Share-Based Payments (Tables)

6 Months Ended

Jun. 30, 2012

The following table provides the details of the approximate total share based payments expense during the three months and six months ended June 30, 2012 and 2011:

	3 Months Ended				6 Months Ended
	June 30,				June 30,
	2012		2011		2012		2011
	(unaudited)		(unaudited)		(unaudited)		(unaudited)
Stock option amortization		247,000		145,000		410,000		291,000
Stock issued for services		39,000		-		39,000		10,000
Stock warrants issued for service		14,000		12,000		26,000		12,000
Right to purchase shares		44,000		155,000		44,000		155,000
		344,000		312,000		519,000		468,000

Stock option activity

Stock option activity for the six months ended June 30, 2012 is summarized as follows:

	June 30, 2012
				Weighted		Aggregate
				Average		Intrinsic
	Shares			Exercise Price		Value
Options outstanding at beginning of year		1,383,567		$	3.32	$	2,600,000
Granted		200,900			4.58		93,058
Exercised		-			-		-
Cancelled/expired		(3,486	)		3.77		(4,295	)
Options outstanding at end of period		1,580,981		$	3.49	$	2,688,763

Options exercisable at end of period		902,620		$	3.30	$	1,729,103

Options available for issuance		2,416,352

Warrants outstanding

In connection with the Company's Share Exchange, capital raising efforts in 2007, the Company's January 2008 Financing of Convertible Notes and Class A Warrants, the April 2010 Convertible Note, the July 2010 and June 2011 financings, the WB Agreement and a service agreement, the Company issued warrants to investors and service providers to purchase common stock of the Company. As of June 30, 2012, the weighted average exercise price was $35.77 and the weighted average remaining life was 2.12 years. The following table outlines the warrants outstanding as of June 30, 2012 and December 31, 2011:

	June 30,		December 31,
	2012		2011
	(unaudited)
	Number of		Number of
	Warrants		Warrants		Exercise		Expiration
Warants Outstanding	Outstanding		Outstanding		Price		Date
Share Exchange Consulting Warrants ($45.00 exercise price)		59,664		59,664	$	45.00	1/11/2013
2007 Private Placement Broker Warrants ($45.00 exercise price)		8,533		8,533	$	45.00	1/11/2013
2007 Private Placement Investor Warrants ($150.00 exercise price)		53,333		53,333	$	150.00	1/11/2013
July 2010 Sinotop Acquisition Warrants ($45.00 exercise price)		17,049		17,049	$	45.00	1/11/2013
July 2010 Sinotop Acquisition Warrants ($150.00 exercise price)		13,333		13,333	$	150.00	1/11/2013
May 2011 Warner Brothers Warrants ($6.60 excercise price)		200,000		200,000	$	6.60	5/11/2016
June 2011 Fidelity Right to Purchase ($6.60 exercise price)		75,000		75,000	$	6.60	12/3/2012
2011 Service Agreement Warrants ($7.20 exercise price)		13,333		6,667	$	7.20	6/15/2016
		440,245		433,579

- 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.

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