STOCK OPTIONS

12 Months Ended

Dec. 31, 2013

NOTE 8: STOCK OPTIONS

The Company has a 1995 Incentive Stock Option Plan for U.S. employees (the “1995 Plan”), which provide for the issuance of stock options to employees and outside consultants of the Company to purchase shares of Common Stock. As of the date of this report, no shares are available for the issuance of future awards under the 1995 Plan. The Company does not contemplate any future issuances or activity with respect to the 1995 Plan.

The Company maintains a 2009 Long Term Incentive Compensation Plan (the “2009 Plan”), which provide for the issuance of stock options to employees and outside consultants of the Company to purchase shares of Common Stock. As of the date of this report, 2,000,000 shares were authorized for issuance under the 2009 Plan. Stock options are generally granted at prices of not less than 100% of the fair market value of the common stock on the date of grant. Options granted under our option plans generally vest over a four year period. Options are exercisable until the tenth anniversary of the date of grant unless they lapse before that date.

On January 13, 2012, the Company granted 141,000 stock options at a strike price of $0.15 to certain officers and employees. The grant date fair value of the awards was $8,219 (net of estimated forfeitures of 10%), which was determined using a Black Scholes option pricing model using the following assumptions: volatility of 72%, risk-free rate of return of .36%, stock price of $0.15 and expected term of 2.5 years. The options expire in 2016. The Company is expensing these awards on a straight line basis over the vesting period.

On May 17, 2012, the Company granted 210,000 stock options at a strike price of $0.17 to the members of its Board of Directors. The grant date fair value of the awards was $13,465, which was determined using a Black Scholes option pricing model using the following assumptions: volatility of 62%, risk-free rate of return of .35%, stock price of $0.17 and expected term of 2.5 years. The options expire in 2017. As these awards vested immediately, the Company expensed the entire fair value of the award during the three months ended June 30, 2012.

On July 25, 2013, the Company granted 25,000 stock options at a strike price of $0.12 to the Principal Financial Officer of the Company. The grant date fair value of the options was $2,677 (net of estimated forfeitures of 10%), which was determined using a Black Scholes option pricing model and the following assumptions: (i) volatility of 292%, (ii) risk-free rate of return of 0.62%, (iii) stock price of $0.12, and (iv) an expected term of 3.25 years. The options expire in July 2018. The Company is expensing these options on a straight line basis over the vesting period.

No other awards were granted during the year ended December 31, 2013. The following sets forth a summary of stock options:

				Weighted-
				Average
		Weighted-		Remaining	Aggregate
		Average Exercise		Contractual Term	Intrinsic
	Number of Units	Price		(in years)	Value

Outstanding at December 31, 2012	998,586	$	0.24	3.3	$	43,083
Grants	25,000		0.12
Forfeitures	(5,500)		3.71
Exercises	-		-
Outstanding at December 31, 2013	1,018,086	$	0.22	2.4	$	15,350

Vested and exercisable at December 31, 2013	913,486	$	0.23	2.3	$	9,520

The following sets forth exercise price information for options outstanding at December 31, 2013:

	Number of
Exercise	Shares
Price	Outstanding	Exerciseable

$0.12 - $0.20	1,016,086	911,486
$7.50	1,000	1,000
$26.80	1,000	1,000

	1,018,086	913,486

The Company recognized expenses relating to stock option award of $7,547 and $32,627 for the years ended December 31, 2013 and 2012, respectively. The future expense relating to unvested awards (net of estimated forfeitures) is $4,039 at December 31, 2013 which will be recognized over a weighted average period of 1.7 years.

America's Suppliers, Inc. 10-K