Document_And_Entity_Informatio
Document And Entity Information | 9 Months Ended | |
Sep. 30, 2013 | Nov. 15, 2013 | |
Document and Entity Information [Abstract] | ' | ' |
Entity Registrant Name | 'CYCLONE POWER TECHNOLOGIES INC | ' |
Document Type | '10-Q | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Common Stock, Shares Outstanding | ' | 260,318,627 |
Amendment Flag | 'false | ' |
Entity Central Index Key | '0001442711 | ' |
Entity Current Reporting Status | 'Yes | ' |
Entity Voluntary Filers | 'No | ' |
Entity Filer Category | 'Smaller Reporting Company | ' |
Entity Well-known Seasoned Issuer | 'No | ' |
Document Period End Date | 30-Sep-13 | ' |
Document Fiscal Year Focus | '2013 | ' |
Document Fiscal Period Focus | 'Q3 | ' |
Condensed_Consolidated_Balance
Condensed Consolidated Balance Sheets (Current Period Unaudited) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
CURRENT ASSETS | ' | ' |
Cash | $151,055 | $14,888 |
Inventory, net | 450,623 | 641,306 |
Other current assets | 45,470 | 59,790 |
Total current assets | 647,148 | 715,984 |
PROPERTY AND EQUIPMENT | ' | ' |
Furniture, fixtures, and equipment | 488,261 | 475,669 |
Accumulated depreciation | -119,178 | -99,492 |
Net property and equipment | 369,083 | 376,177 |
OTHER ASSETS | ' | ' |
Patents, trademarks and copyrights | 566,727 | 564,258 |
Accumulated amortization | -186,659 | -157,572 |
Net patents, trademarks and copyrights | 380,068 | 406,686 |
Other assets | 2,560 | 1,360 |
Total other assets | 382,628 | 408,046 |
Total Assets | 1,398,859 | 1,500,207 |
CURRENT LIABILITIES | ' | ' |
Accounts payable and accrued expenses | 447,982 | 360,630 |
Accounts payable and accrued expenses-related parties | 1,900,186 | 1,694,050 |
Notes and other loans payable- net | 954,573 | 666,094 |
Derivative liabilities-notes payable | 106,592 | ' |
Notes and other loans payable-related parties | 765,761 | 727,339 |
Capitalized lease obligations-current portion | 5,192 | 4,541 |
Deferred revenue and license deposits | 416,186 | 626,586 |
Total current liabilities | 4,596,472 | 4,079,240 |
NON CURRENT LIABILITIES | ' | ' |
Capitalized lease obligations-net of current portion | 14,277 | 18,395 |
Total non-current liabilities | 14,277 | 18,395 |
Total Liabilities | 4,610,749 | 4,097,635 |
Commitments and contingencies | ' | ' |
STOCKHOLDERS' DEFICIT | ' | ' |
Common stock, $.0001 par value, 300,000,000 shares authorized, 256,132,329 and 238,889,929 shares issued and outstanding at September 30, 2013 and December 31, 2012, respectively. | 25,613 | 23,889 |
Additional paid-in capital | 47,754,178 | 46,020,972 |
Treasury stock, 3,000,000 shares, at cost | -210,000 | ' |
Prepaid expenses with common stock | -790,910 | -72,505 |
Stock subscription receivable | -6,000 | -6,000 |
Accumulated deficit (inclusive of non-cash derivative losses of $30,821,832 and other losses of $20,011,934 at September 30, 2013 and non-cash derivative losses of $30,774,710 and other losses of $17,948,634 at December 31, 2012) | -50,833,766 | -48,723,344 |
Total stockholders' deficit-Cyclone Power Technologies Inc. | -4,060,885 | -2,756,988 |
Non controlling interest in consolidated subsidiaries | 848,995 | 159,560 |
Total Stockholders' Deficit | -3,211,890 | -2,597,428 |
Total Liabilities and Stockholders' Deficit | 1,398,859 | 1,500,207 |
Series B Preferred Stock [Member] | ' | ' |
STOCKHOLDERS' DEFICIT | ' | ' |
Series B preferred stock, $.0001 par value, 1,000 shares authorized, 1,000 shares issued and outstanding at September 30, 2013 and December 31, 2012, respectively. | 0 | 0 |
Attributable to Non-Cash Derivative Liability Accounting [Member] | ' | ' |
STOCKHOLDERS' DEFICIT | ' | ' |
Accumulated deficit (inclusive of non-cash derivative losses of $30,821,832 and other losses of $20,011,934 at September 30, 2013 and non-cash derivative losses of $30,774,710 and other losses of $17,948,634 at December 31, 2012) | -30,821,832 | -30,774,710 |
Attributable to Operating Losses [Member] | ' | ' |
STOCKHOLDERS' DEFICIT | ' | ' |
Accumulated deficit (inclusive of non-cash derivative losses of $30,821,832 and other losses of $20,011,934 at September 30, 2013 and non-cash derivative losses of $30,774,710 and other losses of $17,948,634 at December 31, 2012) | ($20,011,934) | ($17,948,634) |
Condensed_Consolidated_Balance1
Condensed Consolidated Balance Sheets (Current Period Unaudited) (Parentheticals) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
Common stock, par value (in Dollars per share) | $0.00 | $0.00 |
Common stock, shares authorized | 300,000,000 | 300,000,000 |
Common stock, shares issued | 256,132,329 | 238,889,929 |
Common stock, shares oustanding | 256,132,329 | 238,889,929 |
Treasury stock, shares | 3,000,000 | ' |
Non-cash derivative losses and other losses (in Dollars) | $50,833,766 | $48,723,344 |
Series B Preferred Stock [Member] | ' | ' |
Preferred stock, par value (in Dollars per share) | $0.00 | $0.00 |
Preferred stock, shares authorized | 1,000 | 1,000 |
Preferred stock, shares issued | 1,000 | 1,000 |
Preferred stock, shares outstanding | 1,000 | 1,000 |
Attributable to Non-Cash Derivative Liability Accounting [Member] | ' | ' |
Non-cash derivative losses and other losses (in Dollars) | 30,821,832 | 30,774,710 |
Attributable to Operating Losses [Member] | ' | ' |
Non-cash derivative losses and other losses (in Dollars) | $20,011,934 | $17,948,634 |
Condensed_Consolidated_Stateme
Condensed Consolidated Statements of Operations (Unaudited) (USD $) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
REVENUES | $212,500 | $502,045 | $715,382 | $882,490 |
COST OF GOODS SOLD | 133,134 | 333,438 | 428,556 | 555,346 |
Gross profit | 79,366 | 168,607 | 286,826 | 327,144 |
OPERATING EXPENSES | ' | ' | ' | ' |
Advertising and promotion | 2,495 | 32,783 | 3,502 | 71,585 |
General and administrative | 572,235 | 475,810 | 1,447,886 | 1,782,334 |
Research and development | 202,829 | 273,645 | 573,600 | 772,468 |
Total operating expenses | 777,559 | 782,238 | 2,024,988 | 2,626,387 |
Operating loss | -698,193 | -613,631 | -1,738,162 | -2,299,243 |
OTHER (EXPENSE) INCOME | ' | ' | ' | ' |
Other (expense) | -33,518 | ' | -11,518 | -25,600 |
Interest (expense) | -140,778 | -127,308 | -371,902 | -190,983 |
Total other (expense) | -173,701 | -127,308 | -382,825 | -101,957 |
Loss before income taxes | -871,894 | -740,939 | -2,120,987 | -2,401,200 |
Income taxes | ' | ' | 0 | 0 |
Net loss | -871,894 | -740,939 | -2,120,987 | -2,401,200 |
Net loss per common share, basic and diluted (in Dollars per share) | $0 | $0 | ($0.01) | ($0.01) |
Weighted average number of common shares outstanding (in Shares) | 246,939,524 | 235,532,775 | 242,791,040 | 228,635,399 |
Notes Payable [Member] | ' | ' | ' | ' |
OTHER (EXPENSE) INCOME | ' | ' | ' | ' |
Derivative income -notes payable | 595 | ' | 595 | ' |
Derivative income -warrants | 595 | ' | 595 | ' |
Warrant [Member] | ' | ' | ' | ' |
OTHER (EXPENSE) INCOME | ' | ' | ' | ' |
Derivative income -notes payable | ' | ' | ' | 114,626 |
Derivative income -warrants | ' | ' | ' | $114,626 |
Condensed_Consolidated_Stateme1
Condensed Consolidated Statements of Cash Flows (Unaudited) (USD $) | 9 Months Ended | |
Sep. 30, 2013 | Sep. 30, 2012 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ' | ' |
Net loss | ($2,120,987) | ($2,401,200) |
Adjustments to reconcile net loss to net cash used by operating activities: | ' | ' |
Depreciation and amortization | 48,773 | 46,194 |
Issuance of restricted common stock, options and warrants for services | 723,001 | 1,002,867 |
Issuance of restricted common stock for contract penalty | ' | 50,000 |
Warrants issued pursuant to repayment of debt in common stock | 119,782 | ' |
Amortization of derivative debt discount | 47,717 | ' |
Loss on debt conversion via common stock-net | 11,518 | ' |
Amortization of prepaid expenses via common stock & warrants | 65,957 | 120,034 |
Changes in operating assets and liabilities: | ' | ' |
Decrease in account receivable | ' | 178,311 |
Decrease in inventory | 190,683 | 48,836 |
Decrease (increase) in other current assets | 14,320 | -55,275 |
(Increase) decrease in other assets | -1,200 | 266 |
Increase in accounts payable and accrued expenses | 159,490 | 178,275 |
Increase in accounts payable and accrued expenses-related parties | 260,136 | 191,818 |
Decrease in deferred revenue and deposits | -210,400 | -419,336 |
Decrease in factored receivables | ' | -43,169 |
Net cash used by operating activities | -691,805 | -1,191,405 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ' | ' |
Expenditures incurred for patents, trademarks and copyrights | -2,469 | -5,791 |
Expenditures for property and equipment | -12,592 | -69,265 |
Net cash used by investing activities | -15,061 | -75,056 |
CASH FLOWS FROM FINANCING ACTIVITIES: | ' | ' |
Payment of capitalized leases | -3,467 | -654 |
Proceeds from debt | 870,000 | 925,000 |
Repayment of debt | -161,922 | -427,500 |
Proceeds from sale of common stock, net of direct offering costs | 100,000 | 738,929 |
Increase in related party notes and loans payable-net | 38,422 | 62,608 |
Net cash provided by financing activities | 843,033 | 1,298,383 |
Net increase in cash | 136,167 | 31,922 |
Cash, beginning of period | 14,888 | 66,486 |
Cash, end of period | 151,055 | 98,408 |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: | ' | ' |
Payment of interest in cash | 25,855 | 29,358 |
Derivative Liability - Debt [Member] | ' | ' |
Adjustments to reconcile net loss to net cash used by operating activities: | ' | ' |
Loss (income) from derivative liability | -595 | ' |
Derivative Liability - Warrants [Member] | ' | ' |
Adjustments to reconcile net loss to net cash used by operating activities: | ' | ' |
Loss (income) from derivative liability | ' | -114,626 |
Debt Refinancing [Member] | ' | ' |
Adjustments to reconcile net loss to net cash used by operating activities: | ' | ' |
Common stock issued | ' | 25,600 |
Repayment of Related Party Payables [Member] | ' | ' |
Adjustments to reconcile net loss to net cash used by operating activities: | ' | ' |
Common stock issued | 54,000 | ' |
Issuance for Accrued Expenses [Member] | ' | ' |
Adjustments to reconcile net loss to net cash used by operating activities: | ' | ' |
Common stock issued | 45,875 | ' |
Repayment of Debt [Member] | ' | ' |
Adjustments to reconcile net loss to net cash used by operating activities: | ' | ' |
Common stock issued | 343,672 | ' |
Payment of Debt Interest [Member] | ' | ' |
Adjustments to reconcile net loss to net cash used by operating activities: | ' | ' |
Common stock issued | 20,994 | ' |
Issuance for Prepaid Interest and Debt Commission [Member] | ' | ' |
Adjustments to reconcile net loss to net cash used by operating activities: | ' | ' |
Common stock issued | ' | 120,034 |
Issuance for Cashless Warrant Exercise [Member] | ' | ' |
Adjustments to reconcile net loss to net cash used by operating activities: | ' | ' |
Common stock issued | ' | 380,000 |
Issuance for Liability Acquired from Acquiree [Member] | ' | ' |
Adjustments to reconcile net loss to net cash used by operating activities: | ' | ' |
Common stock issued | ' | 27,500 |
Advent Power Systems Inc. [Member] | ' | ' |
NON CASH INVESTING AND FINANCING ACTIVITIES: | ' | ' |
Issuance of 1,500,000 shares of Common stock pursuant to purchase of Advent Power Systems Inc. | ' | $330,000 |
Condensed_Consolidated_Stateme2
Condensed Consolidated Statements of Cash Flows (Unaudited) (Parentheticals) | 9 Months Ended | |||||||
Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2012 | Sep. 30, 2012 | Sep. 30, 2012 | |
Repayment of Related Party Payables [Member] | Issuance for Accrued Expenses [Member] | Repayment of Debt [Member] | Payment of Debt Interest [Member] | Issuance for Prepaid Interest and Debt Commission [Member] | Issuance for Cashless Warrant Exercise [Member] | Issuance for Liability Acquired from Acquiree [Member] | Advent Power Systems Inc. [Member] | |
Common stock issued, shares | 675,000 | 612,500 | 4,920,833 | 342,996 | 739,772 | 2,000,000 | 125,000 | ' |
Common stock issued pursuant to acquisition, shares | ' | ' | ' | ' | ' | ' | ' | 1,500,000 |
Note_1_Organizational_and_Sign
Note 1 - Organizational and Significant Accounting Policies | 9 Months Ended | |||||||||||||||||
Sep. 30, 2013 | ||||||||||||||||||
Accounting Policies [Abstract] | ' | |||||||||||||||||
Organization, Consolidation, Basis of Presentation, Business Description and Accounting Policies [Text Block] | ' | |||||||||||||||||
NOTE 1 – ORGANIZATIONAL AND SIGNIFICANT ACCOUNTING POLICIES | ||||||||||||||||||
A. ORGANIZATION AND OPERATIONS | ||||||||||||||||||
Cyclone Power Technologies, Inc. (the “Company”) is the successor entity to the business of Cyclone Technologies LLLP (the “LLLP”), a limited liability limited partnership formed in Florida in June 2004. The LLLP was the original developer and intellectual property holder of the Cyclone engine technology. The Company is primarily a research and development engineering company whose main purpose is to develop, commercialize, market and license its Cyclone engine technology. | ||||||||||||||||||
In the third quarter of 2010, the Company established a subsidiary, Cyclone-WHE LLC (the “WHE Subsidiary”) to market the waste heat recovery systems for all Cyclone engine models. As of September 30, 2013, the Company had a 74.46% controlling interest in the WHE Subsidiary. In March 2012, the Company established Cyclone Performance LLC (“Cyclone Performance”) f/k/a Cyclone-TeamSteam USA, LLC. The purpose of Cyclone Performance is to build, test and run a vehicle utilizing the Company’s engine. As of September 30, 2013, the company had a 95% controlling interest in Cyclone Performance. | ||||||||||||||||||
B. PRINCIPLES OF CONSOLIDATION AND BASIS OF PRESENTATION | ||||||||||||||||||
The unaudited condensed consolidated financial statements include the accounts of the Company, its 74.46% owned WHE Subsidiary and its 95% owned subsidiary Cyclone Performance. All material inter-company transactions and balances have been eliminated in the condensed consolidated financial statements. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles applicable to interim financial information and the requirements of Form 10-Q and Article 10 of Regulation S-X of the SEC. Accordingly, they do not include all of the information and disclosures required by accounting principles generally accepted in the United States for complete consolidated financial statements. Interim results are not necessarily indicative of results for a full year. In the opinion of management, all adjustments considered necessary for a fair presentation of the financial position and the results of operations and cash flows for the interim periods have been included. | ||||||||||||||||||
The accounting principles utilized by the Company require the Company to make judgments, estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements, the reported amounts of revenues and expenses, cash flows and the related footnote disclosures during the periods. On an on-going basis, the Company reviews and evaluates its estimates and assumptions, including, but not limited to, those that relate to the realizable value of inventory, identifiable intangible assets and other long-lived assets, contracts, income taxes and contingencies. Actual results could differ from these estimates. | ||||||||||||||||||
C. CASH | ||||||||||||||||||
Cash includes cash on hand and cash in banks. The Company maintains cash balances at several financial institutions. | ||||||||||||||||||
D. COMPUTATION OF LOSS PER SHARE | ||||||||||||||||||
