Related Party Transactions

9 Months Ended

Sep. 30, 2011

Related Party Transactions [Abstract]

Related Party Transactions

Note 5. Related Party Transactions

As of March 31, 2011, GEM entered into a $500,000 Line of Credit Agreement (the “LoC Agreement”) with a related-party lender, pursuant to which the lender initially advanced to GEM $100,000, evidenced by a promissory note of the same amount dated as of equal date. During the second quarter ended June 30, 2011, we borrowed the balance of $400,000 available under the LOC Agreement. The note bears interest at a rate of 12% per year, with interest on the note paid monthly in arrears. The note matures on March 31, 2012. The note can be prepaid at any time before maturity without any prepayment penalties and constitutes an unsecured obligation of GEM. We used the proceeds from the loan for project financing and general corporate purposes. The related-party lender is controlled by Ronald P. Ulfers, Jr., the Chairman, President and Chief Executive Officer and a director of the Company.

On April 26, 2011, we entered into a one-year consulting agreement (the “Watz Agreement”). Watz Enterprises LLC. (“Watz”) is a greater than 5% stockholder of the Company. Under the Watz Agreement, Watz agreed to advise us on business development and marketing matters in exchange for (i) a one-time payment of $65,000 and (ii) a monthly management fee of $25,000 payable from June 16, 2011 to May 15, 2012. Included in the accrued expenses as of September 30, 2011 are three payments of $25,000, totaling $75,000. Within 60 days of the expiration of the Watz Agreement, the Watz Agreement will automatically renew on a month-to-month basis and can be terminated with 10 days notice by either us or Watz. The managing member of Watz is the brother-in-law of Michael Samuel, our former Chairman, President and CEO and current member of the Board of Directors.

During the three- and nine-month periods ended September 30, 2011, certain of our affiliates and a consultant of the Company (the “Lenders”) provided us with short-term bridge loans in aggregate amounts of $131,400 and $239,400, respectively (the “Loans”). The Loans were not evidenced by promissory notes and do not bear interest. We intend to repay the Loans from the proceeds of a third-party financing. There can be no assurance as to the amount of any such financing or that any such financing will be available to us, on satisfactory terms and conditions or at all. If we do not receive such financing proceeds, we intend to proceed to negotiate terms of repayment of the Loans with the Lenders and to execute formal Loan documentation. We used the proceeds of the Loans for project financing and general corporate purposes.

During the three months ended September 30, 2011, we accrued lease payments for our office/storage space located in Miami, Florida in the total amount of $8,350, payable to Michael Samuel, a member of our Board of Directors, and/or his affiliates.