Get Started for Free Contexxia identifies hard-to-find pieces of information in SEC filings. No more highlighters, no more redlining, no more poring over huge documents. ZYTO CORP (1406796) 10-Q published on Nov 14, 2012 at 3:53 pm
Reporting Period: Sep 29, 2012
On March 26, 2012, we executed an amended and restated unsecured promissory note with an officer of the Company for intellectual property and other related technologies, extending the maturity date to December 31, 2013, bearing interest at 7% per annum.
On September 12, 2012, we executed another amended and restated unsecured promissory note with the same Company officer, further extending the maturity date to January 1, 2015, bearing interest at the prime rate plus 1.75% per annum. As of the date of this Report, the interest rate was 5.0%.
In conjunction with the amended and restated promissory note, on September 13, 2012, we issued a warrant to purchase 1,000,000 shares of common stock to Vaughn R Cook, Chairman and CEO. The warrant has an exercise price of $0.04 per share and is exercisable through September 13, 2013. This fair value of the warrant was $4,640 computed using the Black-Scholes pricing model with the following assumptions: risk free interest rate of 0.24%, dividend yield of 0.0%, volatility of 28.9% and an expected life of 1 year.
Selling and marketing expenses for the three months ended September 30, 2012, were $628,384, compared to $380,927 for the three months ended September 30, 2011, reflecting an increase of $247,457, or 65.0 percent. More of our professional sales were a result of referrals. As a result, our external commissions increased. During the quarter, we held more conference workshops to promote the exposure of our biosurveys and professional line of products, which increased our conference expenses. We also increased our personnel costs, including hiring additional trainers and sales coordinators to increase the quality of our customer service.
On September 13, 2012, we granted a warrant to purchase 1,000,000 shares of common stock to Vaughn R Cook, our Chairman and CEO, in exchange for amending and restating the terms of a related party promissory note. This warrant had an exercise price of $0.04 per share and was exercisable through September 13, 2013.
The transaction of unregistered securities listed above did not involve a public offering or general solicitation of offers or sales. The transaction was accomplished pursuant to and in reliance on the private offering exemption from registration under Section 4(2) of the Securities Act and rules promulgated thereunder.