10-Q
2012-09-30
false
OMNITEK ENGINEERING CORP
0001404804
--12-31
Smaller Reporting Company
Yes
No
No
2012
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<!--egx--><p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>NOTE 1 - CONDENSED FINANCIAL STATEMENTS</p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> </p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:.25in;line-height:12.55pt'>The accompanying financial statements have been prepared by the Company without audit.  In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position, results of operations, and cash flows at September 30, 2012, and for all periods presented herein, have been made.</p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> </p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:.25in;line-height:12.55pt'>Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted.  It is suggested that these condensed financial statements be read in conjunction with the financial statements and notes thereto included in the Company's December 31, 2011 audited financial statements.  The results of operations for the periods ended September 30, 2012 and 2011 are not necessarily indicative of the operating results for the full years.</p>
<!--egx--><p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES</p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> </p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'><u>Use of Estimates</u></p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:.25in;line-height:12.55pt'> </p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:.25in;line-height:12.55pt'>The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  Actual results could differ from those estimates.</p> <p style='margin:0in;margin-bottom:.0001pt'> </p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'><u>Recent Accounting Pronouncements</u></p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> </p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:.25in;line-height:12.55pt'>The Company has evaluated recent accounting pronouncements and their adoption has not had or is not expected to have a material impact on the Company’s financial position, or statements.</p> <p style='margin:0in;margin-bottom:.0001pt'> </p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'><u>Inventory</u></p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> </p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:.25in;line-height:12.55pt'>Inventory is stated at the lower of cost or market. The Company’s inventory consists of finished goods and raw material and is located in San Marcos, California at September 30, 2012 and December 31, 2011 consisted of the following:</p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> </p> <table border="0" cellspacing="0" cellpadding="0" style='border-collapse:collapse'> <tr> <td width="348" valign="bottom" style='width:261.0pt;padding:0'> <p style='margin:0in;margin-bottom:.0001pt;layout-grid-mode:char'> </p> </td> <td width="114" valign="bottom" style='width:85.5pt;padding:0'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center;layout-grid-mode:char'>September 30, 2012</p> </td> <td width="138" valign="bottom" style='width:103.5pt;padding:0'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center;layout-grid-mode:char'>December 31, 2011</p> </td> </tr> <tr> <td width="348" valign="bottom" style='width:261.0pt;background:#CCEEFF;padding:0'> <p style='margin:0in;margin-bottom:.0001pt;layout-grid-mode:char'>Raw materials</p> </td> <td width="114" valign="bottom" style='width:85.5pt;background:#CCEEFF;padding:0'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>1,189,455</p> </td> <td width="138" valign="bottom" style='width:103.5pt;background:#CCEEFF;padding:0'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>$946,762</p> </td> </tr> <tr> <td width="348" valign="bottom" style='width:261.0pt;background:white;padding:0'> <p style='margin:0in;margin-bottom:.0001pt;layout-grid-mode:char'>Finished goods</p> </td> <td width="114" valign="bottom" style='width:85.5pt;background:white;padding:0'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>332,004</p> </td> <td width="138" valign="bottom" style='width:103.5pt;background:white;padding:0'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>674,198</p> </td> </tr> <tr> <td width="348" valign="bottom" style='width:261.0pt;background:#CCEEFF;padding:0'> <p style='margin:0in;margin-bottom:.0001pt;layout-grid-mode:char'>Peru (finished goods)</p> </td> <td width="114" valign="bottom" style='width:85.5pt;background:#CCEEFF;padding:0'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>18,454</p> </td> <td width="138" valign="bottom" style='width:103.5pt;background:#CCEEFF;padding:0'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>18,454</p> </td> </tr> <tr> <td width="348" valign="bottom" style='width:261.0pt;background:white;padding:0'> <p style='margin:0in;margin-bottom:.0001pt;layout-grid-mode:char'>In transit</p> </td> <td width="114" valign="bottom" style='width:85.5pt;background:white;padding:0'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>~</p> </td> <td width="138" valign="bottom" style='width:103.5pt;background:white;padding:0'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>8,232</p> </td> </tr> <tr> <td width="348" valign="bottom" style='width:261.0pt;background:#CCEEFF;padding:0'> <p style='margin:0in;margin-bottom:.0001pt;layout-grid-mode:char'>Allowance for obsolete inventory</p> </td> <td width="114" valign="bottom" style='width:85.5pt;background:#CCEEFF;padding:0'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>(627,529)</p> </td> <td width="138" valign="bottom" style='width:103.5pt;background:#CCEEFF;padding:0'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>(627,529)</p> </td> </tr> <tr> <td width="348" valign="bottom" style='width:261.0pt;background:white;padding:0'> <p style='margin:0in;margin-bottom:.0001pt;layout-grid-mode:char'>Total</p> </td> <td width="114" valign="bottom" style='width:85.5pt;background:white;padding:0'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'><u>912,384</u></p> </td> <td width="138" valign="bottom" style='width:103.5pt;background:white;padding:0'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'><u>1,020,117</u></p> </td> </tr> </table> <p style='margin:0in;margin-bottom:.0001pt'> </p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:.25in;line-height:12.55pt'>The Company has established an allowance for obsolete inventory. Expense for obsolete inventory was $-0- and $-0-, for the periods ended September 30, 2012 and December 31, 2011, respectively</p> <p style='margin:0in;margin-bottom:.0001pt'> </p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'><u>Basic and Diluted Net Income (Loss) Per Share</u></p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> </p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:.25in;line-height:12.55pt'>The Company computes net income (loss) per share in accordance with ASC 260, Earnings Per Share, which requires presentation of both basic and diluted earnings per share (EPS) on the face of the income statement. Basic EPS is computed by dividing net income (loss) available to common shareholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method. In computing Diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. As of September 30, 2012, 677,380 warrants and options were excluded from the Diluted EPS calculation as their effect is anti-dilutive.</p> <p style='margin:0in;margin-bottom:.0001pt'> </p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'><u>Income Taxes</u></p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> </p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:.25in;line-height:12.55pt'>The Company accounts for income taxes in accordance with Accounting Standards Codification Topic 740, Income Taxes ("Topic 740"), which requires the recognition of deferred tax liabilities and assets at currently enacted tax rates for the expected future tax consequences of events that have been included in the financial statements or tax returns. A valuation allowance is recognized to reduce the net deferred tax asset to an amount that is more likely than not to be realized. </p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:.25in;line-height:12.55pt'> </p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:.25in;line-height:12.55pt'>Topic 740 provides guidance on the accounting for uncertainty in income taxes recognized in a company's financial statements. Topic 740 requires a company to determine whether it is more likely than not that a tax position will be sustained upon examination based upon the technical merits of the position. If the more likely-than-not threshold is met, a company must measure the tax position to determine the amount to recognize in the financial statements.</p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:.25in;line-height:12.55pt'> </p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:.25in;line-height:12.55pt'>At the adoption date of November 1, 2007, the Company had no unrecognized tax benefit which would affect the effective tax rate if recognized. The Company includes interest and penalties arising from the underpayment of income taxes in the statements of operations in the provision for income taxes. As of September 30, 2012 and December 31, 2011 the Company had no accrued interest or penalties related to uncertain tax positions. The Company files an income tax return in the U.S. federal jurisdiction and the state of California. With few exceptions, the Company is no longer subject to U.S. federal, state, and local, or non-U.S. income tax examinations by tax authorities for years before 2007.</p> <p style='margin:0in;margin-bottom:.0001pt'> </p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'><u>Held to Maturity Investments</u></p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> </p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:.25in;line-height:12.55pt'>During the nine months ended September 30, 2012, the Company purchased various corporate bonds. The Company intends to hold the bonds to maturity. Accordingly, the Company has recorded and is amortizing the premium on the bonds over the remaining life. As of September 30, 2012, the Company has amortized $16,378 of the premium leaving amortized cost basis remaining of $1,211,845.</p>
