Note 6 - Notes Payable

12 Months Ended

Dec. 31, 2013

Note 6 - Notes Payable

Note 6- Notes Payable

Note 6- Notes Payable

At December 31, 2013, outstanding notes payable was made up of the following:

Note Holder	Principal		Accrued Interest		Outstanding as of December 31, 2013
Notes Payable– Related Parties	$	252	$	—	$	252
Total notes payable – current liabilities					$	252

At December 31, 2012, outstanding notes payable was made up of the following:

Note Holder	Principal		Accrued Interest		Outstanding as of December 31, 2012
Notes Payable– Related Parties	$	53,977	$	—	$	53,977
Loan from investors		66,784		5,000		71,784
Total notes payable – current liabilities					$	125,761

Notes Payable to Founders – At December 31, 2013 and 2012, the notes payable to the founders consisted of short-term loans with the three founders.  Credit agreements exist with Terry Anderton and Les Anderton that allow the Company to borrow up to $0.9 million, as needed, to fund working capital needs. These agreements carry an interest rate of 10% only and have been amended with board consent to remain in effect until December 31, 2014 subsequent to the initial expiration date.    The loans have no repayment terms but were repaid in the second quarter of 2013.  As of December 31, 2013, Les Anderton has a shareholder loan of $252. As of December 31, 2012, Terry Anderton, Les Anderton, and Joakim Lindblom had shareholder loans that were comprised of the following balances:  $28,401, $10,066 and $15,510, respectively.

Short-term loan from Investors - In 2011, an investor in the Company made a short-term loan of $16,784 to the Company to cover its working capital needs.  There are no documented terms for this loan.  The Company has treated the loan as interest free and the loan was repaid in second quarter of 2013.

In 2012, an investor in the Company made a short-term loan of $50,000 to the Company to cover its working capital needs.  There are no documented  terms for this loan; however the Company repaid this loan during the second quarter of 2013 including accrued  interest expense of $5,000.

Interest expense recognized for the years ended December 31, 2013 and 2012 related to notes payable and debentures was $122,799 and $61,902, respectively.