bowmo (BOMO) 10-Q 15 Jan 15 2014 Q3 Quarterly report Financial data

Document_And_Entity_Informatio

Document And Entity Information	9 Months Ended
	Sep. 30, 2014	Jan. 14, 2015
Document And Entity Information
Entity Registrant Name	US Highland, Inc.
Entity Central Index Key	1381871
Document Type	10-Q
Document Period End Date	30-Sep-14
Amendment Flag	FALSE
Current Fiscal Year End Date	-19
Is Entity a Well-known Seasoned Issuer?	No
Is Entity a Voluntary Filer?	No
Is Entity's Reporting Status Current?	Yes
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		77,727,669
Document Fiscal Period Focus	Q3
Document Fiscal Year Focus	2014

Unaudited_Condensed_Consolidat

Unaudited Condensed Consolidated Balance Sheets (USD $)	Sep. 30, 2014	Dec. 31, 2013
Current Assets
Cash	$1,779	$43,044
Inventory		99,826
Prepaid expenses	43,873	58,520
Total Current Assets	45,652	201,390
Long-term deposits	11,478	11,491
Property and Equipment, net	16,991	24,555
Total Assets	74,121	237,436
Current Liabilities
Accounts payable	466,534	393,617
Accrued liabilities ($142,587 and $66,184 related parties, respectively)	609,765	258,238
Convertible debentures ($89,549 and $144,362 related parties, respectively)	311,606	351,829
Derivative liabilities	40,286,681	29,430,719
Loans payable ($48,000 and $27,000 related parties, respectively)	171,500	115,500
Total Current Liabilities	41,846,086	30,549,903
Loans Payable ($525,000 and $0 related parties, respectively)	525,000
Total Liabilities	42,371,086	30,549,903
Commitments
Stockholders' Deficiency
Preferred Stock, 3,550,000 shares authorized, par value $0.01; No shares issued and outstanding at September 30, 2014 and December 31, 2013
Common Stock, 500,000,000 shares authorized, $0.01 par value; 77,727,669 shares issued and outstanding at September 30, 2014 and December 31, 2013	777,276	777,276
Common Stock Reserved for Future Issuance	145,886	129,881
Additional Paid-in Capital	54,757,845	54,757,845
Accumulated Deficit	-97,204,472	-85,203,969
Total Deficit	-41,523,465	-29,538,967
Treasury Stock, at cost - 58,333 shares at September 30, 2014 and December 31, 2013	-773,500	-773,500
Total Stockholders' Deficiency	-42,296,965	-30,312,467
Total Liabilities and Stockholders' Deficiency	$74,121	$237,436

Unaudited_Condensed_Consolidat1

Unaudited Condensed Consolidated Balance Sheets (Parenthetical) (USD $)	Sep. 30, 2014	Dec. 31, 2013
Stockholders' Deficiency
Accrued liabilities - related parties	$142,587	$66,184
Convertible debentures - related parties	89,549	144,362
Loans payable - related parties current (in Dollars)	48,000	27,000
Loans payable - related parties (in Dollars)	$525,000	$0
Preferred Stock, shares authorized	3,550,000	3,550,000
Preferred Stock, par value (in Dollars per share)	$0.01	$0.01
Preferred Stock, shares issued	0	0
Preferred Stock, shares outstanding	0	0
Common Stock, shares authorized	500,000,000	500,000,000
Common Stock, par value (in Dollars per share)	$0.01	$0.01
Common Stock, shares issued	77,727,669	77,727,669
Common Stock, shares outstanding	77,727,669	77,727,669
Treasury Stock - shares	58,333	58,333

Unaudited_Condensed_Consolidat2

Unaudited Condensed Consolidated Statements of Operations (USD $)	3 Months Ended		9 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013
Unaudited Condensed Consolidated Statements Of Operations
Revenue
Operating Expenses
Depreciation	2,406	2,723	7,564	7,845
General and administrative	101,946	157,749	636,900	454,114
Professional fees	22,763	184,877	355,882	3,303,026
Write-down of inventory			125,616
Total Operating Expenses	127,115	345,349	1,125,962	3,764,985
Operating Loss	-127,115	-345,349	-1,125,962	-3,764,985
Other Income (Expense)
Interest expense	-321,844	-182,672	-889,605	-195,843
Change in fair value of derivatives	-1,991,170	-12,083,506	-10,800,605	-12,536,990
Loss on settlement of debt	814,668		814,668
Other income	500	1	1,001	2,985
Total Other Income (Expense)	-1,497,846	-12,266,177	-10,874,541	-12,729,848
Net (Loss)	($1,624,961)	($12,611,526)	($12,000,503)	($16,494,833)
Net (Loss) Per Common Share: - Basic and Diluted	($0.02)	($0.16)	($0.15)	($0.22)
Basic and diluted weighted average common shares outstanding	77,727,669	77,194,000	77,727,669	75,100,600

Unaudited_Condensed_Consolidat3

Unaudited Condensed Consolidated Statements of Cash Flows (USD $)	9 Months Ended
	Sep. 30, 2014	Sep. 30, 2013
Operating Activities
Net (loss)	($12,000,503)	($16,494,833)
Adjustments to reconcile net loss to cash used in operating activities:
Depreciation	7,564	7,845
Accretion expense	777,196	171,250
Change in fair value of derivative	10,800,605	12,536,990
Loss on settlement of debt	-814,668
Warrants issued for consulting services		2,599,801
Write down of inventory	125,616
Shares issuable for interest expense	16,005	6,398
Changes in operating assets and liabilities:
Inventory	-25,790
Prepaid expenses and deposits	14,660	-24,735
Accounts payable and accrued liabilities	478,050	520,292
Net Cash Used in Operating Activities	-621,265	-676,992
Investing Activities
Investment in property and equipment		-4,355
Net Cash Used in Investing Activities		-4,355
Financing Activities
Proceeds from issuance of notes payable	608,300
Proceeds from convertible debt		385,000
Proceeds from loan payable		87,000
Repayment of loans	-28,300	-2,000
Proceeds from issuance of common stock		228,500
Net Cash Provided by Financing Activities	580,000	698,500
Increase (Decrease) In Cash	-41,265	17,153
Cash - Beginning of Period	43,044	10,498
Cash - End of Period	1,779	27,651
Non-cash Investing and Financing Activities
Warrants issued to settle debt	53,606	229,942
Common stock issued to settle debt		$21,000

