0.25
P5Y
P5Y
P6Y
P5Y
P6Y
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Note 8 - Equity Financing and the Debt Restructuring</div> <div style="DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: justify; TEXT-INDENT: 0pt"> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> 2012 Equity Financing and the Debt Restructuring</div> <div style="DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: justify; TEXT-INDENT: 0pt"> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: justify; TEXT-INDENT: 36pt"> On March 26, 2012, we closed on an equity financing (the "2012 Equity Financing") as well as a restructuring of our outstanding senior convertible indebtedness (the "2012 Debt Restructuring") resulting in complete satisfaction of our senior indebtedness.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> We entered into an Engagement Agreement, dated October 28, 2011, with MDB Capital Group, LLC ("MDB"), pursuant to which MDB agreed to act as the exclusive agent of the Company on a "best efforts" basis with respect to the sale of the Company's securities.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> Pursuant to the Engagement Agreement, we entered into a Securities Purchase Agreement ("SPA") dated March 23, 2012 with select institutional and other accredited investors for the private placement of 27,800,000 units of our securities. The SPA included a purchase price of $0.25 per unit, with each unit consisting of one share of common stock and two forms of Warrant: (1) The "A" Warrant grants the investors the right to purchase an additional share of common stock for each two shares of common stock purchased, for a term of six years and at an exercise price of $0.35 per share; and (2) The "B" Warrant will not be exercisable unless and until the occurrence of a future issuance of stock at less than $0.25 per share., The holders of the B Warrants agreed in December 2013 to amend the terms of the B Warrant to reduce the amount of subsequent financing required to extinguish the B Warrants with the result that the B Warrants have now been extinguished.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: justify; TEXT-INDENT: 36pt"> Net proceeds from the 2012 Equity Financing, after deducting the commissions and the estimated legal, printing and other costs and expenses related to the financing, were approximately $6.1 million. Coincident to the closing of the 2012 Equity Financing, we also closed on the 2012 Debt Restructuring. In connection therewith, the Company paid $2,750,000 to Castlerigg Master Investment Ltd. ("Castlerigg"), and issued to Castlerigg 2,000,000 shares of common stock in full and complete satisfaction of the senior convertible note and all accrued interest</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> In December 2011, we entered into a loan with 7 accredited individuals and entities under the terms of which we borrowed $1,300,000 to be used as working capital ("Bridge Loan"). . In consideration of the Bridge Loan we granted to the holders of the Bridge Loan warrants with a five year term to purchase 357,500 shares of our common stock at an original exercise price of $0.65 per share. In consideration of the extension of the maturity date of the Bridge Loan, we granted the holders of the Bridge Loan warrants with a six year term to purchase 247,500 shares of our common stock at an original exercise price of $0.35 per share.</div> <div style="DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: justify; TEXT-INDENT: 0pt"> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: justify; TEXT-INDENT: 36pt"> In connection with the 2012 Equity Financing and under the terms of the SPA, two of the above described bridge lenders converted the principal balance of their portion of the bridge loan in the amount of $400,000 to common stock and warrants as part of and on the same terms as the 2012 Equity Financing. In addition, one other entity converted the amount owed by us for equipment purchases in the amount of $500,000 to common stock and warrants as part of and on the same terms as the 2012 Equity Financing. The proceeds from these conversions were treated as funds raised with respect to the financing.</div> <div style="DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: justify; TEXT-INDENT: 0pt"> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: justify; TEXT-INDENT: 36pt"> On April 5, 2012 we secured an additional $154,000 from 1 company and 4 individuals (three of which are members of our Board of Directors) on the same terms and conditions as the investors of the 2012 Equity Financing. As a result of this funding we issued 616,000 shares of our common stock and A warrants totaling 400,400 of which 308,000 were issued to investors and 92,400 were issued to our investment banker.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: justify; TEXT-INDENT: 36pt"> All warrants listed below were issued with price protection provisions and were accounted for as derivative liabilities. The Warrants have an exercise price of $0.25 per share and were valued using the Black Scholes pricing model.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"> </div> <div style="text-align: center"> <table style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman" cellspacing="0" cellpadding="0" width="80%"> <tr> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="55%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="13%" colspan="2" nowrap="nowrap"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Common</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Shares</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Issued</div> </td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="13%" colspan="2" nowrap="nowrap"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Number of</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Warrants</div> </td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="13%" colspan="2" nowrap="nowrap"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Value of</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Warrants</div> </td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="#cceeff"> <td valign="bottom" width="55%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Investors</div> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">24,816,000</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">12,408,000</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">67,767</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="white"> <td valign="bottom" width="55%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Bridge Loan Conversion</div> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">1,600,000</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">800,000</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">4,369</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="#cceeff"> <td valign="bottom" width="55%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Equipment Finance Conversion</div> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">2,000,000</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">1,000,000</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">5,462</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="white"> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="55%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Agency</div> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">--</td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">4,262,400</td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">23,280</td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="#cceeff"> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="55%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Total</div> </td> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">28,416,000</td> <td style="PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">18,470,400</td> <td style="PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">100,878</td> <td style="PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> </table> </div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> We recorded an aggregate derivative liability of $100,878 and $1,090,884 as of March 31, 2014 and 2013, respectively related to the reset feature of the warrants mentioned above. A derivative valuation loss of $92,246 and $333,415 was recorded to reflect the change in value of the aggregate derivative liability from December 31, 2013 and 2012, respectively. The aggregate derivative liability of $100,878 was calculated using a Black-Scholes pricing model with the following assumptions: (i) risk free interest rate 1.34%, (ii) expected life (in years) of 4.0; (iii) expected volatility of 119.06%; (iv) expected dividend yield of 0.00%; and (v) stock trading price of $0.015.</div> <div style="DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: justify; TEXT-INDENT: 0pt"> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> 2010 Equity Financing and the Debt Restructuring</div> <div style="DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: justify; TEXT-INDENT: 0pt"> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> On December 24, 2010, we closed on an equity financing (the "Equity Financing") as well as a restructuring of our then outstanding convertible indebtedness (the "Debt Restructuring"). The Equity Financing and the Debt Restructuring are described as follows.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> In December 2010 we entered into a Placement Agency Agreement, with Philadelphia Brokerage Corporation ("PBC"), pursuant to which PBC agreed to act as the exclusive agent of the Company to sale units of the Company's securities. The units consisted of two shares of our common stock and one warrant to purchase a share of our common stock.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> Pursuant to the Placement Agency Agreement, we entered into Subscription Agreements with select institutional and other accredited investors for the private placement of approximately 12,500,000 units of our securities. The Subscription Agreements included a purchase price of $1.20 per unit, with each unit consisting of two shares of common stock and one warrant to purchase an additional share of common stock. The warrants have a term of five years and had an original exercise price of $1.00 per share which has been reset to $0.725 per share pursuant anti-dilution price protection provisions.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> On November 29, 2010, we entered into a bridge loan transaction with three accredited investors pursuant to which we issued unsecured notes in the aggregate principal amount of $1.0 million. Upon the closing of the Equity Financing, the lenders converted the entire principal amount plus accrued interest into the same units offered in the Equity Financing and the proceeds from the bridge loan transaction were treated as funds raised with respect to the financing.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> On December 24, 2010, we also closed on the Debt Restructuring. In connection therewith, we (i) issued an Amended and Restated Senior Convertible Note in the principal amount of $5.5 million (the "Amended and Restated Note") to Castlerigg Master Investment Ltd. ("Castlerigg"), (ii) paid $2.5 million in cash to Castlerigg, (iii) cancelled warrants previously issued to Castlerigg , (iv) issued 800,000 shares of common stock to Castlerigg in satisfaction of an obligation under a prior loan amendment, (v) paid Castlerigg an additional $2.75 million in cash in lieu of the issuance of $3.5 million in stock and warrants , and (vi) entered into an Investor Rights Agreement with Castlerigg dated December 23, 2010. As a result of the foregoing, Castlerigg forgave approximately $7.2 million of principal and accrued but unpaid interest.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> In connection with the Debt Restructuring, the Company <font style="DISPLAY: inline">amended the note with the holder of a $1.0 million unsecured convertible note, pursuant to which the maturity date of the note was extended to December 31, 2013. We also issued 150,000 shares and 75,000 warrants to acquire our common stock at $.90 per share to the holder of this note as consideration to extend the term of the note.</font></div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: justify; TEXT-INDENT: 36pt"> On March 26, 2012, we closed on an equity financing (the "2012 Equity Financing") as well as a restructuring of our outstanding senior convertible indebtedness (the "2012 Debt Restructuring") resulting in complete satisfaction our senior indebtedness.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: justify; TEXT-INDENT: 36pt"> A portion of the net proceeds from the 2012 Equity Financing was used to close on the 2012 Debt Restructuring therewith. The Company paid $2,750,000 and issued 2,000,000 shares of common stock valued at $760,000 to Castlerigg in satisfaction of the $5,500,000 senior convertible note and accrued interest.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> Investor warrants totaling 12,499,980 issued under the Subscription Agreements contain price protection adjustments in the event we issue new common stock or common stock equivalents in certain transactions at a price less than $1.00 per share and were accounted for as embedded derivatives and valued on the transaction date using a Black Scholes pricing model. The exercise price has been reset to $0.7250 per share due to subsequent financings.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> We recorded an aggregate derivative liability of $21,506 and $231,800 as of March 31, 2014 and 2013 respectively, related to the reset feature of the warrants issued under the Placement agency Agreement. A derivative valuation loss of $21,007 and $122,400, respectively, were recorded to reflect the change in value of the aggregate derivative liability since December 31, 2013 and 2012, respectively. The aggregate derivative liability of $21,506 for the conversion feature of the note was calculated using the Black-Scholes pricing model with the following assumptions: (i) risk free interest rate 0.45%, (ii) expected life (in years) of 1.7; (iii) expected volatility of 159.01%; (iv) expected dividend yield of 0.00%; and (v) stock trading price of $0.015.</div> <div style="DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: justify; TEXT-INDENT: 0pt"> </div> <!--EndFragment--></div> </div>
27800000
0.5
0.25
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: justify; TEXT-INDENT: 36pt"> All warrants listed below were issued with price protection provisions and were accounted for as derivative liabilities. The Warrants have an exercise price of $0.25 per share and were valued using the Black Scholes pricing model.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"> </div> <div style="text-align: center"> <table style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman" cellspacing="0" cellpadding="0" width="80%"> <tr> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="55%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="13%" colspan="2" nowrap="nowrap"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Common</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Shares</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Issued</div> </td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="13%" colspan="2" nowrap="nowrap"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Number of</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Warrants</div> </td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="13%" colspan="2" nowrap="nowrap"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Value of</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Warrants</div> </td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="#cceeff"> <td valign="bottom" width="55%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Investors</div> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">24,816,000</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">12,408,000</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">67,767</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="white"> <td valign="bottom" width="55%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Bridge Loan Conversion</div> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">1,600,000</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">800,000</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">4,369</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="#cceeff"> <td valign="bottom" width="55%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Equipment Finance Conversion</div> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">2,000,000</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">1,000,000</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">5,462</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="white"> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="55%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Agency</div> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">--</td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">4,262,400</td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">23,280</td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="#cceeff"> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="55%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Total</div> </td> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">28,416,000</td> <td style="PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">18,470,400</td> <td style="PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">100,878</td> <td style="PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> </table> </div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"> </div> <!--EndFragment--></div> </div>
