4. Lines of Credit

3 Months Ended

Sep. 30, 2011

Schedule of Line of Credit Facilities [Table Text Block]

4.         Lines of Credit

The Company has two lines of credit as follows:

Creditor	Interest Rate	Borrowing Limit	Repayment Terms	Amount Outstanding	Security	Purpose
Chairman	1% per Month	$2,500,000	Due on Demand	$672,909	General Security over Assets	Sales and Marketing Program
Relative of Chairman	1% per Month	$2,000,000	Due on Demand	$1,691,020	General Security over Assets	Operations, Product Development

On March 6, 2011, the Chairman of the Company established a line of credit of up to $2.5 million with the Company for the exclusive purpose of funding the costs of a comprehensive sales and marketing campaign. To date and during the nine months ended September 30, 2011, the Company has borrowed $647,133 for its sales and marketing program and incurred interest of $25,776.

On May 25 2010, the Company finalized negotiations with a relative of the Chairman for a line of credit borrowing arrangement of $1M. All funds borrowed bear interest at 1% per month, are due on demand and are secured by all the assets of the Company. On January 3, 2011, the Company entered into an agreement with this creditor to increase the borrowing limit from $1,000,000 to $2,000,000.

During the nine months ended September 30, 2011 the Company borrowed a total of $1,541,137 from this creditor and incurred interest expense of $106,277 to bring the total amounts incurred to date borrowings of $1,541,137 and interest of $149,883.

As consideration for the two lines of credit, the Company has granted 60,000,000 options (note 5(c)).