Subsequent Events

12 Months Ended

Dec. 31, 2011

Notes to Financial Statements

Subsequent Events

16. Subsequent Events

As partial compensation per an agreement dated May 19, 2011 for consultant work, the Company issued to Monarch Communications, Inc. the following:

· On January 12, 2012, 26,667 shares of its common stock valued at $0.15 per share

· On February 27, 2012, 26,667 shares of its common stock valued at $0.15 per share.

· On March 6, 2012, 30,769 shares of its common stock valued at $0.13 per share.

· On March 30, 2012, 25,000 shares of its common stock valued at $0.16 per share.

On January 31, 2012, the Company issued 50,000 shares of its common stock valued at $0.175 per share to an outside consultant as compensation for legal work throughout 2010-2011.

Between January 12, 2012 and February 27, 2012, the Company received loans in various amounts totaling $220,000, from the Company’s Chairman and CEO, as advances for working capital needs. The loans bear interest at the same rate of interest as the credit facility provided by the stockholder under the note dated March 28, 2002.

On January 27, 2012 the Company received payment of $34,535 on a note receivable from a warrant holder, in connection with an exercise of previously issued warrants. In connection with this payment, the Company will issue 207,214 shares of its common stock valued at $0.167 per share.

On February 9, 2012, the repayment date of the stockholder loan was extended from December 31, 2012 to December 31, 2013.

On March 30, 2012 an aggregate amount of 905,000 incentive stock options were awarded to certain employees as partial payment for their services to the Company.

On April 3, 2012, the repayment date of the Telesco loan was extended from April 1, 2012 to January 1, 2013.