12500000
1.20
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Note 3- Going Concern</div> <div style="DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: justify; TEXT-INDENT: 0pt"> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. We have incurred losses and have not demonstrated the ability to generate sufficient cash flows from operations to satisfy our liabilities and sustain operations. These factors raise substantial doubt about our ability to continue as a going concern.</div> <div style="DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: justify; TEXT-INDENT: 0pt"> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> Our continuation as a going concern is dependent on our ability to generate sufficient income and cash flow to meet our obligations on a timely basis and to obtain additional financing as may be required. There is no assurance we will be successful in efforts to raise additional funds. The accompanying statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.</div> <div style="DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: justify; TEXT-INDENT: 0pt"> </div> <!--EndFragment--></div> </div>
19467
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Note 9 - Liquidity and Capital Resources</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> At March 31, 2014, we had a cash balance of $35,478, total current assets of $118,223, total current liabilities of $7,571,059 and total stockholders' deficit of $7,275,008. Included in current liabilities is $159,731 relating to the value of the embedded derivatives for our 2012 Senior Secured Convertible Note, our unsecured convertible note and warrants outstanding granted to investors in the 2012 Senior Secured Convertible Note issuances and the 2012 and 2010 Equity Financings.</div> <div style="DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: justify; TEXT-INDENT: 0pt"> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> Our audited consolidated financial statements for the year ended December 31, 2013 contain a "going concern" qualification. As discussed in Note 3 of the Notes to Consolidated Financial Statements, we have incurred losses and have not demonstrated the ability to generate sufficient cash flows from operations to satisfy our liabilities and sustain operations. Because of these conditions, our independent auditors have raised substantial doubt about our ability to continue as a going concern.</div> <div style="DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: justify; TEXT-INDENT: 0pt"> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> We experienced negative cash flow from operations during the fiscal quarter ended March 31, 2014 of $279,938 compared to positive cash flow used in operations for the quarter ended March 31, 2013 of $121,976. We received proceeds from the issuance of our 2012 Senior Secured Convertible Note financing of $83,700 during the quarter ended March 31, 2014, that was used to pay ongoing expenses of operations and accounts payable. We have decreased our negative cash flow to as low as it can go without discontinuing all operations.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> We have trade accounts payable of $1,082,732 that must be all satisfied or settled before we can consummate the Wireless Ronin Merger. We do not have the cash to satisfy those payables and will rely on further investment to do so.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> The current recession and market conditions have had substantial impacts on the global and national economies and financial markets. These factors, together with soft credit markets, have slowed business growth and generally made potential funding sources more difficult to access. We continue to be affected by prevailing economic and market conditions, which present considerable risks and challenges to it.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <!--EndFragment--></div> </div>
65000
400400
308000
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Note 2 - Reclassifications</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> Certain 2013 financial statement amounts have been reclassified to conform to 2014 presentations.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <!--EndFragment--></div> </div>
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--12-31
Q1
2014
2014-03-31
10-Q
0000740726
111370878
Smaller Reporting Company
BROADCAST INTERNATIONAL INC
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<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Note 1 - Basis of Presentation</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: left; TEXT-INDENT: 36pt"> In the opinion of management, the accompanying unaudited condensed consolidated financial statements of Broadcast International, Inc. ("we" or the "Company") contain the adjustments, all of which are of a normal recurring nature, necessary to present fairly our financial position at December 31, 2013 and March 31, 2014 and the results of operations for the three months ended March 31, 2013 and 2014, respectively, with the cash flows for each of the three months ended March 31, 2013 and 2014, in conformity with U.S. generally accepted accounting principles.</div> <div style="TEXT-ALIGN: left; MARGIN-LEFT: 0pt; DISPLAY: block; MARGIN-RIGHT: 0pt; TEXT-INDENT: 36pt"> <br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: left; TEXT-INDENT: 36pt"> These condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes included in our Annual Report on Form 10-K for the year ended December 31, 2013. Operating results for the three months ended March 31, 2014 are not necessarily indicative of the results that may be expected for the year ended December 31, 2014.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <!--EndFragment--></div> </div>
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<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Cash and Cash Equivalents</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> We consider all cash on hand and in banks, and highly liquid investments with maturities of three months or less, to be cash equivalents. At March 31, 2014 and December 31, 2013, we had no bank balances in excess of amounts insured by the Federal Deposit Insurance Corporation. We have not experienced any losses in such accounts, and believe we are not exposed to any significant credit risk on cash and cash equivalents.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> Current financial market conditions have had the effect of restricting liquidity of cash management investments and have increased the risk of even the most liquid investments and the viability of some financial institutions. We do not believe, however, that these conditions will materially affect our business or our ability to meet our obligations or pursue our business plans.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <!--EndFragment--></div> </div>
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Note 14 - Supplemental Cash Flow Information</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> 2014</div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> For the three months ended March 31, 2014 we issued 1,137,653 shares of our common stock to one former employee and one former member of our board of directors for services rendered of which (i) 608,553 was for the settlement of previously awarded restricted stock units and (ii) 529,100 valued at $21,635 for settlement pursuant to a January 6, 2013 Amendment and Settlement Agreement. The value of the settlement had been accrued at December 31, 2013.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> For the three months ended March 31, 2014 sold fixed assets resulting in a $7,941 gain on sale. We received $16,345 in proceeds and have included a $13,323 invoice in our accounts receivable at March 31, 2014.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> For the three months ended March 31, 2014, we recognized $11,130 in depreciation and amortization expense from the following: (i) $8,959 related to property and equipment, and (ii) $2,171 for patent amortization.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> 2013</div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> For the three months ended March 31, 2013 we issued 458,553 shares of our common stock to one former member of our board of directors for services rendered of which (i) 258,553 was for the settlement of previously awarded restricted stock units and (ii) 200,000 valued at $15,000 for unpaid services rendered in 2012, which had been expensed and included in our accounts payable at December 31, 2012.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> For the three months ended March 31, 2013 we awarded 686,667 restricted stock units issued valued at $51,500 to four members of our board of directors for services rendered in 2012. The value of these awards had been expensed and included in our Accounts Payable at December 31, 2012.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> For the three months ended March 31, 2013 sold certain fully depreciated fixed asset satellite receiving equipment to our largest customer for $50,000 recorded which we recorded as gain on sale of assets. The invoice for this sale was included in our accounts receivable until payment was received in May of 2013.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> For the three months ended March 31, 2013 an aggregate non-cash expense of $392,303 was recorded for the accretion of notes payable as follows: (i) $83,334 for our unsecured convertible note and (ii) $308,969 for our 2011 secured convertible notes.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> For the three months ended March 31, 2013, we recognized $97,031 in depreciation and amortization expense from the following: (i) $1,167 related to cost of sales for equipment used directly by or for customers, (ii) $93,326 related to other property and equipment, and (iii) $2,538 for patent amortization.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <!--EndFragment--></div> </div>
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<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> <font style="FONT-WEIGHT: bold; DISPLAY: inline">Note 12 -</font> <font style="FONT-WEIGHT: bold; FONT-STYLE: italic; DISPLAY: inline">Employment Amendment and Settlement Agreements</font></div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> Pursuant to the January 6, 2013 Amendment and Settlement Agreement with each of Mr. Tiede and Mr. Solomon their respective employment agreements were modified and we agreed to issue each individual 529,100 shares of common stock if they were terminated by us at any time following January 6, 2013. All other termination benefits and severance were terminated as of January 6, 2013. We had an obligation as of March 6, 2013 to issue to each of them 529,100 shares of common stock. As of March 31, 2014 these shares had not been issued, however an aggregate of $38,846 has been accrued representing the value of the benefits which will be exchanged for the shares.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <!--EndFragment--></div> </div>
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Concentration of Credit Risk</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> Financial instruments, which potentially subject us to concentration of credit risk, consist primarily of trade accounts receivable. In the normal course of business, we provide credit terms to our customers. Accordingly, we perform ongoing credit evaluations of our customers and maintain allowances for possible losses which, when realized, have been within the range of management's expectations.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> For the three months ended March 31, 2014 and 2013, our largest customer individually constituted 48% and 91%, respectively of our total revenues.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> Our largest customer for 2014 is not the same as in 2013. The largest customer included in our 2013 revenue initially signed a three-year agreement which has expired. We provided services for this customer through May 31, 2013, but provided no services for this customer in 2014 and have not been able to secure new customers to replace the lost revenues.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <!--EndFragment--></div> </div>
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<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Note 7 - Notes Payable</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> The recorded value of our notes payable for the three months ended March 31, 2014 and year ended December 31, 2013 was as follows:</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="MARGIN-LEFT: 18pt; text-align: left"> <table style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman" cellspacing="0" cellpadding="0" width="96%"> <tr> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="76%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="10%" colspan="2" nowrap="nowrap" align="right"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> December 31, 2013</div> </td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="10%" colspan="2" nowrap="nowrap" align="right"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> March 31, 2014</div> </td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr> <td valign="bottom" width="76%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="10%" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="10%" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="#cceeff"> <td valign="bottom" width="76%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> 2012 Secured Convertible Notes</div> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">4,225,000</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">4,308,700</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="white"> <td valign="bottom" width="76%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Unsecured Convertible Note</div> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">1,000,000</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">1,000,000</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="#cceeff"> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="76%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Unsecured Interest Note</div> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">20,000</td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">20,000</td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="white"> <td valign="bottom" width="76%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Total</div> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">5,245,000</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">5,328,700</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="#cceeff"> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="76%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Less Current Portion</div> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">(5,425,000</td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap">)</td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">(5,328,700</td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap">)</td> </tr> <tr bgcolor="white"> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="76%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Total Long-term</div> </td> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">--</td> <td style="PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">--</td> <td style="PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> </table> </div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> 2012 Secured Convertible Notes</div> <div style="DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: justify; TEXT-INDENT: 0pt"> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> We engaged Philadelphia Brokerage Corporation to raise funds through the issuance of convertible promissory notes. We anticipated issuing promissory notes with an aggregate principal amount of up to $5,000,000 ("2012 Convertible Debt Offering"). As of March 31, 2014 we have issued notes having an aggregate principal value of $4,308,700 as explained below. The notes were due and payable on or before December 31, 2013. The principal and accrued interest due remain unsatisfied as of the current date. We are currently in discussions with the note holders regarding the conversion rate and extension of the due date to accommodate the closing of the Wireless Ronin merger.The notes bear interest at 12% per annum and may convertible to common stock at a $.25 per share conversion price. We also granted holders of the notes warrants with a five year life to acquire up to 200,000 shares of our common stock for each $100,000 of principal amount of the convertible notes. The notes are secured by all of our assets.