STOCKHOLDERS' EQUITY (Tables)

9 Months Ended

Sep. 30, 2013

Warrants outstanding and number of shares of common stock subject to exercise

The following table summarizes the warrants outstanding and the number of shares of common stock subject to exercise as of September 30, 2013 and the changes therein during the nine months then ended:

	Number of Shares of Common Stock Subject to Exercise			Weighted – Average Exercise Price
Balance as of December 31, 2012		2,041,165		$	0.98
Warrants issued		4,445,714		$	0.56
Warrants exercised		(479,459	)	$	0.35
Warrants cancelled		(250,000	)	$	0.35
Balance as of September 30, 2013 (1)		5,757,420		$	0.73

(1)

As part of the June 2012 Note, Inter-Mountain received a total of seven warrants to purchase, if they all vest, an aggregate of 3,142,857 shares of common stock, which number of shares could increase based upon the terms and conditions of the warrants. The warrants have an exercise price of $0.35 per share, subject to certain pricing adjustments, and are exercisable, subject to vesting provisions and ownership limitations, until June 27, 2017. Warrants for 785,714, 392,857, 392,857, and 392,857 shares of common stock vested on June 27, 2012, December 31, 2012, February 26, 2013, and July 15, 2013, respectively, and warrants for 479,459 shares of common stock have been exercised. For the purposes of this Table, only such net vested shares of common stock (1,484,826 shares) have been included, based upon an exercise price of $0.35 per share of common stock. Each of the other three warrants vest upon the payment by Inter-Mountain of each of the three remaining Investor Notes.

Expiration dates for warrants subject to exercise

Of the warrant shares subject to exercise as of September 30, 2013, expiration of the right to exercise is as follows:

Date of Expiration		Number of Warrant Shares of Common Stock Subject to Expiration
	January 3, 2014	3,000,000
	July 23, 2014	69,050
	May 15, 2015	357,155
	June 13, 2016	35,000
	July 16, 2016	116,667
	July 28, 2016	34,722
	June 27, 2017	1,484,826
	March 14, 2018	660,000
	Total	5,757,420

- Definition

Tabular disclosure of warrants or rights issued. Warrants and rights outstanding are derivative securities that give the holder the right to purchase securities (usually equity) from the issuer at a specific price within a certain time frame. Warrants are often included in a new debt issue to entice investors by a higher return potential. The main difference between warrants and call options is that warrants are issued and guaranteed by the company, whereas options are exchange instruments and are not issued by the company. Also, the lifetime of a warrant is often measured in years, while the lifetime of a typical option is measured in months. Disclose the title of issue of securities called for by warrants and rights outstanding, the aggregate amount of securities called for by warrants and rights outstanding, the date from which the warrants or rights are exercisable, and the price at which the warrant or right is exercisable.

+ References+ Details