On May 10, 2007, Mr. Feintech signed an executive employment agreement. The agreement is for a three-year term and calls for him to receive a minimum base salary of $175,000 per year. The employment agreement also grants to him: (i) a one-time stock issuance of 1,500,000 shares of common stock upon execution of the agreement; (ii) an award of non-statutory stock options of 425,000 shares of common stock at an exercise price of $0.10 per share; and (iii) a bonus equal to an additional 1,000,000 shares of common stock upon the achievement of each incremental level of $50,000,000 in revenue, provided that cumulative net after-tax income is being maintained at a level not less than 7.5% on total revenue.
In addition, in May 2006, Mr. Feintech was issued 50,000 shares of common stock in exchange for the assignment of any intellectual property rights related to our business and granted an option to purchase 325,000 shares of common stock pursuant to our stock incentive plan at an exercise price of $0.10 at any time prior to May 13, 2013. The options vested 25% on May 31, 2007 and have continued to vest 1/48th each month thereafter until fully vested.
On June 21, 2010, Mr. Feintech was granted 2,250,000 shares of common stock as additional compensation. Such shares were valued at $0.14, for total compensation of $31,500.
On February 11, 2011, Mr. Feintech was granted 1,750,000 shares of common stock as additional compensation. Such shares were valued at $0.008, for total compensation of $14,000.
On February 13, 2011, Mr. Feintech was granted 400,000 warrants to purchase common stock at a strike price of $0.05. The warrant term extends five years through February 12, 2016. The warrants were valued at $3,212 using the Black-Scholes method, assuming a risk-free rate of return of 0.13% and volatility of 347%.
On September 30, 2011, Mr. Feintech was granted 500,000 warrants to purchase common stock at a strike price of $0.25. The warrant term extends five years through September 29, 2016. The warrants were valued at $119,984 using the Black-Scholes method, assuming a risk-free rate of return of 0.02% and volatility of 317%.
On May 17, 2010, Mr. Campbell was granted 1,500,000 warrants to purchase common stock at a strike price of $0.05. The fair value per common share was $0.02. The warrant term extends five years through May 16, 2015. The warrants were valued at $30,027 using the Black-Scholes method, assuming a risk-free rate of return of .12% to .15% and a volatility of 347%.
On September 30, 2011, Mr. Campbell was granted 250,000 warrants to purchase common stock at a strike price of $0.25. The warrant term extends five years through September 29, 2016. The warrants were valued at $60,008 using the Black-Scholes method, assuming a risk-free rate of return of 0.02% and volatility of 317%.
On December 20, 2012, Mr. Campbell was granted 350,000 warrants to purchase common stock at a strike price of $.05. The warrant term extends three years through December 20, 2015. The warrants were valued at $2,334 using the Black-Scholes method, assuming a risk-free rate of return of .02% and volatility of 310%.
On December 31, 2013, Mr. Campbell was granted 350,000 warrants to purchase common stock at a strike price of $.05. The warrant term extends three years to December 31, 2016. The warrants were valued at $607 using the Black-Scholes method, assuming a risk-free rate of return of .78% and volatility of 307%.
