Quarterly report pursuant to Section 13 or 15(d)

NOTE 7: EQUITY TRANSACTIONS

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NOTE 7: EQUITY TRANSACTIONS
3 Months Ended
Mar. 31, 2013
Stockholders' Equity Note Disclosure [Text Block]
NOTE 7: EQUITY TRANSACTIONS

Common Stock

During the three months ended March 31, 2013, the Company issued an aggregate of 3,150,000 common shares for services valued at $160,299 and sold 8,000,000 common shares for cash proceeds of $400,000.

Options

Total stock option expense was $323,496 for the three months ended March 31, 2013. As of March 31, 2013, there was an aggregate of $749,938 that will be expensed over the remaining vesting period of the outstanding option through July 1, 2014.

On March 22, 2013, Clean Coal granted a consultant an aggregate of 1,000,000 common stock options which have a term of 3 years and the following exercise prices and vesting terms: 400,000 options are exercisable at $0.15 per share and vest on March 22, 2013, 300,000 options are exercisable at $0.25 per share and vest on July 1, 2013 and 300,000 options are exercisable at $0.35 per share and vest on July 1, 2013. The fair value of these options was determined to be $31,307 using the Black-Scholes Option Pricing Model. The significant assumptions used in the model include (1) discount rate of 0.39%, (2) expected term of 3 years (3) expected volatility of 126.53% and (4) zero expected dividends. $15,675 was expensed during the three months ended March 31, 2013 and $15,632 will be expensed over the remaining vesting periods.

A summary of stock option activity for the three months ended March 31, 2013 is as follows:

         
Weighted
 
         
Average
 
   
Options
   
Exercise Price
 
Outstanding - December 31, 2012
    46,000,000     $ 0.22  
Granted
    1,000,000       0.24  
Forfeited/canceled
    -       -  
Exercised
    -       -  
Outstanding – March 31, 2013
    47,000,000     $ 0.22  
Exercisable – March 31, 2013
    10,400,000     $ 0.03  

The weighted average remaining life of the outstanding options as of March 31, 2013 was 6.1 years, the weighted average grant date fair value of the options granted during the three months ended March 31, 2013 was $0.031 and the intrinsic value of the exercisable options as of March 31, 2013 was $200,000.