NOTE 6 - STOCK OPTIONS

6 Months Ended

Jun. 30, 2013

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

NOTE 6 - STOCK OPTIONS

NOTE 6 – STOCK OPTIONS

During the six months ended June 30, 2013, the Company issued 4,535,714 warrants as part of the offering of the senior secured convertible notes. Such warrants triggered derivative liabilities of the Company due to their ratchet features (see Note 11 below). During the six months ended June 30, 2013, 800,000 warrants were exercised for cash proceeds of $120,000. During the six months ended June 30, 2013, 100,000 stock options were exercised for cash proceeds of $11,000. During the six months ended June 30, 2013, 900,000 stock options were exercised through a cashless exercise of options resulting in the issuance of 639,606 shares of common stock.

During the six months ended June 30, 2012, no stock options or warrants were exercised.

Stock Warrants and Options
Stock warrants/options outstanding and exercisable on June 30, 2013 are as follows:
Exercise Price per Share		Shares Under Option/warrant		Remaining Life in Years
	Outstanding
$	0.50		4,535,714		4.71
$	0.35		212,500		0.50
$	0.20		100,000		0.50
$	0.19		200,000		4.50
$	0.15		737,500		1.50
$	0.115		300,000		4.33
$	0.11		150,000		1.80
$	0.070		7,500,000		4.25
$
	Exercisable
$	0.50		4,535,714		4.71
$	0.35		212,500		0.50
$	0.20		100,000		0.50
$	0.15		737,500		1.50
$	0.115		300,000		4.33
$	0.11		150,000		1.80
$	0.070		7,500,000		4.25