Financing Activities | Financing activities: Convertible Debentures On February 26, 2013, the Company issued a promissory note in the amount of $1,100,000 to American DG Energy, its parent. Under the terms of the agreement, the Company is required to pay interest at a rate of 6% per annum payable quarterly in arrears. On June 14, 2013, the Company entered into subscription agreements with certain investors, including American DG Energy for a private placement of an aggregate principal amount of $4,000,000 of 4.00% Senior Unsecured Convertible Notes Due 2015, or the Notes. In connection with the private placement, American DG Energy exchanged a promissory note in the aggregate principal amount of $1,100,000 , originally issued on February 26, 2013 (the "Old Note"), for a like principal amount of the Notes and cash paid for any accrued but unpaid interest on the Old Note. The original maturity date of the Notes was June 14, 2015. The proceeds of the offering of the Notes were used in connection with the development and installation of current and new energy systems, business development and for general corporate purposes. The holders of the Notes are subject to and entitled to the benefits of the 4% Senior Convertible Notes due 2015 Noteholders Agreement, dated June 14, 2013, or the Noteholders Agreement. The Notes were scheduled to mature on June 14, 2015 and accrue interest at the rate of 4.0% per annum payable in cash on a semi-annual basis. At the Investor's option, the Notes may be converted into shares of the Company's common stock at an initial conversion rate of 1,000 shares of common stock per $1,000 principal amount of Notes, subject to adjustment. At the scheduled maturity date, each of the Investors will have the following options: request payment of their principal amount and accrued interest in cash; extend the term of the Notes for an additional 3 years with an automatic decrease in interest rate to 3.0% per annum; or exchange the Notes for a new non-convertible note with a 3 -year maturity and a 6.0% per annum interest rate; no accrued interest will be lost on such exchange. The Company evaluated the term-extending option and concluded that it was an embedded derivative with de minimis value. The Company has subsequently concluded that it is not considered a derivative under ASC 815-Derivatives and Hedging because the term extending feature is considered clearly and closely related to the Notes. Thus, this feature was not required to be bifurcated and no other initial accounting was required. The term-extending option has subsequently been eliminated pursuant to the note exchange agreements discussed herein. The Noteholders Agreement provides for customary events of default by the Company, including failure to pay interest within ten days of becoming due, failure to pay principal when due, failure to comply provisions of the Notes or the Note-holders Agreement, subject to cure, and certain events of bankruptcy or insolvency. The holders of the Notes are entitled to the benefits of a registration rights agreement dated June 14, 2013 by and among the Company and the Note-holders named therein, or the Registration Rights Agreement. The Registration Rights Agreement provides for demand registration rights, such that upon the demand of 30.0% of the holders of Registrable Securities, as defined in the Registration Rights Agreement and subject to certain conditions (including that the Company is eligible to use a Form S-3 registration statement and that such holders anticipate an aggregate offering price, net of selling expenses, of at least $250,000 ), the Company will file a Form S-3 registration statement covering the Registrable Securities requested to be included in such registration, subject to adjustment, and use its commercially reasonable efforts to cause such registration statement to become effective. Included among the investors subscribing for the Notes are: Bruno Meier, a director of the Company, in the amount of $250,000 ; Prime World Inc., a company controlled by Joan Giacinti, one of the Company's directors, in the amount of $300,000 ; Charles T. Maxwell, Chairman of the Board of Directors of American DG Energy, in the amount of $250,000 ; and Nettlestone Enterprises Limited, a shareholder of both the Company and American DG Energy, in the amount of $300,000 . On February 20, 2014, the Company entered into a Note Exchange Agreement with American DG Energy and other investors whereby the parties agreed to exchange the $4,000,000 of 4.00% Senior Unsecured Convertible Notes Due 2015 for New Notes. The effect of the Note Exchange Agreement (a) extended the maturity date from June 14, 2015 to June 14, 2017, (b) adjusted the conversion price of the notes which changed from 1,000 shares of the Company’s common stock for each $1,000 of principal converted to 1,667 shares of the Company’s common stock for each $1,000 of principal converted, and (c) eliminated the Holders’ options to extend the Notes. Management analyzed the impact of the Note Exchange Agreement and determined that the Notes and the New Notes were substantially different and, as a result, has recognized a loss on extinguishment of $713,577 to recognize the excess of the fair value of the New Notes that were issued in the exchange over the carrying value of the Notes surrendered as well as debt issue costs. As a result of the application of extinguishment accounting, the Company has recorded the New Notes at fair value as of the date of the exchange. Because fair value of the New Notes is $4,656,000 and the carrying value is $4,000,000 , a premium of $656,000 was established. The Company will amortize the premium over the life of the New Notes. The fair value of the New Notes was determined using a binomial lattice model. The following table provides quantitative information used in the valuation of the fair value measurement, including the assumptions for the significant unobservable inputs used in the binomial lattice model valuation: Notional amount $4,000,000 Par amount $1,000 Interest rate 4.0 % Conversion ratio 1,667 