NOTE 6 - STOCK OPTIONS

3 Months Ended

Mar. 31, 2012

Schedule of Share-based Compensation, Stock Options, Activity [Table Text Block]

NOTE 6 – STOCK OPTIONS

The shareholders approved, by a majority vote, the adoption of the 1998 Stock Incentive Plan (the “Plan”).  As amended on August 11, 2003, the Plan reserves 20,000,000 shares of common stock for issuance upon the exercise of options which may be granted from time-to-time to officers, directors and certain employees and consultants of the Company or its subsidiaries.  The Plan permits the award of both qualified and non-qualified incentive stock options.  On August 18, 2003, the Company registered its “Amended Stock Incentive Plan of Klever Marketing, Inc.” on Form S-8.  The Company granted 125,000 stock options during the three months ended March 31, 2012.  The options vest immediately and have an exercise price of $0.10 per share. Of the options granted, 100,000 expire on September 22, 2012 and 25,000 expire on December 31, 2012. The Company recorded $10,381 of consulting expense during the three months ended March 31, 2012 in connection with issuing the options. The fair value of each option grant is estimated on the date of grant using the Black-Scholes option-pricing model with the assumptions noted below:

Assumptions
Dividend Yield	0%
Weighted average volatility	487.85%
Risk-free interest rate	0.18%
Expected Life (years)	0.59

The summary of option activity for the three months ended March, 2012 is presented below:

	Shares		Weighted Average Exercise Price		Weighted Average Remaining Life (Years)
Balance as of December 31, 2011	—	$	—	$	—
Granted	125,000		0.10		0.59
Expired	—		—		—
Cancelled	—		—		—
Balance as of March 31, 2012	125,000	$	0.10	$	0.53

As of March 31, 2012, 125,000 options were exercisable. The weighted-average grant-date fair value of options granted during the three months ended March 31, 2012 was $0.08. There were no options granted during the three months ended March 31, 2011.

As of March 31, 2012, the intrinsic value of outstanding and vested stock options was $0.

Expected option lives and expected stock price volatility were based on historical data of the Company. The risk free interest rate was calculated using U.S. Treasury constant maturity rates similar to the expected lives of the options, as published by the Federal Reserve. The Company has no plans to declare any future dividends on our common stock.