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Note 8 - Long-term Debt
3 Months Ended
Mar. 31, 2014
Notes  
Note 8 - Long-term Debt

NOTE 8 – LONG-TERM DEBT

 

Our long-term debt at March 31, 2014 and December 31, 2013 consisted of an unsecured note payable to an individual due July 30, 2016, with interest at 14% per annum.  The long-term debt has been recorded net of a discount of $5,946 and $6,915 at March 31, 2014 and December 31, 2013, respectively, for the value assigned to shares of our common stock and detachable warrants issued in connection with the origination of the notes.  The discount is amortized to interest expense over the term of the notes.  Pursuant to an Amendment to Security Agreement, the warrants were subsequently cancelled.

 

Payment terms for the $30,000 note payable are $350 per month for six months and $698 per month for sixty months, including interest. We are in default on the $30,000 note payable at March 31, 2014 due to our failure to make timely payments in accordance with the terms of the note agreement.