<!--egx--><p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>NOTE 3 - RELATED PARTY TRANSACTIONS</p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> </p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'><u>Accounts Receivable – Related Parties</u></p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> </p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:.25in;line-height:12.55pt'>During the years ended December 31, 2007 through 2010, the Company a minority interest in various distributors in exchange for use of the Company’s name and logo. As of December 31, 2011, the Company owned a 15% interest in Omnitek Engineering Thailand Co. Ltd., a 20% interest in Omnitek Peru S.A.C., and a 5% interest in Omnitek Stationary, Inc. As of September 30, 2012 and December 31, 2011, the Company was owed $30,876 and $16,715, respectively, by these related parties for the purchase of products.</p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> </p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'><u>Accounts Payable – Related Parties</u></p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> </p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:.25in;line-height:12.55pt'>The Company regularly incurs expenses that are paid for by related parties and purchases goods and services from related parties. As of September 30, 2012 and December 31, 2011, the Company owed related parties for such expenses, goods and services in the amounts of $25 and $2,568, respectively.</p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:.25in;line-height:12.55pt'> </p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'><u>Accrued Expenses – Related Parties</u></p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> </p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:.25in;line-height:12.55pt'>During the periods ended September 30, 2012 and December 31, 2011, related parties were due amounts for services performed for the Company. As of September 30, 2012 and December 31, 2011 the related parties’ payables consisted of the following:</p> <p align="center" style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-align:center;text-indent:-1.0in;line-height:12.55pt'> </p> <table border="0" cellspacing="0" cellpadding="0" width="95%" style='width:95.2%;border-collapse:collapse'> <tr> <td width="50%" valign="bottom" style='width:50.5%;background:#CCEEFF;padding:0'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> </p> </td> <td width="24%" style='width:24.26%;background:#CCEEFF;padding:0'> <p align="center" style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-align:center;text-indent:-1.0in;line-height:12.55pt'>September 30, 2012</p> </td> <td width="25%" style='width:25.24%;background:#CCEEFF;padding:0'> <p align="center" style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-align:center;text-indent:-1.0in;line-height:12.55pt'>December 31, 2011</p> </td> </tr> <tr> <td width="50%" valign="bottom" style='width:50.5%;background:#CCEEFF;padding:0'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>Amounts due to the president</p> </td> <td width="24%" style='width:24.26%;background:#CCEEFF;padding:0'> <p align="right" style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-align:right;text-indent:-1.0in;line-height:12.55pt'>214,628</p> </td> <td width="25%" style='width:25.24%;background:#CCEEFF;padding:0'> <p align="right" style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-align:right;text-indent:-1.0in;line-height:12.55pt'>271,253</p> </td> </tr> <tr> <td width="50%" valign="bottom" style='width:50.5%;background:white;padding:0in 0in 1.5pt 0in'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>Amounts due to other officers of the company</p> </td> <td width="24%" style='width:24.26%;border:none;border-bottom:solid black 1.0pt;background:white;padding:0in 0in 1.5pt 0in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-align:right;text-indent:-1.0in;line-height:12.55pt'>62,715</p> </td> <td width="25%" style='width:25.24%;border:none;border-bottom:solid black 1.0pt;background:white;padding:0in 0in 1.5pt 0in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-align:right;text-indent:-1.0in;line-height:12.55pt'>80,327</p> </td> </tr> <tr> <td width="50%" valign="bottom" style='width:50.5%;background:#CCEEFF;padding:0in 0in 3.0pt 0in'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>Total</p> </td> <td width="24%" style='width:24.26%;border:none;border-bottom:double black 1.0pt;background:#CCEEFF;padding:0in 0in 3.0pt 0in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-align:right;text-indent:-1.0in;line-height:12.55pt'>277,343</p> </td> <td width="25%" style='width:25.24%;border:none;border-bottom:double black 1.0pt;background:#CCEEFF;padding:0in 0in 3.0pt 0in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-align:right;text-indent:-1.0in;line-height:12.55pt'>351,580</p> </td> </tr> </table> <p style='margin:0in;margin-bottom:.0001pt'> </p>
<!--egx--><p style='margin:0in;margin-bottom:.0001pt'>NOTE 4 - NOTES PAYABLE</p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> </p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'><u>Line of Credit Payable</u></p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> </p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:.25in;line-height:12.55pt'>On February 15, 2012 the Company entered into a revolving line of credit agreement with a shareholder for $50,000 for an initial period of 6 months. During the six months ended September 30, 2012, the Company borrowed a total of $40,000, and accrued interest expense of $490. As of September 30, 2012 the Company has repaid all of the outstanding debt and now owes $-0- under the revolving line of credit. The Company granted 5,000 stock purchase warrants as consideration for the funding of the revolving line of credit resulting in an expense of $15,450.</p>
<!--egx--><p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>NOTE 5 - STOCK OPTIONS AND WARRANTS</p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> </p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:.25in;line-height:12.55pt'>In April 2007, the Company’s shareholders approved its 2006 Long-Term Incentive Plan (“the Plan”).   Under the plan, the Company may issue up to 10,000,000 shares of both Incentive Stock Options to employees only and Non-Qualified Stock Options to employees and consultants at its discretion.  As of September 30, 2012 the Company has a total of 5,635,313 options and warrants issued under the plan.  During the nine months ended September 30, 2012 the Company issued an additional amount of 2,810,313 options and warrants.</p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> </p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:.25in;line-height:12.55pt'>During the nine months ended September 30, 2012 and 2011, the Company recognized expense of $626,915 and $126,534, respectively, for options and warrants that vested during the periods pursuant to ASC Topic 718.</p> <p style='margin:0in;margin-bottom:.0001pt;line-height:12.55pt'> </p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:.25in;line-height:12.55pt'>A summary of the status of the options and warrants granted at September 30, 2012 and December 31, 2011 and changes during the periods then ended is presented below:</p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> </p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> </p> <table border="0" cellspacing="0" cellpadding="0" width="100%" style='width:100.0%;border-collapse:collapse'> <tr style='height:15.0pt'> <td width="30%" valign="bottom" style='width:30.16%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p style='margin:0in;margin-bottom:.0001pt;layout-grid-mode:char'> </p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:-23.4pt;layout-grid-mode:char'> </p> </td> <td width="28%" colspan="3" valign="bottom" style='width:28.72%;border-top:solid black 1.0pt;border-left:none;border-bottom:solid black 1.0pt;border-right:none;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center;layout-grid-mode:char'>2012</p> </td> <td width="2%" valign="bottom" style='width:2.32%;border:none;border-top:solid black 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p style='margin:0in;margin-bottom:.0001pt;layout-grid-mode:char'> </p> </td> <td width="36%" colspan="3" valign="bottom" style='width:36.48%;border-top:solid black 1.0pt;border-left:none;border-bottom:solid black 1.0pt;border-right:none;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center;layout-grid-mode:char'>2011</p> </td> </tr> <tr style='height:60.0pt'> <td width="30%" valign="bottom" style='width:30.16%;padding:0in 5.4pt 0in 5.4pt;height:60.0pt'> <p