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9. RELATED PARTY TRANSACTIONS
 6 Months Ended
Jun. 30, 2013
Notes to Financial Statements  
NOTE 9. RELATED PARTY TRANSACTIONS

Employment Agreement

 

In February 2011, the Company entered into a new employment agreement with its CEO that provides for a base salary of $20,000 per annum, subject to CPI adjustments, incentive performance bonuses equal to 12% of the Company’s annual GAAP earnings for the years 2011 through 2015 and discretionary bonuses, as well as expense reimbursements and certain employee benefits. The agreement terminates December 31, 2015.  As of June 30, 2013 and December 31, 2012, the Company has accrued $15,000 and $5,000 respectively, for unpaid wages under the employment agreement.

 

Support and Service Agreement

 

Effective April 1, 2013 the Company entered into a Support and Service Agreement (“the Agreement”) with Rolyn Companies, Inc. (“Rolyn”) under the terms of which Rolyn will provide labor and services support.  The Agreement calls for payment to Rolyn of $20,000 per month in the form of the Company’s common stock, based on a share price of $0.261, regardless of market price, and payment of out of pocket expenses.  Either party can terminate the Agreement with 30 days written notice.  The Company has recorded $60,000 support and service expense for the quarter ended June 30, 2013 and a related liability has been reported as common stock to be issued.  Certain officers of Rolyn were appointed officers of the Company in June and July 2013.