XML 53 R19.htm IDEA: XBRL DOCUMENT v2.4.0.6
(13) Related Party Transactions
12 Months Ended
Dec. 31, 2012
Notes  
(13) Related Party Transactions

(13)     Related Party Transactions

 

            Since its inception, the Company has operated without rent from the home of its Chairman and Chief Executive Officer. The value of the rent is believed by management to be immaterial to the consolidated financial statements.

 

Daniel Melton Media, Inc. owned by Corinda Melton, the Company CEO and a shareholder, and Trent Daniel, a shareholder, performed graphic design and web related services for the company and received cash payments of $3,250 for the year ended December 31, 2012, $5,730 for the year ended December 31, 2011, and $34,180 for the period from inception, October 1, 2010 to December 31, 2012.

           

In addition, Daniel Melton Media, Inc. advanced to the Company $11,060 during the year ended December 31, 2012, $1,904 during the year ended December 31, 2011, and $33,064 for the period from inception, October 1, 2010 to December 31, 2012. These funds are reflected on the balance sheet under balances due to shareholders.

 

On July 21, 2011, the Company received proceeds under a $20,000 short-term note payable to an individual who is also a shareholder of the Company. This note is uncollateralized, and bears interest of 15% per year. The Company is currently in default on this note and is subject to legal costs of up to $10,600, which are considered a default fee under the terms of the note. As of the date of this filing, the note has not been demanded, however, the default fee is currently recorded on the balance sheet as part of accrued liabilities, and interest on the outstanding principal continues to be expensed monthly.

 

On July 21, 2011, the Company 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. These notes are recorded on the Balance Sheets under notes payable – related parties under current liabilities. The notes are currently in default and interest is currently being expensed monthly. Under the terms of these notes payable, there are no additional fees or costs associated with default by the Company.

 

On February 24, 2012, the Company entered into a promissory note in the total amount of $33,000, with Stacey McBride Irby, a Director of the Company. The note has a sixty-day maturity, and bears interest of 15% per year starting on September 21, 2011. The Company is currently in default on this note and is subject to legal costs of up to $7,590, which are considered a default fee under the terms of the note. As of the date of this filing, the note has not been demanded, however, the default fee is currently recorded on the balance sheet as part of accrued liabilities, and interest on the outstanding principal continues to be expensed monthly.

 

On March 9, 2012 the Company issued a $5,000 convertible debenture to Inez McBride, mother of Director Stacey McBride-Irby.  The debenture bears simple interest of 14% per annum with a one-year maturity.  The outstanding principal and interest of the debenture is convertible into shares of common stock at a conversion price of $0.04 per share.  The conversion rate was based upon the market price of the Company's common stock as determined by reference to recent cash sales.

 

On March 9, 2012, the Company granted 219,300 shares of common stock to Sherman Walker, brother of Corinda Melton, CEO, for payment on an invoice for services valued at $8,772. The cost basis of the stock is $0.04 per share.  The conversion rate was based upon the market price of the Company's common stock as determined by reference to recent cash sales

 

On July 2, 2012 the Company received proceeds under a $25,000 short term note payable to Sonya Carothers who is a shareholder of the Company. This note is uncollateralized, bears a simple interest rate of 14% per annum and has one year maturity.  The outstanding principal and interest of the debenture is convertible into shares of common stock at a conversion price of $0.04 per share.  The conversion rate was based upon the market price of the Company's common stock as determined by reference to recent cash sales.

 

 

The Company paid Trent Daniel, a shareholder, for contract services related to marketing, graphic design, business and relationship development. The payments totaled $66,161 during the year ended December 31, 2012, $87,345 during the year ended December 31, 2011, and $161,940 for the period from inception October 1, 2010 to December 31, 2012.

 

As of December 31, 2012, the Company had issued and unissued shares of stock to the following related parties:

 

Stockholder

Shares issued

Unissued Shares

Value ($)

Relationship

Nature of Services

Henderson J. Smith, Jr.

2,674,980

-

30,000

Brother-in-law of company founder Trent Daniel

Business Development services

Sarah Marie Daniel

764,280

625,000

45,000

Wife of company founder Trent Daniel

Creative writing services

Nedra Hall

382,140

625,000

35,000

Sister-in-law of company founder Trent Daniel

Bookkeeping services

Bradley Melton

3,179,405

750,000

93,200

Son of Corinda Melton, CEO

Purchased shares and provided business development services

Sherman Walker

601,440

-

18,772

Brother of Corinda Melton, CEO

Purchased shares for cash

Wilma Delaney

687,852

-

18,000

Director and sister of Corinda Melton, CEO

Director related services

Robert Hines

1,452,132

-

38,000

Director

Director related services and financial consulting

Stacey McBride-Irby

6,381,738

-

167,000

Chief Product Development Officer

Cash purchase and company employee

Corinda Melton

4,707,965

-

3,080

CEO

Employee

 

 

 

 

 

 

Trent Daniel

4,077,434

5,000,000

202,668

Founder

Marketing and relationship development services