Unaudited_Condensed_Consolidat4

Unaudited Condensed Consolidated Statement of Stockholder's Equity (USD $)	Common Stock	Additional Paid-in Capital	Commom Stock Reserved For Future Issuance	Stock Subscription Receivable	Accumulated Deficit	Treasury Stock	Total
Beginning Balance at Dec. 31, 2012	$672,743	$51,337,434	$114,303	($1,000)	($53,096,829)	($773,500)	($1,746,849)
Beginning Balance, Shares at Dec. 31, 2012	67,757,669
Shares issued upon conversion of warrants	50,000	3,202,278					3,252,278
Shares issued upon conversion of warrants, Shares	5,000,000
Subscriptions received				1,000			1,000
Cancellation of shares issued in error, Shares	-483,333
Shares issued to settle debt	9,533	38,133					47,666
Shares issued to settle debt, Shares	953,333
Shares issuable in payment of accrued interest			15,578				15,578
Shares issued for cash	45,000	180,000					225,000
Shares issued for cash, Shares	4,500,000
Net (loss)					-32,107,140		-32,107,140
Ending Balance at Dec. 31, 2013	777,276	54,757,845	129,881		-85,203,969	-773,500	-30,312,467
Ending Balance, Shares at Dec. 31, 2013	77,727,669
Shares issuable in payment of accrued interest			16,005				16,005
Net (loss)					-12,000,503		-12,000,503
Ending Balance at Sep. 30, 2014	$777,276	$54,757,845	$145,886		($97,204,472)	($773,500)	($42,296,965)
Ending Balance, Shares at Sep. 30, 2014	77,727,669

1_Summary_of_Business_and_Basi

1. Summary of Business and Basis of Presentation	9 Months Ended
	Sep. 30, 2014
Notes to Financial Statements
Summary of Business and Basis of Presentation	Organization and Business
	US Highland, Inc. was originally formed as a Limited Liability Company on February 5, 1999 under the name The Powerhouse, L.L.C. pursuant to the laws of the State of Oklahoma. On November 9, 2006, Powerhouse Productions, L.L.C. filed Articles of Conversion changing the entity from a limited liability company to a corporation under the name Harcom Productions, Inc. On January 25, 2010, Articles of Merger were filed with the state of Oklahoma merging U.S. Highland, Inc., an Oklahoma corporation into Harcom Productions, Inc. and the name of the corporation was changed to US Highland, Inc. US Highland, Inc. (the “Company”) is a recreational power sports Original Equipment Manufacturer (“OEM”), developing motorcycles, quads, single cylinder engines, and v-twin engines under its own brand and for other OEMs.
	Basis of Presentation
	The Company’s condensed consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States. These consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary, US Highlands Electric Inc. All significant intercompany transactions and balances have been eliminated.
	The unaudited condensed consolidated financial statements have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) and reflect all adjustments (consisting of normal recurring adjustments unless otherwise indicated) which, in the opinion of management, are necessary for a fair presentation of the results for the interim periods presented. Certain prior year amounts have been reclassified to conform to current year presentation.
	Certain information in footnote disclosures normally included in the financial statements were prepared in conformity with accounting principles generally accepted in the United States of America and have been condensed or omitted pursuant to such principles and the financial results for the periods presented may not be indicative of the full year’s results. The Company believes the disclosures are adequate to make the information presented not misleading.
	These financial statements should be read in conjunction with the Company’s audited financial statements and the notes thereto for the fiscal year ended December 31, 2013 included in the Company’s Annual Report on Form 10K filed on May 6, 2014 (the “2013 Annual Report”).
	Significant Accounting Policies
	There have been no material changes in the Company’s significant accounting policies to those previously disclosed in the 2013 Annual Report.
	Going concern
	The accompanying condensed consolidated financial statements have been prepared in conformity with generally accepted accounting principles which contemplate continuation of the Company as a going-concern basis. The going concern basis assumes that assets are realized and liabilities are extinguished in the ordinary course of business at amounts disclosed in the consolidated financial statements. The Company has incurred recurring losses from operations, and as of September 30, 2014, current liabilities exceed current assets by $41,800,434, and the Company has an accumulated deficit of $97,204,472. The Company’s ability to continue as a going concern depends upon its ability to obtain adequate funding to support its operations through continuing investments of debt and/or equity by qualified investors/creditors, and internally generated working capital. These factors raise substantial doubt about the Company’s ability to continue as a going concern. These consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.
	Earnings (Loss) Per Share
	Basic earnings (loss) per share is calculated by dividing net profit attributable to common stockholders by the weighted average number of outstanding common shares during the year. The calculation of basic earnings (loss) per share excludes any dilutive effects of options, warrants and other stock-based compensation, which are included in diluted earnings per share. When a company is in a loss situation, all outstanding dilutive shares are excluded from the calculation of diluted earnings because their inclusion would be antidilutive; and the basic and fully diluted common shares outstanding are stated to be the same. At September 30, 2014 and 2013, approximately 91,886,000 and 51,090,000 shares, respectively, underlying the convertible debentures and warrants were antidilutive.

2_Inventory

2. Inventory	9 Months Ended
	Sep. 30, 2014
Notes to Financial Statements
Inventory	Inventory is stated at the lower of cost or market, utilizing the specific lot identification method. At December 31, 2013, inventory consisted of raw materials. During the nine months ended September 30, 2014, the Company recorded an inventory write-down of $125,616 to reduce inventory to its net realizable value of $0.

3_Property_and_Equipment

3. Property and Equipment	9 Months Ended
	Sep. 30, 2014
Notes to Financial Statements
Property and Equipment	Property and equipment consists of the following:
		Useful	September 30,			December 31,
		Life	2014			2013
	Computers and office equipment	3 years	$	15,930		$	15,930
	Manufacturing equipment	5 - 10 years		28,408			28,408
				44,338			44,338
	Accumulated depreciation			(27,347	)		(19,783	)
	Property and equipment, net		$	16,991		$	24,555
	Depreciation expense amounted to approximately $7,564 and $7,845 for the nine months ended September 30, 2014 and 2013, respectively.

