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Note N - Equity
 3 Months Ended 12 Months Ended
Mar. 31, 2013
Dec. 31, 2012
Stockholders' Equity Note [Abstract]    
Stockholders' Equity Note Disclosure [Text Block]

6.                      STOCKHOLDERS’ DEFICIENCY


Issuances of Common Stock


Pursuant to a Securities Purchase Agreement dated February 26, 2013 by and between the Company and DRNC (the “InterDigital SPA”), the Company issued 4,026,935 shares of its common stock at a purchase price $0.10 per share, for an aggregate purchase price of $402,693. DRNC has anti-dilution rights under the InterDigital SPA that would require the Company to issue additional shares to DRNC on a full-ratchet basis if the Company, within the nine months following February 26, 2013, sells or issues any common stock or common stock equivalents (other than sales or issuances to directors, officers, employees or independent contractors in the ordinary course of business for compensation purposes and stock splits and stock dividends payable in respect of the Company’s common stock) having a purchase, exercise or conversion price per share of less than $0.10.


Concurrently with the closing of the transactions described above, the Company closed an equity financing with a number of private investors pursuant to a Securities Purchase Agreement dated February 26, 2013 by and between the Company and such private and institutional investors (the “Private Investor SPA”). Pursuant to the Private Investor SPA, the Company issued 5,000,000 shares of its common stock at a purchase price $0.10 per share, for an aggregate purchase price of $500,000.


In connection with the share issuances described above, the Company incurred costs of $46,176 which were offset against additional paid-in capital.


Issuances of Stock Options


For the three months ended March 31, 2013 and 2012, 2,300,000 and 1,125,000 stock options were granted, respectively. Terms of the options issued in 2013 include the following: term - 7 years, exercise price - $0.17, vesting - 3 years.


Derivative Liabilities


In connection with the issuances of equity instruments or debt, the Company may issue options or warrants to purchase common stock. In certain circumstances, these options or warrants may be classified as liabilities, rather than as equity. In addition, the equity instrument or debt may contain embedded derivative instruments, such as conversion options or listing requirements, which in certain circumstances may be required to be bifurcated from the associated host instrument and accounted for separately as a derivative liability instrument. The Company accounts for derivative liability instruments under the provisions of FASB ASC 815, “Derivatives and Hedging.”


As discussed above, the Company issued shares to DRNC that contain anti-dilution rights.  The Company determined that the anti-dilution rights are embedded derivatives that must be bifurcated and recorded as derivative liabilities. In addition, the Company would be required to revalue the derivative liabilities at the end of each reporting period with the change in value reported on the statement of operations. The Company did not account for these derivative liabilities in its financial statements as it was determined to not be material.


NOTE N— EQUITY


1. Redeemable Preferred Stock


Within the limits and restrictions provided in the Company’s Certificate of Incorporation, the Board of Directors has the authority, without further action by the shareholders, to issue up to 5,000,000 shares of preferred stock, $.0001 par value per share, in one or more series, and to fix, as to any such series, any dividend rate, redemption price, preference on liquidation or dissolution, sinking fund terms, conversion rights, voting rights, and any other preference or special rights and qualifications.


2. Common Stock


The Company is authorized to issue 170,000,000 shares of common stock, $.0001 par value per share, of which 78,155,413 were outstanding as of December 31, 2012 and 2011.


Holders of common stock have equal rights to receive dividends when, as and if declared by the Board of Directors, out of funds legally available therefor. Holders of common stock have one vote for each share held of record and do not have cumulative voting rights.


Holders of common stock are entitled, upon liquidation of the Company, to share ratably in the net assets available for distribution, subject to the rights, if any, of holders of any preferred stock then outstanding. Shares of common stock are not redeemable and have no preemptive or similar rights. All outstanding shares of common stock are fully paid and nonassessable.


On February 26, 2013, the Company entered into an agreement to issue 4,026,935 shares of its common stock at a purchase price $0.10 per share, for an aggregate purchase price of $402,693.  Concurrently, the Company closed an equity financing with a number of private and institutional investors and issued 5,000,000 shares of its common stock at a purchase price $0.10 per share, for an aggregate purchase price of $500,000.  See Note S below.


3. Warrants


The Company has issued warrants to certain creditors, investors, investment bankers and consultants. A summary of warrant activity is as follows:


   

Total Warrants

   

Weighted

average

exercise

price 

   

Weighted

average

remaining

life

(in years) 

   

Aggregate

intrinsic

value 

 
                                 

Outstanding, as of December 31, 2010

    10,261,615     $ 0.32                  
                                 

Granted

    —       —                  

Exercised

    —       —                  

Forfeited

    —       —                  

Expired

    (2,011,615

)

    0.39                  

Outstanding, as of December 31, 2011

    8,250,000     $ 0.30       3.97          
                                 

Granted

    —       —                  

Exercised

    —       —                  

Forfeited

    —       —                  

Expired

    —       —                  

Outstanding, as of December 31, 2012

    8,250,000     $ 0.30       2.97       —  

Vested or expected to vest at December 31, 2012

    8,250,000     $ 0.30       2.97       —  

Exercisable at December 31, 2012

    8,250,000     $ 0.30       2.97       —