10. Notes Payable, Related Parties

9 Months Ended

Sep. 30, 2012

Related Party Transactions [Abstract]

Notes Payable, Related Parties

Notes payable, related parties consist of the following at September 30, 2012 and December 31, 2011, respectively:

	September 30,			December 31,
	2012			2011
Various unsecured promissory notes carrying a 15% interest rate, due on demand from the Company’s CEO.	$	11,029		$	61,513
Unsecured promissory note payable owed to an immediate family member of the Company’s CEO carries a 15% interest rate, matured on July 31, 2007. Currently in default.		34,700			34,700
Unsecured promissory note payable owed to a Company owned by an immediate family member of the Company’s CEO carries a 15% interest rate, matured on July 31, 2007. Currently in default.		8,085			12,085
Secured promissory note originated on June 4, 2008 due to Star Financial Corporation, which is owned by Fay Passley, the mother of the Company’s CEO, Shaun Passley. The loan carried interest at 10%. In April 2010, Star Financial, agreed to modify the repayment terms of the June 2008 Note (as defined above), to provide for $100,000 to be due on August 1, 2011, $100,000 to be due on August 1, 2012, and the remaining balance of the June 2008 Note to be due on August 1, 2013 in return for junior lien on the Company’s assets. On July 2, 2012 this note and accrued interest was exchanged for a convertible promissory note in the amount of $440,849. The note is convertible at 75% of the average closing price of the Company’s common stock immediately preceding the date of conversion, or the fixed price of $0.005 per share, whichever is greater.		–			296,103
Total notes payable, related parties		53,815			404,401
Less: current portion		(53,815	)		(404,401	)
Notes payable, related parties, less current portion	$	–		$	–

The Company recorded interest expense on notes payable to related parties in the amounts of $40,625 and $-0- during the nine months ended September 30, 2012 and 2011, respectively.