4_Loans_Payable

4. Loans Payable	9 Months Ended
	Sep. 30, 2014
Notes to Financial Statements
Loans Payable	Loans payable consist of the following:		September 30,			December 31,
			2014			2013
	a)	Loans payable that are unsecured, non-guaranteed, past due and are non-interest bearing.	$	25,000		$	25,000
	b)	Note payable which is unsecured, non-guaranteed, past due and bears interest at 10% per annum.		7,500			7,500
	c)	On January 15, 2011, the Company entered into 8 unsecured, non-guaranteed, loan agreements pursuant to which the Company received proceeds of $56,000. If the loans were not repaid within 90 days they then bear interest at 1% per month. In addition, if the loan was not repaid within 90 days, the Company is required to issue 167 common shares every month until the loan is repaid in full. As at September 30, 2014, the Company recognized the fair value of 7,000 (December 31, 2013 – 5,500) common shares issuable for interest expense of $124,537 (December 31, 2013 - $120,282), as shares reserved for future issuance. The Company has not yet issued these common shares. As at September 30, 2014, the Company has also accrued interest expense of $24,920 (December 31, 2013 - $19,880).		56,000			56,000
	d)	On May 30, 2013 and August 12, 2013, the Company received advances from a director for $2,000 and $25,000, respectively. On August 12, 2013, the Company entered into an unsecured, non-guaranteed, demand loan agreement with the director for $27,000. The loan bears interest at 1% per annum compounded monthly. In addition, the Company is required to issue 5,000 common shares every month until the loan is repaid in full. As of September 30, 2014, the Company recognized the fair value of 65,000 (December 31, 2013 - 20,000) common shares issuable for interest expense of $21,350 (December 31, 2013 - $9,600), as shares reserved for future issuance. The Company has not yet issued these common shares. As at September 30, 2014, the Company has also accrued interest expense of $317 (December 31, 2013 - $125).		27,000			27,000
	e)	On February 27, 2014, May 9 2014, and July 11, 2014 the Company received advances from a director of $6,000, $3,300 and $9,000, respectively. The Company repaid $3,300 on June 12, 2014 and $9,000 on July 28, 2014. The outstanding amount is unsecured, due on demand and bears interest at 1% per annum compounded and calculated monthly.		6,000			–
	f)	On September 18, 2014, the Company entered into an unsecured, non-guaranteed, loan agreement pursuant to which the Company received proceeds of $35,000. The loan bears interest at 8% per annum compounded annually and is due 1 year after the date of issuance.		35,000			–
	g)	On August 26, 2014, the Company issued an unsecured $15,000 note payable to a significant shareholder. The note bears interest at an annual rate of 8% per annum, is uncollateralized, and due 1 year after the date of issuance.		15,000			–
	The Company issued the following unsecured notes payable to a significant shareholder. The notes bear interest at an annual rate of 8% per annum, are uncollateralized, and are due 2 years after the date of issuance:
	a)	On January 17, 2014, the Company issued a $50,000 note payable.		50,000			–
	b)	On January 29, 2014 the Company issued a $50,000 note payable.		50,000			–
	c)	On February 19, 2014, the Company issued a $25,000 note payable.		25,000			–
	d)	On March 3, 2014, the Company issued a $50,000 note payable.		50,000			–
	e)	On March 19, 2014, the Company issued a $150,000 note payable.		150,000			–
	f)	On April 25, 2014, the Company issued a $25,000 note payable.		25,000			–
	g)	On May 19, 2014, the Company issued a $25,000 note payable.		25,000			–
	h)	On June 2, 2014, the Company issued an $18,000 note payable.		18,000			–
	i)	On June 12, 2014, the Company issued a $32,000 note payable.		32,000			–
	j)	On July 1, 2014, the Company issued a $25,000 note payable.		25,000			–
	k)	On July 16, 2014, the Company issued a $75,000 note payable to a related party. On July 23, the note holder assigned the note to a related party.		75,000			–
		Total	$	696,500		$	115,500
		Less Short Term		(171,500	)		(115,500	)
		Long Term	$	525,000		$	–