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> In July 2012, we entered into a note and warrant purchase and security agreement with individual investors and broke escrow on the initial funding under the 2012 Convertible Debt Offering, the principal amount of which was $1,900,000, which included the conversion of $900,000 of previously issued short term debt and issued warrants to acquire 3,800,000 shares of our common stock.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> In August 2012, we increased our 2012 Convertible Debt Offering by issuing short term debt with a principal amount of $900,000 and issued warrants to acquire 1,800,000 shares of our common stock.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> In December 2012, we increased our 2012 Convertible Debt Offering by issuing short term debt with a principal amount of $250,000, issued warrants to acquire 500,000 shares of our common stock to one member of our Board of Directors.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> In January 2013, we increased our 2012 Convertible Debt Offering by issuing short term debt with a principal amount of $425,000, issued warrants to acquire 850,000 shares of our common stock to; (i) one member of our Board of Directors, (ii) three individuals and (iii) two companies.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> In August 2013, we converted the $750,000 principal balance of 2013 Accounts Receivable Purchase Agreement into our 2012 Convertible Debt Offering through the issuance of short term debt. No warrants were issued with respect to this transaction.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> In March 2014 we increased our 2012 Convertible Debt Offering by issuing short term debt with a principal amount of $83,700 to one member of our Board of Directors. <font style="FONT-SIZE: 10pt; DISPLAY: inline"> </font> No warrants were issued with respect to this transaction.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: justify; TEXT-INDENT: 36pt"> The notes and warrants mentioned above were issued with price protection provisions and were accounted for as derivative liabilities and valued on the dates issued using a Black-Scholes pricing model.</div> <div style="DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: justify; TEXT-INDENT: 0pt"> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> We recorded an aggregate derivative liability of $179,300 as of March 31, 2013, related to the conversion feature of the note. A derivative valuation loss of $89,700 was recorded to reflect the change in value of the aggregate derivative liability since December 31, 2012. The aggregate derivative liability of $179,300 was calculated as follows using a Black-Scholes pricing model with the following assumptions: (i) risk free interest rate 0.07%, (ii) expected life (in years) of 0.30; (iii) expected volatility of 175.61%, (iv) expected dividend yield of 0.00%; and (v) stock trading price of $0.10.</div> <div style="DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: justify; TEXT-INDENT: 0pt"> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> Additionally, we recorded an aggregate derivative liability of $33,523 and $345,800 as of March 31, 2014 and 2013, respectively related to the warrant reset provision. A derivative valuation loss of $30,869 and $119,500 was recorded to reflect the change in value of the aggregate derivative liability from December 31, 2013 and 2012, respectively. The aggregate derivative liability of $33,523 was calculated as follows using the Black-Scholes pricing model with the following assumptions: (i) risk free interest rate 0.93%, (ii) expected life (in years) of 3.30; (iii) expected volatility of 125.67%, (iv) expected dividend yield of 0.00%; and (v) stock trading price of $0.015.</div> <div style="DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: justify; TEXT-INDENT: 0pt"> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> The principal value of the secured convertible note was being accreted over the amended term of the obligation for which $308,968 was included in interest expense for the three months ended March 31, 2013. The note bears a 12% annual interest rate and for the three months ended March 31, 2014 and 2013, $125,014 and $98,861, respectively were included in interest expense.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Unsecured Convertible Note</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> On September 29, 2006, we entered into a letter of understanding with Triage Capital Management, or Triage. The letter of understanding provided that Triage loan $1,000,000 to us in a convertible note securities agreement.On December 24, 2010 we closed on a Debt Restructuring as mentioned above, In connection with that Debt Restructuring the Company <font style="DISPLAY: inline">amended the note with the holder of a $1.0 million unsecured convertible note, pursuant to which the maturity date of the note was extended to December 31, 2013. </font> The principal and accrued interest due remain unsatisfied as of the current date. We are currently in discussions with the note holder regarding the conversion rate and extension of the due date to accommodate the closing of the Wireless Ronin merger.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> We recorded an aggregate derivative liability of $99,800 as of March 31, 2013 related to the conversion feature of the note. A derivative valuation loss of $53,400 was recorded to reflect the change in value of the aggregate derivative liability since December 31, 2012. The aggregate derivative liability of $99,800 for the conversion feature of the note was calculated using the Black-Scholes pricing model with the following assumptions: (i) risk free interest rate 0.14%, (ii) expected life (in years) of 0.8; (iii) expected volatility of 142.68%; (iv) expected dividend yield of 0.00%; and (v) stock trading price of $0.10.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> In connection with the amendment mentioned above, the principal value of the note was accreted due to the difference in the value of the conversion feature before and after the amendment. The principal value of $1,000,000 of the unsecured convertible note was accreted over the amended term of the obligation, for which $83,334 was included in interest expense for the three months March 31, 2013. The note bears an 8% annual interest rate payable semi-annually, and for each the three months ended March 31, 2014 and 2013, $20,000, was included in interest expense.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Unsecured Interest Note</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> On April 17, 2013, we entered into a promissory note with the holder of our Unsecured Convertible Note in the amount of $20,000. The note was to satisfy unremitted interest due the holder on our Unsecured Convertible Note at that time. The note bears a 12 % per annum interest rate and was due on December 31, 2013. The principal and accrued interest due remain unsatisfied as of the current date.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Accounts Receivable Purchase Agreements</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> During the year ended December 31, 2010 we entered into two Accounts Receivable Purchase Agreements with one individual for an aggregate amount of $775,000. During the year ended December 31, 2011 we remitted $100,000 of the principal balance and converted the remaining $675,000 of principal balance plus accrued and unpaid interest into 1,307,153 shares of our common stock and warrants to purchase an additional 653,576 shares of our common stock. The warrants contain anti-dilution price protection provisions in the event the Company issues stock or convertible debt with a purchase price or conversion price less than $1.00 per share. The current exercise price has been reset to $0.725 per share due to subsequent financings.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> We recorded an aggregate derivative liability of $1,373 and $13,400 as of March 31, 2014 and 2013, respectively, related to the warrant reset provision. A derivative valuation loss of $1,345 and $7,500, respectively, were recorded to reflect the change in value of the aggregate derivative liability since December 31, 2013 and December 31, 2012, respectively. The aggregate derivative liability of $1,373 was calculated using the Black-Scholes pricing model with the following assumptions: (i) risk free interest rate 0.45%, (ii) expected life (in years) of 2.0; (iii) expected volatility of 152.63%; (iv) expected dividend yield of 0.00%; and (v) stock trading price of $0.015.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> 2011 Bridge Loan</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> <font style="DISPLAY: inline">On December 28, 2011 we entered into a Note and Warrant Purchase and Security Agreement with seven individuals for an aggregate of $1,300,000</font> ("Bridge Loan") to be used as working capital<font style="DISPLAY: inline">. The note bore an annual interest rate of 18%, payable monthly in cash. Additionally, we</font> granted to the holders of the Bridge Loan warrants with a five year term to purchase an aggregate of 357,500 shares of our common stock at an exercise price of $0.65 which has been subsequently reset to $0.50.<font style="DISPLAY: inline"> The note was originally due on February 28, 2012, but</font> was extended and satisfied as described below. In consideration of the extension of the maturity date of the Bridge Loan, we granted the holders of the Bridge Loan warrants with a six year term to purchase 247,500 shares of our common stock at an exercise price of $0.35 which has been subsequently reset to $0.25 per share. <font style="DISPLAY: inline">In connection with the Bridge Loan we issued warrants to purchase 65,000 shares of our common stock at an exercise price of $0.65</font> which has been subsequently reset to $0.50 <font style="DISPLAY: inline">per share</font>, <font style="DISPLAY: inline">to our investment banker for services in completing the above transaction.</font></div> <div style="DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: justify; TEXT-INDENT: 0pt"> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: justify; TEXT-INDENT: 36pt"> On March 26, 2012, we closed on the 2012 Equity Financing and under the terms of the associated securities purchase agreement, two of the above described bridge lenders converted the principal balance of their portion of the bridge loan in the amount of $400,000 to common stock and warrants as part of and on the same terms as the 2012 Equity Financing, reducing the outstanding principal balance to $900,000. On July 13, 2012 the $900,000 principal balance was retired and was included as part of the 2012 Secured Convertible Note (as described above).</div> <div style="DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: justify; TEXT-INDENT: 0pt"> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: justify; TEXT-INDENT: 36pt"> All warrants mentioned above were issued with price protection provisions and were accounted for as derivative liabilities and valued using a Black Scholes pricing model.</div> <div style="DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: justify; TEXT-INDENT: 0pt"> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> We recorded an aggregate derivative liability of $1,324 and $13,000 as of March 31, 2014 and 2013, respectively, related to the reset provision for the original and placement warrants issued. A derivative valuation loss of $1,280 and $5,600, respectively, were recorded to reflect the change in value of the aggregate derivative liability since December 31, 2013 and December 31, 2012, respectively. The aggregate derivative liability of $1,324 for the reset provision of the warrants was calculated using the Black-Scholes pricing model with the following assumptions: (i) risk free interest rate 0.93%, (ii) expected life (in years) of 2.7; (iii) expected volatility of 136.22%; (iv) expected dividend yield of 0.00%; and (v) stock trading price of $0.015.</div> <div style="DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: justify; TEXT-INDENT: 0pt"> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> We recorded an aggregate derivative liability of $1,127 and $10,800 as of March 31, 2013 and 2012, respectively, related to the reset provision for the warrants issued for an extension of the maturity date. A derivative valuation loss of $1,068 and $3,600, respectively, were recorded to reflect the change in value of the aggregate derivative liability since December 31, 2013 and December 31, 2012, respectively. The aggregate derivative liability of $1,127 for the reset provision of the warrants was calculated using the Black-Scholes pricing model with the following assumptions: (i) risk free interest rate 0.93%, (ii) expected life (in years) of 2.7; (iii) expected volatility of 136,22%; (iv) expected dividend yield of 0.00%; and (v) stock trading price of $0.015.</div> <div style="MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; TEXT-INDENT: 0pt"> </div> <!--EndFragment--></div> </div>
0.25
7200000
4308700
5000000
900000
1300000
1000000
20000
5500000
0.12
0.08
0.18
0.12
2013-12-31
2013-12-31
2012-02-28
2013-12-31
51500
15000
21635
38846
529100
200000
529100
5280
4496
11130
95864
11130
97031
8959
93326
159731
159731
11736
159731
179300
33523
345800
99800
1373
13400
1324
13000
1127
10800
100878
1090884
21506
231800
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> <font style="FONT-WEIGHT: bold; DISPLAY: inline">Note 13 -</font> <font style="FONT-WEIGHT: bold; FONT-STYLE: italic; DISPLAY: inline">Recent Accounting Pronouncements</font></div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> In April 2014, the FASB issued ASU 2014-08, <font style="FONT-STYLE: italic; DISPLAY: inline">Presentation of Financial Statements (Topic 205) and Property, Plant, & Equipment (topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity.</font> This Update changes the requirements for reporting discontinued operations in Subtopic 205-20. The Update improves the definition of discontinued operations by limiting discontinued operations reporting to disposals of components of an entity that represent strategic shifts that have (or will have) a major effect on an entity's operations and financial results. Under current U.S. GAAP, many disposals, some of which may be routine in nature and not a change in an entity's strategy, are reported in discontinued operations. In addition, the definition of discontinued operations expanded to include business activities and nonprofit activities that, on acquisition, meet the criteria to be classified as held for sale. The Update requires expanded disclosures for discontinued operations, including more information about the assets, liabilities, revenues and expenses of discontinued operations. This Update is effective for all disposals of components of an entity that occur with annual periods beginning on or after December 15, 2014 for public companies. Since the Company has not disposed of significant components of its business or activities in 2014, the Company doesn't expect this Update to have a significant impact on its financials.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> In March 2014, the FASB issued ASU 2014-06, <font style="FONT-STYLE: italic; DISPLAY: inline">Technical Corrections and Improvements Related to Glossary Terms.</font> The amendments in this Update represent changes to clarify the Master Glossary of the Codification, consolidate multiple instances of the same term into a single definition, or make minor improvements to the Master Glossary that are not expected to result in substantive changes to the application of existing guidance or create a significant administrative cost to most entities. Additionally, the amendments will make the Master Glossary easier to understand, as well as reduce the number of terms appearing in the Master Glossary. The amendments in this Update are effective immediately. The Company reviewed and noted the changes made in this Update, which can be categorized into four sections: 1) Deletion of Master Glossary Terms, 2) Addition of Master Glossary Term Links, 3) Duplicate Master Glossary Terms, and 4) Other Technical Corrections Related to Glossary Terms. The Company implemented the Update upon issuance, but the changes did not have a significant impact on our financial statements.</div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> </div> <!--EndFragment--></div> </div>
