11. CONTRACTS AND AGREEMENTS	9 Months Ended
Sep. 30, 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. TOMI Panama is its exclusive distributor of the Company’s products and services within the country of Panama. In January of 2015, the Company entered into a consulting agreement which has since been terminated that provided 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 a 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 exercise price for the warrants issued in April, July and accrued for in September was $0.50, $0.62 and $0.33, respectively. During the nine months ended September 30, 2015, the Company utilized the Black-Scholes method to fair value the 225,000 warrants with the following range of assumptions: volatility, 157%-174%; expected dividend yield, 0%; risk free interest rate, 1.01%-1.42%; and a life of 3 years. The grant date fair value of the warrant issued in April, July and accrued for in the third quarter was $0.37, $0.54 and $0.30, respectively. For the nine months ended September 30, 2015, the Company recognized approximately $91,000 in equity based compensation on the issuance of the warrants in April, July and the accrual of the warrants issued in October. This consulting agreement was terminated October 1, 2015 when the consultant accepted a full time employment position with the Company. In May of 2015, the Company entered into a consulting agreement that provides for the issuance of 600,000 shares of restricted common stock which was issued in July of 2015 and valued at $264,000. In addition, the agreement provides for the issuance of 3,000,000 common stock warrants that vest upon issuance with an exercise price of $1.00 and have a term of 5 years. The Company utilized the Black-Scholes method to fair value the 3,000,000 warrants with the following assumptions: volatility, 191%; expected dividend yield, 0%; risk free interest rate, 1.49%; and a life of 5 years. The grant date fair value of each warrant was $0.42. For the nine months ended September 30, 2015, the Company recognized approximately $1,259,000 in equity based compensation on the warrants issued. In May 2015, the Company was awarded a grant by the United States Agency for International Development (“USAID”) in the amount of $559,000 for the development of SteraMistTM Mobile Decontamination Chambers to fight the Ebola epidemic. The grant is based on milestones set forth on the agreement between the Company and USAID. During the quarter ended September 30, 2015 the Company met the first two milestones and received gross proceeds from the grant in the amount of $347,826. The Company has incurred costs in connection with the grant through September 30, 2015 in the amount of $220,452. The proceeds received as part of the grant in excess of the costs incurred has been presented on the Company’s balance sheet as a liability in the amount of $127,374 as of September 30, 2015.

11. CONTRACTS AND AGREEMENTS

9 Months Ended

Sep. 30, 2015

In September 2014, the Company entered into a Sales and Distribution Agreement, superseding previous agreements, with TOMI Panama covering Panama. TOMI Panama is its exclusive distributor of the Company’s products and services within the country of Panama.

In January of 2015, the Company entered into a consulting agreement which has since been terminated that provided 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 a 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 exercise price for the warrants issued in April, July and accrued for in September was $0.50, $0.62 and $0.33, respectively. During the nine months ended September 30, 2015, the Company utilized the Black-Scholes method to fair value the 225,000 warrants with the following range of assumptions: volatility, 157%-174%; expected dividend yield, 0%; risk free interest rate, 1.01%-1.42%; and a life of 3 years. The grant date fair value of the warrant issued in April, July and accrued for in the third quarter was $0.37, $0.54 and $0.30, respectively. For the nine months ended September 30, 2015, the Company recognized approximately $91,000 in equity based compensation on the issuance of the warrants in April, July and the accrual of the warrants issued in October. This consulting agreement was terminated October 1, 2015 when the consultant accepted a full time employment position with the Company.

In May of 2015, the Company entered into a consulting agreement that provides for the issuance of 600,000 shares of restricted common stock which was issued in July of 2015 and valued at $264,000. In addition, the agreement provides for the issuance of 3,000,000 common stock warrants that vest upon issuance with an exercise price of $1.00 and have a term of 5 years. The Company utilized the Black-Scholes method to fair value the 3,000,000 warrants with the following assumptions: volatility, 191%; expected dividend yield, 0%; risk free interest rate, 1.49%; and a life of 5 years. The grant date fair value of each warrant was $0.42. For the nine months ended September 30, 2015, the Company recognized approximately $1,259,000 in equity based compensation on the warrants issued.

In May 2015, the Company was awarded a grant by the United States Agency for International Development (“USAID”) in the amount of $559,000 for the development of SteraMistTM Mobile Decontamination Chambers to fight the Ebola epidemic. The grant is based on milestones set forth on the agreement between the Company and USAID. During the quarter ended September 30, 2015 the Company met the first two milestones and received gross proceeds from the grant in the amount of $347,826. The Company has incurred costs in connection with the grant through September 30, 2015 in the amount of $220,452. The proceeds received as part of the grant in excess of the costs incurred has been presented on the Company’s balance sheet as a liability in the amount of $127,374 as of September 30, 2015.