5_Convertible_Debentures

5. Convertible Debentures	9 Months Ended
	Sep. 30, 2014
Notes to Financial Statements
Convertible Debentures		a)	Effective January 25, 2010, the Company issued a convertible note for $225,000. Pursuant to the terms of the agreement, the loan was unsecured, non-interest bearing, and was due on December 21, 2010. The note was convertible into shares of the Company’s common stock at any time at a variable conversion price equal to 65% of the average of the closing bid prices of the common stock during the 28 trading days prior to the date of the conversion notice and was subject to adjustment upon the issuance of certain dilutive instruments. Due to these provisions, the embedded conversion option qualified for derivative accounting and bifurcation under ASC 815-15 Derivatives and Hedging. The initial fair value of the derivative liability of $538,249 resulted in a full discount to the note payable of $225,000 and the recognition of a loss on derivatives of $313,249.
			On June 2, 2010, the Company issued 6,386 restricted shares of common stock upon the conversion of the principal amount of $166,667. The fair value of the derivative liability at June 2, 2010, was $266,425 and $197,352 was reclassified to additional paid-in capital upon conversion. During the year ended December 31, 2013, the Company repaid $2,000 of the note and during the nine months ended September 30, 2014, the Company repaid an additional $1,000. At September 30, 2014, the carrying value of the note was $55,333 (December 31, 2013 - $56,333). The note is in default at September 30, 2014.
		b)	Effective July 25, 2013, the Company issued a convertible note to secure a demand loan of $75,000. Pursuant to the terms of the agreement, the loan is unsecured and convertible into shares of the Company’s common stock at any time at a price of $0.035. The note bears interest at 8% per annum compounded monthly, and is due on demand.
			The embedded conversion option qualifies for derivative accounting and bifurcation under ASC 815-15 Derivatives and Hedging. The initial fair value of the conversion feature of $577,797 resulted in a discount to the note payable of $75,000 and the recognition of a loss on derivatives of $502,797. As the note is due on demand the entire discount was recorded as interest expense on July 25, 2013.
		c)	Effective July 25, 2013, the Company issued a convertible note to secure the demand loan of $45,000. Pursuant to the terms of the agreement, the loan is unsecured and convertible into shares of the Company’s common stock at any time at a price of $0.035. The note bears interest at 8% per annum compounded monthly, and is due on demand.
			The embedded conversion option qualifies for derivative accounting and bifurcation under ASC 815-15 Derivatives and Hedging. The initial fair value of the conversion feature of $346,678 resulted in a discount to the note payable of $45,000 and the recognition of a loss on derivatives of $301,678. As the note is due on demand the entire discount was recorded as interest expense on July 25, 2013.
		d)	On July 25, 2013, the Company issued a convertible note for up to $500,000 and warrants to purchase 12,500,000 underlying shares of the Company’s common stock. The warrants are exercisable into 10,000,000 common shares of the Company at $0.05 per share and 2,500,000 shares at an exercise price of $0.10 per share until July 31, 2014. During the year ended December 31, 2013, the Company received proceeds of $500,000 under the note. The note bears interest at 8% per annum compounded monthly, and principal and interest are due on July 31, 2014. In addition, so long as any amounts are due hereunder, the Company is obligated to remit to the lender 100% of all revenues, payments and receivables from the sale of the first 50 engines sold by the Company. The note is secured against substantially all of the assets of the Company.
			The note may be prepaid by the Company without penalty with 30 days prior notice. The note is convertible into shares of the Company’s common stock at any time at a conversion price equal to $0.02 per share and is subject to adjustment upon the issuance of certain dilutive instruments and other events. The conversion price was subsequently reduced to $0.01 per share upon the failure to file various reports with the SEC within 120 days of the issuance of the note.
			Due to the potential adjustments to the conversion feature and the inability to conclude that the Company has enough unissued-authorized common shares to settle the warrants, the embedded conversion option and the warrants qualify for derivative accounting and bifurcation under ASC 815-15 Derivatives and Hedging. The initial fair value of the conversion feature of $6,714,279 and warrants of $3,169,531 resulted in a discount to the note payable of $500,000 and the recognition of a loss on derivatives of $9,383,810.
			On July 24, 2014, the Company and the note holder agreed to extend the maturity date to December 31, 2014 and increase the interest rate to 12% starting on August 1, 2014. The Company accounted for the modification in accordance with ASC 405-20 and ASC 470-50-40. As the present value of the future cash flows was more than 10% different than the cash flows of the original debt, it was determined that the original and new debt instruments are substantially different and the Company treated the original convertible note extinguished and exchanged for a new convertible note. The Company recorded a loss on extinguishment of debt of $474,668. The Company also recognized the fair value of the embedded conversion feature of $24,501,757 as a derivative liability and reduced the value of the convertible loan to $nil. The fair value of the derivative liability was $22,000,404 at September 30, 2014. During the nine months ended September 30, 2014, the Company recorded total accretion of $437,350 and at September 30, 2014 the carrying value of the note was $53,285.
		e)	On July 25, 2013, the Company issued a convertible note for up to $500,000 and warrants to purchase 10,197,916 underlying shares of the Company’s common stock. The warrants are exercisable into 8,158,333 common shares of the Company at $0.05 per share and 2,039,583 shares at an exercise price of $0.10 per share until July 31, 2014. During the year ended December 31, 2013, the Company received proceeds of $273,700 under the note. At November 30, 2013, the Company had determined that no additional funding would be received pursuant to the convertible note. The note bears interest at 8% per annum compounded monthly, and principal and interest are due on July 31, 2014.
			The note may be prepaid by the Company without penalty with 30 days prior notice. The note is convertible into shares of the Company’s common stock at any time at a conversion price equal to $0.02 per share and is subject to adjustment upon the issuance of certain dilutive instruments and other events. The conversion price was subsequently reduced to $0.01 per share upon the failure to file various reports with the SEC within 120 days of the issuance of the note.
			Due to the potential adjustments to the conversion rate of the conversion feature and the inability to conclude that the Company has enough unissued-authorized common shares to settle the warrants, the embedded conversion option and the warrants qualify for derivative accounting and bifurcation under ASC 815-15 Derivatives and Hedging. The initial fair value of the conversion feature of $5,278,978 and warrants of $2,450,519 resulted in a discount to the note payable of $273,700 and the recognition of a loss on derivatives of $7,455,797.
			The note was not repaid on July 31, 2014. On August 4, 2014, the Company and the note holder agreed to extend the maturity date to December 31, 2014 and increase the interest rate to 12% starting on August 1, 2014. The Company accounted for the modification in accordance with ASC 405-20 and ASC 470-50-40. As the present value of the future cash flows was more than 10% different than the cash flows of the original debt, it was determined that the original and new debt instruments are substantially different and the Company treated the original convertible note extinguished and exchanged for a new convertible note. The Company recorded a loss on extinguishment of debt of $273,700. The Company also recognized the fair value of the embedded conversion feature of $13,685,849 as a derivative liability and reduced the value of the convertible loan to $nil.
			The fair value of the derivative liability was $12,043,021 at September 30, 2014. During the nine months ended September 30, 2014, the Company recorded total accretion of $257,956 and at September 30, 2014 the carrying value of the note was $36,264.
		f)	Effective November 12, 2013, the Company issued a convertible note for up to $500,000 and warrants to purchase 694,445 underlying shares of the Company’s common stock. The warrants are exercisable into 555,556 common shares of the Company at $0.05 per share and 138,889 shares at an exercise price of $0.10 per share until July 31, 2014. During the year ended December 31, 2013, the Company received proceeds of $20,000 under the note. At November 30, 2013, the Company had determined that no additional funding would be received pursuant to the convertible note. The note bears interest at 8% per annum compounded monthly, and principal and interest was due on July 31, 2014.
			The note may be prepaid by the Company without penalty with 30 days prior notice. The note is convertible into shares of the Company’s common stock at any time at a conversion price equal to $0.02 per share and is subject to adjustment upon the issuance of certain dilutive instruments and other events. The conversion price was subsequently reduced to $0.01 per share upon the failure to file various reports with the SEC within 120 days of the issuance of the note.
			Due to the potential adjustments to the conversion feature and the inability to conclude that the Company has enough unissued-authorized common shares to settle the warrants, the embedded conversion option and the warrants qualify for derivative accounting and bifurcation under ASC 815-15 Derivatives and Hedging. The initial fair value of the conversion feature of $250,021 and warrants of $145,943 resulted in a discount to the note payable of $20,000 and the recognition of a loss on derivatives of $375,964. During the nine months ended September 30, 2014, the Company recorded accretion of $13,479 increasing the carrying value of the note to $20,000. The note was not repaid on July 31, 2014. The note is in default at September 30, 2014.
		g)	Effective October 7, 2013, the Company issued a convertible note for up to $500,000 and warrants to purchase 868,055 underlying shares of the Company’s common stock. The warrants are exercisable into 694,444 common shares of the Company at $0.05 per share and 173,611 shares at an exercise price of $0.10 per share until July 31, 2014. During the year ended December 31, 2013, the Company received proceeds of $25,000 under the note. At November 30, 2013, the Company had determined that no additional funding would be received pursuant to the convertible note. The note bears interest at 8% per annum compounded monthly, and principal and interest are due on July 31, 2014.
			The note may be prepaid by the Company without penalty with 30 days prior notice. The note is convertible into shares of the Company’s common stock at any time at a conversion price equal to $0.02 per share and is subject to adjustment upon the issuance of certain dilutive instruments and other events. The conversion price was subsequently reduced to $0.01 per share upon the failure to file various reports with the SEC within 120 days of the issuance of the note.
			Due to the potential adjustments to the conversion feature and the inability to conclude that the Company has enough unissued-authorized common shares to settle the warrants, the embedded conversion option and the warrants qualify for derivative accounting and bifurcation under ASC 815-15 Derivatives and Hedging. The initial fair value of the conversion feature of $312,522 and warrants of $182,522 resulted in a discount to the note payable of $25,000 and the recognition of a loss on derivatives of $470,045.
			On July 24, 2014, the Company and the note holder agreed to extend the maturity date to December 31, 2014 and increase the interest rate to 12% starting on August 1, 2014. The Company accounted for the modification in accordance with ASC 405-20 and ASC 470-50-40. As the present value of the future cash flows was more than 10% different than the cash flows of the original debt, it was determined that the original and new debt instruments are substantially different and the Company treated the original convertible note extinguished and exchanged for a new convertible note. The Company recorded a loss on extinguishment of debt of $25,000. The Company also recognized the fair value of the embedded conversion feature of $1,250,082 as a derivative liability and reduced the value of the convertible loan to $nil.
			The fair value of the derivative liability was $1,100,020 at September 30, 2014. During the nine months ended September 30, 2014, the Company recorded total accretion of $26,387 and at September 30, 2014 the carrying value of the note was $9,355.
		h)	On July 25, 2013, the Company issued a convertible note for up to $500,000 and warrants to purchase 739,584 underlying shares of the Company’s common stock. The warrants are exercisable into 591,667 common shares of the Company at $0.05 per share and 147,917 shares at an exercise price of $0.10 per share until July 31, 2014. During the year ended December 31, 2013, the Company received proceeds of $41,300 under the note. At November 30, 2013, the Company had determined that no additional funding would be received pursuant to the convertible note. The note bears interest at 8% per annum compounded monthly, and principal and interest are due on July 31, 2014.
			The note may be prepaid by the Company without penalty with 30 days prior notice. The note is convertible into shares of the Company’s common stock at any time at a conversion price equal to $0.02 per share and is subject to adjustment upon the issuance of certain dilutive instruments and other events. The conversion price was subsequently reduced to $0.01 per share upon the failure to file various reports with the SEC within 120 days of the issuance of the note.
			Due to the potential adjustments to the conversion feature and the inability to conclude that the Company has enough unissued-authorized common shares to settle the warrants, the embedded conversion option and the warrants qualify for derivative accounting and bifurcation under ASC 815-15 Derivatives and Hedging. The initial fair value of the conversion feature of $547,736 and warrants of $187,531, resulted in a discount to the note payable of $41,300 and the recognition of a loss on derivatives of $693,967.
			On August 4, 2014, the Company and the note holder agreed to extend the maturity date to December 31, 2014 and increase the interest rate to 12% starting on August 1, 2014. The Company accounted for the modification in accordance with ASC 405-20 and ASC 470-50-40. As the present value of the future cash flows was more than 10% different than the cash flows of the original debt, it was determined that the original and new debt instruments are substantially different and the Company treated the original convertible note extinguished and exchanged for a new convertible note. The Company recorded a loss on extinguishment of debt of $41,300. The Company also recognized the fair value of the embedded conversion feature of $2,065,135 as a derivative liability and reduced the value of the convertible loan to $nil.
			The fair value of the derivative liability was $1,817,233 at September 30, 2014. During the nine months ended September 30, 2014, the Company recorded total accretion of $42,024 and at September 30, 2014, the carrying value of the note was $17,369.