style='margin:0in;margin-bottom:.0001pt;layout-grid-mode:char'> </p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:60.0pt'> <p style='margin:0in;margin-bottom:.0001pt;layout-grid-mode:char'> </p> </td> <td width="15%" valign="bottom" style='width:15.28%;border:none;border-bottom:solid black 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:60.0pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center;layout-grid-mode:char'>Shares</p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:60.0pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center;layout-grid-mode:char'> </p> </td> <td width="11%" valign="bottom" style='width:11.12%;border:none;border-bottom:solid black 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:60.0pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;margin-right:-.4pt;text-align:center;layout-grid-mode:char'>Weighted Average Exercise Price</p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:60.0pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center;layout-grid-mode:char'> </p> </td> <td width="22%" valign="bottom" style='width:22.32%;border:none;border-bottom:solid black 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:60.0pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center;layout-grid-mode:char'>Shares</p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:60.0pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center;layout-grid-mode:char'> </p> </td> <td width="11%" valign="bottom" style='width:11.84%;border:none;border-bottom:solid black 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:60.0pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center;layout-grid-mode:char'>Weighted Average Exercise Price</p> </td> </tr> <tr style='height:15.0pt'> <td width="30%" valign="bottom" style='width:30.16%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;layout-grid-mode:char'><font style='letter-spacing:-.5pt'>Outstanding at beginning of period</font></p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p style='margin:0in;margin-bottom:.0001pt;layout-grid-mode:char'> </p> </td> <td width="15%" valign="bottom" style='width:15.28%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>2,820,000   </p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'> </p> </td> <td width="11%" valign="bottom" style='width:11.12%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>$0.73 </p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'> </p> </td> <td width="22%" valign="bottom" style='width:22.32%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>5,870,000</p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'> </p> </td> <td width="11%" valign="bottom" style='width:11.84%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>$0.52</p> </td> </tr> <tr style='height:15.0pt'> <td width="30%" valign="bottom" style='width:30.16%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;layout-grid-mode:char'><font style='letter-spacing:-.5pt'>Granted</font></p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p style='margin:0in;margin-bottom:.0001pt;layout-grid-mode:char'> </p> </td> <td width="15%" valign="bottom" style='width:15.28%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>2,815,313</p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'> </p> </td> <td width="11%" valign="bottom" style='width:11.12%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>3.29</p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'> </p> </td> <td width="22%" valign="bottom" style='width:22.32%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>-</p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'> </p> </td> <td width="11%" valign="bottom" style='width:11.84%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>- </p> </td> </tr> <tr style='height:15.0pt'> <td width="30%" valign="bottom" style='width:30.16%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;layout-grid-mode:char'><font style='letter-spacing:-.5pt'>Exercised</font></p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p style='margin:0in;margin-bottom:.0001pt;layout-grid-mode:char'> </p> </td> <td width="15%" valign="bottom" style='width:15.28%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>-</p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center;layout-grid-mode:char'> </p> </td> <td width="11%" valign="bottom" style='width:11.12%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'><font style='letter-spacing:-.5pt'>-</font></p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'> </p> </td> <td width="22%" valign="bottom" style='width:22.32%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>(1,177,983)</p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'> </p> </td> <td width="11%" valign="bottom" style='width:11.84%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>0.15</p> </td> </tr> <tr style='height:15.0pt'> <td width="30%" valign="bottom" style='width:30.16%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;layout-grid-mode:char'><font style='letter-spacing:-.5pt'>Expired or canceled</font></p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p style='margin:0in;margin-bottom:.0001pt;layout-grid-mode:char'> </p> </td> <td width="15%" valign="bottom" style='width:15.28%;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'><font style='letter-spacing:-.5pt'>-</font></p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'> </p> </td> <td width="11%" valign="bottom" style='width:11.12%;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'><font style='letter-spacing:-.5pt'>-</font></p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'> </p> </td> <td width="22%" valign="bottom" style='width:22.32%;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>(1,872,017)</p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'> </p> </td> <td width="11%" valign="bottom" style='width:11.84%;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>0.43</p> </td> </tr> <tr style='height:15.75pt'> <td width="30%" valign="bottom" style='width:30.16%;padding:0in 5.4pt 0in 5.4pt;height:15.75pt'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;layout-grid-mode:char'><font style='letter-spacing:-.5pt'>Outstanding at end of period</font></p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:15.75pt'> <p style='margin:0in;margin-bottom:.0001pt;layout-grid-mode:char'> </p> </td> <td width="15%" valign="bottom" style='width:15.28%;border:none;border-bottom:double black 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:15.75pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'><font style='letter-spacing:-.5pt'>5,635,313</font></p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:15.75pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'> </p> </td> <td width="11%" valign="bottom" style='width:11.12%;border:none;border-bottom:double black 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:15.75pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'><font style='letter-spacing:-.5pt'>2.30 </font></p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:15.75pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'> </p> </td> <td width="22%" valign="bottom" style='width:22.32%;border:none;border-bottom:double black 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:15.75pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'><font style='letter-spacing:-.5pt'>2,820,000 </font></p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:15.75pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'> </p> </td> <td width="11%" valign="bottom" style='width:11.84%;border:none;border-bottom:double black 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:15.75pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'><font style='letter-spacing:-.5pt'>0.73 </font></p> </td> </tr> <tr style='height:18.9pt'> <td width="30%" valign="bottom" style='width:30.16%;padding:0in 5.4pt 0in 5.4pt;height:18.9pt'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;layout-grid-mode:char'><font style='letter-spacing:-.5pt'>Exercisable </font></p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:18.9pt'> <p style='margin:0in;margin-bottom:.0001pt;layout-grid-mode:char'> </p> </td> <td width="15%" valign="bottom" style='width:15.28%;border:none;border-bottom:double black 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:18.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'><font style='letter-spacing:-.5pt'>5,635,313</font></p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:18.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'> </p> </td> <td width="11%" valign="bottom" style='width:11.12%;border:none;border-bottom:double black 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:18.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'><font style='letter-spacing:-.5pt'>$2.30 </font></p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:18.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'> </p> </td> <td width="22%" valign="bottom" style='width:22.32%;border:none;border-bottom:double black 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:18.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'><font style='letter-spacing:-.5pt'>2,820,000 </font></p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:18.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'> </p> </td> <td width="11%" valign="bottom" style='width:11.84%;border:none;border-bottom:double black 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:18.