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Related Party Transactions
9 Months Ended
Sep. 30, 2012
Related Party Transactions [Abstract]  
Related Party Transactions

8. Related Party Transactions

 

On May 28, 2010 the Company entered into a short-term note payable of $175,000 with a former officer of the Company. The note has a 60 day maturity and 9% interest rate. As of September 30, 2012 and December 31, 2011 the Company has accrued $38,621 and $25,114 interest on the note payable, respectively. The Company recorded $4,503 and $3,938 in interest expense for the three months ended September 30, 2012 and 2011, respectively. As of November 2012 the note has not been repaid and is in default.


On February 16, 2011 an officer of the Company loaned the Company $100,000 bearing an interest rate of 12%. The note matured on February 16, 2012. As of September 30, 2012 and December 31, 2011 the Company has accrued $20,351 and $10,414 interest on the note payable, respectively. The Company recorded $3,312 and $3,000 in interest expense for the three months ended September 30, 2012 and 2011, respectively. As of November 2012 the note has not been repaid and is in default.


On February 28, 2012 an officer of the Company loaned the Company $15,000 bearing an interest rate of 12%. As of September 30, 2012 the Company has accrued $613 interest on the note payable. The Company recorded $450 in interest expense for the three months ended September 30, 2012. As of November 2012 the note has not been repaid.


On April 3, 2012 the Company signed a $90,000 convertible promissory note payable to the relative of an officer of the Company. The note is due on October 3, 2012 and has a 10% interest rate. The note provides for the conversion of principal plus interest into the Company's common stock at a price equal to 90% of the market price on date of conversion. Consequently, the liability has been recorded at $100,000 on the balance sheet. The difference between the face value and fair value of the note has been recognized as interest expense. As of September 30, 2012, the Company had accrued interest of $4,355 and recorded $2,250 in interest expense for the three months ended September 30, 2012. As of November 2012 no payments have been made on this note.