6_Derivative_Liabilities

6. Derivative Liabilities	9 Months Ended
	Sep. 30, 2014
Notes to Financial Statements
Derivative Liabilities	The embedded conversion options of the Company’s convertible debentures described in Note 5 contain conversion features that qualify for embedded derivative classification. The warrants described in Note 8 also qualify for derivative classification. The fair value of these liabilities will be re-measured at the end of every reporting period and the change in fair value will be reported in the statement of operations as a gain or loss on derivative financial instruments.
	The table below sets forth a summary of changes in the fair value of the Company’s Level 3 financial liabilities:
		September 30,			December 31,
		2014			2013
	Balance at the beginning of period	$	29,430,719		$	941,464
	Addition of new derivative liabilities (embedded conversion options)		–			14,028,014
	Addition of new derivative liabilities (warrants)		53,606			9,209,794
	Change in fair value of warrants		(5,346,878	)		(627,690	)
	Change in fair value of embedded conversion option		16,152,736			9,128,915
	Expiration of warrants		(3,502	)		–
	Conversion of warrants		–			(3,249,778	)
	Balance at the end of the period	$	40,286,681		$	29,430,719
	The following table summarizes the change in fair value of derivatives:
		Change in Fair Value of Derivative Liabilities
		$
	Three months ended September 30, 2014:
	Change in fair value of derivative liabilities during the three months ended September 30, 2014		(1,991,170	)
	Change in fair value of derivatives		(1,991,170	)
	Three months ended September 30, 2013:
	Fair value of derivative liabilities in excess of note proceeds received		(12,412,823	)
	Change in fair value of derivative liabilities during the three months ended September 30, 2013		329,317
	Change in fair value of derivatives		(12,083,506	)
		Change in Fair Value of Derivative Liabilities
		$
	Nine months ended September 30, 2014:
	Change in fair value of derivative liabilities during the nine months ended September 30, 2014		(10,800,605	)
	Change in fair value of derivatives		(10,800,605	)
	Nine months ended September 30, 2013:
	Fair value of derivative liabilities in excess of note proceeds received		(12,412,823	)
	Change in fair value of derivative liabilities during the nine months ended September 30, 2013		(124,167	)
	Change in fair value of derivatives		(12,536,990	)
	The Company uses Level 3 inputs for its valuation methodology for the warrant derivative liabilities and embedded conversion option liabilities as their fair values were determined by using the Black-Scholes option pricing model based on various assumptions. The model incorporates the price of a share of the Company’s common stock (as quoted on the Over the Counter Bulletin Board), volatility, risk free rate, dividend rate and estimated life. Significant changes in any of these inputs in isolation would result in a significant change in the fair value measurement. As required, these are classified based on the lowest level of input that is significant to the fair value measurement. The following table shows the assumptions used in the calculations:
		Expected			Risk-free Interest Rate			Expected Dividend Yield			Expected Life (in years)
		Volatility
	At December 31, 2013		29% -209%			0.10%-0.58%			0	%		0.58-3.00
	At issuance		209%			0.38%			0	%		3
	At September 30, 2014		117%-228%			0.02%-0.58%			0	%		0.17-2.26

7_Common_Stock

7. Common Stock	9 Months Ended
	Sep. 30, 2014
Notes to Financial Statements
Common Stock	There were no share transactions during the nine months ended September 30, 2014.

8_Stock_Purchase_Warrants

8. Stock Purchase Warrants	9 Months Ended
	Sep. 30, 2014
Notes to Financial Statements
Stock Purchase Warrants		a)	On January 2, 2014, the Company entered into a settlement agreement with a consultant to settle $11,800 of services provided in 2012. Pursuant to the agreement, the Company issued a warrant to purchase 43,750 shares of common stock at $0.0005 per share for three years.
		b)	On January 3, 2014, the Company entered into a settlement agreement with a consultant to settle $41,806 of services provided in 2012. Pursuant to the agreement, the Company issued a warrant to purchase 155,000 shares of common stock at $0.0005 per share for three years.
			A summary of the changes in the Company’s common share purchase warrants is presented below:
			Number			Weighted Average Exercise Price		Weighted Average Remaining Term
	Balance December 31, 2013			27,214,166		$	0.08	0.70 years
	Issued			198,750			0.0005
	Expired			(25,133,333	)		0.0677
	Balance September 30, 2014			2,279,583		$	0.17	1.34 years

9_Commitments_and_Contingencie

9. Commitments and Contingencies	9 Months Ended
	Sep. 30, 2014
Notes to Financial Statements
Commitments		a)	The Company entered into a consulting agreement dated September 20, 2011 with a director of the Company for services to be provided for a term of three years. The Company agreed to pay $2,250 per month, as well as issue 16,667 shares of common stock. The agreement was subsequently suspended. During the nine months ended September 30, 2014, the Company recorded $nil (2013 - $10,000) of professional fees.
		b)	During the year ended December 31, 2012, the Company entered into two leases for the provision of office and warehouse space until April 30, 2015. On April 1, 2013, the Company entered into an amendment to the lease agreements. Pursuant to the amendment, one of the leases was terminated and the other was extended to March 31, 2019. During the nine months ended September 30, 2014, the Company recognized $46,454 (2013 - $37,203) of rent expense. The Company’s future minimum lease payments are as follows:
	Twelve months ending September 30, 2015		$	53,147
	Twelve months ending September 30, 2016			55,140
	Twelve months ending September 30, 2017			57,133
	Twelve months ending September 30, 2018			59,126
	Twelve months ending September 30, 2019			30,223
			$	254,769
		c)	The Company issued a $500,000 convertible note on July 25, 2013, of which so long as any amounts are due hereunder, the Company is obligated to remit to the lender 100% of all revenues, payments and receivables from the sale of the first 50 engines sold by the Company.
		d)	On May 13, 2014, the Company terminated the former CEO and President of the Company’s employment agreement in accordance with its terms. Also on May 13, 2014, the Company terminated an employment agreement with an employee in accordance with its terms.
		e)	On June 17, 2014, the Company was informed that a debtor will be instituting legal proceedings against the Company for collection of the sum of $76,712. The Company believes it owes the debtor $9,986 which it has recorded as owing. Accordingly, the Company intends to defend these potential matters vigorously.
		f)	On June 26, 2014, the Company was informed that a debtor will be instituting legal proceedings against the Company for collection of the sum of $17,534. The Company believes it owes the debtor $11,705 which it has recorded as owing. Accordingly, the Company intends to defend these potential matters vigorously.
		g)	On December 16, 2013, the Company was informed that a vendor will be instituting legal proceedings against the Company for collection of the sum of $12,455. The Company believes it does not owe the vendor anything. Accordingly, the Company intends to defend these potential matters vigorously.
		h)	On July 8, 2014, the Company filed civil actions against the former CEO and President, and against a former employee of the Company. The petitions allege they breached the terms and conditions of their employment agreements with the Company, converted property belonging to the Company, and filed false and wrongful claims with the Oklahoma Department of Labor. Neither former employee has filed answers to the petitions, although the Company expects them to do so and to file counterclaims against the Company. On August 7, 2014, the Oklahoma Department of Labor entered an Administrative Order of Determination in favor of the former CEO and President of the Company in the amount of $72,000 and liquidated damages of $72,000; and also entered an Administrative Order of Determination in favor of the former employee in the amount of $54,000 and liquidated damages of $54,000. The Company has requested a rehearing, re-opening and reconsideration of the administrative orders with the Oklahoma Department of Labor. At September 30, 2014, the Company had accrued a total of $252,000 pursuant to the Administrative Order of Determination.
		i)	On August 8, 2014, the Company entered into an employment agreement with an existing employee.  Pursuant to the agreement the employee will act as the Interim CFO and Secretary of the Company for an initial period of six months in consideration for $1,200 per month in addition to the employee’s current salary structure of $60,000 per year.

