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RELATED PARTY TRANSACTIONS AND AMOUNTS OWING

3 Months Ended

Mar. 31, 2012

a)	Loans payable to related party

The amounts due to a related party at March 31, 2012 and December 31, 2011 of $106,537 and $89,584, respectively, represent an unsecured promissory note due to a shareholder and director of the Company. These amounts are unsecured, bear interest at 15% per annum and are repayable on demand, with accumulated interest.

b)	Contingent consideration payable to related party

Pursuant to Stock Purchase Agreement between a director of the company (“the Director”) and DEDC, dated February 25, 2011 and Amendments No. 1 and No. 2 to Stock Purchase Agreement, dated December 30, 2011 and March 31, 2012, respectively, DEDC acquired all of the outstanding shares, of Transformation Consulting (“TC”). The purchase price for the shares was $2,000,000, payable from the gross revenues of TC, subject to the following contingent reduction or increase of the purchase price. If TC’s gross revenues during the two years following the closing are less than $2,000,000, then the purchase price for the shares shall be reduced to the actual revenue received by TC during the two year period. If TC’s revenues during the same two year period exceed $2,000,000, then the purchase price for the shares shall be increased by one-half of the excess revenues over $2,000,000 (“contingent consideration”).

TC’s revenues are primarily related to revenues received from an entity controlled by the Director (“related entity”) under a January 2010, Management Services and Agency Agreement (“Agency Agreement”). Under the Agency Agreement, TC receives revenues based on billings received from certain of TC’s direct to consumer membership club products that were transferred to the related entity under the Agency Agreement. Pursuant to the Agency Agreement, TC agreed to (1) transfer to the related entity the ownership of certain TC current direct to consumer membership products upon TC receiving a total of $1,000,000 in revenues; (2) introduce the related entity to TC’s existing and potential vendors for use in managing the TC current programs on behalf of TC; and (3) have the related entity act as TC’s sales agent for new product sales. In consideration, TC receives all gross receipts of existing sales, less the related entity’s management fee of 20% of gross sales. Separately, TC and the related entity would each be entitled to 50% of new business sales. After total payments of $2,000,000 to TC from all related revenues under the Agency Agreement, the related entity would no longer be obligated to pay TC any further compensation.

Pursuant to the contingent consideration of $2,000,000 due to the Director from TC, all revenues generated by TC under the Agency Agreement are disbursed to Director. All cash management services, pertaining to the revenues generated by TC under the Agency Agreement are managed by the Director directly from an escrow account, including deposits of revenues and payment disbursements to the Director. As a result, the Company does not have access to the cash flow from such revenues, which are administered from said escrow account. Contingency consideration is payable based on a payment schedule as follows:

- Payment one: the first $900,000 of gross revenues paid on receipt;

- Payment two: the next $400,000 of gross revenues paid at the later of 90 days of receipt or June 30, 2012;

- Payment three: the next $400,000 of gross revenues paid at the later of 90 days of receipt or September 30, 2012;

- Payment four: the next $300,000 of gross revenues paid at the later of 90 days of receipt or December 31, 2012.

For the three months ended March 31, 2012 and 2011, TC gross revenues totaled $301,704 and $0, respectively.

Through March 31, 2012, payments, net of refunds, made to Director totaled $974,232. At March 31, 2012 and December 31, 2011, contingency consideration payable to Director is $1,025,768 and $996,414, respectively, as follows:

		As of March 31, 2012		As of December 31, 2011
Contingency consideration due		$	2,000,000	$	2,000,000
Less: payments, net of refunds, to Director			974,232		1,003,586
		$	1,025,768	$	996,414
c)	Transactions with related parties

Related party transactions were in the normal course of operations and were measured at the exchange amount, which is the amount of consideration established and agreed to by the related parties.

For the three months ended March 31, 2012 and 2011, the Company incurred expenses as follows:

(i)	Consulting services for development and construction of the Company’s energy campus project, provided by a company related through common shareholdings, in the amount of $60,000 and $0, respectively. At March 31, 2012 and December 31, 2011, the Company has an accounts payable balance of $46,863 and $46,863, respectively to this related party.
(ii)	Strategic business and legal services provided by a company related through common shareholdings in the amount of $10,500 and $0, respectively. There are not amounts owing to this related party at March 31, 2012 and December 31, 2011.

On or about July 9, 2011, and as further amended on December 30, 2011, the Company executed a contractor agreement (the “Contractor Agreement”), with an entity controlled by a director and shareholder of the Company (the “Contractor”), in which the Company is obligated to issue one or more warrants to acquire a total of 1,000,000 shares of restricted common stock of the Company (the “Shares”) every 90 days during the term of the Contractor Agreement (the “Warrant”). During the first quarter of 2012, the Company recorded the issuance of a Warrant for 1,000,000 Shares to this Contractor. As of March 31, 2012, the Company was obligated to issue one or more Warrants totaling 7,000,000 Shares to this Contractor under the Contractor Agreement, in addition to 1,000,000 Shares every 90 days for a total of five (5) years. All warrants are exercisable at $0.0001 per share, and have a 60 month term from the date each issuance, and are exercisable at the sole discretion of the Contractor. The amount of consideration for the services rendered by the Contractor to the Company shall be determined on the fair market value of the Shares on the date of each issuance.