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2. DEBT

3 Months Ended

Mar. 31, 2014

The table below summarizes the Company’s debt at March 31, 2014 and December 31, 2013:

Debt Description	March 31,		December 31,
	2014		2013		Maturity	Rate

IDB Credit Facility	$	5,000,000	$	5,000,000	14-May		4	%
Capital lease obligations - Noteholder lease		128,008		132,321	19-Aug		8	%
Capital lease obligations - Office furniture		35,126		36,778	18-Sep		9.8	%
Convertible notes - related parties, net of discount of $3,300,538 and $1,921,394, respectively		23,363,692		23,512,836	16-Nov		8	%
Convertible notes		730,770		730,770	16-Nov		8	%
Total debt		29,257,596		29,412,705

Less: current portion of long term debt
Capital lease obligations		26,639		26,113
IDB Credit Facility		5,000,000		5,000,000
Total current portion of long term debt		5,026,639		5,026,113

Debt - long term	$	24,230,957	$	24,386,592

Convertible Notes

During the three months ended March 31, 2014, the Company sold $1,230,000 of additional Convertible Secured Subordinated Promissory Notes (the “Notes”) to Union Bancaire Privée (“UBP”) under its existing Convertible Secured Subordinated Note Purchase Agreement, dated November 14, 2007, as amended (as so amended, the “Note Purchase Agreement”) at conversion prices equal to $.56 on the date of sale. The Company recorded a beneficial conversion feature of $1,625,357 and corresponding debt discount, which is being amortized into interest expense through the maturity of the Notes.

IDB Credit Facility and New Facility Commitment

The Company has an outstanding promissory note with Israel Discount Bank (“IDB”) that has a maturity date of May 31, 2014 (the “IDB Credit Facility”). Borrowings under the IDB Credit Facility were guaranteed by Atlas Capital SA (“Atlas”) and subsequent to the merger between Atlas and Mirelis InvesTrust SA (“Mirelis”), by Mirelis. The IDB Credit Facility is further secured by an extended irrevocable standby letter of credit issued by UBS Private Bank with an expiration date of November 30, 2015.

The Company has obtained a bank commitment letter to borrow up to $5,000,000 under a facility with substantially the same terms as the IDB Credit Facility (the "new Facility"). When finalized, the proceed of the New Facility will be sued to repay the IDB Credit Facility on or before its maturity date.

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

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