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13. Related Party Transactions
 12 Months Ended
Dec. 31, 2011
Related Party Transactions [Abstract]  
13. Related Party Transactions

 

13. Related Party Transactions

 

The Company owes Eric McAfee and McAfee Capital, solely owned by Eric McAfee, amounts of $1,254,188 and $803,370 in connection with employment agreements and expense reimbursements, which are included in accrued expenses and accounts payable on the balance sheet as of December 31, 2011 and 2010.  For the years ended December 31, 2011 and 2010, the Company expensed $519,828 and $608,874 in connection with compensation and expense reimbursements.

 

The Company owes various Board Members amounts of $638,563 and $490,658 as of December 31, 2011 and 2010, respectively, in connection with board compensation fees, which are included in accounts payable on the balance sheet.  For the years ended December 31, 2011 and 2010 the Company expensed $228,654 and $188,198, respectively, in connection with board compensation fees.

 

In July 2009, the Company entered into a sublease agreement with Nevo Energy, Inc. (formerly known as Solargen Energy, Inc.) for approximately 3,000 square feet of leased space. For the year ended December 31, 2010, the Company invoiced, collected and offset as rent and utilities expense $125,858 under this agreement and collected a prepayment of $11,876, which the Company received for April 2010 rent.  For the year ending December 31, 2011, the Company invoiced Nevo Energy $86,291 in rents, but reserved all the payments during 2011 due to Nevo Energy’s inability to pay.  The future minimum lease payments above exclude collections of rents under this sublease agreement.  Eric McAfee is a member of the Board of Directors and a significant shareholder of Nevo Energy, Inc.  Michael Peterson, a former member of the Company’s Board of Directors, was also the Chief Executive Officer of Nevo Energy, Inc. during 2011.   See Note 6 Operating Leases.