XML 50 R12.htm IDEA: XBRL DOCUMENT v2.4.0.6
(6) Notes Payable-related Parties
12 Months Ended
Dec. 31, 2012
Notes  
(6) Notes Payable-related Parties

 (6)      Notes Payable-Related Parties

 

On July 21, 2011, the Company received proceeds under a $20,000 short-term note payable to an individual shareholder. This note is uncollateralized, and originally bore no interest and was due two months from the date of issue. The note includes provisions for an extension period of an additional two months with interest at 15% per year, which period expired on November 21, 2011. As of December 31, 2012, the Company is currently in default on this note and is subject to the legal costs of up to $10,600, should the note holder elect to pursue collection as per the terms of the note. Interest on this note is currently being expensed and accrued monthly at a rate of 15% per year.[MK3] 

On July 21, 2011, the Company also assumed accounts payable to former officers and directors totaling $34,000. These accounts payable were converted to uncollateralized notes payable that bear interest of 16% per year and were due July 21, 2012. The notes are currently in default and interest is currently being expensed and accrued monthly at a rate of 16% per year.  The holders of these notes are shareholders in the Company.

 

On February 24, 2012, the Company received proceeds under a $33,000 short-term note payable to Stacey McBride-Irby, the Chief Product Development Officer and a Director. This note is uncollateralized, originally bore interest at a rate of 15% per year and was due two months from the date of issue. The note matured on April 18, 2012. The Company is currently in default on this note and is subject to legal costs of up to $7,590, should the note holder elect to pursue collection as per the terms of the note. Interest on the note is currently being expensed and accrued monthly at a rate of 16% per year.