Note 13 – Warrants

In recognition of the substantial financial risks undertaken by the members of the organizing group, the Company granted an aggregate of 255,992 warrants to its Organizers and one Founder in June 2009. Of the amount granted, 231,992 warrants were vested immediately. The other 24,000 warrants were subject to an annual vesting schedule over 36 months. All warrants are exercisable at a price of $10.00 per share, the initial offering price, and expire June 8, 2019. There were 255,992 warrants outstanding at December 31, 2011 and 2010, respectively with a weighted average grant date fair value for all outstanding warrants equal to $2.29.


Warrants Exercisable
Type	Exercise Price	Number		Weighted Average Remaining Contractual Life (in years)	Weighted Average Exercise Price
Organizer/founder warrants	$ 10.00		231,992	7.5	$ 10.00
Director warrants	$ 10.00		16,000	7.5	$ 10.00
Total			247,992

Organizer warrants totaling 231,992 were immediately vested upon issuance. Of the 231,992 organizer/founder warrants, 64,547 were treated as compensatory with the fair market value of $147,814 charged to earnings in 2009. The remaining 167,445 organizer/founder warrants were investment warrants with the fair market value of $383,449, and were treated as a component of shareholders’ equity. The other 24,000 director warrants vest over three years. The Company recognized expense of $16,488 and $16,488 during the years ended December 31, 2011 and 2010, respectively, related to these director warrants. As of December 31, 2011 and 2010, respectively, there was $6,870 and $23,358 of total unrecognized compensation cost related to the outstanding warrants.