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Note 5 - Stock-based Compensation</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> In accordance with ASC Topic 718, stock-based compensation cost is estimated at the grant date, based on the estimated fair value of the awards, and recognized as expense ratably over the requisite service period of the award for awards expected to vest.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; FONT-STYLE: italic; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Stock Incentive Plans</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> <font style="DISPLAY: inline">Under the Broadcast International, Inc. 2004 Long-Term Incentive Plan (the "2004 Plan"), the board of directors may issue incentive stock options to employees and directors and non-qualified stock options to consultants of the company. </font> Options generally may not be exercised until twelve months after the date granted and expire ten years after being granted. Options granted vest in accordance with the vesting schedule determined by the board of directors, usually ratably over a three-year vesting schedule upon the anniversary date of the grant. Should an employee terminate before the vesting period is completed, the unvested portion of each grant is forfeited. We have used the Black-Scholes valuation model to estimate fair value of our stock-based awards, which requires various judgmental assumptions including estimated stock price volatility, forfeiture rates, and expected life. Our computation of expected volatility is based on a combination of historical and market-based implied volatility. The number of unissued stock options authorized under the 2004 Plan at March 31, 2014 was 4,523,911.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> The Broadcast International, Inc. 2008 Equity Incentive Plan (the "2008 Plan") has become our primary plan for providing stock-based incentive compensation to our eligible employees and non-employee directors and consultants of the company. The provisions of the 2008 Plan are similar to the 2004 Plan except that the 2008 Plan allows for the grant of share equivalents such as restricted stock awards, stock bonus awards, performance shares and restricted stock units in addition to non-qualified and incentive stock options. We continue to maintain and grant awards under our 2004 Plan which will remain in effect until it expires by its terms. The number of unissued shares of common stock reserved for issuance under the 2008 Plan was 363,200 at March 31, 2014.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; FONT-STYLE: italic; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Stock Options</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> <font style="DISPLAY: inline">We estimate the fair value of stock option awards granted beginning January 1, 2006 using the Black-Scholes option-pricing model. We then amortize the fair value of awards expected to vest on a straight-line basis over the requisite service periods of the awards, which is generally the period from the grant date to the end of the vesting period. The Black-Scholes valuation model</font> requires various judgmental assumptions including the estimated volatility, risk-free interest rate and expected option term. Our computation of expected volatility is based on a combination of historical and market-based implied volatility. <font style="DISPLAY: inline">The risk-free interest rate was based on the yield curve of a zero-coupon U.S. Treasury bond on the date the stock option award was granted with a maturity equal to the expected term of the stock option award. The expected option term is derived from an analysis of historical experience of similar awards combined with expected future exercise patterns based on several factors including the strike price in relation to the current and expected stock price, the minimum vest period and the remaining contractual period.</font></div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> There were no options granted for either the three months ended March 31, 2014 or 2013.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; FONT-STYLE: italic; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Warrants</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> We <font style="DISPLAY: inline">estimate the fair value of issued warrants on the date of issuance as determined using a Black-Scholes pricing model. We amortize the fair value of issued warrants using a vesting schedule based on the terms and conditions of each associated underlying contract, as earned. The Black-Scholes valuation model</font> requires various judgmental assumptions including the estimated volatility, risk-free interest rate and warrant expected exercise term. Our computation of expected volatility is based on a combination of historical and market-based implied volatility. <font style="DISPLAY: inline">The risk-free interest rate was based on the yield curve of a zero-coupon U.S. Treasury bond on the date the warrant was issued with a maturity equal to the expected term of the warrant.</font></div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> The fair values for the warrants issued for the three months ended March 31, 2013 estimated at the date of issuance using the Black-Scholes option-pricing model with the following weighted average assumptions:</div> <div style="DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: justify; TEXT-INDENT: 0pt"> </div> <div style="text-align: center"> <table style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman" cellspacing="0" cellpadding="0" width="60%"> <tr> <td valign="top" width="75%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="top" width="25%"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Three Months Ended</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> March 31, 2013</div> </td> </tr> <tr bgcolor="#cceeff"> <td valign="top" width="75%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Risk free interest rate</div> </td> <td valign="bottom" width="25%"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> 0.65%</div> </td> </tr> <tr bgcolor="white"> <td valign="top" width="75%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Expected life (in years)</div> </td> <td valign="bottom" width="25%"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 8.8pt; text-align: center; TEXT-INDENT: 0pt"> 4.42</div> </td> </tr> <tr bgcolor="#cceeff"> <td valign="top" width="75%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Expected volatility</div> </td> <td valign="bottom" width="25%"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> 90.68%</div> </td> </tr> <tr bgcolor="white"> <td valign="top" width="75%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Expected dividend yield</div> </td> <td valign="bottom" width="25%"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> 0.00%</div> </td> </tr> </table> </div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> The weighted average fair value of warrants issued during the three months ended March 31, 2013 was $0.05. There were no warrants issued during the three months ended March 31, 2014.</div> <div style="DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: justify; TEXT-INDENT: 0pt"> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> Results of operations for the three months ended March 31, 2014 and 2013 includes $13,033 and $2,824, respectively, of non-cash stock-based compensation expense. Restricted stock units and options issued to directors vest immediately. All other restricted stock units, options and warrants are subject to applicable vesting schedules. Expense is recognized proportionally as each award or grant vests.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> The $13,033 and $2,824 of non-cash stock-based compensation expense for the three months ended March 31, 2014 and 2013 was from the vesting of unexpired options and warrants issued prior to January 1, 2014 and 2013, respectively and were included in our general and administrative expense.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> Due to unexercised options and warrants outstanding at March 31, 2014, we will recognize an aggregate total of $29,294 during the year ending December 31, 2014 in accordance with vesting provisions.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> The following unaudited tables summarize option and warrant activity during the three months ended March 31, 2014.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="text-align: center"> <table style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman" cellspacing="0" cellpadding="0" width="80%"> <tr> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="70%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; FONT-WEIGHT: bold; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="13%" colspan="2" nowrap="nowrap"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Options</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> and</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Warrants</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Outstanding</div> </td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; FONT-WEIGHT: bold; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; FONT-WEIGHT: bold; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="13%" colspan="2" nowrap="nowrap"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Weighted</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Average</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Exercise</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Price</div> </td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; FONT-WEIGHT: bold; DISPLAY: inline"> </font> </td> </tr> <tr> <td valign="bottom" width="70%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="13%" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="13%" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="#cceeff"> <td valign="bottom" width="70%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Outstanding at December 31, 2013</div> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">43,068,136</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">0.47</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="white"> <td valign="bottom" width="70%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 9pt"> Options granted</div> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">--</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">--</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="#cceeff"> <td valign="bottom" width="70%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 9pt"> Warrants issued</div> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">--</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">--</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="white"> <td valign="bottom" width="70%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 9pt"> Expired</div> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">(4,500</td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap">)</td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">4.00</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="#cceeff"> <td valign="bottom" width="70%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 9pt"> Forfeited</div> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">(200,000</td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap">)</td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">1.20</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="white"> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="70%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 9pt"> Exercised</div> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">--</td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">--</td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="#cceeff"> <td valign="bottom" width="70%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: right" valign="bottom" width="12%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: right" valign="bottom" width="12%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="white"> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="70%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Outstanding at March 31, 2014</div> </td> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">42,863,636</td> <td style="PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">0.47</td> <td style="PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> </table> </div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> The following table summarizes information about stock options and warrants outstanding at March 31, 2014.</div> <div style="DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: justify; TEXT-INDENT: 0pt"> </div> <div style="MARGIN-LEFT: 27pt; text-align: left"> <table style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman" cellspacing="0" cellpadding="0" width="90%"> <tr bgcolor="#ffffff"> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="10%" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="34%" colspan="10" nowrap="nowrap"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Outstanding</div> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="22%" colspan="6" nowrap="nowrap"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Exercisable</div> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="#ffffff"> <td valign="bottom" width="10%" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="10%" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="10%" colspan="2" nowrap="nowrap"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Weighted</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Average</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Remaining</div> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="10%" colspan="2" nowrap="nowrap"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Weighted</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Average</div> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="10%" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="10%" colspan="2" nowrap="nowrap"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Weighted</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Average</div> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="#ffffff"> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="10%" colspan="2" nowrap="nowrap"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Range of</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Exercise Prices</div> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="10%" colspan="2" nowrap="nowrap"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Number</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Outstanding</div> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="10%" colspan="2" nowrap="nowrap"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Contractual</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Life (years)</div> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="10%" colspan="2" nowrap="nowrap"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Exercise</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Price</div> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="10%" colspan="2" nowrap="nowrap"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Number</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Exercisable</div> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="10%" colspan="2" nowrap="nowrap"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Exercise</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Price</div> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="#cceeff"> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">0.25-0.95</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">40,024,414</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">3.10</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">0.42</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">39,941,081</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">0.42</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="white"> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">1.00-1.59</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">2,509,222</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">2.21</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">1.03</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">2,494,555</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">1.03</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="#cceeff"> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">2.25-2.90</td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">330,000</td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">1.72</td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">2.50</td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">330,000</td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">2.50</td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="white"> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">0.25-2.90</td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">42,863,636</td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">3.03</td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">0.47</td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">42,765,636</td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">0.47</td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> </table> </div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; FONT-STYLE: italic; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Restricted Stock Units</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> The value of restricted stock units is determined using the fair value of our common stock on the date of the award and compensation expense is recognized in accordance with the vesting schedule.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> During the three months ended March 31, 2014, 608,553 restricted stock units were settled with issuance of shares of our common stock, (a) 408,553 shares to a former member of our board of directors for prior services rendered and (b) 200,000 shares to a former employee. For the three months ended March 31, 2014 no restricted stock units were awarded.