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'><font style='letter-spacing:-.5pt'>$0.73</font></p> </td> </tr> </table> <p style='margin:0in;margin-bottom:.0001pt;line-height:12.55pt'> </p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:.25in;line-height:12.55pt'>A summary of the status of the options and warrants outstanding at September 30, 2012 is presented below:</p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> </p> <table border="0" cellspacing="0" cellpadding="0" style='margin-left:-2.75pt;border-collapse:collapse'> <tr style='height:13.5pt'> <td width="79" valign="bottom" style='width:59.0pt;padding:0;height:13.5pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> </p> </td> <td width="213" colspan="2" valign="bottom" style='width:159.75pt;border:none;border-bottom:solid black 1.0pt;padding:0;height:13.5pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>Total Outstanding</p> </td> <td width="126" valign="bottom" style='width:94.25pt;border:none;border-bottom:solid black 1.0pt;padding:0;height:13.5pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>Total Exercisable</p> </td> <td width="162" valign="top" style='width:121.75pt;padding:0;height:13.5pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> </p> </td> </tr> <tr style='height:12.75pt'> <td width="79" valign="bottom" style='width:59.0pt;border-top:solid black 1.0pt;border-left:solid black 1.0pt;border-bottom:none;border-right:none;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> </p> </td> <td width="119" valign="bottom" style='width:89.25pt;border:none;border-left:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> </p> </td> <td width="94" valign="bottom" style='width:70.5pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>Average</p> </td> <td width="126" valign="bottom" style='width:94.25pt;border:none;border-left:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> </p> </td> <td width="162" valign="bottom" style='width:121.75pt;border:none;border-right:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>Weighted</p> </td> </tr> <tr style='height:12.75pt'> <td width="79" valign="bottom" style='width:59.0pt;border:none;border-left:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> </p> </td> <td width="119" valign="bottom" style='width:89.25pt;border:none;border-left:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>Number  </p> </td> <td width="94" valign="bottom" style='width:70.5pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>Remaining</p> </td> <td width="126" valign="bottom" style='width:94.25pt;border:none;border-left:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>Number  </p> </td> <td width="162" valign="bottom" style='width:121.75pt;border:none;border-right:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>Average</p> </td> </tr> <tr style='height:12.75pt'> <td width="79" valign="bottom" style='width:59.0pt;border-top:none;border-left:solid black 1.0pt;border-bottom:solid black 1.0pt;border-right:none;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>Range</p> </td> <td width="119" valign="bottom" style='width:89.25pt;border-top:none;border-left:solid black 1.0pt;border-bottom:solid black 1.0pt;border-right:none;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>O/S</p> </td> <td width="94" valign="bottom" style='width:70.5pt;border:none;border-bottom:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>Life (Yrs)</p> </td> <td width="126" valign="bottom" style='width:94.25pt;border-top:none;border-left:solid black 1.0pt;border-bottom:solid black 1.0pt;border-right:none;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>Exercisable</p> </td> <td width="162" valign="top" style='width:121.75pt;border-top:none;border-left:none;border-bottom:solid black 1.0pt;border-right:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>Exercisable</p> </td> </tr> <tr style='height:12.75pt'> <td width="79" valign="bottom" style='width:59.0pt;border:none;border-left:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>$0.01 - 0.50</p> </td> <td width="119" valign="bottom" style='width:89.25pt;border:none;border-left:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>200,000 </p> </td> <td width="94" valign="bottom" style='width:70.5pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>2.03</p> </td> <td width="126" valign="bottom" style='width:94.25pt;border:none;border-left:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>200,000 </p> </td> <td width="162" valign="bottom" style='width:121.75pt;border:none;border-right:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> $0.38 </p> </td> </tr> <tr style='height:12.75pt'> <td width="79" valign="bottom" style='width:59.0pt;border:none;border-left:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>$0.51 - 0.75</p> </td> <td width="119" valign="bottom" style='width:89.25pt;border:none;border-left:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>1,580,000</p> </td> <td width="94" valign="bottom" style='width:70.5pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>2.35</p> </td> <td width="126" valign="bottom" style='width:94.25pt;border:none;border-left:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>1,580,000 </p> </td> <td width="162" valign="bottom" style='width:121.75pt;border:none;border-right:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> $0.63 </p> </td> </tr> <tr style='height:12.75pt'> <td width="79" valign="bottom" style='width:59.0pt;border:none;border-left:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>$0.76 – 1.00</p> </td> <td width="119" valign="bottom" style='width:89.25pt;border:none;border-left:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>1,040,000</p> </td> <td width="94" valign="bottom" style='width:70.5pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>2.10</p> </td> <td width="126" valign="bottom" style='width:94.25pt;border:none;border-left:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>1,040,000</p> </td> <td width="162" valign="bottom" style='width:121.75pt;border:none;border-right:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>$0.94</p> </td> </tr> <tr style='height:13.5pt'> <td width="79" valign="bottom" style='width:59.0pt;border:none;border-left:solid black 1.0pt;padding:0;height:13.5pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>$1.01 – 2.00</p> </td> <td width="119" valign="bottom" style='width:89.25pt;border:none;border-left:solid black 1.0pt;padding:0;height:13.5pt'> <p style='margin:0in;margin-bottom:.0001pt;line-height:12.55pt'>90,000</p> </td> <td width="94" valign="bottom" style='width:70.5pt;padding:0;height:13.5pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>2.69</p> </td> <td width="126" valign="bottom" style='width:94.25pt;border:none;border-left:solid black 1.0pt;padding:0;height:13.5pt'> <p style='margin:0in;margin-bottom:.0001pt;line-height:12.55pt'>90,000 </p> </td> <td width="162" valign="bottom" style='width:121.75pt;border:none;border-right:solid black 1.0pt;padding:0;height:13.5pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> $0.99 </p> </td> </tr> <tr style='height:12.75pt'> <td width="79" valign="bottom" style='width:59.0pt;border:none;border-left:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>$2.01 – 3.00</p> </td> <td width="119" valign="bottom" style='width:89.25pt;border:none;border-left:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;line-height:12.55pt'>5,000 </p> </td> <td width="94" valign="bottom" style='width:70.5pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>4.37</p> </td> <td width="126" valign="bottom" style='width:94.25pt;border:none;border-left:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;line-height:12.55pt'>5,000 </p> </td> <td width="162" valign="bottom" style='width:121.75pt;border:none;border-right:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>$2.68</p> </td> </tr> <tr style='height:12.75pt'> <td width="79" valign="bottom" style='width:59.0pt;border:none;border-left:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>$3.01 – 4.00</p> </td> <td width="119" valign="bottom" style='width:89.25pt;border:none;border-left:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>2,720,313</p> </td> <td width="94" valign="bottom" style='width:70.5pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>4.52</p> </td> <td width="126" valign="bottom" style='width:94.25pt;border:none;border-left:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>2,720,313</p> </td> <td width="162" valign="bottom" style='width:121.75pt;border:none;border-right:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>$3.88</p> </td> </tr> <tr style='height:12.75pt'> <td width="79" valign="bottom" style='width:59.0pt;border-top:none;border-left:solid black 1.0pt;border-bottom:solid black 1.0pt;border-right:none;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>$0.01 – 4.00</p> </td> <td width="119" valign="bottom" style='width:89.25pt;border-top:none;border-left:solid black 1.0pt;border-bottom:solid black 1.0pt;border-right:none;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>5,635,313 </p> </td> <td width="94" valign="bottom" style='width:70.5pt;border:none;border-bottom:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>3.24</p> </td> <td width="126" valign="bottom" style='width:94.25pt;border-top:none;border-left:solid black 1.0pt;border-bottom:solid black 1.0pt;border-right:none;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>5,635,313</p> </td> <td width="162" valign="bottom" style='width:121.75pt;border-top:none;border-left:none;border-bottom:solid black 1.0pt;border-right:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>$2.24</p> </td> </tr> </table>