Net loss per share is computed by dividing the net loss by the weighted average number of common shares outstanding during the period. Diluted net loss per share is not presented as the conversion of the preferred stock and exercise of outstanding stock options and warrants would have an anti-dilutive effect. As of September 30, 2013 and 2012, total anti-dilutive shares amounted to approximately 19.3 and 18.7 million shares, respectively. | ||||||||||||||||||
E. INCOME TAXES | ||||||||||||||||||
Income taxes are accounted for under the asset and liability method as stipulated by ASC 740, “Income Taxes” (“ASC 740”). Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Under ASC 740, the effect on deferred tax assets and liabilities or a change in tax rate is recognized in income in the period that includes the enactment date. Deferred tax assets are reduced to estimated amounts to be realized by the use of a valuation allowance. A valuation allowance is applied when in management’s view it is more likely than not (50%) that such deferred tax will not be utilized. | ||||||||||||||||||
In the unlikely event that an uncertain tax position exists in which the Company could incur income taxes, the Company would evaluate whether there is a probability that the uncertain tax position taken would be sustained upon examination by the taxing authorities. Reserves for uncertain tax positions would be recorded if the Company determined it is probable that a position would not be sustained upon examination or if payment would have to be made to a taxing authority and the amount is reasonably estimated. As of September 30, 2013, the Company does not believe it has any uncertain tax positions that would result in the Company having a liability to the taxing authorities. Interest related to the unrecognized tax benefits is recognized in the condensed consolidated financial statements as a component of income taxes. The Company’s tax returns are subject to examination by the federal and state tax authorities for the years ended 2009 through 2012. | ||||||||||||||||||
F. REVENUE RECOGNITION | ||||||||||||||||||
The Company’s revenue recognition policies are in compliance with ASC 605, “Revenue Recognition – Multiple Element Arrangements”, and Staff Accounting Bulletin (“SAB”) 104, Revenue Recognition. Revenue is recognized at the date of shipment of engines and systems, engine prototypes, engine designs or other deliverables to customers when a formal arrangement exists, the price is fixed or determinable, the delivery is completed, no other significant obligations of the Company exist and collectability is reasonably assured. Revenue from contracts for multiple deliverables and milestone methods recognition are evaluated and allocated as appropriate. The Company has determined that the milestone method of revenue recognition (ASC 605-28) is appropriate for two of the Company’s contracts which specifically enumerate approved work effort milestones required for remuneration – the Company’s contract with the U.S. Army / TARDEC and the Amended and Restated Technology Application License Agreement with Phoenix Power Group LLC. The Company achieved the first milestone on its contract with the U.S. Army in July 2012 and for all of 2012 recognized revenue and related costs of goods sold of approximately $753,000 and $428,000, respectively. In the first nine months of 2013, the Company achieved two additional milestones on the U.S. Army contract and recognized additional revenue and related cost of goods sold of approximately $503,000 and $295,000, respectively. With respect to the amended Phoenix license, the Company achieved one milestone in the third quarter of 2013 and recognized revenue and related cost of goods sold of approximately $150,000 and $133,000 respectively. All revenue and costs of goods sold are included in the accompanying condensed consolidated statements of operations. Payments received before all of the relevant criteria for revenue recognition are satisfied are recorded as deferred revenue on the condensed consolidated balance sheet. The Company does not allow its customers to return prototype products. Current contracts do not require the Company to provide any warranty assistance after the “deliverable” has been accepted. | ||||||||||||||||||
It is the Company’s intention when it has royalty revenue from its contracts to record royalty revenue periodically when earned, as reported in sales statements from customers. The Company does not have any royalty revenue to date. | ||||||||||||||||||
G. WARRANTY PROVISIONS | ||||||||||||||||||
Current contracts do not require warranty assistance subsequent to acceptance of the “deliverable R&D prototype” by the customer. For products that the Company will sell in the future, warranty costs are anticipated to be borne by the manufacturing vendor. | ||||||||||||||||||
H. INVENTORY | ||||||||||||||||||
Inventory is recorded at the lower of cost or market. Costs include material, labor and allocated overhead to manufacture a completed engine. These costs are periodically evaluated to determine if they have a net realizable value. If the net realizable value is lower than the carrying amount, a reserve is provided. | ||||||||||||||||||
I. FAIR VALUE OF FINANCIAL INSTRUMENTS | ||||||||||||||||||
ASC 820, “Fair Value Measurements and Disclosures” requires disclosures of information about the fair value of certain financial instruments for which it is practicable to estimate the value. The carrying amounts reported in the balance sheet for cash, accounts payable and accrued expenses, and loans payable approximate their fair market value based on the short-term maturity of these instruments. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Inputs refer broadly to the assumptions that market participants would use in pricing the asset or liability, including assumptions about risk. Inputs may be observable or unobservable. Observable inputs are based on market data obtained from sources independent of the Company. Unobservable inputs reflect the Company’s own assumptions based on the best information available in the circumstances. The fair value hierarchy prioritizes the inputs used to measure fair value into three broad levels. The three levels of the fair value hierarchy are defined as follows: | ||||||||||||||||||
Level 1 | — | Inputs are quoted prices in active markets for identical assets or liabilities as of the reporting date. | ||||||||||||||||
Level 2 | — | Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly, as of the reporting date. | ||||||||||||||||
Level 3 | — | Unobservable inputs for the asset or liability that reflect management’s own assumptions about the assumptions that market participants would use in pricing the asset or liability as of the reporting date. | ||||||||||||||||
The summary of fair values and changing values of financial instruments as of January 1, 2013 (beginning of period) and September 30, 2013 (end of period) is as follows: | ||||||||||||||||||
Instrument | Beginning | Change | End of Period | Level | Valuation | |||||||||||||
of Period | Methodology | |||||||||||||||||
Derivative liabilities- | $ | - | $ | 106,592 | $ | 106,592 | 3 | Binomial | ||||||||||
notes payable | Lattice Model | |||||||||||||||||
Please refer to Note 16 for disclosure and assumptions used to calculate the fair value of the derivative liabilities. | ||||||||||||||||||
J. RESEARCH AND DEVELOPMENT | ||||||||||||||||||
Research and development activities for product development are expensed as incurred. Costs for the nine months ended September 30, 2013 and 2012 were $573,600 and $772,468, respectively. | ||||||||||||||||||
K. STOCK BASED COMPENSATION | ||||||||||||||||||
The Company applies the fair value method of ASC 718, “Share Based Payment”, in accounting for its stock based compensation. This standard states that compensation cost is measured at the grant date based on the value of the award and is recognized over the service period, which is usually the vesting period. The Company values stock based compensation at the market price for the Company’s common stock as of the date in which the obligation for payment of services is incurred. | ||||||||||||||||||
L. COMMON STOCK OPTIONS AND PURCHASE WARRANTS | ||||||||||||||||||
The Company accounts for common stock options and purchase warrants at fair value in accordance with ASC 815-40, “Derivatives and Hedging”. The Black-Scholes option pricing valuation method is used to determine fair value of these warrants consistent with ASC 718, “Share Based Payment”. Use of this method requires that the Company make assumptions regarding stock volatility, dividend yields, expected term of the warrants and risk-free interest rates. | ||||||||||||||||||
The Company accounts for transactions in which services are received from non-employees in exchange for equity instruments based on the fair value of the equity instruments exchanged, in accordance with ASC 505-50, “Equity Based payments to Non-employees”. | ||||||||||||||||||
M. ORIGINAL ISSUE DEBT DISCOUNT | ||||||||||||||||||
The original issue discount (OID) related to notes payable is amortized by the effective interest method over the repayment period of the notes. The unamortized OID is represented as a reduction of the amount of the notes payable. | ||||||||||||||||||
N. PROPERTY AND EQUIPMENT | ||||||||||||||||||
Property and equipment are recorded at cost. Depreciation is computed on the straight-line method, based on the estimated useful lives of the assets as follows: | ||||||||||||||||||
Years | ||||||||||||||||||
Display equipment for trade shows | 3 | |||||||||||||||||
Leasehold improvements and furniture and fixtures | 10 | - | 15 | |||||||||||||||
Shop equipment | 7 | |||||||||||||||||
Computers | 3 | |||||||||||||||||
Expenditures for maintenance and repairs are charged to operations as incurred. | ||||||||||||||||||
O. IMPAIRMENT OF LONG LIVED ASSETS | ||||||||||||||||||
The Company continually evaluates the carrying value of intangible assets and other long lived assets to determine whether there are any impairment losses. If indicators of impairment are present and future cash flows are not expected to be sufficient to recover the assets’ carrying amount, an impairment loss would be charged to expense in the period identified. To date, the Company has not recognized any impairment charges. | ||||||||||||||||||
P. RECENT ACCOUNTING PRONOUNCEMENTS | ||||||||||||||||||
The FASB issued an Accounting Standard Update (“ASU”) 2013-11 “Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists” in July 2013, ASU 2013-02 “Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income (Topic 220)” in February 2013 and 2013-01 “Clarifying the Scope of Disclosures about Offsetting Assets and Liabilities” in January 2013. Management believes that these standards will not materially impact our financial statements. | ||||||||||||||||||
Q. CONCENTRATION OF RISK | ||||||||||||||||||
The Company does not have any off-balance sheet concentrations of credit risk. The Company expects cash and accounts receivable to be the two assets most likely to subject the Company to concentrations of credit risk. The Company’s policy is to maintain its cash with high credit quality financial institutions to limit its risk of loss exposure. | ||||||||||||||||||
As of September 30, 2013, the Company maintained its cash in two quality financial institutions. The Company has not experienced any losses in its bank accounts through September 30, 2013. The Company purchases raw material and components from multiple sources, none of which may be considered a principal or material supplier. If necessary, the Company could replace these suppliers with minimal effect on its business operations. | ||||||||||||||||||
R. DERIVATIVE FINANCIAL INSTRUMENTS | ||||||||||||||||||
Accounting and reporting standards for derivative instruments and for hedging activities were codified by ASC Topic 815, Derivatives and Hedging (“ASC Topic 815”). It requires that all derivatives be recognized in the balance sheet and measured at fair value. Gains or losses resulting from changes in the fair value of derivatives are recognized in earnings or recorded in other comprehensive income (loss) depending on the purpose of the derivatives and whether they qualify and have been designated for hedge accounting treatment. The Company has a derivative liability pursuant to renegotiated convertible debt, and has recognized net expenses on the income statement. The Company does not have any derivative instruments for which it has applied hedge accounting treatment. |
Note_2_Going_Concern
Note 2 - Going Concern | 9 Months Ended |
Sep. 30, 2013 | |
Going Concern [Abstract] | ' |
Going Concern [Text Block] | ' |
NOTE 2 - GOING CONCERN | |
As shown in the accompanying condensed consolidated financial statements, the Company incurred substantial operating and other losses of approximately $2.1 million for the nine months ended September 30, 2013, and $3.0 million for the year ended December 31, 2012. The cumulative deficit since inception is approximately | |
$50.8 million, which is comprised of $20.0 million attributable to actual operating losses (which were paid in cash, stock for services and other equity instruments) and other expenses, and $30.8 million in non-cash derivative liability accounting which was a result of the conversion of the Company’s Series A Convertible Preferred Stock in 2011, the retirement of a common stock purchase warrant in 2012 and the change in fair value of derivatives associated with notes payable for the nine months ended September 30, 2013. The Company has a working capital deficit at September 30, 2013 of approximately $3.9 million. There is no guarantee whether the Company will be able to generate enough revenue and/or raise capital to support its operations. This raises substantial doubt about the Company’s ability to continue as a going concern. The ability of the Company to continue as a going concern is dependent on management’s plans which include implementation of its business model to generate revenue from development contracts, licenses and product sales, and continuing to raise funds through debt or equity raises. The Company will also likely continue to rely upon related-party debt or equity financing. | |
The condensed consolidated financial statements do not include any adjustments that might result from the outcome of these uncertainties. The Company is currently raising working capital to fund its operations via private placements of common stock and debt, advance contract payments (deferred revenue), and advances from and deferred payments to related parties. |
Note_3_Inventory_Net
Note 3 - Inventory, Net | 9 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Inventory Disclosure [Abstract] | ' | ||||||||
Inventory Disclosure [Text Block] | ' | ||||||||
NOTE 3 – INVENTORY, NET | |||||||||
Inventory, net consists of: | |||||||||
September 30, | December 31, | ||||||||
2013 | 2012 | ||||||||
Engine material and parts | $ | 372,608 | $ | 542,116 | |||||
Labor | 154,796 | 173,209 | |||||||
Applied overhead | 23,219 | 25,981 | |||||||
Total | 550,623 | 741,306 | |||||||
Inventory valuation reserve | (100,000 | ) | (100,000 | ) | |||||
Inventory, net | $ | 450,623 | $ | 641,306 | |||||
Note_4_Property_and_Equipment
Note 4 - Property and Equipment | 9 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Property, Plant and Equipment [Abstract] | ' | ||||||||
Property, Plant and Equipment Disclosure [Text Block] | ' | ||||||||
NOTE 4 – PROPERTY AND EQUIPMENT | |||||||||
Property and equipment consists of the following: | |||||||||
September 30, | December 31, | ||||||||
2013 | 2012 | ||||||||
