|
Note 11 - Shareholders' Equity
|
9 Months Ended | |||||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
|
Feb. 29, 2012
|
||||||||||||||||||||||||||
| Notes To Financial Statements | ||||||||||||||||||||||||||
| Stockholders' Equity Note Disclosure [Text Block] |
11.
SHAREHOLDERS’
EQUITY
Preferred
Stock Issuances
During
the quarter ended August 31, 2011, several private investors made
an equity investment of $430,250 for which these investors
received 430,250 shares of the Company’s redeemable
convertible preferred stock. The proceeds were used for operating
capital.
During
the quarter ended August 31, 2011, a secured lender agreed to
accept payment of the outstanding interest owed on its note
through May 25, 2011, totaling approximately $277,544
into 277,544 shares of the Company’s preferred stock.
In
August 2011, the Company issued 50,000 shares of preferred stock
to a lender in connection with a loan to the Company of
$200,000. The company recorded total debt discount of
$50,000 and interest expense of $2,778 in connection with these
shares.
During
the quarter ended November 30, 2011, one private investor made an
investment of $370,000 for which he received 370,000 shares of
the Company’s redeemable convertible preferred stock. The
proceeds were used for operating capital.
During
the quarter ended November 30, 2011, two preferred shareholders
converted a total of 263,300 shares of preferred stock at the
conversion rate of $.30 per share for which they received a total
of 877,666 shares of common stock.
During
the quarter ended February 29, 2012, a preferred shareholder
converted a total of 756,000 shares of preferred stock at the
conversion rate of $.30 per share for which they received a
total of 2,520,000 shares of common stock.
Common
Stock Issuances
In
September 2011, two preferred shareholders converted a total of
263,300 shares of preferred stock at the conversion rate of $.30
per share for which they received a total of 877,666 shares of
common stock.
In
October, 2011, the Company issued a total of 155,000 shares of
common stock to three employees. The company has record an
expense of $75,950 in connection with these shares over a one
year amortization period.
During
the quarter ended February 29, 2012, a preferred shareholder
converted a total of 756,000 shares of preferred stock at the
conversion rate of $.30 per share for which they received a total
of 2,520,000 shares of common stock.
Stock
Option Issuances
On
or about February 11, 2011, the Company entered a marketing and
distribution agreement with KeHE Distributors pursuant to which
the Company is obligated to issue stock options subject to KeHE
achieving the purchase thresholds as set forth below:
The
total number of shares represents 9.99% of the Company’s
common stock outstanding on a fully-diluted basis. The respective
stock options which will have an exercise period of three years
from the date of issuance at an exercise price of $.30 per
share. During May 2011, the Company amended the
vesting terms of these options, whereby 440,000 of such options
were vested and the remainder of the options vested as of August
31, 2011.
In
September 2011, the Company agreed to issue a total of 550,000
stock options to board members, subject to shareholder
ratification, to replace those options which expired earlier in
the year. The stock options have an exercise period of
three years from the date of issuance and an exercise price of
$.30 per share. The issuance of the options was
ratified at the annual shareholder meeting in January 2012. The
Company has recorded an expense of $20,420 in connection with
these options.
|
|||||||||||||||||||||||||