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> During the three months ended March 31, 2013, 686,667 restricted stock units valued at $51,500 were awarded to five members of our board of directors for services rendered during the year ended 2012. One member of our board of directors settled 258,553 restricted stock units at the conclusion of his board participation during the three months ended March 31, 2013. The value of the units awarded had been expensed as directors fees in the year ended December 31, 2012.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> The following is a summary of restricted stock unit activity for the three months ended March 31, 2014.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="MARGIN-LEFT: 63pt; text-align: left"> <table style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman" cellspacing="0" cellpadding="0" width="90%"> <tr> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="76%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; FONT-WEIGHT: bold; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="10%" colspan="2" nowrap="nowrap" align="right"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> Restricted</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> Stock Units</div> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; FONT-WEIGHT: bold; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; FONT-WEIGHT: bold; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="10%" colspan="2" nowrap="nowrap" align="right"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> Weighted</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> Average</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> Grant</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> Date Fair</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> Value</div> </td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; FONT-WEIGHT: bold; DISPLAY: inline"> </font> </td> </tr> <tr> <td valign="bottom" width="76%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="10%" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="10%" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="#cceeff"> <td valign="bottom" width="76%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Outstanding at December 31, 2013</div> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">3,093,247</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">0.88</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="white"> <td valign="bottom" width="76%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 9pt"> Awarded at fair value</div> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">--</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">--</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="#cceeff"> <td valign="bottom" width="76%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 9pt"> Canceled/Forfeited</div> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">--</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">--</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="white"> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="76%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 9pt"> Settled by issuance of stock</div> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">(608,553</td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap">)</td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">0.51</td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="#cceeff"> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="76%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Outstanding at March 31, 2014</div> </td> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">2,484,694</td> <td style="BORDER-BOTTOM: black 4px double; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">0.97</td> <td style="PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="white"> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="76%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Vested at March 31, 2014</div> </td> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">2,484,694</td> <td style="BORDER-BOTTOM: black 4px double; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">0.97</td> <td style="PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> </table> </div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <!--EndFragment--></div> </div>
3393149
2750000
2500000
-0.01
-0.02
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Note 4 - Weighted Average Shares</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> The computation of diluted earnings per common share is based on the weighted average number of shares outstanding during the year, plus the dilutive common stock equivalents that would rise from the exercise of stock options, warrants and restricted stock units outstanding during the year, using the treasury stock method and the average market price per share during the year.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> As we experienced net losses during the three month periods ending March 31, 2014 and 2013, no common stock equivalents have been included in the diluted earnings per common share calculations as the effect of such common stock equivalents would be anti-dilutive.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> Options and warrants to purchase 42,863,636 and 43,711,269, shares of common stock at prices ranging from $0.25 to $2.90 and $0.25 to $4.00 per share were outstanding at March 31, 2014 and 2013, respectively. Additionally, unsettled restricted stock units of 2,484,694 and 3,368,247 were outstanding at March 31, 2014 and 2013, respectively. Furthermore, we had convertible debt that was convertible into 21,234,800 and 17,900,000 shares of common stock at March 31, 2014 and 2013, respectively that was excluded from the calculation of diluted earnings per share because the effect was anti-dilutive.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <!--EndFragment--></div> </div>
98962
81799
29294
900000
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: left; TEXT-INDENT: 36pt"> We measure certain financial instruments at fair value on a recurring basis. Assets and liabilities measured at fair value on a recurring basis are as follows at March 31, 2014:</div> <div style="DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 18pt"> </div> <div style="text-align: left"> <table style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman" cellspacing="0" cellpadding="0" width="100%"> <tr> <td valign="bottom"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" colspan="2" nowrap="nowrap" align="right"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> Significant</div> </td> <td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr> <td valign="bottom"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" colspan="2" nowrap="nowrap" align="right"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> Quoted Prices in</div> </td> <td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" colspan="2" nowrap="nowrap" align="right"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> Other</div> </td> <td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" colspan="2" nowrap="nowrap" align="right"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> Significant</div> </td> <td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr> <td valign="bottom"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" colspan="2" nowrap="nowrap" align="right"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> Active Markets for</div> </td> <td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" colspan="2" nowrap="nowrap" align="right"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> Observable</div> </td> <td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" colspan="2" nowrap="nowrap" align="right"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> Unobservable</div> </td> <td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr> <td valign="bottom"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" colspan="2" nowrap="nowrap" align="right"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> Identical Assets</div> </td> <td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" colspan="2" nowrap="nowrap" align="right"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> Inputs</div> </td> <td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" colspan="2" nowrap="nowrap" align="right"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> Inputs</div> </td> <td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr> <td style="PADDING-BOTTOM: 2px" valign="bottom"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" colspan="2" nowrap="nowrap" align="right"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> Total</div> </td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" colspan="2" nowrap="nowrap" align="right"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> (Level 1)</div> </td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" colspan="2" nowrap="nowrap" align="right"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> (Level 2)</div> </td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" colspan="2" nowrap="nowrap" align="right"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> (Level 3)</div> </td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr> <td valign="bottom" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Assets</div> </td> <td valign="bottom"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="#cceeff"> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left; PADDING-LEFT: 0pt; MARGIN-LEFT: 9pt; MARGIN-RIGHT: 0pt; TEXT-INDENT: 0pt" valign="bottom" width="52%"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 18pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: left; TEXT-INDENT: 0pt"> None</div> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">--</td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">--</td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">--</td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">--</td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="white"> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="52%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Total assets measured at fair value</div> </td> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">--</td> <td style="PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">--</td> <td style="PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">--</td> <td style="PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">--</td> <td style="PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="#cceeff"> <td valign="bottom" width="52%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: right" valign="bottom" width="9%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: right" valign="bottom" width="9%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: right" valign="bottom" width="9%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: right" valign="bottom" width="9%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="white"> <td valign="bottom" width="52%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Liabilities</div> </td> <td valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: right" valign="bottom" width="9%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: right" valign="bottom" width="9%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: right" valign="bottom" width="9%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: right" valign="bottom" width="9%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="#cceeff"> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left; PADDING-LEFT: 0pt; MARGIN-LEFT: 9pt; MARGIN-RIGHT: 0pt; TEXT-INDENT: 0pt" valign="bottom" width="52%"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 18pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: left; TEXT-INDENT: 0pt"> Derivative valuation (1)</div> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">159,731</td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">--</td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">--</td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">159,731</td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="white"> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="52%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Total liabilities measured at fair value</div> </td> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">159,731</td> <td style="PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">--</td> <td style="PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">--</td> <td style="PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">159,731</td> <td style="PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> </table> </div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> </div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 18pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> (1) See Notes 7 & 8 for additional discussion.</div> <br /> </div> <!--EndFragment--></div> </div>
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0
0
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<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Note 10- Fair Value Measurements</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: left; TEXT-INDENT: 36pt"> The Company has certain financial instruments that are measured at fair value on a recurring basis. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A three-tier fair value hierarchy has been established which prioritizes the inputs used in measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1 measurements) and the lowest priority to unobservable inputs (level 3 measurements). These tiers include:</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div> <table style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman" cellspacing="0" cellpadding="0" width="100%" align="center" border="0"> <tr valign="top"> <td style="WIDTH: 18pt"> <div style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; DISPLAY: inline"> </div> </td> <td style="WIDTH: 18pt"> <div style="DISPLAY: inline; font-family: Symbol, serif; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; TEXT-INDENT: 0pt"> ·</div> </td> <td> <div style="DISPLAY: inline; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; text-align: left"> Level 1, defined as observable inputs such as quoted prices for identical instruments in active markets;</div> </td> </tr> </table> </div> <div> <table style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman" cellspacing="0" cellpadding="0" width="100%" align="center" border="0"> <tr valign="top"> <td style="WIDTH: 18pt"> <div style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; DISPLAY: inline"> </div> </td> <td style="WIDTH: 18pt"> <div style="DISPLAY: inline; font-family: Symbol, serif; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; TEXT-INDENT: 0pt"> ·</div> </td> <td> <div style="DISPLAY: inline; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; text-align: left"> Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such as quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active; and</div> </td> </tr> </table> </div> <div> <table style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman" cellspacing="0" cellpadding="0" width="100%" align="center" border="0"> <tr valign="top"> <td style="WIDTH: 18pt"> <div style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; DISPLAY: inline"> </div> </td> <td style="WIDTH: 18pt"> <div style="DISPLAY: inline; font-family: Symbol, serif; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; TEXT-INDENT: 0pt"> ·</div> </td> <td> <div style="DISPLAY: inline; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; text-align: left"> Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.