Annual report pursuant to Section 13 and 15(d)

COMMON STOCK PURCHASE OPTIONS

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COMMON STOCK PURCHASE OPTIONS
12 Months Ended
Mar. 31, 2012
Notes to Financial Statements  
COMMON STOCK PURCHASE OPTIONS

 

NOTE 7 – COMMON STOCK PURCHASE OPTIONS

 

On October 28, 2009, the Company issued a total of 410,000 stock purchase options exercisable for the purchase of its common stock at $0.40 per share. The options were issued to key employees. The options vest 1/3 each year for 3 years. The Company estimates the fair value of each  stock  award at the  grant  date by  using  the  Black-Scholes  option  pricing model.  The following weighted average assumptions used for grants as of October 28, 2009: dividend yield of zero percent; expected volatility of 127%; risk-free interest rates of 1.35% and expected life of 3.0 years. The Company recognized $40,224 and $21,788 in expense for the fair value of the options vesting during 2012 and 2011, respectively.

 

On February 15, 2011, the Company issued a total of 600,000 stock purchase options exercisable for the purchase of its common stock at $0.30 per share. The options were issued to key employees. The options vest over 1/5 each year for 5 years. The Company estimates the fair value of each  stock  award at the  grant  date by  using  the  Black-Scholes  option  pricing model.  The following weighted average assumptions used for grants as of February 15, 2011: dividend yield of zero percent; expected volatility of 254%; risk-free interest rates of 2.02% and expected life of 2.5 years. The Company recognized $40,306 and $5,038 in expense for the fair value of the options vesting during 2012 and 2011, respectively.

 

A summary of the status of the Company’s stock option plans as of March 31, 2012 and 2011 and the changes during the period are presented below:

  

  2012   2011
Unexercised options, beginning of year 1,010,000   410,000
Stock options issued during the year -   600,000
Stock options expired -   -
Stock options exercised -   -
Unexercised options, end of year     1,010,000   1,010,000

 

The following table summarizes information about the stock options as of March 31, 2012:

 

Outstanding Options
        Wtd. Avg.        
Range of       Remaining   Wtd. Avg.   Aggregate
Exercise       Contractual   Exercise   Intrinsic
Prices   Shares   Life (years)   Price   Value
$ 0.40   410,000   0.46   $ 0.40   $        164,000
$ 0.75   600,000   3.88      0.30   180,000
    1,010,000   2.17   $ 0.34   $       344,000

 

The following table summarizes information about the exercisable stock options as of March 31, 2012:

 

Exercisable Options
    Wtd. Avg.        
    Remaining   Wtd. Avg.   Aggregate
    Contractual   Exercise   Intrinsic
Shares   Life (years)   Price   Value
341,667   0.46   $   0 .40   $       136,667
134,400   3.88          0.30   40,320
476,067   2.17   $    0.34   $      176,987

 

The following table summarizes information about non-vested options as of the year ended March 31, 2012:

 

      Wtd. Avg.
      Grant Date
  Options   Fair Value
Non-vested at March 31, 2011 726,667   $           0.34
Stock options issued during the year -   -
Vested during the year ended March 31, 2011 (192,734)   0.40
Non-vested at March 31, 2012 533,933   $           0.34