; width: 2%; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; width: 17%; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&lt;b&gt;Average
    &lt;/b&gt;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; width: 2%; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; width: 17%; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&lt;b&gt;Number
    &lt;/b&gt;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: top; width: 2%; text-align: justify; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: top; width: 17%; text-align: center; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&lt;b&gt;Intrinsic
    &lt;/b&gt;&lt;/font&gt;&lt;/td&gt;&lt;/tr&gt;
&lt;tr style="font: 8pt Times New Roman, Times, Serif"&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&lt;b&gt;Outstanding
    &lt;/b&gt;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&lt;b&gt;Remaining
    &lt;/b&gt;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&lt;b&gt;Exercisable
    &lt;/b&gt;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: top; text-align: justify; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: top; text-align: center; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&lt;b&gt;Value
    &lt;/b&gt;&lt;/font&gt;&lt;/td&gt;&lt;/tr&gt;
&lt;tr style="font: 8pt Times New Roman, Times, Serif"&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&lt;b&gt;at
    &lt;/b&gt;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&lt;b&gt;Contractual
    &lt;/b&gt;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&lt;b&gt;at
    &lt;/b&gt;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: top; text-align: justify; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: top; text-align: center; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&lt;b&gt;at
    &lt;/b&gt;&lt;/font&gt;&lt;/td&gt;&lt;/tr&gt;
&lt;tr style="font: 8pt Times New Roman, Times, Serif"&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&lt;b&gt;June
    30,&lt;/b&gt;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&lt;b&gt;Life
    &lt;/b&gt;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&lt;b&gt;June
    30, &lt;/b&gt;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: top; text-align: justify; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: top; text-align: center; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&lt;b&gt;June
    30, &lt;/b&gt;&lt;/font&gt;&lt;/td&gt;&lt;/tr&gt;
&lt;tr style="font: 8pt Times New Roman, Times, Serif"&gt;
    &lt;td style="vertical-align: bottom; border-bottom: black 1pt solid; font: 8pt/12pt Times New Roman, Times, Serif; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&lt;b&gt;Exercise
    Price&lt;/b&gt;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; border-bottom: black 1pt solid; font: 8pt/12pt Times New Roman, Times, Serif; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&lt;b&gt;2013&lt;/b&gt;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; border-bottom: black 1pt solid; font: 8pt/12pt Times New Roman, Times, Serif; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&lt;b&gt;(Years)&lt;/b&gt;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; border-bottom: black 1pt solid; font: 8pt/12pt Times New Roman, Times, Serif; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&lt;b&gt;2013&lt;/b&gt;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: top; text-align: justify; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: top; border-bottom: black 1pt solid; font: 8pt/12pt Times New Roman, Times, Serif; text-align: center"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&lt;b&gt;2013&lt;/b&gt;&lt;/font&gt;&lt;/td&gt;&lt;/tr&gt;
&lt;tr style="font: 8pt Times New Roman, Times, Serif"&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;$0.0009&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: justify; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;3,448,507&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: justify; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;2.33&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: justify; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;3,448,507&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: top; text-align: justify; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: top; text-align: right; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;$&amp;#160;&amp;#160;&amp;#160;45,175&lt;/font&gt;&lt;/td&gt;&lt;/tr&gt;
&lt;tr style="font: 8pt Times New Roman, Times, Serif"&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;0.0009&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: justify; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;175,140,000&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: justify; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;7.00&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: justify; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;175,140,000&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: top; text-align: justify; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: top; text-align: right; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;2,294,334&lt;/font&gt;&lt;/td&gt;&lt;/tr&gt;
&lt;tr style="font: 8pt Times New Roman, Times, Serif"&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;0.0009&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: justify; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;175,140,000&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: justify; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;9.50&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: justify; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;-
    &lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: top; text-align: justify; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: top; text-align: right; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;-&lt;/font&gt;&lt;/td&gt;&lt;/tr&gt;
&lt;tr style="font: 8pt Times New Roman, Times, Serif"&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;0.0030&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: justify; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;17,833,456&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: justify; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;1.83&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: justify; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;17,833,456&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: top; text-align: justify; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: top; text-align: right; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;196,168&lt;/font&gt;&lt;/td&gt;&lt;/tr&gt;
&lt;tr style="font: 8pt Times New Roman, Times, Serif"&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;0.0033&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: justify; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;19,710,430&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: justify; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;3.00&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: justify; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;7,193,588&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: top; text-align: justify; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/td&gt;
    &lt;td style="vertical-align: top; text-align: right; font: 8pt/12pt Times New Roman, Times, Serif"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;210,902&lt;/font&gt;&lt;/td&gt;&lt;/tr&gt;
&lt;/table&gt;
&lt;p style="font: 8pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&amp;#160;&lt;/font&gt;&lt;/p&gt;

