Related Party Transactions

9 Months Ended

Sep. 30, 2015

Related Party Transactions [Abstract]

Related Party Transactions

Note 13 - Related Party Transactions

Samuel G. Rose

Pursuant to the terms of the Purchase Agreement associated with out 8% convertible promissory notes (see note 6), Samuel G. Rose was appointed to our board of directors on August 4, 2014 and resigned on June 9, 2015. Mr. Rose and Julie Walters own in excess of 5% of our outstanding common stock.

Since 2011, Mr. Rose has participated in various financings benefiting the Company, and as of September 30, 2015 holds the following securities:

			Common
			Stock
			Equivalent,
	Principal		If Converted
10% convertible preferred stock	$	1,000,000		1,428,571
8% convertible notes (2012)		5,209,260		13,023,151
12% revolving		1,000,000		-	(i)
8% convertible notes (2014)		666,666		2,500,000
12% convertible promissory notes		333,333		3,030,300	(ii)
12% secured notes		2,427,888		-	(i)
TOTAL	$	10,637,147		19,982,022

(i) not convertible into shares of common stock.

(ii) assumes a 10-day volume weighted average price was $0.11.

Subsequent to September 30, 2015, we entered into an agreement with Mr. Rose whereby he has agreed to sell back to us all of the above securities totaling $10,637,147 at a nominal price to facilitate our ability to restructure our balance sheet and raise additional capital.

MLTM Lending, LLC and the ML Dynasty Trust

MLTM Lending, LLC and the ML Dynasty Trust (together “MLTM”) beneficially own in excess of 5% of our outstanding stock. Pursuant to the Schedule 13D filings made by MLTM Lending, LLC and the ML Dynasty Trust, the ML Dynasty Trust shares with MLTM the power to vote or direct the vote of, and to dispose or direct the disposition of, greater than 5% of our outstanding stock. Thomas Bowersox, a prior member of our board of directors (resigned on June 9, 2015), is a trustee of the ML Dynasty Trust.

Since 2011, MLTM has participated in various financings benefiting the Company, and as of September 30, 2015 holds the following securities:

			Common
			Stock
			Equivalent,
	Principal		If Converted
8% convertible notes (2012)	$	4,888,444		12,221,112
12% revolving		1,300,000		-	(i)
8% convertible notes (2014)		666,667		2,500,000
12% convertible promissory notes		333,334		3,030,309	(ii)
12% secured notes		1,538,888		-	(i)
TOTAL	$	8,727,333		17,751,421

(i) not convertible into shares of common stock.

(ii) assumes 10-day volume weighted average price was $0.11.

Subsequent to September 30, 2015, we entered into an agreement with MLTM whereby they have agreed to sell back to us all of the above securities totaling $8,727,333 at a nominal price to facilitate our ability to restructure our balance sheet and raise additional capital.

Allen Kronstadt

Allen Kronstadt beneficially owns in excess of 5% of our outstanding stock and was appointed to our board of directors on September 11, 2012 pursuant to the terms of the Purchase Agreement and resigned on June 9, 2015.

Since 2011, Mr. Kronstadt has participated in various financings benefiting the Company, and as of September 30, 2015 holds the following securities:

			Common Stock
			Equivalent,
	Principal		If Converted
8% convertible notes (2012)	$	5,209,297		13,023,243
8% convertible notes (2014)		666,667		2,500,000
12% convertible promissory notes		333,333		3,030,300	(ii)
12% secured notes		2,427,888		-	(i)
TOTAL	$	8,637,185		18,553,543

(i) not convertible into shares of common stock.

(ii) assumes 10-day volume weighted average price was $0.11.