</div> </td> </tr> </table> </div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: left; TEXT-INDENT: 36pt"> We measure certain financial instruments at fair value on a recurring basis. Assets and liabilities measured at fair value on a recurring basis are as follows at March 31, 2014:</div> <div style="DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 18pt"> </div> <div style="text-align: left"> <table style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman" cellspacing="0" cellpadding="0" width="100%"> <tr> <td valign="bottom"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" colspan="2" nowrap="nowrap" align="right"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> Significant</div> </td> <td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr> <td valign="bottom"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" colspan="2" nowrap="nowrap" align="right"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> Quoted Prices in</div> </td> <td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" colspan="2" nowrap="nowrap" align="right"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> Other</div> </td> <td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" colspan="2" nowrap="nowrap" align="right"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> Significant</div> </td> <td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr> <td valign="bottom"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" colspan="2" nowrap="nowrap" align="right"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> Active Markets for</div> </td> <td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" colspan="2" nowrap="nowrap" align="right"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> Observable</div> </td> <td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" colspan="2" nowrap="nowrap" align="right"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> Unobservable</div> </td> <td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr> <td valign="bottom"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" colspan="2" nowrap="nowrap" align="right"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> Identical Assets</div> </td> <td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" colspan="2" nowrap="nowrap" align="right"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> Inputs</div> </td> <td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" colspan="2" nowrap="nowrap" align="right"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> Inputs</div> </td> <td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr> <td style="PADDING-BOTTOM: 2px" valign="bottom"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" colspan="2" nowrap="nowrap" align="right"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> Total</div> </td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" colspan="2" nowrap="nowrap" align="right"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> (Level 1)</div> </td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" colspan="2" nowrap="nowrap" align="right"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> (Level 2)</div> </td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" colspan="2" nowrap="nowrap" align="right"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> (Level 3)</div> </td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr> <td valign="bottom" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Assets</div> </td> <td valign="bottom"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="#cceeff"> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left; PADDING-LEFT: 0pt; MARGIN-LEFT: 9pt; MARGIN-RIGHT: 0pt; TEXT-INDENT: 0pt" valign="bottom" width="52%"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 18pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: left; TEXT-INDENT: 0pt"> None</div> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">--</td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">--</td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">--</td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">--</td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="white"> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="52%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Total assets measured at fair value</div> </td> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">--</td> <td style="PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">--</td> <td style="PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">--</td> <td style="PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">--</td> <td style="PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="#cceeff"> <td valign="bottom" width="52%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: right" valign="bottom" width="9%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: right" valign="bottom" width="9%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: right" valign="bottom" width="9%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: right" valign="bottom" width="9%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="white"> <td valign="bottom" width="52%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Liabilities</div> </td> <td valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: right" valign="bottom" width="9%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: right" valign="bottom" width="9%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: right" valign="bottom" width="9%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: right" valign="bottom" width="9%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="#cceeff"> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left; PADDING-LEFT: 0pt; MARGIN-LEFT: 9pt; MARGIN-RIGHT: 0pt; TEXT-INDENT: 0pt" valign="bottom" width="52%"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 18pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: left; TEXT-INDENT: 0pt"> Derivative valuation (1)</div> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">159,731</td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">--</td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">--</td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">159,731</td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="white"> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="52%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Total liabilities measured at fair value</div> </td> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">159,731</td> <td style="PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">--</td> <td style="PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">--</td> <td style="PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">159,731</td> <td style="PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> </table> </div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> </div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 18pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> (1) See Notes 7 & 8 for additional discussion.</div> <br /> </div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> The table below presents our assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) at March 31, 2014. We classify financial instruments in Level 3 of the fair value hierarchy when there is reliance on at least one significant unobservable input to the valuation model.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="text-align: center"> <table style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman" cellspacing="0" cellpadding="0" width="80%"> <tr> <td valign="bottom" width="85%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="13%" colspan="2" nowrap="nowrap" align="right"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> Derivative</div> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr> <td valign="bottom" width="85%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="13%" colspan="2" nowrap="nowrap" align="right"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> Valuation</div> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="85%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="13%" colspan="2" nowrap="nowrap" align="right"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> Liability</div> </td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="#cceeff"> <td valign="bottom" width="85%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Balance at December 31, 2013</div> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">(11,736</td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap">)</td> </tr> <tr bgcolor="white"> <td valign="bottom" width="85%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Total gains or losses (realized and unrealized)</div> </td> <td valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: right" valign="bottom" width="12%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="#cceeff"> <td style="TEXT-ALIGN: left; PADDING-LEFT: 0pt; MARGIN-LEFT: 9pt; MARGIN-RIGHT: 0pt; TEXT-INDENT: 0pt" valign="bottom" width="85%"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 9pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: left; TEXT-INDENT: 0pt"> Included in net loss</div> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">(147,995</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> ) </font> </td> </tr> <tr bgcolor="white"> <td style="TEXT-ALIGN: left; PADDING-LEFT: 0pt; MARGIN-LEFT: 9pt; MARGIN-RIGHT: 0pt; TEXT-INDENT: 0pt" valign="bottom" width="85%"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 9pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: left; TEXT-INDENT: 0pt"> Valuation adjustment</div> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">--</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="#cceeff"> <td valign="bottom" width="85%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Purchases, issuances, and settlements, net</div> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">--</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="white"> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="85%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Transfers to Level 3</div> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">--</td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="#cceeff"> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="85%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Balance at March 31, 2014</div> </td> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">(159,731</td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap">)</td> </tr> </table> </div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Fair Value of Other Financial Instruments</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> The carrying amounts of our accounts receivable, accounts payable and accrued liabilities approximate their fair values due to their immediate or short-term maturities. The aggregate carrying amount of the notes payable approximates fair value as the individual notes bear interest at market interest rates and there has not been a significant change in our operations and risk profile.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <!--EndFragment--></div> </div>
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> The table below presents our assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) at March 31, 2014. We classify financial instruments in Level 3 of the fair value hierarchy when there is reliance on at least one significant unobservable input to the valuation model.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="text-align: center"> <table style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman" cellspacing="0" cellpadding="0" width="80%"> <tr> <td valign="bottom" width="85%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="13%" colspan="2" nowrap="nowrap" align="right"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> Derivative</div> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr> <td valign="bottom" width="85%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="13%" colspan="2" nowrap="nowrap" align="right"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> Valuation</div> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="85%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="13%" colspan="2" nowrap="nowrap" align="right"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> Liability</div> </td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="#cceeff"> <td valign="bottom" width="85%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Balance at December 31, 2013</div> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">(11,736</td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap">)</td> </tr> <tr bgcolor="white"> <td valign="bottom" width="85%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Total gains or losses (realized and unrealized)</div> </td> <td valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: right" valign="bottom" width="12%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="#cceeff"> <td style="TEXT-ALIGN: left; PADDING-LEFT: 0pt; MARGIN-LEFT: 9pt; MARGIN-RIGHT: 0pt; TEXT-INDENT: 0pt" valign="bottom" width="85%"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 9pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: left; TEXT-INDENT: 0pt"> Included in net loss</div> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">(147,995</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> ) </font> </td> </tr> <tr bgcolor="white"> <td style="TEXT-ALIGN: left; PADDING-LEFT: 0pt; MARGIN-LEFT: 9pt; MARGIN-RIGHT: 0pt; TEXT-INDENT: 0pt" valign="bottom" width="85%"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 9pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: left; TEXT-INDENT: 0pt"> Valuation adjustment</div> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">--</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="#cceeff"> <td valign="bottom" width="85%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Purchases, issuances, and settlements, net</div> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">--</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="white"> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="85%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Transfers to Level 3</div> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">--</td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="#cceeff"> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="85%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Balance at March 31, 2014</div> </td> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">(159,731</td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap">)</td> </tr> </table> </div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <!--EndFragment--></div> </div>
-147995
11736
159731
10121
10121
10121
10121
10121
111022
108851
P20Y
-147995
-735115
-89700
-30869
-119500
-53400
-1345
-7500
-1280
-5600
-1068
-3600
-92246
-333415
-21007
-122400
7941
50000
69087
331280
986209
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Patents and Intangibles</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> Patents represent initial legal costs incurred to apply for United States and international patents on the CodecSys technology, and are amortized on a straight-line basis over their useful life of approximately 20 years. We have filed several patents in the United States and foreign countries. As of March 31, 2014, the United States Patent and Trademark Office had approved six patents. Additionally, eleven foreign countries had approved patent rights. While we are unsure whether we can develop the technology in order to obtain the full benefits, the patents themselves hold value and could be sold to companies with more resources to complete the development. On-going legal expenses incurred for patent follow-up have been expensed from July 2005 forward.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> Amortization expense recognized on all patents totaled $2,171 and $2,538 for the three months ended March 31, 2014 and 2013, respectively. Our estimated future amortization expense, if all patents were issued at the beginning of 2014, would be $10,121 for each of the next five years.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <!--EndFragment--></div> </div>
16068
703000
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Long-Lived Assets</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> We review our long-lived assets, including patents, annually or whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets held and used is measured by a comparison of the carrying amount of an asset to future undiscounted net cash flows expected to be generated by the asset. If such assets are considered to be impaired, then the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the estimated fair value of the assets. Fair value is determined by using cash flow analyses and other market valuations. After our review at March 31, 2014 it was determined that no adjustment was required.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <!--EndFragment--></div> </div>
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Income Taxes</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> We account for income taxes in accordance with the asset and liability method of accounting for income taxes prescribed by ASC Topic 740. Under the asset and liability method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to the taxable income in the years in which those temporary differences are expected to be recovered or settled.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <!--EndFragment--></div> </div>
164387
387517
-6198
-430533
-784
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-333
-15612
-44336
-51610
146614
533785
20000
20000
125014
98861
400
19457
19124
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Inventories</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> Inventories consisting of electrical and computer parts are stated at the lower of cost or market determined using the first-in, first-out method.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <!--EndFragment--></div> </div>
