Quarterly report pursuant to Section 13 or 15(d)

Notes Payable

Notes Payable

3 Months Ended

Mar. 31, 2015

6.	NOTES PAYABLE

In October 2014, the Company entered into a loan agreement with a financing company for $192,000. The terms of the loan stipulate equal monthly payments of principal and interest payments of $24,293 over an eight month period. Interest accrues on this loan at annual rate of 3.25%.

From 2010 through 2013, the Company entered into notes payable agreements with vendors in lieu of making payments due on accounts payable to these vendors. Interest accrued on interest bearing notes payables at an annual rate of 7% with accrued interest and principal due at maturity.

The Company had a note payable outstanding to a vendor as of March 31, 2014 which has no stated interest rate; however the Company had imputed interest cost at a rate of 7% for this note payable but the Company reached an agreement with the vendor to pay off this note payable with no interest.

Interest expense for three months ended March 31, 2015 and 2014 totaled $979 and $11,163, respectively.

Notes payable consisted of the following:


	March 31,			December 31,
	2015			2014
Notes payable	$	72,487		$	144,389
Less: current portion		(72,487	)		(144,389	)

	$	—		$	—

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

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