10_Subsequent_Events

10. Subsequent Events	9 Months Ended
	Sep. 30, 2014
Notes to Financial Statements
Subsequent Events		a)	On October 7, 2014, the Company received an advance from a director of $7,000. The outstanding amount is unsecured, due on demand and bears interest at 1% per annum compounded and calculated monthly. The loan was repaid on October 8, 2014.
		b)	On October 7, 2014, the Company entered into a note payable with a related party, pursuant to which the Company received proceeds of $30,000. The note is bears interest at an annual rate of 8% per annum and due on October 7, 2016.
		c)	On October 31, 2014, the Company entered into a note payable with a related party, pursuant to which the Company received proceeds of $20,000. The note is bears interest at an annual rate of 8% per annum and due on October 31, 2016.
		d)	On November 4, 2014, the Company entered into a note payable with a related party, pursuant to which the Company received proceeds of $32,000. The note is bears interest at an annual rate of 8% per annum and due on November 4, 2016.
		e)	The Company failed to repay the convertible notes described in Notes 5(d), (e), (g) and (h) when they became due on December 31, 2014. The Company is attempting to negotiate a further extension.

1_Summary_of_Business_and_Basi1

1 . Summary of Business and Basis of Presentation (Policies)	9 Months Ended
	Sep. 30, 2014
Summary Of Business And Basis Of Presentation Policies
Organization and Business	US Highland, Inc. was originally formed as a Limited Liability Company on February 5, 1999 under the name The Powerhouse, L.L.C. pursuant to the laws of the State of Oklahoma. On November 9, 2006, Powerhouse Productions, L.L.C. filed Articles of Conversion changing the entity from a limited liability company to a corporation under the name Harcom Productions, Inc. On January 25, 2010, Articles of Merger were filed with the state of Oklahoma merging U.S. Highland, Inc., an Oklahoma corporation into Harcom Productions, Inc. and the name of the corporation was changed to US Highland, Inc. US Highland, Inc. (the “Company”) is a recreational power sports Original Equipment Manufacturer (“OEM”), developing motorcycles, quads, single cylinder engines, and v-twin engines under its own brand and for other OEMs.
Basis of Presentation	The Company’s condensed consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States. These consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary, US Highlands Electric Inc. All significant intercompany transactions and balances have been eliminated.
	The unaudited condensed consolidated financial statements have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) and reflect all adjustments (consisting of normal recurring adjustments unless otherwise indicated) which, in the opinion of management, are necessary for a fair presentation of the results for the interim periods presented. Certain prior year amounts have been reclassified to conform to current year presentation.
	Certain information in footnote disclosures normally included in the financial statements were prepared in conformity with accounting principles generally accepted in the United States of America and have been condensed or omitted pursuant to such principles and the financial results for the periods presented may not be indicative of the full year’s results. The Company believes the disclosures are adequate to make the information presented not misleading.
	These financial statements should be read in conjunction with the Company’s audited financial statements and the notes thereto for the fiscal year ended December 31, 2013 included in the Company’s Annual Report on Form 10K filed on May 6, 2014 (the “2013 Annual Report”).
Significant Accounting Policies	There have been no material changes in the Company’s significant accounting policies to those previously disclosed in the 2013 Annual Report.
Going concern	The accompanying condensed consolidated financial statements have been prepared in conformity with generally accepted accounting principles which contemplate continuation of the Company as a going-concern basis. The going concern basis assumes that assets are realized and liabilities are extinguished in the ordinary course of business at amounts disclosed in the consolidated financial statements. The Company has incurred recurring losses from operations, and as of September 30, 2014, current liabilities exceed current assets by $41,800,434, and the Company has an accumulated deficit of $97,204,472. The Company’s ability to continue as a going concern depends upon its ability to obtain adequate funding to support its operations through continuing investments of debt and/or equity by qualified investors/creditors, and internally generated working capital. These factors raise substantial doubt about the Company’s ability to continue as a going concern. These consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.
Earnings (Loss) Per Share	Basic earnings (loss) per share is calculated by dividing net profit attributable to common stockholders by the weighted average number of outstanding common shares during the year. The calculation of basic earnings (loss) per share excludes any dilutive effects of options, warrants and other stock-based compensation, which are included in diluted earnings per share. When a company is in a loss situation, all outstanding dilutive shares are excluded from the calculation of diluted earnings because their inclusion would be antidilutive; and the basic and fully diluted common shares outstanding are stated to be the same. At September 30, 2014 and 2013, approximately 91,886,000 and 51,090,000 shares, respectively, underlying the convertible debentures and warrants were antidilutive.

