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Note 5: Stockholders' Equity
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12 Months Ended |
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Dec. 31, 2011
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| Stockholders' Equity Note Disclosure [Text Block] |
Note
5: Stockholders’ Equity (Deficit)
As
part of the Reincorporation, the total number of authorized
shares of common stock was changed to 250,000,000 shares of
$0.001 par value. The common stock and additional
paid in capital accounts were restated as of December 31,
2011 and December 31, 2010, and for the years then ended, to
recognize the change from no par common stock to a par value
of $0.001 per share. As of December 31, 2011 and
December 31, 2010, there were 60,698,815 and 55,116,515
shares of common stock outstanding, respectively.
The
Company has 10,000,000 shares of preferred stock authorized
with a par value of $0.001. The Board of Directors is
authorized, subject to any limitations prescribed by law,
without further vote or action by our stockholders, to issue
from time to time shares of preferred stock in one or more
series. Each series of preferred stock will have
such number of shares, designations, preferences, voting
powers, qualifications and special or relative rights or
privileges as shall be determined by our board of directors,
which may include, among others, dividend rights, voting
rights, liquidation preferences, conversion rights and
preemptive rights. As of December 31, 2011, no
shares were outstanding and the Board of Directors has not
authorized issuance of preferred shares.
On
April 6, 2010, the Company commenced a confidential private
placement offering to certain accredited investors for up to
12,500,000 shares of common stock at a purchase price of
$0.40 per share. On July 13, 2010, the Board of
Directors amended the terms of the offering to include the
issuance of a warrant to purchase one additional share of
common stock for each share of common stock sold through the
offering. Each warrant has an expiration of three
years from the date of purchase and an exercise price of
$0.40 per share. As of December 31, 2010, a total
subscription of $188,443 was received and 471,108 shares have
been issued. Costs of the offering in the amount
of $17,396 were offset against the additional paid in capital
account through December 31, 2010. The offering is
closed.
During
March and April, 2011, the Company conducted a private
placement offering to certain accredited investors under Rule
506. As a result of the offering, the Company
received subscriptions in the total amount of $860,000 and
4,300,000 shares were issued. Ms. Isabel Moeller
also subscribed for 1,000,000 shares. In lieu of cash payment
for the subscribed shares, Ms. Moeller agreed to a $200,000
reduction in the outstanding principal balance of her note
effective April 1, 2011. Costs of the offering in the
amount of $1,770 were offset against the additional paid in
capital account.
On
September 30, 2010, 50,000 shares were issued in exchange for
services valued at $25,000, or $0.50 per share. On
March 31, 2011, an additional 32,300 shares were issued in
exchange for debt valued at $9,690, or $0.30 per
share. On December 31, 2011, 250,000 shares of
common stock were issued in exchange for services valued at
$42,500, or $0.17 per share.
Through
December 31, 2011, stock option grant notices for up to
15,035,000 shares of common stock have been issued to
employees and service providers of the Company pursuant to
the 2008 Stock Option Plan, in accordance with the provisions
of Topic 718, Compensation, of the Accounting Standards
Codification, which requires companies to measure the cost of
employee services received in exchange for equity instruments
based on the grant date fair value of those awards and to
recognize the compensation expense over the requisite service
period during which the awards are expected to
vest. A total of $1,879,464 has been recognized as
additional paid in capital as the value of these options
granted, which includes $432,422 and $117,610 for the twelve
months ended December 31, 2011 and the year ended December
31, 2010, respectively. Of the total grants for
shares issued, 40,000 have expired as of December 31, 2011
and options to purchase up to 14,995,000 shares of common
stock are outstanding. Additional details regarding the stock
options granted is found in Note 9: Stock Options.
On
June 2, 2009, the Company, through Glendale Securities, Inc.
of Sherman Oaks, California as broker-dealer, filed a
Disclosure Statement with the Financial Investment Regulatory
Agency (FINRA) pursuant to Rule 15c2-11 of the Securities and
Exchange Act of 1934, as amended, to establish a secondary
trading market on the Pink Sheets Electronic OTC Markets
system. Glendale Securities’ request for
un-priced quotation on the Pink OTC Markets was cleared by
FINRA on July 13, 2009 and trading began on July 24,
2009. In May 2011, the OTC Markets, Inc. moved the
Company to the OTCQB trading platform. On
September 7, 2011, FINRA cleared the Company for quotation on
the OTCBB. In connection with the change in
domicile and name change from Pacific Entertainment
Corporation to Genius Brands International, Inc., the Company
filed an application for a new ticker symbol for trading
purposes. The new trading symbol is GNUS.
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