NOTE 8. STOCK WARRANTS

Since the Company’s inception, it has financed its operations primarily through the issuance of debt or equity instruments, which have often included the issuance of warrants to purchase shares of the Company’s common stock.

As further described in Note 3 to these condensed consolidated financial statements, MultiCell entered into the LJCI Agreement pursuant to which MultiCell agreed to sell the Debenture in the principal amount of $100,000. In connection with the Debenture, MultiCell issued LJCI a warrant to purchase up to 10 million shares of the Company’s common stock at an exercise price of $1.09 per share, exercisable over the next five years according to a schedule described in a letter agreement dated February 28, 2007. Pursuant to the terms of the LJCI Warrant, upon the conversion of any portion of the principal amount of the Debenture, LJCI is required to simultaneously exercise and purchase that same percentage of the warrant shares equal to the percentage of the dollar amount of the Debenture being converted. Therefore, as an example, for each $1,000 of the principal of the Debenture converted, LJCI would be required to simultaneously purchase 100,000 shares under the warrant at $1.09 per share. During the nine months ended August 31, 2013, LJCI exercised warrants to purchase 943,000 shares of the Company’s common stock, resulting in proceeds to the Company of $1,027,870. During the nine months ended August 31, 2012, LJCI exercised warrants to purchase 729,000 shares of the Company’s common stock, resulting in proceeds to the Company of $794,610.

A summary of the status of warrants at August 31, 2013, and changes during the nine months then ended is presented in the following table:

					Weighted
			Weighted		Average
	Shares		Average		Remaining		Aggregate
	Under		Exercise		Contractual		Intrinsic
	Warrants		Price		Life		Value

Outstanding at November 30, 2012		9,277,030	$	0.7535		2.2 years	$	-
Issued		-		-
Exercised		(943,000)		1.0900
Expired		(360,000)		0.5000

Outstanding at August 31, 2013		7,974,030	$	0.7251		1.7 years	$	-