Supplemental Cash Flow Information

9 Months Ended

Sep. 30, 2012

Supplemental Cash Flow Information [Abstract]

Supplemental Cash Flow Information

Note 13 - Supplemental Cash Flow Information

2012

During the nine months ended September 30, 2012, we issued 427,508 shares of our common stock valued at $167,494 to two consultants and one corporation of which (i) 250,000 shares was in consideration for cancellation of a warrant issued for consulting services rendered and (ii) 177,508 was for consulting services rendered.

For the nine months ended September 30, 2012 an aggregate non-cash expense of $593,297 was recorded for the accretion of notes payable as follows: (i) $250,002 for the Unsecured Convertible Note, (ii) $116,630 for the Bridge Loan and (iii) $226,665 for 2012 Convertible Notes.

For the nine months ended September 30, 2012, we recognized $918,206 in depreciation and amortization expense from the following: (i) $464,197 related to cost of sales for equipment used directly by or for customers, (ii) $446,396 related to other property and equipment, and (iii) $7,613 for patent amortization.

2011

During the nine months ended September 30, 2011, we granted options to acquire up to 600,000 shares of our common stock valued at $389,000 to two consultants in consideration of consulting services to be rendered by the consultants over a one year period pursuant to a written consulting agreement. The value of options is being recognized over the contract period and for the nine months ended September 30, 2011, $263,572 was included in stock based compensation.

On March 21, 2011, the Company converted $784,292 of its short-term debt into equity through the issuance of common stock and warrants to two lenders at the same unit pricing as the Equity Financing. In consideration of converting the short- term loans on the basis of $1.20 for two shares of common stock plus one warrant at an exercise price of $1.00, the Company issued 1,307,153 shares of common stock and warrants to acquire up to 653,576 shares of common stock, which warrants have a five year term and are exercisable at $1.00 per share. The Company's objective for converting the short-term debt into equity is to conserve cash for further market development.

In March 2011, we granted to the holder of our senior unsecured convertible note a warrant to acquire 400,000 shares of our common stock at an exercise price of $.05 per share in consideration of a waiver of the holder's reset provision that allowed us to convert certain short terms loans to equity without causing an adjustment in the conversion price of our senior note. The warrants had a 5 - year life from the date of grant, contained full-ratchet anti-dilution price protection provisions and were valued $404,000 using a Black Scholes pricing model on the date of grant. During the three and nine months ended September 30, 2011 the warrant holder exercised these warrants using a cashless provision resulting in the company issuing 372,272 shares of our common stock.

For the nine months ended September 30, 2011 an aggregate non-cash expense of $250,002 was recorded for the accretion of the unsecured convertible note.

For the nine months ended September 30, 2011, we recognized $1,117,703 in depreciation and amortization expense from the following: (i) $599,952 related to cost of sales for equipment used directly by or for customers, (ii) $510,138 related to other property and equipment, and (iii) $7,613 for patent amortization.