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Note 11 - <font style="FONT-STYLE: italic; DISPLAY: inline">Interact Devices Inc. (IDI)</font></div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> We began investing in and advancing monies to IDI in 2001. IDI was developing technology which became an initial part of the CodecSys technology.</div> <div style="DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: justify; TEXT-INDENT: 0pt"> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> On October 23, 2003, IDI filed for Chapter 11 Federal Bankruptcy protection. We desired that the underlying patent process proceed and that the development of CodecSys technology continue. Therefore, we participated in IDI's plan of reorganization, whereby we would satisfy the debts of the creditors and obtained certain licensing rights. On May 18, 2004, the debtor-in-possession's plan of reorganization for IDI was confirmed by the United States Bankruptcy Court. As a result of this confirmation, we issued to the creditors of IDI shares of our common stock and cash in exchange for approximately 50,127,218 shares of the common stock of IDI. Since May 18, 2004, we have acquired additional common share equivalents IDI. As of March 31, 2014, we owned approximately 55,897,169 IDI common share equivalents, representing approximately 94% of the total outstanding IDI share equivalents</div> <div style="DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: justify; TEXT-INDENT: 0pt"> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> Since May 18, 2004, we have advanced additional cash to IDI for the payment of operating expenses, which continues development and marketing of the CodecSys technology. As of March 31, 2014 we have advanced an aggregate amount of $3,393,149, pursuant to a promissory note that is secured by assets and technology of IDI.</div> <div style="DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: justify; TEXT-INDENT: 0pt"> </div> <!--EndFragment--></div> </div>
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7197395
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159731
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1000000
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1000000
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20000000
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0
0
66081
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15136
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750000
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425000
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1900000
900000
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83700
92000
6100000
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16345
13323
64282
33597
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Property and Equipment</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> Property and equipment are stated at cost. Depreciation is provided using the straight-line method over the estimated useful lives of the property, generally from three to five years. Repairs and maintenance costs are expensed as incurred except when such repairs significantly add to the useful life or productive capacity of the asset, in which case the repairs are capitalized.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"> </div> <!--EndFragment--></div> </div>
P3Y
P5Y
-4250
23080
2750000
100000
3774
225374
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Research and Development</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> Research and development costs are expensed when incurred. We expensed $3,774 and $225,374 of research and development costs for the three months ended March 31, 2014 and 2013, respectively.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"> </div> <!--EndFragment--></div> </div>
-111873431
-112527806
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Revenue Recognition</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> We recognize revenue when evidence exists that there is an arrangement between us and our customers, delivery of equipment sold or service has occurred, the selling price to our customers is fixed and determinable with required documentation, and collectability is reasonably assured. We recognize as deferred revenue, payments made in advance by customers for services not yet provided.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> When we enter into a multi-year contract with a customer to provide installation, network management, satellite transponder and help desk, or combination of these services, we recognize this revenue as services are performed and as equipment is sold. These agreements typically provide for additional fees, as needed, to be charged if on-site visits are required by the customer in order to ensure that each customer location is able to receive network communication. As these on-site visits are performed the associated revenue and cost are recognized in the period the work is completed. If we install, for an additional fee, new or replacement equipment to an immaterial number of new customer locations, and the equipment immediately becomes the property of the customer, the associated revenue and cost are recorded in the period in which the work is completed.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> In instances where we have entered into license agreements with a third parties to use our technology within their product offering, we recognize any base or prepaid revenues over the term of the agreement and any per occurrence or periodic usage revenues in the period they are earned.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <!--EndFragment--></div> </div>
73995
1480569
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> The recorded value of our notes payable for the three months ended March 31, 2014 and year ended December 31, 2013 was as follows:</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="MARGIN-LEFT: 18pt; text-align: left"> <table style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman" cellspacing="0" cellpadding="0" width="96%"> <tr> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="76%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="10%" colspan="2" nowrap="nowrap" align="right"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> December 31, 2013</div> </td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="10%" colspan="2" nowrap="nowrap" align="right"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> March 31, 2014</div> </td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr> <td valign="bottom" width="76%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="10%" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="10%" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="#cceeff"> <td valign="bottom" width="76%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> 2012 Secured Convertible Notes</div> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">4,225,000</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">4,308,700</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="white"> <td valign="bottom" width="76%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Unsecured Convertible Note</div> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">1,000,000</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">1,000,000</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="#cceeff"> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="76%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Unsecured Interest Note</div> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">20,000</td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">20,000</td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="white"> <td valign="bottom" width="76%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Total</div> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">5,245,000</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">5,328,700</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="#cceeff"> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="76%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Less Current Portion</div> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">(5,425,000</td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap">)</td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">(5,328,700</td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap">)</td> </tr> <tr bgcolor="white"> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="76%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Total Long-term</div> </td> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">--</td> <td style="PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">--</td> <td style="PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> </table> </div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <!--EndFragment--></div> </div>
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> The following is a summary of restricted stock unit activity for the three months ended March 31, 2014.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="MARGIN-LEFT: 63pt; text-align: left"> <table style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman" cellspacing="0" cellpadding="0" width="90%"> <tr> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="76%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; FONT-WEIGHT: bold; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="10%" colspan="2" nowrap="nowrap" align="right"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> Restricted</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> Stock Units</div> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; FONT-WEIGHT: bold; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; FONT-WEIGHT: bold; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="10%" colspan="2" nowrap="nowrap" align="right"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> Weighted</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> Average</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> Grant</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> Date Fair</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: right; TEXT-INDENT: 0pt"> Value</div> </td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; FONT-WEIGHT: bold; DISPLAY: inline"> </font> </td> </tr> <tr> <td valign="bottom" width="76%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="10%" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="10%" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="#cceeff"> <td valign="bottom" width="76%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Outstanding at December 31, 2013</div> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">3,093,247</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">0.88</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="white"> <td valign="bottom" width="76%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 9pt"> Awarded at fair value</div> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">--</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">--</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="#cceeff"> <td valign="bottom" width="76%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 9pt"> Canceled/Forfeited</div> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">--</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">--</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="white"> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="76%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 9pt"> Settled by issuance of stock</div> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">(608,553</td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap">)</td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">0.51</td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="#cceeff"> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="76%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Outstanding at March 31, 2014</div> </td> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">2,484,694</td> <td style="BORDER-BOTTOM: black 4px double; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">0.97</td> <td style="PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="white"> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="76%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Vested at March 31, 2014</div> </td> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">2,484,694</td> <td style="BORDER-BOTTOM: black 4px double; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">0.97</td> <td style="PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> </table> </div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <!--EndFragment--></div> </div>
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> The following table summarizes information about stock options and warrants outstanding at March 31, 2014.</div> <div style="DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: justify; TEXT-INDENT: 0pt"> </div> <div style="MARGIN-LEFT: 27pt; text-align: left"> <table style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman" cellspacing="0" cellpadding="0" width="90%"> <tr bgcolor="#ffffff"> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="10%" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="34%" colspan="10" nowrap="nowrap"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Outstanding</div> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="22%" colspan="6" nowrap="nowrap"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Exercisable</div> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="#ffffff"> <td valign="bottom" width="10%" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="10%" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="10%" colspan="2" nowrap="nowrap"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Weighted</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Average</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Remaining</div> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="10%" colspan="2" nowrap="nowrap"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Weighted</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Average</div> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="10%" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="10%" colspan="2" nowrap="nowrap"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Weighted</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Average</div> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="#ffffff"> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="10%" colspan="2" nowrap="nowrap"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Range of</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Exercise Prices</div> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="10%" colspan="2" nowrap="nowrap"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Number</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Outstanding</div> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="10%" colspan="2" nowrap="nowrap"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Contractual</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Life (years)</div> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="10%" colspan="2" nowrap="nowrap"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Exercise</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Price</div> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="10%" colspan="2" nowrap="nowrap"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Number</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Exercisable</div> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="10%" colspan="2" nowrap="nowrap"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Exercise</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Price</div> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="#cceeff"> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">0.25-0.95</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">40,024,414</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">3.10</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">0.42</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">39,941,081</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">0.42</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="white"> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">1.00-1.59</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">2,509,222</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">2.21</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">1.03</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">2,494,555</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">1.03</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="#cceeff"> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">2.25-2.90</td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">330,000</td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">1.72</td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">2.50</td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">330,000</td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">2.50</td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="white"> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">0.25-2.90</td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">42,863,636</td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">3.03</td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">0.47</td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">42,765,636</td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="9%">0.47</td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> </table> </div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <!--EndFragment--></div> </div>