<!--egx--><p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>NOTE 6 - SIGNIFICANT EVENTS</p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> </p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:.25in;line-height:12.55pt'>On April 9, 2012, the Company closed a private placement (the “Private Placement”) with select accredited investors (the “Investors”) related to the sale and issuance of an aggregate of 2,602,246 shares of common stock (the “Common Stock”) of the Company (the “Shares”) and warrants to purchase an aggregate of 2,602,246 shares of Common Stock (the “Warrants”). The aggregate gross proceeds raised by the Company was $5,516,762 million. Each Share was be sold to the Investors at $2.12 per Share. The Warrants will expire five (5) years from the date of issue and may be exercised at $3.88 per Share, subject to adjustment in certain circumstances.</p> <p style='margin:0in;margin-bottom:.0001pt;line-height:12.55pt'> </p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:.25in;line-height:12.55pt'>In connection with the Private Placement, the Company paid its placement agents (the “Placement Agents”) an aggregate cash commission equal to $386,173. In addition, the Company will reimburse the Placement Agents $23,632 for costs and expenses incurred in connection with the Private Placement, and issue to the Placement Agents five-year warrants to purchase an aggregate of 78,067 shares of common stock, at an exercise price of $3.88 per share, subject to adjustment in certain circumstances (the “Placement Agent Warrants”). The Company also issued to two consultants, five-year warrants to purchase an aggregate of 40,000 shares of common stock, at an exercise price of $3.88 per share. The Company recognized $502,965 of compensation expense for the warrants issued.</p>
<!--egx--><p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>NOTE 7 - SUBSEQUENT EVENTS</p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> </p> <p style='margin:0in;margin-bottom:.0001pt'>In accordance with ASC 855-10, the Company’s management has reviewed all material events there are no material subsequent events to report.</p>
<!--egx--><p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'><u>Use of Estimates</u></p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:.25in;line-height:12.55pt'> </p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:.25in;line-height:12.55pt'>The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  Actual results could differ from those estimates.</p>
<!--egx--><p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'><u>Recent Accounting Pronouncements</u></p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> </p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:.25in;line-height:12.55pt'>The Company has evaluated recent accounting pronouncements and their adoption has not had or is not expected to have a material impact on the Company’s financial position, or statements.</p>
<!--egx--><p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'><u>Inventory</u></p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> </p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:.25in;line-height:12.55pt'>Inventory is stated at the lower of cost or market. The Company’s inventory consists of finished goods and raw material and is located in San Marcos, California at September 30, 2012 and December 31, 2011 consisted of the following:</p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> </p> <table border="0" cellspacing="0" cellpadding="0" style='border-collapse:collapse'> <tr> <td width="348" valign="bottom" style='width:261.0pt;padding:0'> <p style='margin:0in;margin-bottom:.0001pt;layout-grid-mode:char'> </p> </td> <td width="114" valign="bottom" style='width:85.5pt;padding:0'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center;layout-grid-mode:char'>September 30, 2012</p> </td> <td width="138" valign="bottom" style='width:103.5pt;padding:0'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center;layout-grid-mode:char'>December 31, 2011</p> </td> </tr> <tr> <td width="348" valign="bottom" style='width:261.0pt;background:#CCEEFF;padding:0'> <p style='margin:0in;margin-bottom:.0001pt;layout-grid-mode:char'>Raw materials</p> </td> <td width="114" valign="bottom" style='width:85.5pt;background:#CCEEFF;padding:0'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>1,189,455</p> </td> <td width="138" valign="bottom" style='width:103.5pt;background:#CCEEFF;padding:0'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>$946,762</p> </td> </tr> <tr> <td width="348" valign="bottom" style='width:261.0pt;background:white;padding:0'> <p style='margin:0in;margin-bottom:.0001pt;layout-grid-mode:char'>Finished goods</p> </td> <td width="114" valign="bottom" style='width:85.5pt;background:white;padding:0'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>332,004</p> </td> <td width="138" valign="bottom" style='width:103.5pt;background:white;padding:0'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>674,198</p> </td> </tr> <tr> <td width="348" valign="bottom" style='width:261.0pt;background:#CCEEFF;padding:0'> <p style='margin:0in;margin-bottom:.0001pt;layout-grid-mode:char'>Peru (finished goods)</p> </td> <td width="114" valign="bottom" style='width:85.5pt;background:#CCEEFF;padding:0'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>18,454</p> </td> <td width="138" valign="bottom" style='width:103.5pt;background:#CCEEFF;padding:0'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>18,454</p> </td> </tr> <tr> <td width="348" valign="bottom" style='width:261.0pt;background:white;padding:0'> <p style='margin:0in;margin-bottom:.0001pt;layout-grid-mode:char'>In transit</p> </td> <td width="114" valign="bottom" style='width:85.5pt;background:white;padding:0'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>~</p> </td> <td width="138" valign="bottom" style='width:103.5pt;background:white;padding:0'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>8,232</p> </td> </tr> <tr> <td width="348" valign="bottom" style='width:261.0pt;background:#CCEEFF;padding:0'> <p style='margin:0in;margin-bottom:.0001pt;layout-grid-mode:char'>Allowance for obsolete inventory</p> </td> <td width="114" valign="bottom" style='width:85.5pt;background:#CCEEFF;padding:0'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>(627,529)</p> </td> <td width="138" valign="bottom" style='width:103.5pt;background:#CCEEFF;padding:0'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>(627,529)</p> </td> </tr> <tr> <td width="348" valign="bottom" style='width:261.0pt;background:white;padding:0'> <p style='margin:0in;margin-bottom:.0001pt;layout-grid-mode:char'>Total</p> </td> <td width="114" valign="bottom" style='width:85.5pt;background:white;padding:0'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'><u>912,384</u></p> </td> <td width="138" valign="bottom" style='width:103.5pt;background:white;padding:0'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'><u>1,020,117</u></p> </td> </tr> </table> <p style='margin:0in;margin-bottom:.0001pt'> </p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:.25in;line-height:12.55pt'>The Company has established an allowance for obsolete inventory. Expense for obsolete inventory was $-0- and $-0-, for the periods ended September 30, 2012 and December 31, 2011, respectively</p>
<!--egx--><p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'><u>Basic and Diluted Net Income (Loss) Per Share</u></p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> </p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:.25in;line-height:12.55pt'>The Company computes net income (loss) per share in accordance with ASC 260, Earnings Per Share, which requires presentation of both basic and diluted earnings per share (EPS) on the face of the income statement. Basic EPS is computed by dividing net income (loss) available to common shareholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method. In computing Diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. As of September 30, 2012, 677,380 warrants and options were excluded from the Diluted EPS calculation as their effect is anti-dilutive.</p>
<!--egx--><p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'><u>Income Taxes</u></p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> </p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:.25in;line-height:12.55pt'>The Company accounts for income taxes in accordance with Accounting Standards Codification Topic 740, Income Taxes ("Topic 740"), which requires the recognition of deferred tax liabilities and assets at currently enacted tax rates for the expected future tax consequences of events that have been included in the financial statements or tax returns. A valuation allowance is recognized to reduce the net deferred tax asset to an amount that is more likely than not to be realized. </p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:.25in;line-height:12.55pt'> </p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:.25in;line-height:12.55pt'>Topic 740 provides guidance on the accounting for uncertainty in income taxes recognized in a company's financial statements. Topic 740 requires a company to determine whether it is more likely than not that a tax position will be sustained upon examination based upon the technical merits of the position. If the more likely-than-not threshold is met, a company must measure the tax position to determine the amount to recognize in the financial statements.</p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:.25in;line-height:12.55pt'> </p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:.25in;line-height:12.55pt'>At the adoption date of November 1, 2007, the Company had no unrecognized tax benefit which would affect the effective tax rate if recognized. The Company includes interest and penalties arising from the underpayment of income taxes in the statements of operations in the provision for income taxes. As of September 30, 2012 and December 31, 2011 the Company had no accrued interest or penalties related to uncertain tax positions. The Company files an income tax return in the U.S. federal jurisdiction and the state of California. With few exceptions, the Company is no longer subject to U.S. federal, state, and local, or non-U.S. income tax examinations by tax authorities for years before 2007.</p>
