NOTE 9 - PROMISSORY NOTES
|9 Months Ended|
Sep. 30, 2011
|Short-term Debt [Text Block]||
NOTE 9 – PROMISSORY NOTES
On April 11, 2011 the Company entered into two promissory notes (each a “Note” and together the “Notes”) each in the face amount of $275,000 with two accredited investors, totaling $550,000 (each a “Loan” and together the “Loans”). Each Note bears 7% interest and principal and interest has a maturity date of September 15, 2011. The Company can repay the Notes at any time without penalty. These notes are secured by all of the Company’s assets. As partial consideration for the loans, the Company issued two shares of Series A convertible preferred stock, par value $1.00 per share (the “Series A Convertible Preferred Stock”) (one share to be issued to each investor mandatorily convertible into Class A Common Stock equal to 1% of the outstanding common stock at the time of conversion (no later than January 15, 2012) (see Note 10). The total outstanding principal balance of the Notes as of September 30, 2011 was $450,000, plus accrued interest of $8,779. For the three and nine months ended September 30, 2011, the Company recorded interest expense of $8,619 and $17,134, respectively. The due date for the Notes was extended to November 4, 2011 when these notes were paid in full (See Note 11 – Subsequent Events). The Company’s Chief Executive Officer, Mr. Mark Meller, agreed to personally guarantee the repayment of the Notes (See Series B Preferred Stock in Note 10).
The entire disclosure for short-term debt.
Reference 1: http://www.xbrl.org/2003/role/presentationRef