Conversion price, per share $0.60 Stock price as of the valuation date $0.51 Historical realized weekly volatility 87 % Risk free rate 0.9 % Discrete dividend payment rate — % Significant increases (decreases) in the significant unobservable inputs used in the fair value measurement of the New Notes would result in a significantly higher (lower) fair value measurement. On April 15, 2014, April 24, 2014, May 20, 2014 and June 9, 2014, the Company, entered into subscription agreements with European investors, a principal owner of the Company and John Hatsopoulos, a related party and chairman of the Company's Board of Directors, for the sale of $1,450,000 , of 4% Senior Convertible Notes due 2018 ("2014 Notes"). The 2014 Notes will mature in four years and will accrue interest at the rate of 4% per annum payable on a semi-annual basis. At the holder’s option, the 2014 Notes may be converted into shares of the Company’s common stock at a conversion price of $0.60 per share, subject to adjustment in certain circumstances. The proceeds of the 2014 Notes will be used in connection with the development and installation of current and new energy systems, business development and for general corporate purposes. On October 3, 2014, the Company, entered into convertible note amendment agreements, or the Note Amendment Agreements, with American DG Energy, John N. Hatsopoulos and a principal owner of the Company, as well as certain separate convertible note conversion agreements, or the Note Conversion Agreements, with certain other investors, which eliminated $3,050,000 of the Company's convertible notes. Among other things, the Note Amendment Agreements provided for the conversion, in full, of the principal amount of certain of the Company’s New Notes, originally issued on February 20, 2014 and 4% Senior Convertible Notes Due 2018, originally issued on April 24, 2014, the Notes and the 2014 Notes, or collectively the Converted Notes, in an aggregate principal amount of $3,050,000 , pursuant to which the holders of such Converted Notes, or the Holders, agreed to convert, in full, the principal amount of the Converted Notes. In connection with the conversion, the Converted Notes were cancelled and the Holders were issued 6,100,000 shares of the Company’s common stock at a conversion price of $.50 per share, with any accrued but unpaid interest paid in cash. The conversion price of $.50 per share was less than the $.60 per share that was contractually provided for on the convertible debentures. Accordingly, in accordance with ASC 470-20-40, this transaction was accounted for as an inducement conversion with the fair value of the incremental shares issued being recognized as an expense. The Company recognized debt conversion inducement expense of $508,333 in connection with the conversions. The unamortized premium was $136,422 at December 31, 2015 , and non-cash net interest income related to amortization of the premium for the year-ended December 31, 2015 was $96,288 . American DG Energy guarantees (the “Guarantees”), all of the Company's remaining notes on a subordinated basis. Among other things, the Guarantees provide that, in the event of the Company's failure to pay principal or interest on the notes, the holder of such notes, on the terms and conditions set forth in the notes, may proceed directly against American DG Energy, as guarantor, to enforce the Guarantee. These securities were offered and sold to the Investors in private placement transactions made in reliance upon exemptions from registration pursuant to Section 4(a)(2) under the Securities Act of 1933 and Rule 506 promulgated thereunder. The Investors are accredited investor as defined in Rule 501 of Regulation D promulgated under the Securities Act of 1933. Interest expense, net of premium amortization was $ 1,612 and $ 34,949 for the years ended December 31, 2015 and 2014 , respectively. The face amount of convertible debentures and the related premium or discount are as follows as of December 31, 2015 and 2014 , respectively: 2015 Face amount, 4% notes $ 2,400,000 Premium 136,422 Total $ 2,536,422 2014 Face amount, 4% notes $ 2,400,000 Premium 232,710 Total $ 2,632,710 Note Payable - related party On September 19, 2014, John Hatsopoulos, the Chairman of the board of directors of the Company, loaned the Company $3,000,000 without interest pursuant to a promissory note (the "Loan"). The Loan matures upon a substantial capital raise or on September 19, 2019. Prepayment of principal may be made at any time without penalty. The proceeds of the Loan were used in connection with the development and installation of current and new energy systems in the United Kingdom and Europe. On December 30, 2014, the Company amended and restated the existing promissory note to provide for interest at a rate of 1.85% . During 2015 the Company made a prepayment of $1,000,000 on this note. As of December 31, 2015 , the outstanding balance on the Loan was $2,000,000 . Interest expense related to the Loan was $ 39,862 and $ 11,563 for the years ended December 31, 2015 and December 31, 2014 , respectively. On July 7, 2015, the Company, entered into a Revolving Line of Credit Agreement, or the Agreement, with Elias Samaras, the Company's Chief Executive Officer, President, and a member of the Company's board of directors. Under the terms of the Agreement, Dr. Samaras has agreed to lend the Company up to an aggregate of $1 million , at the written request of the Company. Any amounts borrowed by the Company pursuant to the Agreement will bear interest at 6% per year. Interest is due and payable quarterly in arrears. The term of the Agreement is from June 30, 2015 to June 30, 2017. Repayment of the principal amount borrowed pursuant to the Agreement will be due on June 30, 2017, or the Maturity Date. Prepayment of any amounts due under the Agreement may be made at any time without penalty. The Agreement terminates on the Maturity Date. The Company has not yet borrowed any amounts pursuant to the Agreement. See Note 6 "Stockholders equity" for equity related financing activities. |