3_Property_and_Equipment_Table

3. Property and Equipment (Tables)	9 Months Ended
	Sep. 30, 2014
Property And Equipment Tables
Property, Plant and Equipment		Useful	September 30,			December 31,
		Life	2014			2013
	Computers and office equipment	3 years	$	15,930		$	15,930
	Manufacturing equipment	5 - 10 years		28,408			28,408
				44,338			44,338
	Accumulated depreciation			(27,347	)		(19,783	)
	Property and equipment, net		$	16,991		$	24,555

4_Loans_Payable_Tables

4. Loans Payable (Tables)	9 Months Ended
	Sep. 30, 2014
Loans Payable Tables
Schedule of Debt			September 30,			December 31,
			2014			2013
	a)	Loans payable that are unsecured, non-guaranteed, past due and are non-interest bearing.	$	25,000		$	25,000
	b)	Note payable which is unsecured, non-guaranteed, past due and bears interest at 10% per annum.		7,500			7,500
	c)	On January 15, 2011, the Company entered into 8 unsecured, non-guaranteed, loan agreements pursuant to which the Company received proceeds of $56,000. If the loans were not repaid within 90 days they then bear interest at 1% per month. In addition, if the loan was not repaid within 90 days, the Company is required to issue 167 common shares every month until the loan is repaid in full. As at September 30, 2014, the Company recognized the fair value of 7,000 (December 31, 2013 – 5,500) common shares issuable for interest expense of $124,537 (December 31, 2013 - $120,282), as shares reserved for future issuance. The Company has not yet issued these common shares. As at September 30, 2014, the Company has also accrued interest expense of $24,920 (December 31, 2013 - $19,880).		56,000			56,000
	d)	On May 30, 2013 and August 12, 2013, the Company received advances from a director for $2,000 and $25,000, respectively. On August 12, 2013, the Company entered into an unsecured, non-guaranteed, demand loan agreement with the director for $27,000. The loan bears interest at 1% per annum compounded monthly. In addition, the Company is required to issue 5,000 common shares every month until the loan is repaid in full. As of September 30, 2014, the Company recognized the fair value of 65,000 (December 31, 2013 - 20,000) common shares issuable for interest expense of $21,350 (December 31, 2013 - $9,600), as shares reserved for future issuance. The Company has not yet issued these common shares. As at September 30, 2014, the Company has also accrued interest expense of $317 (December 31, 2013 - $125).		27,000			27,000
	e)	On February 27, 2014, May 9 2014, and July 11, 2014 the Company received advances from a director of $6,000, $3,300 and $9,000, respectively. The Company repaid $3,300 on June 12, 2014 and $9,000 on July 28, 2014. The outstanding amount is unsecured, due on demand and bears interest at 1% per annum compounded and calculated monthly.		6,000			–
	f)	On September 18, 2014, the Company entered into an unsecured, non-guaranteed, loan agreement pursuant to which the Company received proceeds of $35,000. The loan bears interest at 8% per annum compounded annually and is due 1 year after the date of issuance.		35,000			–
	g)	On August 26, 2014, the Company issued an unsecured $15,000 note payable to a significant shareholder. The note bears interest at an annual rate of 8% per annum, is uncollateralized, and due 1 year after the date of issuance.		15,000			–
	The Company issued the following unsecured notes payable to a significant shareholder. The notes bear interest at an annual rate of 8% per annum, are uncollateralized, and are due 2 years after the date of issuance:
	a)	On January 17, 2014, the Company issued a $50,000 note payable.		50,000			–
	b)	On January 29, 2014 the Company issued a $50,000 note payable.		50,000			–
	c)	On February 19, 2014, the Company issued a $25,000 note payable.		25,000			–
	d)	On March 3, 2014, the Company issued a $50,000 note payable.		50,000			–
	e)	On March 19, 2014, the Company issued a $150,000 note payable.		150,000			–
	f)	On April 25, 2014, the Company issued a $25,000 note payable.		25,000			–
	g)	On May 19, 2014, the Company issued a $25,000 note payable.		25,000			–
	h)	On June 2, 2014, the Company issued an $18,000 note payable.		18,000			–
	i)	On June 12, 2014, the Company issued a $32,000 note payable.		32,000			–
	j)	On July 1, 2014, the Company issued a $25,000 note payable.		25,000			–
	k)	On July 16, 2014, the Company issued a $75,000 note payable to a related party. On July 23, the note holder assigned the note to a related party.		75,000			–
		Total	$	696,500		$	115,500
		Less Short Term		(171,500	)		(115,500	)
		Long Term	$	525,000		$	–

6_Derivative_Liabilities_Table

6. Derivative Liabilities (Tables)	9 Months Ended
	Sep. 30, 2014
Derivative Liabilities Tables
Schedule of Derivative Instruments		September 30,			December 31,
		2014			2013
	Balance at the beginning of period	$	29,430,719		$	941,464
	Addition of new derivative liabilities (embedded conversion options)		–			14,028,014
	Addition of new derivative liabilities (warrants)		53,606			9,209,794
	Change in fair value of warrants		(5,346,878	)		(627,690
	Change in fair value of embedded conversion option		16,152,736			9,128,915
	Expiration of warrants		(3,502	)		–
	Conversion of warrants		–			(3,249,778
	Balance at the end of the period	$	40,286,681		$	29,430,719
Fair Value, by Balance Sheet Grouping		Change in Fair Value of Derivative Liabilities
		$
	Three months ended September 30, 2014:
	Change in fair value of derivative liabilities during the three months ended September 30, 2014		(1,991,170	)
	Change in fair value of derivatives		(1,991,170	)
	Three months ended September 30, 2013:
	Fair value of derivative liabilities in excess of note proceeds received		(12,412,823	)
	Change in fair value of derivative liabilities during the three months ended September 30, 2013		329,317
	Change in fair value of derivatives		(12,083,506	)
		Change in Fair Value of Derivative Liabilities
		$
	Nine months ended September 30, 2014:
	Change in fair value of derivative liabilities during the nine months ended September 30, 2014		(10,800,605	)
	Change in fair value of derivatives		(10,800,605	)
	Nine months ended September 30, 2013:
	Fair value of derivative liabilities in excess of note proceeds received		(12,412,823	)
	Change in fair value of derivative liabilities during the nine months ended September 30, 2013		(124,167	)
	Change in fair value of derivatives		(12,536,990	)
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions		Expected			Risk-free Interest Rate		Expected Dividend Yield			Expected Life (in years)
		Volatility
	At December 31, 2013		29% - 209%			0.10%-0.58%		0	%		0.58-3.00
	At issuance		209%			0.38%		0	%		3
	At September 30, 2014		117%-228%			0.02%-0.58%		0	%		0.17-2.26

8_Stock_Purchase_Warrants_Tabl

8. Stock Purchase Warrants (Tables)	9 Months Ended
	Sep. 30, 2014
Stock Purchase Warrants Tables
Schedule of Share-based Compensation, Stock Options and Stock Appreciation Rights Award Activity		Number			Weighted Average Exercise Price		Weighted Average Remaining Term
	Balance December 31, 2013		27,214,166		$	0.08	0.70 years
	Issued		198,750			0.0005
	Expired		(25,133,333	)		0.0677
	Balance September 30, 2014		2,279,583		$	0.17	1.34 years

9_Commitments_and_Contingencie1

9. Commitments and Contingencies (Tables)	9 Months Ended
	Sep. 30, 2014
Commitments And Contingencies Tables
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense	Twelve months ending September 30, 2015	$	53,147
	Twelve months ending September 30, 2016		55,140
	Twelve months ending September 30, 2017		57,133
	Twelve months ending September 30, 2018		59,126
	Twelve months ending September 30, 2019		30,223
		$	254,769

1_Summary_of_Business_and_Basi2

1. Summary of Business and Basis of Presentation (Details Narrative) (USD $)	9 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Dec. 31, 2013
Summary Of Business And Basis Of Presentation Details Narrative
Current liabilities exceed current assets	$41,800,434
Accumulated deficit	$97,204,472		$85,203,969
Antidilutive convertible debentures and warrants	91,886,000	51,090,000