Display equipment for trade shows | $ | 9,648 | $ | 9,648 | |||||
Leasehold improvements and furniture and fixtures | 94,572 | 94,572 | |||||||
Equipment and computers | 384,041 | 371,449 | |||||||
Total | 488,261 | 475,669 | |||||||
Accumulated depreciation | (119,178 | ) | (99,492 | ) | |||||
Net property and equipment | $ | 369,083 | $ | 376,177 | |||||
Depreciation expense for the nine months ended September 30, 2013 and 2012 was $19,686 and $16,178, respectively. |
Note_5_Patents_and_Trademarks_
Note 5 - Patents and Trademarks and Copyrights | 9 Months Ended |
Sep. 30, 2013 | |
Disclosure Text Block [Abstract] | ' |
Intangible Assets Disclosure [Text Block] | ' |
NOTE 5 – PATENTS AND TRADEMARKS AND COPYRIGHTS | |
Patents, trademarks and copyrights consist of legal fees paid to file and perfect these claims. The net balances as of September 30, 2013 and December 31, 2012 were $380,068 and $406,686, respectively. For the nine months ended September 30, 2013 and for the year ended December 31, 2012, the Company capitalized $2,469 and $5,315, respectively, of expenditures related to these assets. As of September 30, 2013, the Company had 33 patents issued on its technology both in the U.S. and internationally, and three trademarks in the U.S. | |
Patents, trademarks and copyrights are amortized over the life of the intellectual property which is 15 years. Amortization expense for the nine months ended September 30, 2013 and 2012 was $29,087 and $30,016, respectively. |
Note_6_Notes_and_Other_Loans_P
Note 6 - Notes and Other Loans Payable | 9 Months Ended | |||||||||
Sep. 30, 2013 | ||||||||||
Debt Disclosure [Abstract] | ' | |||||||||
Debt Disclosure [Text Block] | ' | |||||||||
NOTE 6 – NOTES AND OTHER LOANS PAYABLE | ||||||||||
A summary of non-related party notes and other loans payable is as follows: | ||||||||||
September 30, | December 31, | |||||||||
2013 | 2012 | |||||||||
8% uncollateralized note payable, paid by February 2013 | $ | - | $ | 10,000 | ||||||
12% uncollateralized notes payable, paid by June 2013 | - | 110,000 | ||||||||
9% convertible notes payable, net of original issue discounts of $0 and $97,628 at September 30, 2013 and December 31, 2012, paid by September 2013, and collateralized by receivables from the U.S. Army Contract | - | 385,594 | ||||||||
6-12% uncollateralized demand notes payable | 230,500 | 160,500 | ||||||||
12% senior secured note payable, plus 6% redemption premium, collateralized by all assets of the Company, monthly payments commencing December 2013 through September 2014 | 400,000 | - | ||||||||
12% convertible notes payable, net of 10% original issue discount of $67,893 at September 30, 2013, maturing at various dates from November 2013 through March 2014 (A) | 140,530 | - | ||||||||
10% convertible note payable, net of original issue discount of $30,101 at September 30, 2013, monthly payments commencing in December 2013 through July 2014 (B) | 183,543 | - | ||||||||
Total current non related party notes –net of discount (accrued interest is included in accrued expenses) | $ | 954,573 | $ | 666,094 | ||||||
(A) | Notes issued net of original discount of $20,000 ($8,423 unamortized a September 30, 2013) along with additional discount from derivative liabilities of $107,187 ($59,470 unamortized at September 30, 2013). | |||||||||
(B) | Note issued net of original discount of $26,250 ($13,644 unamortized at September 30, 2013) along with stock purchase warrants whose value has been carried as a discount against the note ($16,457 unamortized at September 30, 2013). | |||||||||
A summary of related party notes and other loans payable is as follows: | ||||||||||
September 30, | December 31, | |||||||||
2013 | 2012 | |||||||||
6% demand loan from controlling shareholder, uncollateralized (A) | $ | - | $ | 11,285 | ||||||
6% demand loans per Operations Agreement with Schoell Marine Inc., a company owned by Cyclone’s Chairman and controlling shareholder (B) | 424,282 | 424,785 | ||||||||
6% non-collateralized loans from officer and shareholder, payable on demand. The original principle balances were $157,101. | 85,364 | 66,364 | ||||||||
12% non-collateralized loans from officer and shareholder, payable on demand | 12,000 | 11,000 | ||||||||
Accrued Interest | 244,115 | 213,905 | ||||||||
Total current related party notes, inclusive of accrued interest | $ | 765,761 | $ | 727,339 | ||||||
(A) | This note (originally $40,000) was issued to finance the purchase of 8,000 shares of the Company’s Series A Preferred Stock. This treasury stock was subsequently sold for $40,000. For the nine months ended September 30, 2013 and for the year ended December 31, 2012, $11,285 and $0 of principal was paid on the note balance. | |||||||||
(B) | This note arose from services and salaries incurred by Schoell Marine on behalf of the Company. Schoell Marine also owns the building that is leased to the Company. The Schoell Marine note bears an interest rate of 6% and repayments occur as cash flow of the Company permits. The note was secured by a UCC-1 filing on the Company’s patents and patent applications, which expired and has not been renewed. For the nine months ended September 30, 2013 and for the year ended December 31, 2012, $500 and $4,550 of principal was paid on the note balance. | |||||||||
Note_7_Related_Party_Transacti
Note 7 - Related Party Transactions | 9 Months Ended |
Sep. 30, 2013 | |
Related Party Transactions [Abstract] | ' |
Related Party Transactions Disclosure [Text Block] | ' |
NOTE 7 – RELATED PARTY TRANSACTIONS | |
A. LEASE ON FACILITIES | |
The Company leases a 6,000 square foot warehouse and office facility located at 601 NE 26th Court in Pompano Beach, Florida. The lease, which is part of the Company’s Operations Agreement with Schoell Marine, provides for the Company to pay rent equal to the monthly mortgage payment on the building plus property taxes, utilities and sales tax due on rent. Occupancy costs for the nine months ended September 30, 2013 and 2012 were $47,223 in both periods. The Operations Agreement runs year-to-year, however, the lease portion of this agreement is month-to-month, but can only be cancelled on 180 day notice by Schoell Marine. | |
B. DEFERRED COMPENSATION | |
Included in Accounts Payable and Accrued Expenses - Related Parties as of September 30, 2013 and December 31, 2012 are $1,838,369 and $1,647,811, respectively, of accrued and deferred officers’ salaries compensation which may be paid as funds are available. These are non-interest bearing and due on demand. |
Note_8_Preferred_Stock
Note 8 - Preferred Stock | 9 Months Ended |
Sep. 30, 2013 | |
Disclosure Text Block Supplement [Abstract] | ' |
Preferred Stock [Text Block] | ' |
NOTE 8 – PREFERRED STOCK | |
The Series B Preferred Stock is majority voting stock and is held by the two co-founders of the Company. Ownership of the Series B Preferred Stock shares assures the holders thereof a 51% voting control over the common stock of the Company. The 1,000 Series B Preferred Stock shares are convertible on a one-for-one basis with the common stock in the instance the Company is merged, sold or otherwise dissolved. |
Note_9_Stock_Transactions
Note 9 - Stock Transactions | 9 Months Ended |
Sep. 30, 2013 | |
Stockholders' Equity Note [Abstract] | ' |
Stockholders' Equity Note Disclosure [Text Block] | ' |
NOTE 9 – STOCK TRANSACTIONS | |
During the nine months ended September 30, 2013, the Company issued 9,691,071 shares of restricted common stock valued at $692,750 for outside services. Additionally, the Company amortized (based on vesting) $109,882 of common stock options for employee services, $51,930 for re-priced employee options, and $119,782 of common stock warrants. Unless otherwise described in these footnotes, reference to “restricted” common stock means that the shares are restricted from resale pursuant to Rule 144 of the Securities Act of 1933, as amended. | |
During the nine months ended September 30, 2013, the Company sold 1,000,000 shares of restricted common stock for $100,000, and issued 675,000 shares of restricted common stock valued at $54,000 in satisfaction of contracted and accrued officers’ salaries. | |
During the nine months ended September 30, 2013, the Company issued 342,996 shares of common stock valued at $20,994 as partial payment of interest on debt, 4,920,833 shares of common stock in repayment of $343,672 of debt, and 612,500 shares of common stock valued at $45,875 in satisfaction of liabilities. | |
In the third quarter of 2013, officers and members of the senior management of the Company donated 1,820,000 shares of their personal holdings of common stock to the 2013 Employee Appreciation Stock Pool, which was distributed to the Company’s employees as additional compensation and incentives based on their years in service. This resulted in a non-cash charge to compensation of $145,600. Additionally in the third quarter of 2013, the Company’s Chairman purchased a 5% equity interest in our subsidiary Cyclone-WHE LLC in exchange for 5,000,000 common shares of the Company that he personally owned. During the same quarter, Cyclone-WHE used 2,000,000 of these shares to compensate service providers and consultants, and currently holds 3,000,000 shares which are presented as treasury stock in the condensed consolidated balance sheets. The treasury stock may be used in the future to pay for services or for fund raising activities. |
Note_10_Stock_Options_and_Warr
Note 10 - Stock Options and Warrants | 9 Months Ended | |||||||||||||
Sep. 30, 2013 | ||||||||||||||
Stock Options And Warrants [Abstract] | ' | |||||||||||||
Stock Options And Warrants [Text Block] | ' | |||||||||||||
NOTE 10 – STOCK OPTIONS AND WARRANTS | ||||||||||||||
A. COMMON STOCK OPTIONS | ||||||||||||||
In recognition of and compensation for services rendered by officers and employees for the nine months ended September 30, 2013, the Company issued 600,000 common stock options, valued at $37,000 (pursuant to the Black Scholes valuation model) that are exercisable into shares of common stock at exercise prices of $0.08 and with a maturity life of 10 years. For the nine months ended September 30, 2013, the income statement charge for the amortization of stock options was $109,882 and the unamortized balance was $25,012. | ||||||||||||||
To improve the common stock position of the Company and help limit dilution, effective with the second quarter of 2013, the four corporate officers unanimously agreed to waive their rights to 2.4 million common stock options (600,000 per quarter collectively) contractually due them over the next 12 months. In lieu of issuing additional options to these officers and all other employees through the end of the year, the Company re-priced 4,185,000 million vested options held by the officers and employees that were priced at a minimum of $0.15 per share ($0.20 average) to $0.10 per share. The result was a non-cash charge of approximately $52,000. The remaining contractual life of the options was not changed. | ||||||||||||||
A summary of the common stock options for the period from December 31, 2012 through September 30, 2013 follows: | ||||||||||||||
Number | Weighted Avg. | Weighted Avg. | ||||||||||||
Outstanding | Exercise Price | Remaining | ||||||||||||
Contractual Life | ||||||||||||||
(Years) | ||||||||||||||
Balance, December 31, 2012 | 9,740,000 | $ | 0.185 | 7.4 | ||||||||||
Options issued | 600,000 | 0.08 | 9.5 | |||||||||||
Options exercised | - | - | - | |||||||||||
Options cancelled | (600,000 | ) | (0.135 | ) | - | |||||||||
Options re-priced: | ||||||||||||||
Cancelled-old | (4,185,000 | ) | (0.20 | ) | (6.8 | ) | ||||||||
Re-priced | 4,185,000 | 0.1 | 6.8 | |||||||||||
Balance, September 30, 2013 | 9,740,000 | $ | 0.139 | 6.7 | ||||||||||
The vested and exercisable options at period end follows: | ||||||||||||||
Exercisable/ | Weighted | Weighted | ||||||||||||
Vested | Avg. | Avg. | ||||||||||||
Options | Exercise Price | Remaining | ||||||||||||
Outstanding | Contractual | |||||||||||||
Life (Years) | ||||||||||||||
Balance September 30, 2013 | 8,540,000 | $ | 0.153 | 6.4 | ||||||||||
Additional vesting by December 31, 2013 | 600,000 | 0.078 | 9.3 | |||||||||||
The fair value of new stock options, re-priced stock options, new purchase warrants and re-priced purchase warrants granted using the Black-Scholes option pricing model was calculated using the following assumptions: | ||||||||||||||
Nine Months Ended | ||||||||||||||
September 30, | ||||||||||||||
2013 | ||||||||||||||
Risk free interest rate | 0.51 | % | - | 1.41 | % | |||||||||
Expected volatility | 34 | % | - | 107 | % | |||||||||
Expected term in years | 1 | 5 | ||||||||||||
Expected dividend yield | 0 | % | ||||||||||||
Average value per options and warrants | $ | 0.01 | - | $ | 0.06 | |||||||||
Expected volatility is based on historical volatility of the Company’s common stock price. Short Term U.S. Treasury rates were utilized at the risk free interest rate. The expected term of the options and warrants was calculated using the alternative simplified method newly codified as ASC 718 “Accounting for Stock Based Compensation,” which defined the expected life as the average of the contractual term of the options and warrants and the weighted average vesting period for all issuances. | ||||||||||||||
B. COMMON STOCK WARRANTS | ||||||||||||||
In the nine months ended September 30, 2013, pursuant to the Company repaying $110,000 of debt with common stock, the Company re-priced 360,000 common stock warrants to $0.10 per share from an average price of $0.30 per share. Additionally, in connection with $200,000 of new debt, the Company issued 565,625 common stock warrants at an exercise price of $0.10 with a 5-year term. The Company also issued 100,000 warrants at an exercise price of $0.10 with a 5 year term (valued at $ 5,900) pursuant to a consulting agreement. | ||||||||||||||
In the nine months ended September 30, 2013, the Company also repaid debt and interest of $364,666 in common stock. The Company re-priced to $0.10 per share (from $0.20 per share) 1,986,222 common stock warrants issued in connection with $544,000 aggregate debt financing in the third quarter of 2012, and issued an additional 993,111 common stock warrants priced at $0.10 pursuant to this repayment event. The warrant holders may exercise the warrants without paying the cash price, and instead have the Company withhold shares that would otherwise be delivered pursuant to the warrant, based upon the market value of those shares and equal to the total conversion price of the remaining converted warrants. The warrants are also subject to certain anti-dilution protections, whereby if the Company issues common stock at a price less than $0.10 a share (in a “non-exempted” issuance, and based on the most current exercise price), then the exercise price of the warrants shall reset to that lower value. “Exempted” issuances include shares issued subject to Board-approved option plans, any convertible securities outstanding as of the date of the warrant issuance, up to 5 million shares of common stock issued to service providers of the Company, and certain other issuances set forth in the warrant agreements. | ||||||||||||||
A summary of outstanding vested warrant activity for the period from December 31, 2012 to September 30, 2013 follows: | ||||||||||||||
Number | Weighted Avg. | Weighted | ||||||||||||
Outstanding | Exercise Price | Avg. | ||||||||||||
Remaining | ||||||||||||||
Contractual | ||||||||||||||
Life (Years) | ||||||||||||||
Balance, December 31, 2012 | 7,856,165 | $ | 0.218 | 2.9 | ||||||||||
Warrants issued | 1,658,737 | 0.087 | 4.2 | |||||||||||
