STOCK COMPENSATION

On September 19, 2008, the Board of Directors and Stockholders of the Company adopted the 2008 Stock Option Plan (the "2008 Plan") in addition to the 2004 Stock Option Plan, which allowed the Company to grant up to 500,000 options to employees, officers, directors and consultants to purchase shares of the Company's Common Stock. Options granted under the 2008 Plan could have been either Incentive Stock Options or Non-Qualified Stock Options. There have not been any grants under the 2008 Stock Option Plan since its inception. The Board of Directors replaced the 2008 Stock Option Plan with the 2016 Equity Incentive Plan described below.

Options granted under granted under the 2004 Stock Option Plan, generally vested over a three year period. The Company recognizes stock option expense over the vesting period. The Company did not record any stock option expense for the years 2017 and 2016 as all of the options were fully vested.

There were 56,800 options exercised for the year ending December 31, 2017 and there were 62,800 options exercised in 2016. The intrinsic value of the 10,333 options outstanding and exercisable at December 31, 2017 was approximately $58,000.

The following tables summarize activity under the 2004 Stock Option Plan of the Company and the stock options outstanding at December 31, 2017:



	Weighted Average Exercise Price			Options Outstanding		Vested and Exercisable
Balance, December 31, 2015	$	1.96		190,933		190,933
Granted	—			—		—
Forfeited	(2.21		)	(60,000	)	(60,000	)
Exercised	(1.31		)	(62,800	)	(62,800	)

Balance, December 31, 2016	1.96			68,133		68,133
Granted	—			—		—
Forfeited	(2.15		)	(1,000	)	(1,000	)
Exercised	(1.89		)	(56,800	)	(56,800	)

Balance, December 31, 2017	$	1.21		10,333		10,333

On October 13, 2016, the Board of Directors of the Company adopted the 2016 Equity Incentive Plan, which allows the Company to grant up to 400,000 shares of restricted common stock of the Company to employees, officers, directors and consultants. The grants may be in the form of restricted or performance shares of common stock of the Company. There were 72,000 and 103,000 shares of restricted stock issued during the years ended December 31, 2017 and December 31, 2016, respectively. The shares have a three year vesting period which vests ratably, on an annual basis, over a three year period. The total intrinsic value of the outstanding shares of restricted stock is $1,588,950.

The fair value of restricted stock awards is estimated to be the market price of the Company's common stock at the close of date of grant. Restricted stock activity during the year ended December 31, 2017 is as follows:



	Number of Shares	Weighted Average Grant Date Fair Value per Share
Non-vested, December 31, 2015	—	$	—
Granted	103,000	4.95
Vested	—	—
Forfeited	—	—

Non-vested, December 31, 2016	103,000	4.95
Granted	72,000	5.45
Vested	49,667	5.10
Forfeited	—	—

Non-vested, December 31, 2017	125,333	$	5.19

Awards are being amortized to expense ratably, on an annual basis, over a three year vesting term, except one grant that vested immediately. Stock compensation for the year ended December 31, 2017 was approximately $411,000, based upon the value at the date of vesting. There was no expense for the year ended December 31, 2016, as the grants were made in December 2016. The total unrecognized compensation cost related to the non-vested restricted stock is approximately $650,000 as of December 31, 2017.