<!--egx--><p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'><u>Held to Maturity Investments</u></p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> </p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:.25in;line-height:12.55pt'>During the nine months ended September 30, 2012, the Company purchased various corporate bonds. The Company intends to hold the bonds to maturity. Accordingly, the Company has recorded and is amortizing the premium on the bonds over the remaining life. As of September 30, 2012, the Company has amortized $16,378 of the premium leaving amortized cost basis remaining of $1,211,845.</p>
<!--egx--><p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> </p> <table border="0" cellspacing="0" cellpadding="0" style='border-collapse:collapse'> <tr> <td width="348" valign="bottom" style='width:261.0pt;padding:0'> <p style='margin:0in;margin-bottom:.0001pt;layout-grid-mode:char'> </p> </td> <td width="114" valign="bottom" style='width:85.5pt;padding:0'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center;layout-grid-mode:char'>September 30, 2012</p> </td> <td width="138" valign="bottom" style='width:103.5pt;padding:0'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center;layout-grid-mode:char'>December 31, 2011</p> </td> </tr> <tr> <td width="348" valign="bottom" style='width:261.0pt;background:#CCEEFF;padding:0'> <p style='margin:0in;margin-bottom:.0001pt;layout-grid-mode:char'>Raw materials</p> </td> <td width="114" valign="bottom" style='width:85.5pt;background:#CCEEFF;padding:0'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>1,189,455</p> </td> <td width="138" valign="bottom" style='width:103.5pt;background:#CCEEFF;padding:0'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>$946,762</p> </td> </tr> <tr> <td width="348" valign="bottom" style='width:261.0pt;background:white;padding:0'> <p style='margin:0in;margin-bottom:.0001pt;layout-grid-mode:char'>Finished goods</p> </td> <td width="114" valign="bottom" style='width:85.5pt;background:white;padding:0'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>332,004</p> </td> <td width="138" valign="bottom" style='width:103.5pt;background:white;padding:0'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>674,198</p> </td> </tr> <tr> <td width="348" valign="bottom" style='width:261.0pt;background:#CCEEFF;padding:0'> <p style='margin:0in;margin-bottom:.0001pt;layout-grid-mode:char'>Peru (finished goods)</p> </td> <td width="114" valign="bottom" style='width:85.5pt;background:#CCEEFF;padding:0'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>18,454</p> </td> <td width="138" valign="bottom" style='width:103.5pt;background:#CCEEFF;padding:0'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>18,454</p> </td> </tr> <tr> <td width="348" valign="bottom" style='width:261.0pt;background:white;padding:0'> <p style='margin:0in;margin-bottom:.0001pt;layout-grid-mode:char'>In transit</p> </td> <td width="114" valign="bottom" style='width:85.5pt;background:white;padding:0'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>~</p> </td> <td width="138" valign="bottom" style='width:103.5pt;background:white;padding:0'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>8,232</p> </td> </tr> <tr> <td width="348" valign="bottom" style='width:261.0pt;background:#CCEEFF;padding:0'> <p style='margin:0in;margin-bottom:.0001pt;layout-grid-mode:char'>Allowance for obsolete inventory</p> </td> <td width="114" valign="bottom" style='width:85.5pt;background:#CCEEFF;padding:0'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>(627,529)</p> </td> <td width="138" valign="bottom" style='width:103.5pt;background:#CCEEFF;padding:0'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>(627,529)</p> </td> </tr> <tr> <td width="348" valign="bottom" style='width:261.0pt;background:white;padding:0'> <p style='margin:0in;margin-bottom:.0001pt;layout-grid-mode:char'>Total</p> </td> <td width="114" valign="bottom" style='width:85.5pt;background:white;padding:0'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'><u>912,384</u></p> </td> <td width="138" valign="bottom" style='width:103.5pt;background:white;padding:0'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'><u>1,020,117</u></p> </td> </tr> </table>
<!--egx--><p align="center" style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-align:center;text-indent:-1.0in;line-height:12.55pt'> </p> <table border="0" cellspacing="0" cellpadding="0" width="95%" style='width:95.2%;border-collapse:collapse'> <tr> <td width="50%" valign="bottom" style='width:50.5%;background:#CCEEFF;padding:0'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> </p> </td> <td width="24%" style='width:24.26%;background:#CCEEFF;padding:0'> <p align="center" style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-align:center;text-indent:-1.0in;line-height:12.55pt'>September 30, 2012</p> </td> <td width="25%" style='width:25.24%;background:#CCEEFF;padding:0'> <p align="center" style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-align:center;text-indent:-1.0in;line-height:12.55pt'>December 31, 2011</p> </td> </tr> <tr> <td width="50%" valign="bottom" style='width:50.5%;background:#CCEEFF;padding:0'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>Amounts due to the president</p> </td> <td width="24%" style='width:24.26%;background:#CCEEFF;padding:0'> <p align="right" style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-align:right;text-indent:-1.0in;line-height:12.55pt'>214,628</p> </td> <td width="25%" style='width:25.24%;background:#CCEEFF;padding:0'> <p align="right" style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-align:right;text-indent:-1.0in;line-height:12.55pt'>271,253</p> </td> </tr> <tr> <td width="50%" valign="bottom" style='width:50.5%;background:white;padding:0in 0in 1.5pt 0in'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>Amounts due to other officers of the company</p> </td> <td width="24%" style='width:24.26%;border:none;border-bottom:solid black 1.0pt;background:white;padding:0in 0in 1.5pt 0in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-align:right;text-indent:-1.0in;line-height:12.55pt'>62,715</p> </td> <td width="25%" style='width:25.24%;border:none;border-bottom:solid black 1.0pt;background:white;padding:0in 0in 1.5pt 0in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-align:right;text-indent:-1.0in;line-height:12.55pt'>80,327</p> </td> </tr> <tr> <td width="50%" valign="bottom" style='width:50.5%;background:#CCEEFF;padding:0in 0in 3.0pt 0in'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>Total</p> </td> <td width="24%" style='width:24.26%;border:none;border-bottom:double black 1.0pt;background:#CCEEFF;padding:0in 0in 3.0pt 0in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-align:right;text-indent:-1.0in;line-height:12.55pt'>277,343</p> </td> <td width="25%" style='width:25.24%;border:none;border-bottom:double black 1.0pt;background:#CCEEFF;padding:0in 0in 3.0pt 0in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-align:right;text-indent:-1.0in;line-height:12.55pt'>351,580</p> </td> </tr> </table>
<!--egx--><p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> </p> <table border="0" cellspacing="0" cellpadding="0" width="100%" style='width:100.0%;border-collapse:collapse'> <tr style='height:15.0pt'> <td width="30%" valign="bottom" style='width:30.16%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p style='margin:0in;margin-bottom:.0001pt;layout-grid-mode:char'> </p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:-23.4pt;layout-grid-mode:char'> </p> </td> <td width="28%" colspan="3" valign="bottom" style='width:28.72%;border-top:solid black 1.0pt;border-left:none;border-bottom:solid black 1.0pt;border-right:none;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center;layout-grid-mode:char'>2012</p> </td> <td width="2%" valign="bottom" style='width:2.32%;border:none;border-top:solid black 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p style='margin:0in;margin-bottom:.0001pt;layout-grid-mode:char'> </p> </td> <td width="36%" colspan="3" valign="bottom" style='width:36.48%;border-top:solid black 1.0pt;border-left:none;border-bottom:solid black 1.0pt;border-right:none;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center;layout-grid-mode:char'>2011</p> </td> </tr> <tr style='height:60.0pt'> <td width="30%" valign="bottom" style='width:30.16%;padding:0in 5.4pt 0in 5.4pt;height:60.0pt'> <p style='margin:0in;margin-bottom:.0001pt;layout-grid-mode:char'> </p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:60.0pt'> <p style='margin:0in;margin-bottom:.0001pt;layout-grid-mode:char'> </p> </td> <td width="15%" valign="bottom" style='width:15.28%;border:none;border-bottom:solid