Common Stock Warrants

6 Months Ended

Jun. 30, 2012

Common Stock Warrants [Abstract]

COMMON STOCK WARRANTS

NOTE G — COMMON STOCK WARRANTS

Albitar Warrant

On January 9, 2012 Dr. Maher Albitar was granted a warrant to purchase 200,000 shares of the Company’s common stock (the “Albitar Warrant”) at an exercise price per share of $1.43, which was the closing price per share on the last trading day prior to his start date. This warrant will be treated as a non-employee consultant warrant agreement and as such we revalued the warrant at June 30, 2012. The Albitar Warrant has a five year term and vests in accordance with the performance criteria as follows:

(i) 80,000 will vest upon the commercial launch of the Company’s gene-based plasma prostate cancer test licensed from Health Discovery Corp (“HDC”) or similar test based on our mutual agreement.

(ii) 40,000 will vest upon the commercial launch of the Company’s gene-based colon cancer test licensed from HDC or similar test based on our mutual agreement.

(iii) 40,000 will vest upon the commercial launch of the Company’s gene-based pancreatic cancer test licensed from HDC or similar test based on our mutual agreement.

(iv) 20,000 will vest upon successful consummation of a sublicensing agreement with an instrument manufacturer to commercialize the cytogenetics automated image analysis technology licenses from HDC

(v) 20,000 will vest upon successful consummation of a sublicensing agreement with an instrument manufacturer to commercialize the flow cytometry automated image analysis technology licenses from HDC

In the event of a change of control of the Company in which the consideration payable to common stockholders of the Company has a deemed value of at least $4.00 per share, any unvested portion of the Albitar Warrant will immediately vest in full.

On June 30, 2012 this Albitar Warrant was valued at $130,678 and we recorded approximately $15,000 and $32,500 of stock compensation expense related to the Albitar Warrant for the three and six months ended June 30, 2012.

Warrant exercises

In March 2012, a former member of our board of directors exercised 100,000 warrants in a cashless net exercise which resulted in him receiving 10,571 shares of our common stock

In June 2012, 550,000 warrants previously issued in June 2007 to then members of our board of directors and 348,417 warrants issued in June 2007 as part of a common stock offering were exercised or expired as follows:

Type of Exercise	Warrant Shares		Exercise Price / Share		Cash Received		Common Stock Shares Issued
For cash		175,000	$	1.50	$	262,500		175,000
Cashless net exercise		575,000	$	1.50	$	—		64,495
Expired unexercised		98,417	$	1.50	$	—		—

Warrant activity for the six months ended June 30, 2012 is summarized as follows:

	Shares			Weighted Average Exercise Price
Warrants outstanding, December 31, 2011		2,156,750		$	1.34
Granted		200,000			1.43
Exercised		(900,000	)		1.50
Expired		(98,417	)		1.50
Cancelled		—			—
Warrants outstanding, June 30, 2012		1,358,333			1.24