XML 43 R17.htm IDEA: XBRL DOCUMENT

11. CONTRACTS AND AGREEMENTS	3 Months Ended
Mar. 31, 2015
Notes to Financial Statements
NOTE 11. CONTRACTS AND AGREEMENTS	In September 2014, the Company entered into a Sales and Distribution Agreement, superseding previous agreements, with TOMI Panama covering Panama, El Salvador, Guatemala, Nicaragua, Columbia, Honduras, Costa Rica and Ecuador. TOMI Panama is its exclusive distributor of the Company’s products and services within the country of Panama. For the quarter ended March 31, 2015, revenues of approximately $37,000 were recognized with regards to TOMI Panama. On October 15, 2014, the Company entered into a manufacturing and development agreement with RG Group, Inc. For the quarter ended March 31, 2015, RG Group, Inc. manufactured substantially all of the Company’s equipment. In January of 2015, the Company entered into a consulting agreement that provides for a fee based on revenue received from existing and prospective clients assigned and revenue from sales related to customers the consultant finds for the Company. The agreement also provided for the issuance of 100,000 shares of the Company’s common restricted stock that were issued in February of 2015 and valued at $25,000. In addition, the agreement provides for the issuance of 75,000 common stock warrants on a quarterly basis that vest upon issuance with strike price equal to the VWAP for the 5 day period prior to the close of the quarter with a term of 3 years. The term of the Consulting agreement is two years. The Company utilized the Black-Scholes method to fair value the 75,000 warrants with the following assumptions: volatility, 174%; expected dividend yield, 0%; risk free interest rate, 1.42%; and a life of 3 years. The grant date fair value of each warrant was $0.37. For the quarter ended March 31, 2015, the Company recognized approximately $28,000 in equity based compensation on the accrual of the warrants issued in April to the consultant.

11. CONTRACTS AND AGREEMENTS

3 Months Ended

Mar. 31, 2015

In September 2014, the Company entered into a Sales and Distribution Agreement, superseding previous agreements, with TOMI Panama covering Panama, El Salvador, Guatemala, Nicaragua, Columbia, Honduras, Costa Rica and Ecuador. TOMI Panama is its exclusive distributor of the Company’s products and services within the country of Panama. For the quarter ended March 31, 2015, revenues of approximately $37,000 were recognized with regards to TOMI Panama.

On October 15, 2014, the Company entered into a manufacturing and development agreement with RG Group, Inc. For the quarter ended March 31, 2015, RG Group, Inc. manufactured substantially all of the Company’s equipment.

In January of 2015, the Company entered into a consulting agreement that provides for a fee based on revenue received from existing and prospective clients assigned and revenue from sales related to customers the consultant finds for the Company. The agreement also provided for the issuance of 100,000 shares of the Company’s common restricted stock that were issued in February of 2015 and valued at $25,000. In addition, the agreement provides for the issuance of 75,000 common stock warrants on a quarterly basis that vest upon issuance with strike price equal to the VWAP for the 5 day period prior to the close of the quarter with a term of 3 years. The term of the Consulting agreement is two years. The Company utilized the Black-Scholes method to fair value the 75,000 warrants with the following assumptions: volatility, 174%; expected dividend yield, 0%; risk free interest rate, 1.42%; and a life of 3 years. The grant date fair value of each warrant was $0.37. For the quarter ended March 31, 2015, the Company recognized approximately $28,000 in equity based compensation on the accrual of the warrants issued in April to the consultant.