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10. COMMITMENTS AND CONTINGENCIES | 12 Months Ended
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Dec. 31, 2013
Notes to Financial Statements |
NOTE 10. COMMITMENTS AND CONTINGENCIES | The Company also leases 1,611 square feet of office/warehouse space in San Diego, CA for research and development purposes. The lease payments amount to approximately $24,500 annually with expiration on May 31, 2014. On January 2, 2013, the Company entered into an Environmental Advisory Services Agreement (“the EAS Agreement”). The EAS Agreement calls for an initial retainer payment of $15,000 cash and the issuance of 250,000 warrants. The Company valued the warrants at $37,495 using the Black Scholes model (see Note 8) and recorded the amount within professional fees for the year ended December 31, 2013. Additional payments of $12,500 and 250,000 warrants and 500,000 warrants are due upon the achievement of certain milestones, none of which have been met at December 31, 2013. The EAS Agreement also provides for reimbursement of travel and other expenses.

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