Warrants exercised | - | - | - | |||||||||||
Warrants cancelled | - | - | - | |||||||||||
Warrants re-priced: | ||||||||||||||
Cancelled-old | (2,346,222 | ) | (.170 | ) | (3.5 | ) | ||||||||
Re-priced | 2,346,222 | 0.08 | 3.5 | |||||||||||
Balance, September 30, 2013 | 9,514,902 | $ | 0.172 | 2.5 | ||||||||||
All warrants were vested and exercisable as of the date issued. |
Note_11_Income_Taxes
Note 11 - Income Taxes | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Income Tax Disclosure [Abstract] | ' | ||||||||||||||||
Income Tax Disclosure [Text Block] | ' | ||||||||||||||||
NOTE 11 – INCOME TAXES | |||||||||||||||||
A reconciliation of the differences between the effective income tax rates and the statutory federal tax rates for the nine months ended September 30, 2013 and 2012 are as follows: | |||||||||||||||||
Nine | Amount | Nine | Amount | ||||||||||||||
months | months | ||||||||||||||||
ended | ended | ||||||||||||||||
September | September | ||||||||||||||||
30, 2013 | 30, 2012 | ||||||||||||||||
Tax benefit at U.S. statutory rate | 34% | $ | 634,989 | 34% | $ | 785,256 | |||||||||||
State taxes, net of federal benefit | 4 | 74,705 | 4 | 92,383 | |||||||||||||
Change in valuation allowance | -38 | (709,694 | ) | -38 | (877,639 | ) | |||||||||||
-% | $ | - | -% | $ | - | ||||||||||||
The tax effect of temporary differences that give rise to significant portions of the deferred tax assets and liabilities for nine months ended September 30, 2013 and the year ended December 31, 2012 consisted of the following: | |||||||||||||||||
Deferred Tax Assets | September 30, | December 31, | |||||||||||||||
2013 | 2012 | ||||||||||||||||
Net Operating Loss Carry-forward | $ | 7,347,942 | $ | 6,604,436 | |||||||||||||
Deferred Tax Liabilities – Accrued Officers’ Salaries | (414,010 | ) | (335,635 | ) | |||||||||||||
Net Deferred Tax Assets | 6,933,932 | 6,268,801 | |||||||||||||||
Valuation Allowance | (6,933,932 | ) | (6,268,801 | ) | |||||||||||||
Total Net Deferred Tax Assets | $ | - | $ | - | |||||||||||||
As of September 30, 2013, the Company had a net operating loss carry forward for income tax reporting purposes of approximately $15.3 million that may be offset against future taxable income through 2027. Current tax laws limit the amount of loss available to be offset against future taxable income when a substantial change in ownership occurs. Therefore, the amount available to offset future taxable income may be limited. No tax asset has been reported in the financial statements because the Company believes there is a 50% or greater chance the carry forwards will expire unused. Accordingly, the potential tax benefits of the loss carry forwards are offset by a valuation allowance of the same amount. |
Note_12_Lease_Obligations
Note 12 - Lease Obligations | 9 Months Ended | ||||
Sep. 30, 2013 | |||||
Leases, Capital [Abstract] | ' | ||||
Capital Leases in Financial Statements of Lessee Disclosure [Text Block] | ' | ||||
NOTE 12 –LEASE OBLIGATIONS | |||||
A. CAPITALIZED LEASE OBLIGATIONS | |||||
In 2009 the Company acquired $27,401 of property and equipment via capitalized lease obligations at an average interest rate of 18.4%. In September 2012, the Company acquired $21,310 of equipment via capitalized lease obligations at an interest rate of 12.5%. Total lease payments made for the nine months ended September 30, 2013 were $3,467. The balance of capitalized lease obligations payable at September 30, 2013 was $19,469. Future lease payments are: | |||||
December 31, | $ | 1,072 | |||
2013 | |||||
2014 | 4,898 | ||||
2015 | 4,383 | ||||
2016 | 4,966 | ||||
2017 | 4,150 | ||||
$ | 19,469 | ||||
B. LEASE ON ADDITIONAL FACILITIES | |||||
In July 2011, the Company signed a one-year lease for an additional 2,000 square feet at a rate of $8.25/ s.f. Effective July 2012 the Company renewed this lease for one year, at an annual rate of $16,800 or $8.40/s.f, terminating in September 2013. The lease has a remaining 1-year extension. The lease expense for the nine months ended September 30, 2013 and 2012 was $14,761 and $14,095, respectively. |
Note_13_Commitments_and_Contin
Note 13 - Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2013 | |
Commitments and Contingencies Disclosure [Abstract] | ' |
Commitments and Contingencies Disclosure [Text Block] | ' |
NOTE 13 – COMMITMENTS AND CONTINGENCIES | |
The Company has employment agreements with Harry Schoell, Chairman and CTO (previously, CEO), at $150,000 per year; Frankie Fruge, COO, at $120,000 per year; and Christopher Nelson, President and General Counsel, at $130,000 per year (collectively, the “Executives”). These agreements provide for a term of three (3) years from their Effective Date (July 2007 in the case of Schoell and Fruge, and August 2011 in the case of Nelson), with automatically renewing successive one year periods starting on the end of the second anniversary of the Effective Date. If the Executive is terminated “without cause” or pursuant to a “change in control” of the Company, as both defined in the respective agreements, the Executive shall be entitled to (i) any unpaid Base Salary accrued through the effective date of termination, (ii) the Executive’s Base Salary at the rate prevailing at such termination through 12 months from the date of termination or the end of his Term then in effect, whichever is longer, and (iii) any performance bonus that would otherwise be payable to the Executive were he/she not terminated, during the 12 months following his or her termination. |
Note_14_Subsidiaries
Note 14 - Subsidiaries | 9 Months Ended |
Sep. 30, 2013 | |
Equity Method Investments and Joint Ventures [Abstract] | ' |
Equity Method Investments and Joint Ventures Disclosure [Text Block] | ' |
NOTE 14 – SUBSIDIARIES | |
In the first quarter of 2012, the Company established a 100% owned subsidiary (renamed) Cyclone Performance LLC. The purpose of Cyclone Performance is to build, test and run a vehicle utilizing the Company’s engine. In the last quarter of 2012, the Company sold a 5% equity investment to an unrelated investor for $30,000. Prior to December 31, 2012, this 5% equity investment was acquired by a corporate officer of the Company. Losses of the subsidiary are currently fully borne by the Company, and no allocations were made to the non-controlling interest in the 2013 balance sheet, as there is no guarantee of future profits or positive cash flow of the subsidiary. As of September 30, 2013, the cumulative unallocated losses to the non-controlling interests of this subsidiary of $954 are to be recovered by the parent from future subsidiary profits if they materialize. | |
In 2010 the Company established Cyclone-WHE LLC (CWHE) to license and market waste heat recovery systems for all engine models. In 2010, the Company sold an equity participation of 5% to a minority investor for $30,000, via the conversion of a Cyclone note payable. Another 5% was purchased directly from the subsidiary by a minority investor for services valued at $30,000 consisting of assistance in marketing, management and financing for projects to be carried out by the subsidiary. These services were amortized over a 12 month period. This investor also received and exercised in 2011 a 2.5% equity purchase warrant in the subsidiary for $50,000. | |
Effective July 1, 2010, the Company provided a 5% equity contribution in CWHE to the Managing Director of the subsidiary in consideration of $30,000 of future professional services (which were amortized over a 12 month period). Additionally, the executive was granted an option for the acquisition of an additional 5% equity in the subsidiary at a total price of $100,000, vesting half in 12 months and half in 24 months, exercisable for 5 years. No value was attributed to this option, since the subsidiary had no significant operations or assets. | |
In July 2013, the Company’s Chairman purchased a 5% equity stake in our subsidiary CWHE in exchange for 5 million shares of his common stock in the Company. In connection with this purchase, the executive also agreed to release the security interest held by his company, Schoell Marine, on certain of the Company’s engine patents, which was collateral on approximately $425,000 in debt owed by the Company to Schoell Marine. The executive also agreed to provide 12 months of consulting services without additional compensation to CWHE. | |
In July 2013, as part of a Joint Manufacturing Operations Agreement, Precision CNC LLC (of Ohio) received a 5% interest in CWHE to provide expertise and management for its production operations (vesting over the following two years). Precision CNC was also given the right, during this period, to purchase up to an additional 5% in Cyclone-WHE at the then current valuation of that company. Concurrent with this agreement, CWHE was re-domiciled to Ohio. | |
The total losses of the CWHE subsidiary for the nine months ended September 30, 2013 and for the year ended December 31, 2012 were $39,601 and $0 respectively. Losses of the subsidiary are currently fully borne by the Company in the condensed consolidated statements of operations. There is no guarantee of future profits or positive cash flow of the subsidiary that will be realized. |
Note_15_Receivables_Deferred_R
Note 15 - Receivables, Deferred Revenue and Backlog | 9 Months Ended |
Sep. 30, 2013 | |
Deferred Revenue Disclosure [Abstract] | ' |
Deferred Revenue Disclosure [Text Block] | ' |
NOTE 15 – RECEIVABLES, DEFERRED REVENUE AND BACKLOG | |
In the nine months ended September 30, 2013, the Company had collected $502,882, which relates to work in progress billings due from the U.S. Army/TARDEC contract, which has been recorded as revenue under the milestone method of revenue recognition for the contract. Additionally, the Company recorded $150,000 in revenue from the amended and restated license with Phoenix Power, which also fell under the milestone method of revenue recognition. As of September 30, 2013, the Company has no billed accounts receivables. | |
As of September 30, 2013, total backlog for prototype engines to be delivered in the following twelve months was $2.15 million, of which approximately $0.5 million has been paid under the Company’s Phoenix Power and Combilift agreements, collectively, and $1.25 million had been paid under the U.S. Army contract. The Company expects the balance from these projects to be paid over the following six to nine months of the respective contracts’ development periods, as engines are delivered to the customers. |
Note_16_Derivative_Financial_I
Note 16 - Derivative Financial Instruments | 9 Months Ended | ||||||||||||
Sep. 30, 2013 | |||||||||||||
Disclosure Text Block [Abstract] | ' | ||||||||||||
Derivatives and Fair Value [Text Block] | ' | ||||||||||||
NOTE 16 – DERIVATIVE FINANCIAL INSTRUMENTS | |||||||||||||
Pursuant to additional financing, on August 13, 2013, the Company renegotiated the conversion calculation for new and prior related debt ($200,000 aggregate). The new conversion price into common stock is the lessor of $.08 or 70% of the lowest closing price in the 20 trading days previous to the conversion. Under provisions of ASC Topic 815-40, this revised conversion triggered derivative accounting treatment because the convertible note was convertible into an indeterminable number of shares of common stock. The fair value of the embedded conversion option was required to be presented as a derivative liability and adjusted to fair value at each reporting date, with changes in fair value reported in the condensed consolidated statements of operation. | |||||||||||||
At the time of the revised conversion provision, the Company recognized a derivative liability of $107,187 with a discount offset against the underlying loan. In the quarter ended September 30, 2013, the Company recorded a $47,717 non-cash charge to interest expense (reflective of debt discount amortization), and $595 of derivative income related to adjusting the derivative liability to fair value. | |||||||||||||
The Company calculates the estimated fair values of the liabilities for derivative instruments at each quarter-end using the BSM option pricing model and Monte Carlo simulations. The closing price of the Company’s common stock at August 13, 2013 and September 30, 2013 was $.074 and $.059, respectively. Volatility, expected term and risk free interest rates used to estimate the fair value of derivative liabilities are indicated in the table below. The volatility was based on historical volatility, the expected term is equal to the remaining term of the debt and the risk free rate is based upon rates for treasury securities with the same term. | |||||||||||||
Volatility | 86 | % | - | 102 | % | ||||||||
Risk Free Rate | 0.02 | % | - | 0.08 | % | ||||||||
Expected Term (years) | 0.1 | - | 0.6 | ||||||||||
Dividend Rate | 0% | ||||||||||||
Note_17_Subsequent_Events
Note 17 - Subsequent Events | 9 Months Ended |
Sep. 30, 2013 | |
Subsequent Events [Abstract] | ' |
Subsequent Events [Text Block] | ' |
NOTE 17 – SUBSEQUENT EVENTS | |
In October 2013, the Company received notice from several unaffiliated shareholders, that they had purchased approximately $50,000 in 12% uncollateralized demand notes from a trust that had loaned the Company $153,000 in 2012. In exchange for these demand notes, the Company issued to these holders four new 12 month 12% interest promissory notes, convertible into common stock at $.04 per share. Shortly thereafter, the holders converted an aggregate of approximately $57,000 of the new notes and interest into 1,421,713 shares of common stock. | |
In October 2013, the Company received notice from a fund that had previously provided $200,000 in 12% convertible promissory notes, that it was electing to convert up to $100,000 of that note into common stock at a price equal to 70% of the lowest closing price of the Company’s stock in the previous 20 trading days. To date, this conversion has amounted to 1,950,000 shares valued at approximately $60,000. |
Accounting_Policies_by_Policy_
Accounting Policies, by Policy (Policies) | 9 Months Ended | ||||||||||||
Sep. 30, 2013 | |||||||||||||
Accounting Policies [Abstract] | ' | ||||||||||||
Consolidation, Policy [Policy Text Block] | ' | ||||||||||||
B. PRINCIPLES OF CONSOLIDATION AND BASIS OF PRESENTATION | |||||||||||||
The unaudited condensed consolidated financial statements include the accounts of the Company, its 74.46% owned WHE Subsidiary and its 95% owned subsidiary Cyclone Performance. All material inter-company transactions and balances have been eliminated in the condensed consolidated financial statements. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles applicable to interim financial information and the requirements of Form 10-Q and Article 10 of Regulation S-X of the SEC. Accordingly, they do not include all of the information and disclosures required by accounting principles generally accepted in the United States for complete consolidated financial statements. Interim results are not necessarily indicative of results for a full year. In the opinion of management, all adjustments considered necessary for a fair presentation of the financial position and the results of operations and cash flows for the interim periods have been included. | |||||||||||||
The accounting principles utilized by the Company require the Company to make judgments, estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements, the reported amounts of revenues and expenses, cash flows and the related footnote disclosures during the periods. On an on-going basis, the Company reviews and evaluates its estimates and assumptions, including, but not limited to, those that relate to the realizable value of inventory, identifiable intangible assets and other long-lived assets, contracts, income taxes and contingencies. Actual results could differ from these estimates. | |||||||||||||
