Notes Payable, Long-Term Debt and Other Financing

3 Months Ended

Mar. 31, 2012

Notes to Financial Statements

Note 6. Notes Payable, Long-Term Debt and Other Financing

Notes payable consisted of the following at:

	March 31, 2012	December 31, 2011
Secured note payable to Credit Managers Association of California, bearing interest at prime plus 3% (6.25% as of March 31, 2012), and is adjusted annually in April through maturity. Principal and unpaid interest due in April 2016. A sinking fund escrow may be funded with 10% of future equity financing, as defined in the Agreement	$  1,238,000	$  1,238,000
Secured note payable to a Coca Cola Enterprises in the original amount of $40,000, bearing interest at 10% per annum. Principal and unpaid interest due on demand	40,000	40,000
Secured note payable to a financial institution in the original amount of $38,000, bearing interest at 8.25% per annum, payable in 60 equal monthly installments of principal and interest through February 19, 2014	16,000	18,000
Secured note payable to a financial institution in the original amount of $19,000, bearing interest at 10.50% per annum, payable in 60 equal monthly installments of principal and interest through August 25, 2014	11,000	12,000
Secured note payable to a financial institution in the original amount of $26,000, bearing interest at 7.91% per annum, payable in 60 equal monthly installments of principal and interest through April 9, 2015	17,000	18,000
Secured note payable to a financial institution in the original amount of $25,000, bearing interest at 7.24% per annum, payable in 60 equal monthly installments of principal and interest through March 10, 2016	20,000	22,000
	1,342,000	1,348,000
Less current portion of notes payable	(62,000)	(62,000)
Notes payable, net of current portion	$  1,280,000	$  1,286,000

As of March 31, 2012 and December 31, 2011, the balance of long term interest payable with respect to the Credit Managers Association of California note amounted to $1,257,000 and $1,237,000, respectively. Interest expense on notes payable amounted to $22,000 during each of the three months ended March 31, 2012 and 2011, respectively.