Common Stock

The Company agreed to compensate two of its directors in the form of common stock for 2010 and 2011. Both directors are affiliated with the advisory services firm that is currently providing investment banking services to the Company. Beginning in the second quarter of 2011, the Company agreed to provide one-half of the compensation of a third director in common stock. For compensation relating to 2010, the number of shares issued to each director was determined based upon the equivalent cash compensation accrued divided by the closing price of the Company’s common stock on the last day of the quarter with respect to which the shares were issued.

On February 16, 2011, the Company issued 18,383 and 18,940 respectively, shares of common stock to each of two directors as compensation for the three months ended September 30, 2010 and December 31, 2010, respectively. On June 2, 2011, the Company issued 16,892 shares of common stock to each of two directors as compensation for the three months ended March 31, 2011. On July 7, 2011, the Company issued 16,892 shares of common stock to each of two directors, and 8,446 shares to another director as compensation for the three months ended June 30, 2011. On October 13, 2011, the Company issued 22,322 shares of common stock to each of two directors, and 11,161 shares to another director as compensation for the three months ended June 30, 2011. On January 25, 2012 the Company issued 26,042 shares of common stock to each of two directors, and 13,022 shares to another director as compensation for the three months ended December 31, 2011. The Company issued to these directors a total of 206,465 shares during the year ended December 31, 2011, and the shares were valued at an average share price of approximately $0.33, or a total value of $68,750. The Company issued to these directors a total of 121,056 shares during the year ended December 31, 2010.