Cash and Cash Equivalents, Policy [Policy Text Block] | ' | ||||||||||||
C. CASH | |||||||||||||
Cash includes cash on hand and cash in banks. The Company maintains cash balances at several financial institutions. | |||||||||||||
Earnings Per Share, Policy [Policy Text Block] | ' | ||||||||||||
D. COMPUTATION OF LOSS PER SHARE | |||||||||||||
Net loss per share is computed by dividing the net loss by the weighted average number of common shares outstanding during the period. Diluted net loss per share is not presented as the conversion of the preferred stock and exercise of outstanding stock options and warrants would have an anti-dilutive effect. As of September 30, 2013 and 2012, total anti-dilutive shares amounted to approximately 19.3 and 18.7 million shares, respectively. | |||||||||||||
Income Tax, Policy [Policy Text Block] | ' | ||||||||||||
E. INCOME TAXES | |||||||||||||
Income taxes are accounted for under the asset and liability method as stipulated by ASC 740, “Income Taxes” (“ASC 740”). Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Under ASC 740, the effect on deferred tax assets and liabilities or a change in tax rate is recognized in income in the period that includes the enactment date. Deferred tax assets are reduced to estimated amounts to be realized by the use of a valuation allowance. A valuation allowance is applied when in management’s view it is more likely than not (50%) that such deferred tax will not be utilized. | |||||||||||||
In the unlikely event that an uncertain tax position exists in which the Company could incur income taxes, the Company would evaluate whether there is a probability that the uncertain tax position taken would be sustained upon examination by the taxing authorities. Reserves for uncertain tax positions would be recorded if the Company determined it is probable that a position would not be sustained upon examination or if payment would have to be made to a taxing authority and the amount is reasonably estimated. As of September 30, 2013, the Company does not believe it has any uncertain tax positions that would result in the Company having a liability to the taxing authorities. Interest related to the unrecognized tax benefits is recognized in the condensed consolidated financial statements as a component of income taxes. The Company’s tax returns are subject to examination by the federal and state tax authorities for the years ended 2009 through 2012. | |||||||||||||
Revenue Recognition, Policy [Policy Text Block] | ' | ||||||||||||
F. REVENUE RECOGNITION | |||||||||||||
The Company’s revenue recognition policies are in compliance with ASC 605, “Revenue Recognition – Multiple Element Arrangements”, and Staff Accounting Bulletin (“SAB”) 104, Revenue Recognition. Revenue is recognized at the date of shipment of engines and systems, engine prototypes, engine designs or other deliverables to customers when a formal arrangement exists, the price is fixed or determinable, the delivery is completed, no other significant obligations of the Company exist and collectability is reasonably assured. Revenue from contracts for multiple deliverables and milestone methods recognition are evaluated and allocated as appropriate. The Company has determined that the milestone method of revenue recognition (ASC 605-28) is appropriate for two of the Company’s contracts which specifically enumerate approved work effort milestones required for remuneration – the Company’s contract with the U.S. Army / TARDEC and the Amended and Restated Technology Application License Agreement with Phoenix Power Group LLC. The Company achieved the first milestone on its contract with the U.S. Army in July 2012 and for all of 2012 recognized revenue and related costs of goods sold of approximately $753,000 and $428,000, respectively. In the first nine months of 2013, the Company achieved two additional milestones on the U.S. Army contract and recognized additional revenue and related cost of goods sold of approximately $503,000 and $295,000, respectively. With respect to the amended Phoenix license, the Company achieved one milestone in the third quarter of 2013 and recognized revenue and related cost of goods sold of approximately $150,000 and $133,000 respectively. All revenue and costs of goods sold are included in the accompanying condensed consolidated statements of operations. Payments received before all of the relevant criteria for revenue recognition are satisfied are recorded as deferred revenue on the condensed consolidated balance sheet. The Company does not allow its customers to return prototype products. Current contracts do not require the Company to provide any warranty assistance after the “deliverable” has been accepted. | |||||||||||||
It is the Company’s intention when it has royalty revenue from its contracts to record royalty revenue periodically when earned, as reported in sales statements from customers. The Company does not have any royalty revenue to date. | |||||||||||||
Standard Product Warranty, Policy [Policy Text Block] | ' | ||||||||||||
G. WARRANTY PROVISIONS | |||||||||||||
Current contracts do not require warranty assistance subsequent to acceptance of the “deliverable R&D prototype” by the customer. For products that the Company will sell in the future, warranty costs are anticipated to be borne by the manufacturing vendor. | |||||||||||||
Inventory, Policy [Policy Text Block] | ' | ||||||||||||
H. INVENTORY | |||||||||||||
Inventory is recorded at the lower of cost or market. Costs include material, labor and allocated overhead to manufacture a completed engine. These costs are periodically evaluated to determine if they have a net realizable value. If the net realizable value is lower than the carrying amount, a reserve is provided. | |||||||||||||
Fair Value of Financial Instruments, Policy [Policy Text Block] | ' | ||||||||||||
I. FAIR VALUE OF FINANCIAL INSTRUMENTS | |||||||||||||
ASC 820, “Fair Value Measurements and Disclosures” requires disclosures of information about the fair value of certain financial instruments for which it is practicable to estimate the value. The carrying amounts reported in the balance sheet for cash, accounts payable and accrued expenses, and loans payable approximate their fair market value based on the short-term maturity of these instruments. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Inputs refer broadly to the assumptions that market participants would use in pricing the asset or liability, including assumptions about risk. Inputs may be observable or unobservable. Observable inputs are based on market data obtained from sources independent of the Company. Unobservable inputs reflect the Company’s own assumptions based on the best information available in the circumstances. The fair value hierarchy prioritizes the inputs used to measure fair value into three broad levels. The three levels of the fair value hierarchy are defined as follows: | |||||||||||||
Level 1 | — | Inputs are quoted prices in active markets for identical assets or liabilities as of the reporting date. | |||||||||||
Level 2 | — | Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly, as of the reporting date. | |||||||||||
Level 3 | — | Unobservable inputs for the asset or liability that reflect management’s own assumptions about the assumptions that market participants would use in pricing the asset or liability as of the reporting date. | |||||||||||
Research and Development Expense, Policy [Policy Text Block] | ' | ||||||||||||
J. RESEARCH AND DEVELOPMENT | |||||||||||||
Research and development activities for product development are expensed as incurred. Costs for the nine months ended September 30, 2013 and 2012 were $573,600 and $772,468, respectively. | |||||||||||||
Share-based Compensation, Option and Incentive Plans Policy [Policy Text Block] | ' | ||||||||||||
K. STOCK BASED COMPENSATION | |||||||||||||
The Company applies the fair value method of ASC 718, “Share Based Payment”, in accounting for its stock based compensation. This standard states that compensation cost is measured at the grant date based on the value of the award and is recognized over the service period, which is usually the vesting period. The Company values stock based compensation at the market price for the Company’s common stock as of the date in which the obligation for payment of services is incurred. | |||||||||||||
Stockholders' Equity, Policy [Policy Text Block] | ' | ||||||||||||
L. COMMON STOCK OPTIONS AND PURCHASE WARRANTS | |||||||||||||
The Company accounts for common stock options and purchase warrants at fair value in accordance with ASC 815-40, “Derivatives and Hedging”. The Black-Scholes option pricing valuation method is used to determine fair value of these warrants consistent with ASC 718, “Share Based Payment”. Use of this method requires that the Company make assumptions regarding stock volatility, dividend yields, expected term of the warrants and risk-free interest rates. | |||||||||||||
The Company accounts for transactions in which services are received from non-employees in exchange for equity instruments based on the fair value of the equity instruments exchanged, in accordance with ASC 505-50, “Equity Based payments to Non-employees”. | |||||||||||||
Debt, Policy [Policy Text Block] | ' | ||||||||||||
M. ORIGINAL ISSUE DEBT DISCOUNT | |||||||||||||
The original issue discount (OID) related to notes payable is amortized by the effective interest method over the repayment period of the notes. The unamortized OID is represented as a reduction of the amount of the notes payable. | |||||||||||||
Property, Plant and Equipment, Policy [Policy Text Block] | ' | ||||||||||||
N. PROPERTY AND EQUIPMENT | |||||||||||||
Property and equipment are recorded at cost. Depreciation is computed on the straight-line method, based on the estimated useful lives of the assets as follows: | |||||||||||||
Years | |||||||||||||
Display equipment for trade shows | 3 | ||||||||||||
Leasehold improvements and furniture and fixtures | 10 | - | 15 | ||||||||||
Shop equipment | 7 | ||||||||||||
Computers | 3 | ||||||||||||
Expenditures for maintenance and repairs are charged to operations as incurred. | |||||||||||||
Impairment or Disposal of Long-Lived Assets, Policy [Policy Text Block] | ' | ||||||||||||
O. IMPAIRMENT OF LONG LIVED ASSETS | |||||||||||||
The Company continually evaluates the carrying value of intangible assets and other long lived assets to determine whether there are any impairment losses. If indicators of impairment are present and future cash flows are not expected to be sufficient to recover the assets’ carrying amount, an impairment loss would be charged to expense in the period identified. To date, the Company has not recognized any impairment charges. | |||||||||||||
New Accounting Pronouncements, Policy [Policy Text Block] | ' | ||||||||||||
P. RECENT ACCOUNTING PRONOUNCEMENTS | |||||||||||||
The FASB issued an Accounting Standard Update (“ASU”) 2013-11 “Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists” in July 2013, ASU 2013-02 “Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income (Topic 220)” in February 2013 and 2013-01 “Clarifying the Scope of Disclosures about Offsetting Assets and Liabilities” in January 2013. Management believes that these standards will not materially impact our financial statements. | |||||||||||||
Concentration Risk, Credit Risk, Policy [Policy Text Block] | ' | ||||||||||||
Q. CONCENTRATION OF RISK | |||||||||||||
The Company does not have any off-balance sheet concentrations of credit risk. The Company expects cash and accounts receivable to be the two assets most likely to subject the Company to concentrations of credit risk. The Company’s policy is to maintain its cash with high credit quality financial institutions to limit its risk of loss exposure. | |||||||||||||
As of September 30, 2013, the Company maintained its cash in two quality financial institutions. The Company has not experienced any losses in its bank accounts through September 30, 2013. The Company purchases raw material and components from multiple sources, none of which may be considered a principal or material supplier. If necessary, the Company could replace these suppliers with minimal effect on its business operations. | |||||||||||||
Derivatives, Policy [Policy Text Block] | ' | ||||||||||||
R. DERIVATIVE FINANCIAL INSTRUMENTS | |||||||||||||
Accounting and reporting standards for derivative instruments and for hedging activities were codified by ASC Topic 815, Derivatives and Hedging (“ASC Topic 815”). It requires that all derivatives be recognized in the balance sheet and measured at fair value. Gains or losses resulting from changes in the fair value of derivatives are recognized in earnings or recorded in other comprehensive income (loss) depending on the purpose of the derivatives and whether they qualify and have been designated for hedge accounting treatment. The Company has a derivative liability pursuant to renegotiated convertible debt, and has recognized net expenses on the income statement. The Company does not have any derivative instruments for which it has applied hedge accounting treatment. |
Note_1_Organizational_and_Sign1
Note 1 - Organizational and Significant Accounting Policies (Tables) | 9 Months Ended | |||||||||||||||||
Sep. 30, 2013 | ||||||||||||||||||
Accounting Policies [Abstract] | ' | |||||||||||||||||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Table Text Block] | ' | |||||||||||||||||
Instrument | Beginning | Change | End of Period | Level | Valuation | |||||||||||||
of Period | Methodology | |||||||||||||||||
Derivative liabilities- | $ | - | $ | 106,592 | $ | 106,592 | 3 | Binomial | ||||||||||
notes payable | Lattice Model | |||||||||||||||||
Estimated Useful Lives of Property and Equipment [Table Text Block] | ' | |||||||||||||||||
Years | ||||||||||||||||||
Display equipment for trade shows | 3 | |||||||||||||||||
Leasehold improvements and furniture and fixtures | 10 | - | 15 | |||||||||||||||
Shop equipment | 7 | |||||||||||||||||
Computers | 3 |
Note_3_Inventory_Net_Tables
Note 3 - Inventory, Net (Tables) | 9 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Inventory Disclosure [Abstract] | ' | ||||||||
Schedule of Inventory, Current [Table Text Block] | ' | ||||||||
September 30, | December 31, | ||||||||
2013 | 2012 | ||||||||
Engine material and parts | $ | 372,608 | $ | 542,116 | |||||
Labor | 154,796 | 173,209 | |||||||
Applied overhead | 23,219 | 25,981 | |||||||
Total | 550,623 | 741,306 | |||||||
Inventory valuation reserve | (100,000 | ) | (100,000 | ) | |||||
Inventory, net | $ | 450,623 | $ | 641,306 |
Note_4_Property_and_Equipment_
Note 4 - Property and Equipment (Tables) | 9 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Property, Plant and Equipment [Abstract] | ' | ||||||||
Property, Plant and Equipment [Table Text Block] | ' | ||||||||
September 30, | December 31, | ||||||||
2013 | 2012 | ||||||||
Display equipment for trade shows | $ | 9,648 | $ | 9,648 | |||||
Leasehold improvements and furniture and fixtures | 94,572 | 94,572 | |||||||
Equipment and computers | 384,041 | 371,449 | |||||||
Total | 488,261 | 475,669 | |||||||
Accumulated depreciation | (119,178 | ) | (99,492 | ) | |||||
Net property and equipment | $ | 369,083 | $ | 376,177 |
Note_6_Notes_and_Other_Loans_P1
Note 6 - Notes and Other Loans Payable (Tables) | 9 Months Ended | |||||||||
Sep. 30, 2013 | ||||||||||
