Annual report pursuant to section 13 and 15(d)

9. Stock options and warrants (Tables)

9. Stock options and warrants (Tables)

12 Months Ended

Dec. 31, 2012

	Weighted Avg. Options			Weighted Avg. Exercise Price
Options, January 1, 2004		13,250,000		$	0.11
Options granted		1,172,652			1.03
Options exercised		–			–
Options cancelled		–			–
Options, December 31, 2004		14,422,652			0.18
Options granted		2,085,909			0.92
Options exercised		–			–
Options cancelled		(10,000,000	)		0.10
Options, December 31, 2005		6,508,561			0.53
Options granted		1,313,605			1.21
Options exercised		(2,860,000	)		0.10
Options forfeited		(962,607	)		0.84
Options cancelled		–			–
Options, December 31, 2006		3,999,559			0.99
Options granted		238,679			0.55
Options exercised		–			–
Options forfeited		(49,793	)		1.96
Options cancelled		–			–
Options, December 31, 2007		4,188,445		$	0.95
Options granted		2,700,000			0.28
Options exercised		–			–
Options forfeited		(2,287,220	)		1.00
Options cancelled		–			–
Options, December 31, 2008		4,601,225		$	0.53
Options granted		333,333			0.30
Options exercised		(83,333	)		0.27
Options forfeited		–			–
Options cancelled		–			–
Options, December 31, 2009		4,851,225		$	0.52
Options granted		181,818			0.55
Options exercised		(195,555	)		0.27
Options forfeited		–			–
Options cancelled		–			–
Options, December 31, 2010		4,837,488		$	0.52
Options granted		19,800,000			0.26
Options exercised		(77,778	)		0.27
Options forfeited		(310,000	)		0.76
Options cancelled		(181,818	)		0.55
Options, December 31, 2011		24,067,892		$	0.30
Options granted		4,858,000			0.30
Options exercised		(776,667	)		0.47
Options forfeited		(871,127	)		0.98
Options, December 31, 2012		27,278,098		$	0.27

	Outstanding Options					Exercisable Options
Option Exercise Price Per Share	Shares		Life (Years)	Weighted Average Exercise Price		Shares		Weighted Average Exercise Price
$ 0.21 - $ 0.99		27,196,679	8.1	$	0.27		9,616,679	$	0.29
$ 1.00 - $ 1.99		81,419	2.8	$	1.36		81,419	$	1.36
		27,278,098		$	0.27		9,698,098	$	0.30

Black-Scholes-Merton pricing model with the following assumptions

	2012		2011
Expected life (years)	5.0 – 7.0		6.00
Risk free interest rate	0.62 – 1.27	%	1.95	%
Volatility	125% – 140	%	141.97	%
Expected dividend yield	0.00	%	0.00	%

Stock purchase warrants

	Warrants			Weighted Avg. Exercise Price
Warrants outstanding, January 1, 2004		14,252,414			0.48
Warrants granted		2,372,500			1.27
Warrants exercised		(960,500	)		0.20
Warrants cancelled		–			–
Warrants outstanding, December 31, 2004		15,664,414			0.62
Warrants granted		5,198,574			1.16
Warrants exercised		(50,500	)		0.99
Warrants cancelled		(20,000	)		1.50
Warrants outstanding, December 31, 2005		20,792,488			0.75
Warrants granted		3,624,894			1.28
Warrants exercised		(2,328,452	)		0.68
Warrants cancelled		(1,191,619	)		1.46
Warrants outstanding, December 31, 2006		20,897,311		$	0.81
Warrants granted		3,602,701			0.64
Warrants exercised		–			–
Warrants cancelled		(6,580,984	)		1.06
Warrants outstanding, December 31, 2007		17,919,028		$	0.67
Warrants granted		3,931,708			0.42
Warrants exercised		(1,064,650	)		0.50
Warrants cancelled		(10,386,083	)		0.56
Warrants outstanding, December 31, 2008		10,400,003		$	0.70
Warrants granted		5,247,276			0.36
Warrants exercised		–			–
Warrants cancelled		(2,300,515	)		0.95
Warrants outstanding, December 31, 2009		13,346,764		$	0.52
Warrants granted		14,058,032			0.32
Warrants exercised		–			–
Warrants cancelled		(4,425,728	)		0.53
Warrants outstanding, December 31, 2010		22,979,068		$	0.52
Warrants granted		29,781,916			0.30
Warrants exercised		(224,000	)		0.47
Warrants cancelled		(3,430,704	)		0.56
Warrants outstanding, December 31, 2011		49,106,280		$	0.32
Warrants granted		9,273,316			0.31
Warrants exercised		(12,039,846	)		0.29
Warrants cancelled		(4,134,243	)		0.49
Warrants outstanding, December 31, 2012		42,205,507		$	0.31

	Outstanding Warrants					Exercisable Warrants
Warrant Exercise Price Per Share	Shares		Life (Years)	Weighted Average Exercise Price		Shares		Weighted Average Exercise Price
$ 0.30 - $ 0.99		41,705,507	1.4	$	0.30		40,338,840	$	0.30
$ 1.00 - $ 1.99		500,000	1.5	$	1.00		500,000	$	1.00
		42,205,507		$	0.31		40,838,840	$	0.31

- Definition

Tabular disclosure of warrants or rights issued. Warrants and rights outstanding are derivative securities that give the holder the right to purchase securities (usually equity) from the issuer at a specific price within a certain time frame. Warrants are often included in a new debt issue to entice investors by a higher return potential. The main difference between warrants and call options is that warrants are issued and guaranteed by the company, whereas options are exchange instruments and are not issued by the company. Also, the lifetime of a warrant is often measured in years, while the lifetime of a typical option is measured in months. Disclose the title of issue of securities called for by warrants and rights outstanding, the aggregate amount of securities called for by warrants and rights outstanding, the date from which the warrants or rights are exercisable, and the price at which the warrant or right is exercisable.

+ References + Details