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NOTE 8. STOCK OPTIONS AND WARRANTS
6 Months Ended
Jun. 30, 2011
Shareholders' Equity and Share-based Payments [Text Block]
8.
STOCK OPTIONS AND WARRANTS

From January 1, 2011 through June 30, 2011, the Company did not grant any stock options to its employees or third party consultants.

During the three and six months ended June 30, 2011, $10,440 and $20,880 respectively, was recognized for previously granted stock options which vested.

During the three months ended June 30, 2010, the Company issued a Private Placement Memorandum (“PPM”) to raise capital for the business. Under the PPM investors are entitled to receive warrants equal to the number of shares that were purchased. As of June 30, 2011, the Company had issued 7,916,245 warrants to purchase stock based on the number of shares sold. The warrants have an exercise price of $0.50 per share and expire 2 years from the date of issuance. The Company has the right to call and repurchase the warrants at any time after the common stock of the Company has traded at a last sale price of one dollar ($1.00) or more per share for twenty (20) days in the public securities trading market where it is quoted (i.e. currently the OTC Bulletin Board), for a repurchase price of $0.01 per warrant. Each warrant holder will have a period of twenty (20) days from the date of notice of the call to exercise the warrant before it is repurchased by the Company.

As a part of the PPM discussed above, as of June 30, 2011, the Company is obligated to issue 714,286 warrants to the placement agents.  These warrants are exercisable for 5 years at an exercise price of $0.40 per share.