Debt Disclosure [Abstract] | ' | |||||||||
Schedule of Debt [Table Text Block] | ' | |||||||||
September 30, | December 31, | |||||||||
2013 | 2012 | |||||||||
8% uncollateralized note payable, paid by February 2013 | $ | - | $ | 10,000 | ||||||
12% uncollateralized notes payable, paid by June 2013 | - | 110,000 | ||||||||
9% convertible notes payable, net of original issue discounts of $0 and $97,628 at September 30, 2013 and December 31, 2012, paid by September 2013, and collateralized by receivables from the U.S. Army Contract | - | 385,594 | ||||||||
6-12% uncollateralized demand notes payable | 230,500 | 160,500 | ||||||||
12% senior secured note payable, plus 6% redemption premium, collateralized by all assets of the Company, monthly payments commencing December 2013 through September 2014 | 400,000 | - | ||||||||
12% convertible notes payable, net of 10% original issue discount of $67,893 at September 30, 2013, maturing at various dates from November 2013 through March 2014 (A) | 140,530 | - | ||||||||
10% convertible note payable, net of original issue discount of $30,101 at September 30, 2013, monthly payments commencing in December 2013 through July 2014 (B) | 183,543 | - | ||||||||
Total current non related party notes –net of discount (accrued interest is included in accrued expenses) | $ | 954,573 | $ | 666,094 | ||||||
Related Party Notes and Other Loans Payable [Table Text Block] | ' | |||||||||
September 30, | December 31, | |||||||||
2013 | 2012 | |||||||||
6% demand loan from controlling shareholder, uncollateralized (A) | $ | - | $ | 11,285 | ||||||
6% demand loans per Operations Agreement with Schoell Marine Inc., a company owned by Cyclone’s Chairman and controlling shareholder (B) | 424,282 | 424,785 | ||||||||
6% non-collateralized loans from officer and shareholder, payable on demand. The original principle balances were $157,101. | 85,364 | 66,364 | ||||||||
12% non-collateralized loans from officer and shareholder, payable on demand | 12,000 | 11,000 | ||||||||
Accrued Interest | 244,115 | 213,905 | ||||||||
Total current related party notes, inclusive of accrued interest | $ | 765,761 | $ | 727,339 |
Note_10_Stock_Options_and_Warr1
Note 10 - Stock Options and Warrants (Tables) | 9 Months Ended | |||||||||||||
Sep. 30, 2013 | ||||||||||||||
Stock Options And Warrants [Abstract] | ' | |||||||||||||
Schedule of Share-based Compensation, Stock Options, Activity [Table Text Block] | ' | |||||||||||||
Number | Weighted Avg. | Weighted Avg. | ||||||||||||
Outstanding | Exercise Price | Remaining | ||||||||||||
Contractual Life | ||||||||||||||
(Years) | ||||||||||||||
Balance, December 31, 2012 | 9,740,000 | $ | 0.185 | 7.4 | ||||||||||
Options issued | 600,000 | 0.08 | 9.5 | |||||||||||
Options exercised | - | - | - | |||||||||||
Options cancelled | (600,000 | ) | (0.135 | ) | - | |||||||||
Options re-priced: | ||||||||||||||
Cancelled-old | (4,185,000 | ) | (0.20 | ) | (6.8 | ) | ||||||||
Re-priced | 4,185,000 | 0.1 | 6.8 | |||||||||||
Balance, September 30, 2013 | 9,740,000 | $ | 0.139 | 6.7 | ||||||||||
Vested and Exercisable Options [Table Text Block] | ' | |||||||||||||
Exercisable/ | Weighted | Weighted | ||||||||||||
Vested | Avg. | Avg. | ||||||||||||
Options | Exercise Price | Remaining | ||||||||||||
Outstanding | Contractual | |||||||||||||
Life (Years) | ||||||||||||||
Balance September 30, 2013 | 8,540,000 | $ | 0.153 | 6.4 | ||||||||||
Additional vesting by December 31, 2013 | 600,000 | 0.078 | 9.3 | |||||||||||
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions [Table Text Block] | ' | |||||||||||||
Nine Months Ended | ||||||||||||||
September 30, | ||||||||||||||
2013 | ||||||||||||||
Risk free interest rate | 0.51 | % | - | 1.41 | % | |||||||||
Expected volatility | 34 | % | - | 107 | % | |||||||||
Expected term in years | 1 | 5 | ||||||||||||
Expected dividend yield | 0 | % | ||||||||||||
Average value per options and warrants | $ | 0.01 | - | $ | 0.06 | |||||||||
Schedule of Stockholders' Equity Note, Warrants or Rights [Table Text Block] | ' | |||||||||||||
Number | Weighted Avg. | Weighted | ||||||||||||
Outstanding | Exercise Price | Avg. | ||||||||||||
Remaining | ||||||||||||||
Contractual | ||||||||||||||
Life (Years) | ||||||||||||||
Balance, December 31, 2012 | 7,856,165 | $ | 0.218 | 2.9 | ||||||||||
Warrants issued | 1,658,737 | 0.087 | 4.2 | |||||||||||
Warrants exercised | - | - | - | |||||||||||
Warrants cancelled | - | - | - | |||||||||||
Warrants re-priced: | ||||||||||||||
Cancelled-old | (2,346,222 | ) | (.170 | ) | (3.5 | ) | ||||||||
Re-priced | 2,346,222 | 0.08 | 3.5 | |||||||||||
Balance, September 30, 2013 | 9,514,902 | $ | 0.172 | 2.5 |
Note_11_Income_Taxes_Tables
Note 11 - Income Taxes (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Income Tax Disclosure [Abstract] | ' | ||||||||||||||||
Schedule of Effective Income Tax Rate Reconciliation [Table Text Block] | ' | ||||||||||||||||
Nine | Amount | Nine | Amount | ||||||||||||||
months | months | ||||||||||||||||
ended | ended | ||||||||||||||||
September | September | ||||||||||||||||
30, 2013 | 30, 2012 | ||||||||||||||||
Tax benefit at U.S. statutory rate | 34% | $ | 634,989 | 34% | $ | 785,256 | |||||||||||
State taxes, net of federal benefit | 4 | 74,705 | 4 | 92,383 | |||||||||||||
Change in valuation allowance | -38 | (709,694 | ) | -38 | (877,639 | ) | |||||||||||
-% | $ | - | -% | $ | - | ||||||||||||
Schedule of Deferred Tax Assets and Liabilities [Table Text Block] | ' | ||||||||||||||||
Deferred Tax Assets | September 30, | December 31, | |||||||||||||||
2013 | 2012 | ||||||||||||||||
Net Operating Loss Carry-forward | $ | 7,347,942 | $ | 6,604,436 | |||||||||||||
Deferred Tax Liabilities – Accrued Officers’ Salaries | (414,010 | ) | (335,635 | ) | |||||||||||||
Net Deferred Tax Assets | 6,933,932 | 6,268,801 | |||||||||||||||
Valuation Allowance | (6,933,932 | ) | (6,268,801 | ) | |||||||||||||
Total Net Deferred Tax Assets | $ | - | $ | - |
Note_12_Lease_Obligations_Tabl
Note 12 - Lease Obligations (Tables) | 9 Months Ended | ||||
Sep. 30, 2013 | |||||
Leases, Capital [Abstract] | ' | ||||
Schedule of Future Minimum Lease Payments for Capital Leases [Table Text Block] | ' | ||||
December 31, | $ | 1,072 | |||
2013 | |||||
2014 | 4,898 | ||||
2015 | 4,383 | ||||
2016 | 4,966 | ||||
2017 | 4,150 | ||||
$ | 19,469 |
Note_16_Derivative_Financial_I1
Note 16 - Derivative Financial Instruments (Tables) | 9 Months Ended | ||||||||||||
Sep. 30, 2013 | |||||||||||||
Disclosure Text Block [Abstract] | ' | ||||||||||||
Schedule of Derivative Liabilities at Fair Value [Table Text Block] | ' | ||||||||||||
Volatility | 86 | % | - | 102 | % | ||||||||
Risk Free Rate | 0.02 | % | - | 0.08 | % | ||||||||
Expected Term (years) | 0.1 | - | 0.6 | ||||||||||
Dividend Rate | 0% |
Note_1_Organizational_and_Sign2
Note 1 - Organizational and Significant Accounting Policies (Details) (USD $) | 3 Months Ended | 9 Months Ended | 12 Months Ended | 3 Months Ended | |||||
Share data in Millions, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 |
Contract with U.S. Army [Member] | Contract with U.S. Army [Member] | Amended Phoenix License [Member] | WHE Subsidiary [Member] | Cyclone Performance [Member] | |||||
Note 1 - Organizational and Significant Accounting Policies (Details) [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Equity Method Investment, Ownership Percentage | ' | ' | ' | ' | ' | ' | ' | 74.46% | 95.00% |
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount (in Shares) | ' | ' | 19.3 | 18.7 | ' | ' | ' | ' | ' |
Revenues (in Dollars) | $212,500 | $502,045 | $715,382 | $882,490 | $503,000 | $753,000 | $150,000 | ' | ' |
Cost of Goods Sold (in Dollars) | 133,134 | 333,438 | 428,556 | 555,346 | 295,000 | 428,000 | 133,000 | ' | ' |
Research and Development Expense (in Dollars) | $202,829 | $273,645 | $573,600 | $772,468 | ' | ' | ' | ' | ' |
Note_1_Organizational_and_Sign3
Note 1 - Organizational and Significant Accounting Policies (Details) - Summary of Fair Values and Changing Values of Financial Instruments (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Sep. 30, 2013 | |
Summary of Fair Values and Changing Values of Financial Instruments [Abstract] | ' | ' |
Derivative liabilities- notes payable | $106,592 | $106,592 |
Derivative liabilities- notes payable | $106,592 | ' |
Note_1_Organizational_and_Sign4
Note 1 - Organizational and Significant Accounting Policies (Details) - Estimated Useful Lives of Property and Equipment | 6 Months Ended |
Jun. 30, 2013 | |
Display Equipment for Trade Shows [Member] | ' |
Years | ' |
Estimated useful lives | '3 years |
Leasehold Improvements and Furniture and Fixtures [Member] | Minimum [Member] | ' |
Years | ' |
Estimated useful lives | '10 years |
Leasehold Improvements and Furniture and Fixtures [Member] | Maximum [Member] | ' |
Years | ' |
Estimated useful lives | '15 years |
Shop Equipment [Member] | ' |
Years | ' |
Estimated useful lives | '7 years |
Computer Equipment [Member] | ' |
Years | ' |
Estimated useful lives | '3 years |
Note_2_Going_Concern_Details
Note 2 - Going Concern (Details) (USD $) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2013 | Dec. 31, 2012 | |
Note 2 - Going Concern (Details) [Line Items] | ' | ' |
Income (Loss) from Continuing Operations before Equity Method Investments, Income Taxes, Extraordinary Items, Noncontrolling Interest | ($2,100,000) | ($3,000,000) |
Retained Earnings (Accumulated Deficit) | -50,833,766 | -48,723,344 |
Working Capital Deficit | 3,900,000 | ' |
Attributable to Operating Losses [Member] | ' | ' |
Note 2 - Going Concern (Details) [Line Items] | ' | ' |
Retained Earnings (Accumulated Deficit) | -20,011,934 | -17,948,634 |
Attributable to Non-Cash Derivative Liability Accounting [Member] | ' | ' |
Note 2 - Going Concern (Details) [Line Items] | ' | ' |
Retained Earnings (Accumulated Deficit) | ($30,821,832) | ($30,774,710) |
Note_3_Inventory_Net_Details_I
Note 3 - Inventory, Net (Details) - Inventory Components (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
Inventory [Line Items] | ' | ' |
Inventory | $550,623 | $741,306 |
Inventory valuation reserve | -100,000 | -100,000 |
Inventory, net | 450,623 | 641,306 |
Engine Material and Parts [Member] | ' | ' |
Inventory [Line Items] | ' | ' |
Inventory | 372,608 | 542,116 |
Labor [Member] | ' | ' |
Inventory [Line Items] | ' | ' |
Inventory | 154,796 | 173,209 |
Applied Overhead [Member] | ' | ' |
Inventory [Line Items] | ' | ' |
Inventory | $23,219 | $25,981 |
Note_4_Property_and_Equipment_1
Note 4 - Property and Equipment (Details) (USD $) | 9 Months Ended | |
Sep. 30, 2013 | Sep. 30, 2012 | |
Property, Plant and Equipment [Abstract] | ' | ' |
Depreciation | $19,686 | $16,178 |
Note_4_Property_and_Equipment_2
Note 4 - Property and Equipment (Details) - Property and Equipment (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
Property, Plant and Equipment [Line Items] | ' | ' |
Property and Equipment | $488,261 | $475,669 |
Accumulated depreciation | -119,178 | -99,492 |
Net property and equipment | 369,083 | 376,177 |
Display Equipment for Trade Shows [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Property and Equipment | 9,648 | 9,648 |
Leasehold Improvements and Furniture and Fixtures [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Property and Equipment | 94,572 | 94,572 |
Equipment and Computers [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Property and Equipment | $384,041 | $371,449 |
Note_5_Patents_and_Trademarks_1
Note 5 - Patents and Trademarks and Copyrights (Details) (USD $) | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | |
Disclosure Text Block [Abstract] | ' | ' | ' |
Finite-Lived Intangible Assets, Net | $380,068 | ' | $406,686 |
Patents, Trademarks and Copyrights Capitalized | 2,469 | ' | 5,315 |
Number of Patents | 33 | ' | ' |
Number of Trademarks | 3 | ' | ' |
Finite-Lived Intangible Asset, Useful Life | '15 years | ' | ' |
Amortization of Intangible Assets | $29,087 | $30,016 | ' |
Note_6_Notes_and_Other_Loans_P2
Note 6 - Notes and Other Loans Payable (Details) (USD $) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2013 | Dec. 31, 2012 | |
Note 6 - Notes and Other Loans Payable (Details) [Line Items] | ' | ' |
Debt Instrument, Face Amount (in Dollars) | $200,000 | ' |
Number of Shares of Convertible Preferred Stock Issued for Note Payable (in Shares) | 8,000 | ' |
Proceeds from Sale of Treasury Stock | 40,000 | ' |
Original Issue Discount [Member] | 12% Convertible Notes Payable [Member] | Notes Payable [Member] | ' | ' |
Note 6 - Notes and Other Loans Payable (Details) [Line Items] | ' | ' |
Debt Instrument, Unamortized Discount | 107,187 | ' |
Original Issue Discount [Member] | 12% Convertible Notes Payable [Member] | ' | ' |
Note 6 - Notes and Other Loans Payable (Details) [Line Items] | ' | ' |
Debt Instrument, Unamortized Discount | 20,000 | ' |
Original Issue Discount [Member] | 10% Convertible Note Payable [Member] | ' | ' |
Note 6 - Notes and Other Loans Payable (Details) [Line Items] | ' | ' |
Debt Instrument, Unamortized Discount | 26,250 | ' |
Carrying Value of Stock Purchase Warrants [Member] | 10% Convertible Note Payable [Member] | ' | ' |
Note 6 - Notes and Other Loans Payable (Details) [Line Items] | ' | ' |
Debt Instrument, Unamortized Discount | 16,457 | ' |
12% Convertible Notes Payable [Member] | Notes Payable [Member] | ' | ' |
Note 6 - Notes and Other Loans Payable (Details) [Line Items] | ' | ' |
Debt Instrument, Unamortized Discount | 59,470 | ' |
12% Convertible Notes Payable [Member] | ' | ' |
Note 6 - Notes and Other Loans Payable (Details) [Line Items] | ' | ' |
Debt Instrument, Unamortized Discount | 8,423 | ' |
10% Convertible Note Payable [Member] | ' | ' |
Note 6 - Notes and Other Loans Payable (Details) [Line Items] | ' | ' |
Debt Instrument, Unamortized Discount | 13,644 | ' |
6% Demand Loan from Controlling Shareholder [Member] | ' | ' |
Note 6 - Notes and Other Loans Payable (Details) [Line Items] | ' | ' |
Debt Instrument, Face Amount (in Dollars) | 40,000 | ' |
Repayments of Notes Payable | 11,285 | 0 |
6% Demand Loans per Operations Agreement with Schoell Marine Inc. [Member] | ' | ' |
Note 6 - Notes and Other Loans Payable (Details) [Line Items] | ' | ' |
Repayments of Notes Payable | $500 | $4,550 |
Debt Instrument, Interest Rate, Stated Percentage | 6.00% | ' |
Note_6_Notes_and_Other_Loans_P3
Note 6 - Notes and Other Loans Payable (Details) - Non-Related Party Notes and Other Loans Payable (USD $) | Sep. 30, 2013 | Dec. 31, 2012 | ||
Note 6 - Notes and Other Loans Payable (Details) - Non-Related Party Notes and Other Loans Payable [Line Items] | ' | ' | ||
Current non-related party notes | $954,573 | $666,094 | ||
8% Uncollateralized Note Payable [Member] | ' | ' | ||
Note 6 - Notes and Other Loans Payable (Details) - Non-Related Party Notes and Other Loans Payable [Line Items] | ' | ' | ||
Current non-related party notes | ' | 10,000 | ||
12% Uncollateralized Notes Payable [Member] | ' | ' | ||
Note 6 - Notes and Other Loans Payable (Details) - Non-Related Party Notes and Other Loans Payable [Line Items] | ' | ' | ||
Current non-related party notes | ' | 110,000 | ||
9% Convertible Notes Payable [Member] | ' | ' | ||
Note 6 - Notes and Other Loans Payable (Details) - Non-Related Party Notes and Other Loans Payable [Line Items] | ' | ' | ||
Current non-related party notes | ' | 385,594 | ||
6 - 12% Uncollateralized Demand Notes Payable [Member] | ' | ' | ||
Note 6 - Notes and Other Loans Payable (Details) - Non-Related Party Notes and Other Loans Payable [Line Items] | ' | ' | ||
Current non-related party notes | 230,500 | 160,500 | ||