black 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:60.0pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center;layout-grid-mode:char'>Shares</p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:60.0pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center;layout-grid-mode:char'> </p> </td> <td width="11%" valign="bottom" style='width:11.12%;border:none;border-bottom:solid black 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:60.0pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;margin-right:-.4pt;text-align:center;layout-grid-mode:char'>Weighted Average Exercise Price</p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:60.0pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center;layout-grid-mode:char'> </p> </td> <td width="22%" valign="bottom" style='width:22.32%;border:none;border-bottom:solid black 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:60.0pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center;layout-grid-mode:char'>Shares</p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:60.0pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center;layout-grid-mode:char'> </p> </td> <td width="11%" valign="bottom" style='width:11.84%;border:none;border-bottom:solid black 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:60.0pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center;layout-grid-mode:char'>Weighted Average Exercise Price</p> </td> </tr> <tr style='height:15.0pt'> <td width="30%" valign="bottom" style='width:30.16%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;layout-grid-mode:char'><font style='letter-spacing:-.5pt'>Outstanding at beginning of period</font></p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p style='margin:0in;margin-bottom:.0001pt;layout-grid-mode:char'> </p> </td> <td width="15%" valign="bottom" style='width:15.28%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>2,820,000   </p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'> </p> </td> <td width="11%" valign="bottom" style='width:11.12%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>$0.73 </p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'> </p> </td> <td width="22%" valign="bottom" style='width:22.32%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>5,870,000</p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'> </p> </td> <td width="11%" valign="bottom" style='width:11.84%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>$0.52</p> </td> </tr> <tr style='height:15.0pt'> <td width="30%" valign="bottom" style='width:30.16%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;layout-grid-mode:char'><font style='letter-spacing:-.5pt'>Granted</font></p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p style='margin:0in;margin-bottom:.0001pt;layout-grid-mode:char'> </p> </td> <td width="15%" valign="bottom" style='width:15.28%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>2,815,313</p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'> </p> </td> <td width="11%" valign="bottom" style='width:11.12%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>3.29</p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'> </p> </td> <td width="22%" valign="bottom" style='width:22.32%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>-</p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'> </p> </td> <td width="11%" valign="bottom" style='width:11.84%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>- </p> </td> </tr> <tr style='height:15.0pt'> <td width="30%" valign="bottom" style='width:30.16%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;layout-grid-mode:char'><font style='letter-spacing:-.5pt'>Exercised</font></p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p style='margin:0in;margin-bottom:.0001pt;layout-grid-mode:char'> </p> </td> <td width="15%" valign="bottom" style='width:15.28%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>-</p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center;layout-grid-mode:char'> </p> </td> <td width="11%" valign="bottom" style='width:11.12%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'><font style='letter-spacing:-.5pt'>-</font></p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'> </p> </td> <td width="22%" valign="bottom" style='width:22.32%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>(1,177,983)</p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'> </p> </td> <td width="11%" valign="bottom" style='width:11.84%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>0.15</p> </td> </tr> <tr style='height:15.0pt'> <td width="30%" valign="bottom" style='width:30.16%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;layout-grid-mode:char'><font style='letter-spacing:-.5pt'>Expired or canceled</font></p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p style='margin:0in;margin-bottom:.0001pt;layout-grid-mode:char'> </p> </td> <td width="15%" valign="bottom" style='width:15.28%;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'><font style='letter-spacing:-.5pt'>-</font></p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'> </p> </td> <td width="11%" valign="bottom" style='width:11.12%;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'><font style='letter-spacing:-.5pt'>-</font></p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'> </p> </td> <td width="22%" valign="bottom" style='width:22.32%;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>(1,872,017)</p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'> </p> </td> <td width="11%" valign="bottom" style='width:11.84%;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:15.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'>0.43</p> </td> </tr> <tr style='height:15.75pt'> <td width="30%" valign="bottom" style='width:30.16%;padding:0in 5.4pt 0in 5.4pt;height:15.75pt'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;layout-grid-mode:char'><font style='letter-spacing:-.5pt'>Outstanding at end of period</font></p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:15.75pt'> <p style='margin:0in;margin-bottom:.0001pt;layout-grid-mode:char'> </p> </td> <td width="15%" valign="bottom" style='width:15.28%;border:none;border-bottom:double black 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:15.75pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'><font style='letter-spacing:-.5pt'>5,635,313</font></p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:15.75pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'> </p> </td> <td width="11%" valign="bottom" style='width:11.12%;border:none;border-bottom:double black 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:15.75pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'><font style='letter-spacing:-.5pt'>2.30 </font></p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:15.75pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'> </p> </td> <td width="22%" valign="bottom" style='width:22.32%;border:none;border-bottom:double black 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:15.75pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'><font style='letter-spacing:-.5pt'>2,820,000 </font></p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:15.75pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'> </p> </td> <td width="11%" valign="bottom" style='width:11.84%;border:none;border-bottom:double black 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:15.75pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'><font style='letter-spacing:-.5pt'>0.73 </font></p> </td> </tr> <tr style='height:18.9pt'> <td width="30%" valign="bottom" style='width:30.16%;padding:0in 5.4pt 0in 5.4pt;height:18.9pt'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;layout-grid-mode:char'><font style='letter-spacing:-.5pt'>Exercisable </font></p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:18.9pt'> <p style='margin:0in;margin-bottom:.0001pt;layout-grid-mode:char'> </p> </td> <td width="15%" valign="bottom" style='width:15.28%;border:none;border-bottom:double black 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:18.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'><font style='letter-spacing:-.5pt'>5,635,313</font></p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:18.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'> </p> </td> <td width="11%" valign="bottom" style='width:11.12%;border:none;border-bottom:double black 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:18.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'><font style='letter-spacing:-.5pt'>$2.30 </font></p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:18.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'> </p> </td> <td width="22%" valign="bottom" style='width:22.32%;border:none;border-bottom:double black 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:18.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'><font style='letter-spacing:-.5pt'>2,820,000 </font></p> </td> <td width="2%" valign="bottom" style='width:2.32%;padding:0in 5.4pt 0in 5.4pt;height:18.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'> </p> </td> <td width="11%" valign="bottom" style='width:11.84%;border:none;border-bottom:double black 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:18.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;layout-grid-mode:char'><font style='letter-spacing:-.5pt'>$0.73</font></p> </td> </tr> </table>