2_Inventory_Details_Narrative

2. Inventory (Details Narrative) (USD $)	9 Months Ended
	Sep. 30, 2014	Sep. 30, 2013
Inventory Details Narrative
Write down of inventory	$125,616

3_Property_and_Equipment_Detai

3. Property and Equipment (Details) (USD $)	9 Months Ended
	Sep. 30, 2014	Dec. 31, 2013
Computers and office equipment	15,930	$15,930
Manufacturing equipment	28,408	28,408
Property and Equipment Gross	44,338	44,338
Accumulated depreciation	-27,347	-19,783
Property and equipment, net	16,991	$24,555
Computers and office equipment
Property, Plant and Equipment, Useful Life	3 years
Manufacturing equipment [Member] | Minimum [Member]
Property, Plant and Equipment, Useful Life	5 years
Manufacturing equipment [Member] | Maximum [Member]
Property, Plant and Equipment, Useful Life	10 years

3_Property_and_Equipment_Detai1

3. Property and Equipment (Details Narrative) (USD $)	9 Months Ended
	Sep. 30, 2014	Sep. 30, 2013
Property And Equipment Details Narrative
Depreciation, Depletion and Amortization, Nonproduction	$7,564	$7,845

4_Loans_Payable_Details

4. Loans Payable (Details) (USD $)	Sep. 30, 2014	Dec. 31, 2013
Loan Payable	$696,500	$115,500
Less Short Term	-171,500	-115,500
Long Term	525,000
Loan 1 [Member]
Loan Payable	25,000	25,000
Loan 2 [Member]
Loan Payable	7,500	7,500
Loan 3 [Member]
Loan Payable	56,000	56,000
Loan 4 [Member]
Loan Payable	27,000	27,000
Loan 5 [Member]
Loan Payable	6,000
Loan 6 [Member]
Loan Payable	35,000
Loan 7 [Member]
Loan Payable	15,000
Loan 8 [Member]
Loan Payable	50,000
Loan 9 [Member]
Loan Payable	50,000
Loan 10 [Member]
Loan Payable	25,000
Loan 11 [Member]
Loan Payable	50,000
Loan 12 [Member]
Loan Payable	150,000
Loan 13 [Member]
Loan Payable	25,000
Loan 14 [Member]
Loan Payable	25,000
Loan 15 [Member]
Loan Payable	18,000
Loan 16 [Member]
Loan Payable	32,000
Loan 17 [Member]
Loan Payable	25,000
Loan 18 [Member]
Loan Payable	$75,000

5_Convertible_Debentures_Detai

5. Convertible Debentures (Details Narrative) (USD $)	9 Months Ended		12 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Dec. 31, 2013	Dec. 31, 2013
Repayments of Notes Payable	$1,000		$2,000
Debt Instrument, Face Amount	55,333		56,333	56,333
Accretion Expense	777,196	171,250
Conversion option warrants [Member]
Company received proceeds under the note				500,000
Fair value of the derivative liability	22,000,404
Accretion Expense	437,350
Increasing the carrying value of the note	53,285
Conversion option warrants one [Member]
Company received proceeds under the note				273,700
Fair value of the derivative liability	12,043,021
Accretion Expense	257,956
Increasing the carrying value of the note	36,264
Conversion option warrants two [Member]
Company received proceeds under the note				20,000
Fair value of the derivative liability
Accretion Expense	13,479
Increasing the carrying value of the note	20,000
Conversion option warrants three [Member]
Company received proceeds under the note				25,000
Fair value of the derivative liability	1,100,020
Accretion Expense	26,387
Increasing the carrying value of the note	9,355
Conversion option warrants four [Member]
Company received proceeds under the note				41,300
Fair value of the derivative liability	1,817,233
Accretion Expense	42,024
Increasing the carrying value of the note	$17,369

6_Derivative_Liabilities_Detai

6. Derivative Liabilities (Details) (USD $)	9 Months Ended	12 Months Ended
	Sep. 30, 2014	Dec. 31, 2013
Derivative Liabilities Details
Balance at the beginning of period	$29,430,719	$941,464
Addition of new derivative liabilities (embedded conversion options)		14,028,014
Addition of new derivative liabilities (warrants)	53,606	9,209,794
Change in fair value of warrants	-5,346,878	-627,690
Change in fair value of embedded conversion option	16,152,736	9,128,915
Expiration of warrants	-3,502
Conversion of warrants		-3,249,778
Balance at the end of the period	$40,286,681	$29,430,719

6_Derivative_Liabilities_Detai1

6. Derivative Liabilities (Details 1) (USD $)	3 Months Ended		9 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013
Derivative Liabilities Details 1
Fair value of derivative liabilities in excess of note proceeds received		($12,412,823)		($12,412,823)
Change in fair value of derivative liabilities	-1,991,170	329,317	-10,800,605	-124,167
Change in fair value of derivatives	($1,991,170)	($12,083,506)	($10,800,605)	($12,536,990)

6_Derivative_Liabilities_Detai2

6. Derivative Liabilities (Details 2)	9 Months Ended	12 Months Ended
	Sep. 30, 2014	Dec. 31, 2013
Expected Volatility	209.00%
Risk-free Interest Rate	0.38%
Expected Dividend Yield	0.00%
Expected Life (in years)	3 years
Minimum [Member]
Expected Volatility	117.00%	29.00%
Risk-free Interest Rate	0.02%	0.10%
Expected Dividend Yield	0.00%	0.00%
Expected Life (in years)	29 days	6 months 29 days
Maximum [Member]
Expected Volatility	228.00%	209.00%
Risk-free Interest Rate	0.58%	0.58%
Expected Dividend Yield	0.00%	0.00%
Expected Life (in years)	2 years 6 months 4 days	3 years

8_Stock_Purchase_Warrants_Deta

8. Stock Purchase Warrants (Details) (USD $)	9 Months Ended
	Sep. 30, 2013
Stock Purchase Warrants Details
Number Beginning Balance	27,214,166
Issued	198,750
Expired	-25,133,333
Number Ending Balance	2,279,583
Weighted Average Exercise Price Beginning Balance	$0.08
Issued	$0.00
Expired	$0.07
Weighted Average Exercise Price Ending Balance	$0.17
Weighted Average Remaining Term Beginning Balance	8 months 12 days
Weighted Average Remaining Term Ending Balance	1 year 4 months 2 days

9_Commitments_Details

9. Commitments (Details) (USD $)	Sep. 30, 2014
Commitments Details
Twelve months ending September 30, 2015	$53,147
Twelve months ending September 30, 2016	55,140
Twelve months ending September 30, 2017	57,133
Twelve months ending September 30, 2018	59,126
Twelve months ending September 30, 2019	30,223
Total	$254,769

9_Commitments_Details_Narrativ

9. Commitments (Details Narrative) (Employment Contracts [Member], USD $)	9 Months Ended
	Sep. 30, 2014	Sep. 30, 2013
Employment Contracts [Member]
Accrued Professional Fees	$0	$10,000
Rent expense	$46,454	$37,203