12% Senior Secured Note Payable [Member] | ' | ' | ||
Note 6 - Notes and Other Loans Payable (Details) - Non-Related Party Notes and Other Loans Payable [Line Items] | ' | ' | ||
Current non-related party notes | 400,000 | ' | ||
12% Convertible Notes Payable [Member] | ' | ' | ||
Note 6 - Notes and Other Loans Payable (Details) - Non-Related Party Notes and Other Loans Payable [Line Items] | ' | ' | ||
Current non-related party notes | 140,530 | [1] | ' | [1] |
10% Convertible Note Payable [Member] | ' | ' | ||
Note 6 - Notes and Other Loans Payable (Details) - Non-Related Party Notes and Other Loans Payable [Line Items] | ' | ' | ||
Current non-related party notes | $183,543 | [2] | ' | [2] |
[1] | Notes issued net of original discount of $20,000 ($8,423 unamortized a September 30, 2013) along with additional discount from derivative liabilities of $107,187 ($59,470 unamortized at September 30, 2013). | |||
[2] | Note issued net of original discount of $26,250 ($13,644 unamortized at September 30, 2013) along with stock purchase warrants whose value has been carried as a discount against the note ($16,457 unamortized at September 30, 2013). |
Note_6_Notes_and_Other_Loans_P4
Note 6 - Notes and Other Loans Payable (Details) - Non-Related Party Notes and Other Loans Payable (Parentheticals) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
8% Uncollateralized Note Payable [Member] | ' | ' |
Note 6 - Notes and Other Loans Payable (Details) - Non-Related Party Notes and Other Loans Payable (Parentheticals) [Line Items] | ' | ' |
Interest rate | ' | 8.00% |
12% Uncollateralized Notes Payable [Member] | ' | ' |
Note 6 - Notes and Other Loans Payable (Details) - Non-Related Party Notes and Other Loans Payable (Parentheticals) [Line Items] | ' | ' |
Interest rate | ' | 12.00% |
9% Convertible Notes Payable [Member] | ' | ' |
Note 6 - Notes and Other Loans Payable (Details) - Non-Related Party Notes and Other Loans Payable (Parentheticals) [Line Items] | ' | ' |
Interest rate | 9.00% | 9.00% |
Original issue discount (in Dollars) | $0 | $97,628 |
6 - 12% Uncollateralized Demand Notes Payable [Member] | Minimum [Member] | ' | ' |
Note 6 - Notes and Other Loans Payable (Details) - Non-Related Party Notes and Other Loans Payable (Parentheticals) [Line Items] | ' | ' |
Interest rate | 6.00% | 6.00% |
6 - 12% Uncollateralized Demand Notes Payable [Member] | Maximum [Member] | ' | ' |
Note 6 - Notes and Other Loans Payable (Details) - Non-Related Party Notes and Other Loans Payable (Parentheticals) [Line Items] | ' | ' |
Interest rate | 12.00% | 12.00% |
12% Senior Secured Note Payable [Member] | ' | ' |
Note 6 - Notes and Other Loans Payable (Details) - Non-Related Party Notes and Other Loans Payable (Parentheticals) [Line Items] | ' | ' |
Interest rate | 12.00% | ' |
Redemption premium, percent | 6.00% | ' |
12% Convertible Notes Payable [Member] | ' | ' |
Note 6 - Notes and Other Loans Payable (Details) - Non-Related Party Notes and Other Loans Payable (Parentheticals) [Line Items] | ' | ' |
Interest rate | 12.00% | ' |
Original issue discount (in Dollars) | 67,893 | ' |
Original issue discount, percent | 10.00% | ' |
10% Convertible Note Payable [Member] | ' | ' |
Note 6 - Notes and Other Loans Payable (Details) - Non-Related Party Notes and Other Loans Payable (Parentheticals) [Line Items] | ' | ' |
Interest rate | 10.00% | ' |
Original issue discount (in Dollars) | $30,101 | ' |
Note_6_Notes_and_Other_Loans_P5
Note 6 - Notes and Other Loans Payable (Details) - Related Party Notes and Other Loans Payable (USD $) | Sep. 30, 2013 | Dec. 31, 2012 | ||
Note 6 - Notes and Other Loans Payable (Details) - Related Party Notes and Other Loans Payable [Line Items] | ' | ' | ||
Current due to related parties | $765,761 | $727,339 | ||
6% Demand Loan from Controlling Shareholder [Member] | ' | ' | ||
Note 6 - Notes and Other Loans Payable (Details) - Related Party Notes and Other Loans Payable [Line Items] | ' | ' | ||
Current due to related parties | ' | [1] | 11,285 | [1] |
6% Demand Loans per Operations Agreement with Schoell Marine Inc. [Member] | ' | ' | ||
Note 6 - Notes and Other Loans Payable (Details) - Related Party Notes and Other Loans Payable [Line Items] | ' | ' | ||
Current due to related parties | 424,282 | [2] | 424,785 | [2] |
6% Demand Non-Collateralized Loan from Officer and Shareholder [Member] | ' | ' | ||
Note 6 - Notes and Other Loans Payable (Details) - Related Party Notes and Other Loans Payable [Line Items] | ' | ' | ||
Current due to related parties | 85,364 | 66,364 | ||
12% Non-Collateralized Loan from Officer and Shareholder [Member] | ' | ' | ||
Note 6 - Notes and Other Loans Payable (Details) - Related Party Notes and Other Loans Payable [Line Items] | ' | ' | ||
Current due to related parties | 12,000 | 11,000 | ||
Accrued Interest [Member] | ' | ' | ||
Note 6 - Notes and Other Loans Payable (Details) - Related Party Notes and Other Loans Payable [Line Items] | ' | ' | ||
Current due to related parties | $244,115 | $213,905 | ||
[1] | This note (originally $40,000) was issued to finance the purchase of 8,000 shares of the Company's Series A Preferred Stock. This treasury stock was subsequently sold for $40,000. For the nine months ended September 30, 2013 and for the year ended December 31, 2012, $11,285 and $0 of principal was paid on the note balance. | |||
[2] | This note arose from services and salaries incurred by Schoell Marine on behalf of the Company. Schoell Marine also owns the building that is leased to the Company. The Schoell Marine note bears an interest rate of 6% and repayments occur as cash flow of the Company permits. The note was secured by a UCC-1 filing on the Company's patents and patent applications, which expired and has not been renewed. For the nine months ended September 30, 2013 and for the year ended December 31, 2012, $500 and $4,550 of principal was paid on the note balance. |
Note_6_Notes_and_Other_Loans_P6
Note 6 - Notes and Other Loans Payable (Details) - Related Party Notes and Other Loans Payable (Parentheticals) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
Note 6 - Notes and Other Loans Payable (Details) - Related Party Notes and Other Loans Payable (Parentheticals) [Line Items] | ' | ' |
Original loan amount, rP5latP5d party loan (in Dollars) | 200,000 | ' |
6% Demand Loan from Controlling Shareholder [Member] | ' | ' |
Note 6 - Notes and Other Loans Payable (Details) - Related Party Notes and Other Loans Payable (Parentheticals) [Line Items] | ' | ' |
IntP5rP5st ratP5, rP5latP5d party loan | 6.00% | 6.00% |
6% Demand Loans per Operations Agreement with Schoell Marine Inc. [Member] | ' | ' |
Note 6 - Notes and Other Loans Payable (Details) - Related Party Notes and Other Loans Payable (Parentheticals) [Line Items] | ' | ' |
IntP5rP5st ratP5, rP5latP5d party loan | 6.00% | 6.00% |
6% Demand Non-Collateralized Loan from Officer and Shareholder [Member] | ' | ' |
Note 6 - Notes and Other Loans Payable (Details) - Related Party Notes and Other Loans Payable (Parentheticals) [Line Items] | ' | ' |
IntP5rP5st ratP5, rP5latP5d party loan | 6.00% | 6.00% |
Original loan amount, rP5latP5d party loan (in Dollars) | 157,101 | 157,101 |
12% Non-Collateralized Loan from Officer and Shareholder [Member] | ' | ' |
Note 6 - Notes and Other Loans Payable (Details) - Related Party Notes and Other Loans Payable (Parentheticals) [Line Items] | ' | ' |
IntP5rP5st ratP5, rP5latP5d party loan | 12.00% | 12.00% |
Note_7_Related_Party_Transacti1
Note 7 - Related Party Transactions (Details) (USD $) | 9 Months Ended | |||
Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | Jul. 31, 2011 | |
sqft | sqft | |||
Related Party Transactions [Abstract] | ' | ' | ' | ' |
Area of Real Estate Property (in Square Feet) | 6,000 | ' | ' | 2,000 |
Occupancy, Net | $47,223 | $47,223 | ' | ' |
Due to Related Parties | $1,838,369 | ' | $1,647,811 | ' |
Note_8_Preferred_Stock_Details
Note 8 - Preferred Stock (Details) | Sep. 30, 2013 | Dec. 31, 2012 |
Note 8 - Preferred Stock (Details) [Line Items] | ' | ' |
Voting Control Percentage | 51.00% | ' |
Series B Preferred Stock [Member] | ' | ' |
Note 8 - Preferred Stock (Details) [Line Items] | ' | ' |
Preferred Stock, Shares Outstanding (in Shares) | 1,000 | 1,000 |
Note_9_Stock_Transactions_Deta
Note 9 - Stock Transactions (Details) (USD $) | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2013 | Jun. 30, 2013 | Sep. 30, 2013 | |
Note 9 - Stock Transactions (Details) [Line Items] | ' | ' | ' |
Stock Issued During Period, Shares, Restricted Stock Award, Gross | ' | ' | 1,000,000 |
Stock Issued During Period, Value, Restricted Stock Award, Gross (in Dollars) | ' | ' | $100,000 |
Number of Shares of Common Stock Donated by Officers and Senior Management | 1,820,000 | ' | ' |
Other Noncash Expense (in Dollars) | 145,600 | 52,000 | ' |
Stock Issued During Period, Shares, Issued for Services | 2,000,000 | ' | ' |
Treasury Stock, Shares | 3,000,000 | ' | 3,000,000 |
Employee Stock Option [Member] | ' | ' | ' |
Note 9 - Stock Transactions (Details) [Line Items] | ' | ' | ' |
Allocated Share-based Compensation Expense (in Dollars) | ' | ' | 109,882 |
Re-Priced Employee Options [Member] | ' | ' | ' |
Note 9 - Stock Transactions (Details) [Line Items] | ' | ' | ' |
Allocated Share-based Compensation Expense (in Dollars) | ' | ' | 51,930 |
Stock Warrants [Member] | ' | ' | ' |
Note 9 - Stock Transactions (Details) [Line Items] | ' | ' | ' |
Allocated Share-based Compensation Expense (in Dollars) | ' | ' | 119,782 |
Board of Directors Chairman [Member] | ' | ' | ' |
Note 9 - Stock Transactions (Details) [Line Items] | ' | ' | ' |
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners | 5.00% | ' | 5.00% |
Treasury Stock, Shares, Acquired | 5,000,000 | ' | ' |
Outside Services [Member] | ' | ' | ' |
Note 9 - Stock Transactions (Details) [Line Items] | ' | ' | ' |
Stock Issued During Period, Shares, Restricted Stock Award, Gross | ' | ' | 9,691,071 |
Stock Issued During Period, Value, Restricted Stock Award, Gross (in Dollars) | ' | ' | 692,750 |
Satisfaction of Contracted and Accrued Officers' Salaries [Member] | ' | ' | ' |
Note 9 - Stock Transactions (Details) [Line Items] | ' | ' | ' |
Stock Issued During Period, Shares, Restricted Stock Award, Gross | ' | ' | 675,000 |
Stock Issued During Period, Value, Restricted Stock Award, Gross (in Dollars) | ' | ' | 54,000 |
Partial Prepayment of Interest on Debt [Member] | ' | ' | ' |
Note 9 - Stock Transactions (Details) [Line Items] | ' | ' | ' |
Stock Issued During Period, Shares, New Issues | ' | ' | 342,996 |
Stock Issued During Period, Value, New Issues (in Dollars) | ' | ' | 20,994 |
Repayment of Debt [Member] | ' | ' | ' |
Note 9 - Stock Transactions (Details) [Line Items] | ' | ' | ' |
Stock Issued During Period, Shares, New Issues | ' | ' | 4,920,833 |
Stock Issued During Period, Value, New Issues (in Dollars) | ' | ' | 343,672 |
Payment of Liabilities [Member] | ' | ' | ' |
Note 9 - Stock Transactions (Details) [Line Items] | ' | ' | ' |
Stock Issued During Period, Shares, New Issues | ' | ' | 612,500 |
Stock Issued During Period, Value, New Issues (in Dollars) | ' | ' | $45,875 |
Note_10_Stock_Options_and_Warr2
Note 10 - Stock Options and Warrants (Details) (USD $) | 3 Months Ended | 9 Months Ended | 12 Months Ended | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 3 Months Ended | |||||||||||
Sep. 30, 2013 | Jun. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Mar. 31, 2014 | Mar. 31, 2014 | Jun. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | |
Scenario, Forecast [Member] | Scenario, Forecast [Member] | Previous Exercise Price [Member] | Previous Exercise Price [Member] | Previous Exercise Price [Member] | Current Exercise Price [Member] | Employee Stock Option [Member] | Repayment of Debt [Member] | Issued in Connection with Debt Financing [Member] | New Debt [Member] | Consulting Agreement [Member] | Repayment of Debt and Interest [Member] | Issued in Connection with Debt Financing [Member] | Weighted Average [Member] | ||||||
Per Quarter [Member] | |||||||||||||||||||
Note 10 - Stock Options and Warrants (Details) [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross (in Shares) | ' | ' | ' | 600,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Stock Options Issued During Period, Value (in Dollars) | ' | ' | ' | $37,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price | ' | ' | ' | $0.08 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Stock Options Issued During Period, Maturity Life | ' | ' | ' | '10 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share-based Compensation (in Dollars) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 109,882 | ' | ' | ' | ' | ' | ' | ' |
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized (in Dollars) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 25,012 | ' | ' | ' | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Forfeitures in Period (in Shares) | ' | ' | ' | 600,000 | ' | 600,000 | 2,400,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Stock Options Repriced During Period, Number (in Shares) | ' | 4,185,000 | ' | 4,185,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Stock Options Repriced During Period, Exercise Price | ' | $0.10 | ' | $0.10 | ' | ' | ' | $0.15 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $0.20 |
Other Noncash Expense (in Dollars) | 145,600 | 52,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Stock Issued During Period, Value, Other (in Dollars) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 110,000 | ' | ' | ' | ' | ' | ' |
Warrants Repriced During Period, Number (in Shares) | ' | ' | ' | 2,346,222 | ' | ' | ' | ' | ' | ' | ' | ' | 360,000 | 1,986,222 | ' | ' | ' | ' | ' |
Warrants Repriced During Period, Exercise Price | ' | ' | $0.10 | $0.08 | ' | ' | ' | ' | $0.20 | $0.30 | $0.10 | ' | ' | ' | ' | ' | ' | ' | ' |
Debt Instrument, Face Amount (in Dollars) | 200,000 | ' | ' | 200,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Warrants Issued During Period, Number (in Shares) | ' | ' | ' | 1,658,737 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 565,625 | 100,000 | ' | 993,111 | ' |
Warrants Issued During Period, Exercise Price | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $0.10 | $0.10 | ' | $0.10 | ' |
Warrants Issued During Period, Term | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '5 years | '5 years | ' | ' | ' |
Warrants Issued During Period, Value (in Dollars) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5,900 | ' | ' | ' |
Stock Issued During Period, Value, New Issues (in Dollars) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 343,672 | ' | ' | ' | 364,666 | ' | ' |
Proceeds from Debt, Net of Issuance Costs (in Dollars) | ' | ' | $544,000 | $870,000 | $925,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common Stock Issuance Price Threshold for Anti-Dilution Protections | $0.10 | ' | ' | $0.10 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Exempted Issuance, Shares of Common Stock Issued to Service Providers (in Shares) | 5,000,000 | ' | ' | 5,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Note_10_Stock_Options_and_Warr3
Note 10 - Stock Options and Warrants (Details) - Common Stock Options (USD $) | 3 Months Ended | 9 Months Ended | 12 Months Ended |
Jun. 30, 2013 | Sep. 30, 2013 | Dec. 31, 2012 | |
Note 10 - Stock Options and Warrants (Details) - Common Stock Options [Line Items] | ' | ' | ' |
Balance, Number Outstanding | ' | 9,740,000 | 9,740,000 |
Balance, Weighted Average Exercise Price (in Dollars per share) | ' | $0.14 | $0.19 |
Balance, Weighted Avg. Remaining Contract Life | ' | '6 years 255 days | '7 years 146 days |
