Annual report pursuant to Section 13 and 15(d)

Capital Stock, Stock Plans, Warrants, and Stock Based Compensation (Tables)

Capital Stock, Stock Plans, Warrants, and Stock Based Compensation (Tables)

12 Months Ended

Dec. 31, 2018

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions

The fair value of the options granted during 2018 and 2017 and the related assumptions used in the Black-Scholes option model used to value the options granted were as follows:

	Employee Stock Option Granted
	October 19, 2017			July 27, 2017
Weighted-average fair value per share	$	1.75			1.88
Risk -free interest rate ⁽¹⁾		1.98	%		1.98	%
Expected volatility of stock ⁽²⁾		54.64	%		53.15	%
Dividend yield		None			None
Expected option life ⁽³⁾		5.0 years			6.0 years

	Outside Director Stock Options Granted
	January 18, 2018			July 26, 2018			January 13, 2017			July 27, 2017
Weighted-average fair value per share	$	2.55			3.02		$	2.63		$	2.48
Risk -free interest rate ⁽¹⁾		2.62	%		2.98	%		2.40	%		2.32	%
Expected volatility of stock ⁽²⁾		57.29	%		55.34	%		56.32	%		57.21	%
Dividend yield		None			None			None			None
Expected option life ⁽³⁾		10.0 years			10.0 years			10.0 years			10.0 years

⁽¹⁾	The risk-free interest rate is based on the U.S. Treasury yield in effect at the grant date over the expected term of the option.
⁽²⁾	The expected volatility is based on historical volatility from our traded Common Stock over the expected term of the option.
⁽³⁾	The expected option life is based on historical exercises and post-vesting data.

Schedule of Employee Service Share-based Compensation, Allocation of Recognized Period Costs

The following table summarizes stock-based compensation recognized for fiscal years 2018 and 2017.

	Year Ended
	2018		2017
Employee Stock Options	$	147,000	$	78,000
Director Stock Options		51,000		46,000
Total	$	198,000	$	124,000

Schedule of Stock Options Roll Forward

The summary of the Company’s total plans as of December 31, 2018 and 2017, and changes during the period then ended are presented as follows:

	Shares			Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (years)		Aggregate Intrinsic Value ⁽²⁾
Options outstanding January 1, 2018		624,800		$	4.42
Granted		18,000			4.22
Exercised		(10,000	)		3.65
Forfeited/expired		(16,800	)		11.70
Options outstanding end of period ⁽¹⁾		616,000		$	4.23		4.7	$	─
Options exercisable at December 31, 2018⁽¹⁾		249,333		$	5.04		4.4	$	─
Options exercisable and expected to be vested at December 31, 2018		616,000		$	4.23		4.7	$	─

	Shares			Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (years)		Aggregate Intrinsic Value ⁽²⁾
Options outstanding January 1, 2017		247,200		$	6.69
Granted		428,000			3.64
Exercised		─			─
Forfeited/expired		(50,400	)		8.95
Options outstanding end of period ⁽¹⁾		624,800			4.42		5.5	$	19,780
Options exercisable at December 31, 2017⁽¹⁾		179,467			6.30		4.6	$	13,080
Options vested and expected to be vested at December 31, 2017		624,800		$	4.42		5.5	$	19,780

⁽¹⁾	Options with exercise prices ranging from $2.79 to $13.35
⁽²⁾	The intrinsic value of a stock option is the amount by which the market value of the underlying stock exceeds the exercise price of the option.

Schedule of Non Vested Options

The summary of the Company’s nonvested options as of December 31, 2018 and changes during the period then ended are presented as follows:

				Weighted Average
				Grant-Date
	Shares			Fair Value
Non-vested options January 1, 2018		445,333		$	1.89
Granted		18,000			1.89
Vested		(96,666	)		1.99
Forfeited		─			─
Non-vested options at December 31, 2018		366,667		$	1.91