Note 8 - Private Placement of Series B Preferred Shares

3 Months Ended

Mar. 31, 2015

Notes

Note 8 - Private Placement of Series B Preferred Shares

NOTE 8 – PRIVATE PLACEMENT OFFERING AND PROMISSORY NOTE

On March 12, 2015, pursuant to a securities purchase agreement (the “Purchase Agreement”), the Company accepted a subscription from an accredited investor to purchase 100,000 Investment Units (“Units”), comprised of common stock and warrants for a purchase price of $1.00 per Unit, resulting in gross proceeds to the Company of $100,000. Each Unit consists of (i) one (1) share of the Company’s common stock, par value $0.001 per share, and (ii) a warrant to purchase one (1) share of common stock at an exercise price of $1.50 per share. The Company granted piggyback registration rights to the investor in connection with this investment.  The Company intends to use the proceeds from this investment for general corporate and working capital purposes.

Pursuant to the Purchase Agreement, the Company also issued an unsecured promissory note in the principal amount of $100,000 in favor of said investor (the “Note”). Interest accrues on the Note at a rate of 15% per annum. The Company agreed to make quarterly interest-only payments throughout the term of the Note. The entire unpaid principal balance of the Note, together with any accrued interest and other unpaid charges or fees, is due and payable on or before September 12, 2016. The Company may prepay the Note, in whole or in part, at any time without penalty.

As of March 31, 2015, the accrued interest on the promissory note is $667.