<!--egx--><p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> </p> <table border="0" cellspacing="0" cellpadding="0" style='margin-left:-2.75pt;border-collapse:collapse'> <tr style='height:13.5pt'> <td width="79" valign="bottom" style='width:59.0pt;padding:0;height:13.5pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> </p> </td> <td width="213" colspan="2" valign="bottom" style='width:159.75pt;border:none;border-bottom:solid black 1.0pt;padding:0;height:13.5pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>Total Outstanding</p> </td> <td width="126" valign="bottom" style='width:94.25pt;border:none;border-bottom:solid black 1.0pt;padding:0;height:13.5pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>Total Exercisable</p> </td> <td width="162" valign="top" style='width:121.75pt;padding:0;height:13.5pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> </p> </td> </tr> <tr style='height:12.75pt'> <td width="79" valign="bottom" style='width:59.0pt;border-top:solid black 1.0pt;border-left:solid black 1.0pt;border-bottom:none;border-right:none;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> </p> </td> <td width="119" valign="bottom" style='width:89.25pt;border:none;border-left:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> </p> </td> <td width="94" valign="bottom" style='width:70.5pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>Average</p> </td> <td width="126" valign="bottom" style='width:94.25pt;border:none;border-left:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> </p> </td> <td width="162" valign="bottom" style='width:121.75pt;border:none;border-right:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>Weighted</p> </td> </tr> <tr style='height:12.75pt'> <td width="79" valign="bottom" style='width:59.0pt;border:none;border-left:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> </p> </td> <td width="119" valign="bottom" style='width:89.25pt;border:none;border-left:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>Number  </p> </td> <td width="94" valign="bottom" style='width:70.5pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>Remaining</p> </td> <td width="126" valign="bottom" style='width:94.25pt;border:none;border-left:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>Number  </p> </td> <td width="162" valign="bottom" style='width:121.75pt;border:none;border-right:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>Average</p> </td> </tr> <tr style='height:12.75pt'> <td width="79" valign="bottom" style='width:59.0pt;border-top:none;border-left:solid black 1.0pt;border-bottom:solid black 1.0pt;border-right:none;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>Range</p> </td> <td width="119" valign="bottom" style='width:89.25pt;border-top:none;border-left:solid black 1.0pt;border-bottom:solid black 1.0pt;border-right:none;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>O/S</p> </td> <td width="94" valign="bottom" style='width:70.5pt;border:none;border-bottom:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>Life (Yrs)</p> </td> <td width="126" valign="bottom" style='width:94.25pt;border-top:none;border-left:solid black 1.0pt;border-bottom:solid black 1.0pt;border-right:none;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>Exercisable</p> </td> <td width="162" valign="top" style='width:121.75pt;border-top:none;border-left:none;border-bottom:solid black 1.0pt;border-right:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>Exercisable</p> </td> </tr> <tr style='height:12.75pt'> <td width="79" valign="bottom" style='width:59.0pt;border:none;border-left:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>$0.01 - 0.50</p> </td> <td width="119" valign="bottom" style='width:89.25pt;border:none;border-left:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>200,000 </p> </td> <td width="94" valign="bottom" style='width:70.5pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>2.03</p> </td> <td width="126" valign="bottom" style='width:94.25pt;border:none;border-left:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>200,000 </p> </td> <td width="162" valign="bottom" style='width:121.75pt;border:none;border-right:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> $0.38 </p> </td> </tr> <tr style='height:12.75pt'> <td width="79" valign="bottom" style='width:59.0pt;border:none;border-left:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>$0.51 - 0.75</p> </td> <td width="119" valign="bottom" style='width:89.25pt;border:none;border-left:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>1,580,000</p> </td> <td width="94" valign="bottom" style='width:70.5pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>2.35</p> </td> <td width="126" valign="bottom" style='width:94.25pt;border:none;border-left:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>1,580,000 </p> </td> <td width="162" valign="bottom" style='width:121.75pt;border:none;border-right:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> $0.63 </p> </td> </tr> <tr style='height:12.75pt'> <td width="79" valign="bottom" style='width:59.0pt;border:none;border-left:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>$0.76 – 1.00</p> </td> <td width="119" valign="bottom" style='width:89.25pt;border:none;border-left:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>1,040,000</p> </td> <td width="94" valign="bottom" style='width:70.5pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>2.10</p> </td> <td width="126" valign="bottom" style='width:94.25pt;border:none;border-left:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>1,040,000</p> </td> <td width="162" valign="bottom" style='width:121.75pt;border:none;border-right:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>$0.94</p> </td> </tr> <tr style='height:13.5pt'> <td width="79" valign="bottom" style='width:59.0pt;border:none;border-left:solid black 1.0pt;padding:0;height:13.5pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>$1.01 – 2.00</p> </td> <td width="119" valign="bottom" style='width:89.25pt;border:none;border-left:solid black 1.0pt;padding:0;height:13.5pt'> <p style='margin:0in;margin-bottom:.0001pt;line-height:12.55pt'>90,000</p> </td> <td width="94" valign="bottom" style='width:70.5pt;padding:0;height:13.5pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>2.69</p> </td> <td width="126" valign="bottom" style='width:94.25pt;border:none;border-left:solid black 1.0pt;padding:0;height:13.5pt'> <p style='margin:0in;margin-bottom:.0001pt;line-height:12.55pt'>90,000 </p> </td> <td width="162" valign="bottom" style='width:121.75pt;border:none;border-right:solid black 1.0pt;padding:0;height:13.5pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'> $0.99 </p> </td> </tr> <tr style='height:12.75pt'> <td width="79" valign="bottom" style='width:59.0pt;border:none;border-left:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>$2.01 – 3.00</p> </td> <td width="119" valign="bottom" style='width:89.25pt;border:none;border-left:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;line-height:12.55pt'>5,000 </p> </td> <td width="94" valign="bottom" style='width:70.5pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>4.37</p> </td> <td width="126" valign="bottom" style='width:94.25pt;border:none;border-left:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;line-height:12.55pt'>5,000 </p> </td> <td width="162" valign="bottom" style='width:121.75pt;border:none;border-right:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>$2.68</p> </td> </tr> <tr style='height:12.75pt'> <td width="79" valign="bottom" style='width:59.0pt;border:none;border-left:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>$3.01 – 4.00</p> </td> <td width="119" valign="bottom" style='width:89.25pt;border:none;border-left:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>2,720,313</p> </td> <td width="94" valign="bottom" style='width:70.5pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>4.52</p> </td> <td width="126" valign="bottom" style='width:94.25pt;border:none;border-left:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>2,720,313</p> </td> <td width="162" valign="bottom" style='width:121.75pt;border:none;border-right:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>$3.88</p> </td> </tr> <tr style='height:12.75pt'> <td width="79" valign="bottom" style='width:59.0pt;border-top:none;border-left:solid black 1.0pt;border-bottom:solid black 1.0pt;border-right:none;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>$0.01 – 4.00</p> </td> <td width="119" valign="bottom" style='width:89.25pt;border-top:none;border-left:solid black 1.0pt;border-bottom:solid black 1.0pt;border-right:none;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>5,635,313 </p> </td> <td width="94" valign="bottom" style='width:70.5pt;border:none;border-bottom:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>3.24</p> </td> <td width="126" valign="bottom" style='width:94.25pt;border-top:none;border-left:solid black 1.0pt;border-bottom:solid black 1.0pt;border-right:none;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>5,635,313</p> </td> <td width="162" valign="bottom" style='width:121.75pt;border-top:none;border-left:none;border-bottom:solid black 1.0pt;border-right:solid black 1.0pt;padding:0;height:12.75pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-left:1.0in;text-indent:-1.0in;line-height:12.55pt'>$2.24</p> </td> </tr> </table>
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5635313
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2602246
2602246
5516762
2.12
5
3.88
386173
23632
78067
3.88
40000
3.88
502965
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