Options issued | ' | 600,000 | ' |
Options issued (in Dollars per share) | ' | $0.08 | ' |
Options issued | ' | '9 years 6 months | ' |
Options Cancelled, Number Outstanding | ' | -600,000 | ' |
Options Cancelled, Weighted Average Exercise Price (in Dollars per share) | ' | ($0.14) | ' |
Options re-priced: | ' | ' | ' |
Re-priced | 4,185,000 | 4,185,000 | ' |
Re-priced (in Dollars per share) | $0.10 | $0.10 | ' |
Re-priced | ' | '6 years 292 days | ' |
Before [Member] | ' | ' | ' |
Note 10 - Stock Options and Warrants (Details) - Common Stock Options [Line Items] | ' | ' | ' |
Options Cancelled, Number Outstanding | ' | -4,185,000 | ' |
Options Cancelled, Weighted Average Exercise Price (in Dollars per share) | ' | ($0.20) | ' |
Options Cancelled, Weighted Avg. Remaining Contract Life | ' | 'minus 6 years 292 days | ' |
Note_10_Stock_Options_and_Warr4
Note 10 - Stock Options and Warrants (Details) - Vested and Exercisable Options (USD $) | 9 Months Ended | 3 Months Ended |
Sep. 30, 2013 | Dec. 31, 2013 | |
Scenario, Forecast [Member] | ||
Note 10 - Stock Options and Warrants (Details) - Vested and Exercisable Options [Line Items] | ' | ' |
Exercisable/Vested Options Outstanding | 8,540,000 | 600,000 |
Weighted Average Exercise Price (in Dollars per share) | $0.15 | $0.08 |
Weighted Average Remaining Contractual Life | '6 years 146 days | '9 years 109 days |
Note_10_Stock_Options_and_Warr5
Note 10 - Stock Options and Warrants (Details) - Fair Value of Stock Options and Purchase Warrants Assumptions (USD $) | 9 Months Ended |
Sep. 30, 2013 | |
Note 10 - Stock Options and Warrants (Details) - Fair Value of Stock Options and Purchase Warrants Assumptions [Line Items] | ' |
Expected dividend yield | 0.00% |
Stock Options and Purchase Warrants [Member] | ' |
Note 10 - Stock Options and Warrants (Details) - Fair Value of Stock Options and Purchase Warrants Assumptions [Line Items] | ' |
Expected dividend yield | 0.00% |
Minimum [Member] | Stock Options and Purchase Warrants [Member] | ' |
Note 10 - Stock Options and Warrants (Details) - Fair Value of Stock Options and Purchase Warrants Assumptions [Line Items] | ' |
Risk free interest rate | 0.51% |
Expected volatility | 34.00% |
Expected term in years | '1 year |
Average value per options and warrants (in Dollars per share) | 0.01 |
Minimum [Member] | ' |
Note 10 - Stock Options and Warrants (Details) - Fair Value of Stock Options and Purchase Warrants Assumptions [Line Items] | ' |
Risk free interest rate | 0.02% |
Expected volatility | 86.00% |
Expected term in years | '36 days |
Maximum [Member] | Stock Options and Purchase Warrants [Member] | ' |
Note 10 - Stock Options and Warrants (Details) - Fair Value of Stock Options and Purchase Warrants Assumptions [Line Items] | ' |
Risk free interest rate | 1.41% |
Expected volatility | 107.00% |
Expected term in years | '5 years |
Average value per options and warrants (in Dollars per share) | 0.06 |
Maximum [Member] | ' |
Note 10 - Stock Options and Warrants (Details) - Fair Value of Stock Options and Purchase Warrants Assumptions [Line Items] | ' |
Risk free interest rate | 0.08% |
Expected volatility | 102.00% |
Expected term in years | '219 days |
Note_10_Stock_Options_and_Warr6
Note 10 - Stock Options and Warrants (Details) - Outstanding Vested Warrant Activity (USD $) | 3 Months Ended | 9 Months Ended | 12 Months Ended |
Sep. 30, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | |
Outstanding Vested Warrant Activity [Abstract] | ' | ' | ' |
Number Outstanding | ' | 9,514,902 | 7,856,165 |
Weighted Average Exercise Price (in Dollars per share) | ' | $0.17 | $0.22 |
Weighted Average Remaining Contractual Life | ' | '2 years 6 months | '2 years 328 days |
Warrants issued | ' | 1,658,737 | ' |
Warrants issued (in Dollars per share) | ' | $0.09 | ' |
Warrants issued | ' | '4 years 73 days | ' |
Cancelled-old | ' | -2,346,222 | ' |
Cancelled-old (in Dollars per share) | ' | ($0.17) | ' |
Cancelled-old | ' | 'minus 3 years 6 months | ' |
Re-priced | ' | 2,346,222 | ' |
Re-priced (in Dollars per share) | $0.10 | $0.08 | ' |
Re-priced | ' | '3 years 6 months | ' |
Note_11_Income_Taxes_Details
Note 11 - Income Taxes (Details) (USD $) | Sep. 30, 2013 |
In Millions, unless otherwise specified | |
Note 11 - Income Taxes (Details) [Line Items] | ' |
Operating Loss Carryforwards (in Dollars) | $15.30 |
Minimum [Member] | ' |
Note 11 - Income Taxes (Details) [Line Items] | ' |
Percentage that Carry Forwards Will Expire Unused | 50.00% |
Note_11_Income_Taxes_Details_R
Note 11 - Income Taxes (Details) - Reconciliation of Effective Income Tax Rates and Statutory Federal Tax Rates (USD $) | 9 Months Ended | |
Sep. 30, 2013 | Sep. 30, 2012 | |
Reconciliation of Effective Income Tax Rates and Statutory Federal Tax Rates [Abstract] | ' | ' |
Tax benefit at U.S. statutory rate | 34.00% | 34.00% |
Tax benefit at U.S. statutory rate (in Dollars) | $634,989 | $785,256 |
State taxes, net of federal benefit | 4.00% | 4.00% |
State taxes, net of federal benefit (in Dollars) | 74,705 | 92,383 |
Change in valuation allowance | -38.00% | -38.00% |
Change in valuation allowance (in Dollars) | -709,694 | -877,639 |
0.00% | 0.00% | |
(in Dollars) | $0 | $0 |
Note_11_Income_Taxes_Details_D
Note 11 - Income Taxes (Details) - Deferred Tax Assets and Liabilities (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
Deferred Tax Assets and Liabilities [Abstract] | ' | ' |
Net Operating Loss Carry-forward | $7,347,942 | $6,604,436 |
Deferred Tax Liabilities b Accrued Officersb Salaries | -414,010 | -335,635 |
Net Deferred Tax Assets | 6,933,932 | 6,268,801 |
Valuation Allowance | -6,933,932 | -6,268,801 |
Total Net Deferred Tax Assets | $0 | $0 |
Note_12_Lease_Obligations_Deta
Note 12 - Lease Obligations (Details) (USD $) | 1 Months Ended | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2012 | Jul. 31, 2012 | Jul. 31, 2011 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2009 | |
sqft | sqft | |||||
Leases, Capital [Abstract] | ' | ' | ' | ' | ' | ' |
Property and Equipment, Amount Acquired Via Capitalized Lease Obligations | $21,310 | ' | ' | ' | ' | $27,401 |
Capitalized Lease Obligations, Average Interest Rate | 12.50% | ' | ' | ' | 12.50% | 18.40% |
Repayments of Long-term Capital Lease Obligations | ' | ' | ' | 3,467 | 654 | ' |
Capital Lease Obligations | ' | ' | ' | 19,469 | ' | ' |
Lease Term | ' | '1 year | '1 year | ' | ' | ' |
Area of Real Estate Property (in Square Feet) | ' | ' | 2,000 | 6,000 | ' | ' |
Rental Rate (in Dollars per Square Foot) | ' | ' | 8.25 | ' | ' | ' |
Contracted Annual Lease Rate | ' | 16,800 | ' | ' | ' | ' |
Lease Rate (in Dollars per Square Foot) | ' | 8.4 | ' | ' | ' | ' |
Lease Extension Period | ' | '1 year | ' | ' | ' | ' |
Operating Leases, Rent Expense | ' | ' | ' | $14,761 | $14,095 | ' |
Note_12_Lease_Obligations_Deta1
Note 12 - Lease Obligations (Details) - Future Lease Payments (USD $) | Sep. 30, 2013 |
Future Lease Payments [Abstract] | ' |
31-Dec-13 | $1,072 |
2014 | 4,898 |
2015 | 4,383 |
2016 | 4,966 |
2017 | 4,150 |
$19,469 |
Note_13_Commitments_and_Contin1
Note 13 - Commitments and Contingencies (Details) (USD $) | 9 Months Ended |
Sep. 30, 2013 | |
Note 13 - Commitments and Contingencies (Details) [Line Items] | ' |
Employment Agreements, Initial Term of Employment | '3 years |
Automatic Renewing Period of Employment Agreements | '1 year |
Harry Schoell, Chairman and CTO [Member] | ' |
Note 13 - Commitments and Contingencies (Details) [Line Items] | ' |
Employment Agreements, Officer Salary | 150,000 |
Frankie Fruge, COO [Member] | ' |
Note 13 - Commitments and Contingencies (Details) [Line Items] | ' |
Employment Agreements, Officer Salary | 120,000 |
Christopher Nelson, President and General Counsel [Member] | ' |
Note 13 - Commitments and Contingencies (Details) [Line Items] | ' |
Employment Agreements, Officer Salary | 130,000 |
Note_14_Subsidiaries_Details
Note 14 - Subsidiaries (Details) (USD $) | 12 Months Ended | 1 Months Ended | 0 Months Ended | 1 Months Ended | 9 Months Ended | 12 Months Ended | 3 Months Ended | |||||||||
Share data in Millions, unless otherwise specified | Dec. 31, 2010 | Dec. 31, 2010 | Jul. 31, 2013 | Jul. 31, 2010 | Jul. 31, 2010 | Jul. 31, 2010 | Jul. 13, 2013 | Jul. 31, 2013 | Sep. 30, 2013 | Dec. 31, 2012 | Dec. 31, 2010 | Dec. 31, 2012 | Sep. 30, 2012 | Sep. 30, 2013 | Mar. 31, 2012 | Sep. 30, 2013 |
WHE Subsidiary [Member] | WHE Subsidiary [Member] | WHE Subsidiary [Member] | WHE Subsidiary [Member] | WHE Subsidiary [Member] | WHE Subsidiary [Member] | WHE Subsidiary [Member] | WHE Subsidiary [Member] | WHE Subsidiary [Member] | WHE Subsidiary [Member] | WHE Subsidiary [Member] | An Unrelated Investor [Member] | Corporate Officers of the Company [Member] | Cyclone Performance [Member] | Cyclone Performance [Member] | Board of Directors Chairman [Member] | |
First Minority Investor [Member] | Second Minority Investor [Member] | Precision CNC LLC [Member] | Director [Member] | Director [Member] | Director [Member] | Board of Directors Chairman [Member] | Board of Directors Chairman [Member] | Cyclone Performance [Member] | Cyclone Performance [Member] | |||||||
First Half [Member] | Second Half [Member] | |||||||||||||||
Note 14 - Subsidiaries (Details) [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of Ownership in a Consolidated Susidiary | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 100.00% | ' |
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners | 5.00% | 5.00% | 5.00% | ' | ' | 5.00% | ' | 5.00% | ' | ' | ' | 5.00% | 5.00% | ' | ' | 5.00% |
Proceeds from Issuance or Sale of Equity (in Dollars) | $30,000 | $30,000 | ' | ' | ' | $100,000 | ' | ' | ' | ' | ' | $30,000 | ' | ' | ' | ' |
Cumulative Unallocated Losses to Non-Controlling Interest of Subsidiary (in Dollars) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 954 | ' | ' |
Amortization Period for Services Performed by a Minority Investor | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '12 months | ' | ' | ' | ' | ' |
Equity Purchase Warrant Percentage | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2.50% | ' | ' | ' | ' | ' |
Proceeds from Warrant Exercises (in Dollars) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 50,000 | ' | ' | ' | ' | ' |
Stock Issued During Period, Value, Issued for Services (in Dollars) | ' | ' | ' | ' | ' | 30,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amortization Period of Future Professional Services | ' | ' | ' | ' | ' | '12 months | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Noncontrolling Interest, Additional Ownership Percentage Could Be Acquired by Noncontrolling Owners | ' | ' | 5.00% | ' | ' | 5.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | ' | ' | ' | '12 months | '24 months | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Term of Options | ' | ' | ' | ' | ' | '5 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of Shares of Common Stock Exchanged for Equity in Subsidiary (in Shares) | ' | ' | ' | ' | ' | ' | 5 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt Instrument, Collateral Amount (in Dollars) | ' | ' | ' | ' | ' | ' | 425,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Period of Consulting Services Without Additional Compensation by an Executive | ' | ' | ' | ' | ' | ' | ' | '12 months | ' | ' | ' | ' | ' | ' | ' | ' |
Vesting Period of Interest in Subsidiary Acquired by Noncontrolling Owners | ' | ' | '2 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Equity Method Investment, Summarized Financial Information, Net Income (Loss) (in Dollars) | ' | ' | ' | ' | ' | ' | ' | ' | ($39,601) | $0 | ' | ' | ' | ' | ' | ' |
Note_15_Receivables_Deferred_R1
Note 15 - Receivables, Deferred Revenue and Backlog (Details) (USD $) | 9 Months Ended |
Sep. 30, 2013 | |
Note 15 - Receivables, Deferred Revenue and Backlog (Details) [Line Items] | ' |
Licenses Revenue | $150,000 |
Total Backlog for Prototype Engines | 2,150,000 |
U.S. Army/TACOM Contract [Member] | ' |
Note 15 - Receivables, Deferred Revenue and Backlog (Details) [Line Items] | ' |
Proceeds from Customers | 502,882 |
Company's Phoenix Power and Combilift Agreements [Member] | ' |
Note 15 - Receivables, Deferred Revenue and Backlog (Details) [Line Items] | ' |
Proceeds from Customers | 500,000 |
Company's U.S. Army Contract [Member] | ' |
Note 15 - Receivables, Deferred Revenue and Backlog (Details) [Line Items] | ' |
Proceeds from Customers | $1,250,000 |
Minimum [Member] | ' |
Note 15 - Receivables, Deferred Revenue and Backlog (Details) [Line Items] | ' |
Delivery Period | '12 months |
Backlog Orders, Payment Period | '6 months |
Maximum [Member] | ' |
Note 15 - Receivables, Deferred Revenue and Backlog (Details) [Line Items] | ' |
Backlog Orders, Payment Period | '9 months |
Note_16_Derivative_Financial_I2
Note 16 - Derivative Financial Instruments (Details) (USD $) | 0 Months Ended | 3 Months Ended | 9 Months Ended |
Aug. 13, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | |
Disclosure Text Block [Abstract] | ' | ' | ' |
Convertible Debt | $200,000 | ' | ' |
Debt Instrument, Convertible, Conversion Price (in Dollars per share) | $0.08 | ' | ' |
Debt Instrument, Convertible, Threshold Percentage of Stock Price Trigger | 70.00% | ' | ' |
Derivative Liability | 107,187 | ' | ' |
Amortization of Debt Discount (Premium) | ' | 47,717 | 47,717 |
Gain on Derivative Instruments, Pretax | ' | $595 | ' |
Share Price (in Dollars per share) | $0.07 | $0.06 | $0.06 |
Note_16_Derivative_Financial_I3
Note 16 - Derivative Financial Instruments (Details) - Estimated Fair Values of Liabilities for Derivative Instruments | 9 Months Ended |
Sep. 30, 2013 | |
Note 16 - Derivative Financial Instruments (Details) - Estimated Fair Values of Liabilities for Derivative Instruments [Line Items] | ' |
Dividend Rate | 0.00% |
Minimum [Member] | ' |
Note 16 - Derivative Financial Instruments (Details) - Estimated Fair Values of Liabilities for Derivative Instruments [Line Items] | ' |
Volatility | 86.00% |
Risk Free Rate | 0.02% |
Expected Term (years) | '36 days |
Maximum [Member] | ' |
Note 16 - Derivative Financial Instruments (Details) - Estimated Fair Values of Liabilities for Derivative Instruments [Line Items] | ' |
Volatility | 102.00% |
Risk Free Rate | 0.08% |
Expected Term (years) | '219 days |
Note_17_Subsequent_Events_Deta
Note 17 - Subsequent Events (Details) (USD $) | 0 Months Ended | 1 Months Ended | 1 Months Ended | |||
Aug. 13, 2013 | Oct. 31, 2013 | Oct. 31, 2013 | Oct. 31, 2013 | Oct. 31, 2013 | Dec. 31, 2012 | |
Subsequent Event [Member] | Subsequent Event [Member] | Subsequent Event [Member] | Subsequent Event [Member] | Notes Payable to a Trust [Member] | ||
Promissory Notes [Member] | Unaffiliated Shareholders [Member] | A Fund [Member] | ||||
Note 17 - Subsequent Events (Details) [Line Items] | ' | ' | ' | ' | ' | ' |
Notes Payable | ' | ' | $50,000 | $200,000 | ' | $153,000 |
Debt Instrument, Interest Rate, Stated Percentage | ' | 12.00% | 12.00% | 12.00% | ' | ' |
Number of Separate Promissory Notes Received by Unaffiliated Shareholders in Debt Settlement | ' | ' | ' | ' | 4 | ' |
Debt Instrument, Term | ' | '12 months | ' | ' | ' | ' |
Debt Instrument, Convertible, Conversion Price (in Dollars per share) | $0.08 | $0.04 | ' | ' | ' | ' |
Debt Conversion, Original Debt, Amount | ' | 57,000 | ' | 100,000 | ' | ' |
Stock Issued During Period, Shares, Conversion of Convertible Securities (in Shares) | ' | 1,421,713 | ' | 1,950,000 | ' | ' |
Debt Instrument, Convertible, Threshold Percentage of Stock Price Trigger | 70.00% | ' | ' | 70.00% | ' | ' |
Stock Issued During Period, Value, Conversion of Convertible Securities | ' | ' | ' | $60,000 | ' | ' |