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> The following unaudited tables summarize option and warrant activity during the three months ended March 31, 2014.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="text-align: center"> <table style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman" cellspacing="0" cellpadding="0" width="80%"> <tr> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="70%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; FONT-WEIGHT: bold; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="13%" colspan="2" nowrap="nowrap"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Options</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> and</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Warrants</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Outstanding</div> </td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; FONT-WEIGHT: bold; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; FONT-WEIGHT: bold; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="13%" colspan="2" nowrap="nowrap"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Weighted</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Average</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Exercise</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Price</div> </td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; FONT-WEIGHT: bold; DISPLAY: inline"> </font> </td> </tr> <tr> <td valign="bottom" width="70%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="13%" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="13%" colspan="2" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="#cceeff"> <td valign="bottom" width="70%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Outstanding at December 31, 2013</div> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">43,068,136</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">0.47</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="white"> <td valign="bottom" width="70%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 9pt"> Options granted</div> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">--</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">--</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="#cceeff"> <td valign="bottom" width="70%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 9pt"> Warrants issued</div> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">--</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">--</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="white"> <td valign="bottom" width="70%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 9pt"> Expired</div> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">(4,500</td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap">)</td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">4.00</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="#cceeff"> <td valign="bottom" width="70%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 9pt"> Forfeited</div> </td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">(200,000</td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap">)</td> <td valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">1.20</td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="white"> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="70%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 9pt"> Exercised</div> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">--</td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">--</td> <td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="#cceeff"> <td valign="bottom" width="70%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: right" valign="bottom" width="12%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: right" valign="bottom" width="12%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> <tr bgcolor="white"> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="70%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Outstanding at March 31, 2014</div> </td> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double; TEXT-ALIGN: left" valign="bottom" width="1%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">42,863,636</td> <td style="PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="PADDING-BOTTOM: 4px" valign="bottom" width="1%" align="right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: left" valign="bottom" width="1%">$</td> <td style="BORDER-BOTTOM: black 4px double; DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; TEXT-ALIGN: right" valign="bottom" width="12%">0.47</td> <td style="PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" width="1%" nowrap="nowrap"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> </tr> </table> </div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <!--EndFragment--></div> </div>
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> The fair values for the warrants issued for the three months ended March 31, 2013 estimated at the date of issuance using the Black-Scholes option-pricing model with the following weighted average assumptions:</div> <div style="DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: justify; TEXT-INDENT: 0pt"> </div> <div style="text-align: center"> <table style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman" cellspacing="0" cellpadding="0" width="60%"> <tr> <td valign="top" width="75%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; DISPLAY: inline"> </font> </td> <td style="BORDER-BOTTOM: black 2px solid" valign="top" width="25%"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> Three Months Ended</div> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> March 31, 2013</div> </td> </tr> <tr bgcolor="#cceeff"> <td valign="top" width="75%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Risk free interest rate</div> </td> <td valign="bottom" width="25%"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> 0.65%</div> </td> </tr> <tr bgcolor="white"> <td valign="top" width="75%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Expected life (in years)</div> </td> <td valign="bottom" width="25%"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 8.8pt; text-align: center; TEXT-INDENT: 0pt"> 4.42</div> </td> </tr> <tr bgcolor="#cceeff"> <td valign="top" width="75%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Expected volatility</div> </td> <td valign="bottom" width="25%"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> 90.68%</div> </td> </tr> <tr bgcolor="white"> <td valign="top" width="75%" align="left"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Expected dividend yield</div> </td> <td valign="bottom" width="25%"> <div style="DISPLAY: block; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: center; TEXT-INDENT: 0pt"> 0.00%</div> </td> </tr> </table> </div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <!--EndFragment--></div> </div>
38154
137469
13033
2824
51500
P3Y
686667
686667
3093247
2484694
0.88
0.97
0
P4Y5M1D
0.9068
0.0065
4523911
4500
200000
0.05
43068136
42863636
0.47
0.47
608553
258553
408553
200000
4.00
1.20
0.42
1.03
2.50
0.47
0.25
1.00
2.25
0.25
0.25
0.25
39941081
2494555
330000
42765636
40024414
2509222
330000
42863636
0.42
1.03
2.50
0.47
P3Y1M6D
P2Y2M16D
P1Y8M19D
P3Y11D
0.95
1.59
2.90
2.90
2.90
4.00
92400
0.10
0.015
0.10
0.015
0.015
0.015
0.015
0.015
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Note 6 - Significant Accounting Policies</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Cash and Cash Equivalents</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> We consider all cash on hand and in banks, and highly liquid investments with maturities of three months or less, to be cash equivalents. At March 31, 2014 and December 31, 2013, we had no bank balances in excess of amounts insured by the Federal Deposit Insurance Corporation. We have not experienced any losses in such accounts, and believe we are not exposed to any significant credit risk on cash and cash equivalents.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> Current financial market conditions have had the effect of restricting liquidity of cash management investments and have increased the risk of even the most liquid investments and the viability of some financial institutions. We do not believe, however, that these conditions will materially affect our business or our ability to meet our obligations or pursue our business plans.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Accounts Receivable</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> Trade accounts receivable are carried at original invoice amount less an estimate made for doubtful receivables based on a review of all outstanding amounts on a monthly basis. Management determines the allowance for doubtful accounts by identifying troubled accounts and by using historical experience applied to an aging of accounts. Trade receivables are written off when deemed uncollectible. Recoveries of trade receivables previously written off are recorded when collected.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> Included in our $62,120 and $50,745 net accounts receivable for the three months ended March 31, 2014 and the year ended December 31, 2013, respectively, were (i) $65,910 and $57,655 for billed trade receivables, respectively; (ii) $250 and $1,380 of unbilled trade receivables less (iii) ($4,040) and ($8,290) for allowance for uncollectible accounts, respectively.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Inventories</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> Inventories consisting of electrical and computer parts are stated at the lower of cost or market determined using the first-in, first-out method.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Property and Equipment</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> Property and equipment are stated at cost. Depreciation is provided using the straight-line method over the estimated useful lives of the property, generally from three to five years. Repairs and maintenance costs are expensed as incurred except when such repairs significantly add to the useful life or productive capacity of the asset, in which case the repairs are capitalized.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Patents and Intangibles</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> Patents represent initial legal costs incurred to apply for United States and international patents on the CodecSys technology, and are amortized on a straight-line basis over their useful life of approximately 20 years. We have filed several patents in the United States and foreign countries. As of March 31, 2014, the United States Patent and Trademark Office had approved six patents. Additionally, eleven foreign countries had approved patent rights. While we are unsure whether we can develop the technology in order to obtain the full benefits, the patents themselves hold value and could be sold to companies with more resources to complete the development. On-going legal expenses incurred for patent follow-up have been expensed from July 2005 forward.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> Amortization expense recognized on all patents totaled $2,171 and $2,538 for the three months ended March 31, 2014 and 2013, respectively. Our estimated future amortization expense, if all patents were issued at the beginning of 2014, would be $10,121 for each of the next five years.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Long-Lived Assets</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> We review our long-lived assets, including patents, annually or whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets held and used is measured by a comparison of the carrying amount of an asset to future undiscounted net cash flows expected to be generated by the asset. If such assets are considered to be impaired, then the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the estimated fair value of the assets. Fair value is determined by using cash flow analyses and other market valuations. After our review at March 31, 2014 it was determined that no adjustment was required.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Income Taxes</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> We account for income taxes in accordance with the asset and liability method of accounting for income taxes prescribed by ASC Topic 740. Under the asset and liability method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to the taxable income in the years in which those temporary differences are expected to be recovered or settled.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Revenue Recognition</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> We recognize revenue when evidence exists that there is an arrangement between us and our customers, delivery of equipment sold or service has occurred, the selling price to our customers is fixed and determinable with required documentation, and collectability is reasonably assured. We recognize as deferred revenue, payments made in advance by customers for services not yet provided.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> When we enter into a multi-year contract with a customer to provide installation, network management, satellite transponder and help desk, or combination of these services, we recognize this revenue as services are performed and as equipment is sold. These agreements typically provide for additional fees, as needed, to be charged if on-site visits are required by the customer in order to ensure that each customer location is able to receive network communication. As these on-site visits are performed the associated revenue and cost are recognized in the period the work is completed. If we install, for an additional fee, new or replacement equipment to an immaterial number of new customer locations, and the equipment immediately becomes the property of the customer, the associated revenue and cost are recorded in the period in which the work is completed.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> In instances where we have entered into license agreements with a third parties to use our technology within their product offering, we recognize any base or prepaid revenues over the term of the agreement and any per occurrence or periodic usage revenues in the period they are earned.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Research and Development</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> Research and development costs are expensed when incurred. We expensed $3,774 and $225,374 of research and development costs for the three months ended March 31, 2014 and 2013, respectively.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Concentration of Credit Risk</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> Financial instruments, which potentially subject us to concentration of credit risk, consist primarily of trade accounts receivable. In the normal course of business, we provide credit terms to our customers. Accordingly, we perform ongoing credit evaluations of our customers and maintain allowances for possible losses which, when realized, have been within the range of management's expectations.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> For the three months ended March 31, 2014 and 2013, our largest customer individually constituted 48% and 91%, respectively of our total revenues.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> Our largest customer for 2014 is not the same as in 2013. The largest customer included in our 2013 revenue initially signed a three-year agreement which has expired. We provided services for this customer through May 31, 2013, but provided no services for this customer in 2014 and have not been able to secure new customers to replace the lost revenues.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <!--EndFragment--></div> </div>
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<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Note 15 - Subsequent Events</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> In April 2014 we increased our 2012 Convertible Debt Offering by issuing short term debt with a principal amount of $92,000 to one member of our Board of Directors.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> We evaluated subsequent events pursuant to ASC Topic 855 and have determined that there are no additional events that need to be reported.</div> <div style="DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> </div> <!--EndFragment--></div> </div>
55897169
0.94
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" --><div> <div><!--StartFragment--> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-WEIGHT: bold; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 0pt"> Accounts Receivable</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> Trade accounts receivable are carried at original invoice amount less an estimate made for doubtful receivables based on a review of all outstanding amounts on a monthly basis. Management determines the allowance for doubtful accounts by identifying troubled accounts and by using historical experience applied to an aging of accounts. Trade receivables are written off when deemed uncollectible. Recoveries of trade receivables previously written off are recorded when collected.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <div style="DISPLAY: block; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt; text-align: left; TEXT-INDENT: 36pt"> Included in our $62,120 and $50,745 net accounts receivable for the three months ended March 31, 2014 and the year ended December 31, 2013, respectively, were (i) $65,910 and $57,655 for billed trade receivables, respectively; (ii) $250 and $1,380 of unbilled trade receivables less (iii) ($4,040) and ($8,290) for allowance for uncollectible accounts, respectively.</div> <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br /> </div> <!--EndFragment--></div> </div>
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