&lt;p style="font: 8pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;At
June 30, 2013, 391,272,393 shares of common stock were reserved for outstanding options.&lt;/font&gt;&lt;/p&gt;

&lt;p style="font: 8pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/p&gt;

&lt;p style="font: 8pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;The
fair value of each option granted is estimated at the date of grant using the Black-Scholes option-pricing model. The assumptions
used in calculating the fair value of the options granted were: risk-free interest rate of 5.0%, a 3 year expected life, a dividend
yield of 0.0%, and a stock price volatility factor of 40%&lt;/font&gt;&lt;/p&gt;

&lt;p style="font: 8pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/p&gt;

&lt;p style="font: 8pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;There
were no options issued or exercised during the six months ended June 30, 2013 and 2012&amp;#160;&lt;/font&gt;&lt;/p&gt;

&lt;p style="font: 8pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/p&gt;

&lt;p style="font: 8pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;In
May 2013, the Company signed an amendment to its agreement with an investor relations firm, pursuant to which the Company issued
the firm a warrant to purchase up to 37,526,065 shares of the Company&amp;#146;s Common Stock, subject to vesting, at an exercise
price of $0.012 per share, with 7.505,213 shares vesting on each of May 1, 2013, October 15, 2013, January 15, 2014 and April
14, 2014. Exercise of the warrants is also subject to certain performance metrics set forth in the warrant. The fair value of
each option granted is estimated at the date of grant using the Black-Scholes option-pricing model. The warrants were valued at
roughly $247,000. The assumptions used in calculating the fair value of the options granted were: risk-free interest rate of 5.0%,
a 2.5 year expected life, a dividend yield of 0.0%, and a stock price of volatility factor of 89%&lt;/font&gt;&lt;/p&gt;

&lt;p style="font: 8pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify"&gt;&lt;font style="font: 8pt Times New Roman, Times, Serif"&gt;&amp;#160;&lt;/font&gt;&lt;/p&gt;</NonNumbericText><FootnoteIndexer /><CurrencyCode /><CurrencySymbol /><IsIndependantCurrency>false</IsIndependantCurrency><ShowCurrencySymbol>false</ShowCurrencySymbol><DisplayDateInUSFormat>false</DisplayDateInUSFormat></Cell></Cells><ElementDataType>nonnum:textBlockItemType</ElementDataType><SimpleDataType>na</SimpleDataType><ElementDefenition>The entire disclosure for accounts comprising shareholders' equity, comprised of portions attributable to the parent entity and noncontrolling interest, including other comprehensive income, and compensation-related costs for equity-based compensation. Includes, but is not limited to, disclosure of policies, compensation plan details, equity-based arrangements to obtain goods and services, deferred compensation arrangements, and employee stock purchase plan details.</ElementDefenition><ElementReferences>No definition available.</ElementReferences><IsTotalLabel>false</IsTotalLabel><UnitID>0</UnitID><Label>9. Stock-Based Compensation</Label></Row></Rows><Footnotes /><IsEquityReport>false</IsEquityReport><ReportName>9. Stock-Based Compensation</ReportName><MonetaryRoundingLevel>UnKnown</MonetaryRoundingLevel><SharesRoundingLevel>UnKnown</SharesRoundingLevel><PerShareRoundingLevel>UnKnown</PerShareRoundingLevel><ExchangeRateRoundingLevel>UnKnown</ExchangeRateRoundingLevel><HasCustomUnits>true</HasCustomUnits><IsEmbedReport>false</IsEmbedReport><IsMultiCurrency>false</IsMultiCurrency><ReportType>Sheet</ReportType><RoleURI>http://onehorizongroup.com/role/Stock-BasedCompensation</RoleURI><NumberOfCols>1</NumberOfCols><NumberOfRows>2</NumberOfRows></InstanceReport>
