Note 5. Shareholders’ Equity.
Between April 12 and July 2, 2012, the Company sold 707,000 shares of its common stock at $1.00 per share in a private offering.
On August 9, 2012, the Company issued 25,000 non-qualified stock options to each of its non-employee directors pursuant to its standard annual option award program, upon their re-election to the Board. The options are fully vested and exercisable for a period of seven years at an exercise price of $0.60 per share, and vest ratably over 12 months. The options were valued at $0.46 per share using the Black-Scholes pricing model and will be expensed as general and administrative expense on a straight-line basis over the vesting period. The assumptions used in the Black-Scholes valuation of these options are shown in the table in Note 1(d).
On September 26, 2012, the Company issued 30,000 shares of its common stock to an individual lender as interest consideration for the loan (see Note 4).