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SUBSEQUENT EVENTS | 6 Months Ended
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Jun. 30, 2012
SUBSEQUENT EVENTS |
SUBSEQUENT EVENTS | NOTE 11 - SUBSEQUENT EVENTS On July 13, 2012, the Company made an offering of up to $1,300,000 of Secured Subordinated Promissory Note(s) to unrelated parties. As of August 1, 2012 the principal balance payable on these notes is $1,005,000. The Note(s) mature on October 12, 2012. The terms of the debt are as follows: (i) interest accrues at 5% until maturity date thereafter interest accrues at 18% per annum; (ii) maturity date is October 12, 2012; (iii) the Company will issue to the Lenders five-year warrants to purchase a total of 1,005,000 shares of common Stock at a price of $0.15 per share. On March 20, 2012, the Company executed a secured promissory note payable to Juventas, LLC in the amount of $930,000 related to the Settlement Agreement (see Note 3). As of June 30, 2012, the principal balance of $930,000 and $20,791 of accrued interest remained due. In July 2012, the Company reached agreement with Juventas that upon payment of $880,000, all remaining principal of, and accrued interest on, the Juventas secured promissory note would be forgiven. The Company made such payment in July of 2012, at which point the note was cancelled. On July 13, 2012, Tonaquint, Inc. (“Tonaquint”) filed suit against the Company and certain of its affiliates in connection with a Securities Purchase Agreement by and between Tonaquint and the Company under which Tonaquint purchased a Secured Convertible Promissory Note in the original principal amount of $560,000. The suit alleges, among other things, a failure of the Company to make certain payments and to honor a conversion notice delivered pursuant to the Secured Convertible Promissory Note. The Company is defending this suit and is currently in negotiations to reach a settlement agreement. On August 3, 2012 the Company executed a promissory note in the amount of 75,000 to an unrelated party. The terms of the debt are as follows: (i) interest accrues at 10% per annum; (ii) The principal of this Note shall be due and payable as follows: (a) $10,000 each on August 15, 2012, August 30, 2012, September 15, 2012, September 30, 2012 and October 15, 2012; and (b) $25,000 on October 30, 2012 the maturity date. The Company has evaluated all subsequent events from the balance sheet date through the date of this filing and with the exception of the items mentioned above there are no events to disclose.

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- Definition The entire disclosure for significant events or transactions that occurred after the balance sheet date through the date the financial statements were issued or the date the financial statements were available to be issued. Examples include: the sale of a capital stock issue, purchase of a business, settlement of litigation, catastrophic loss, significant foreign exchange rate changes, loans to insiders or affiliates, and transactions not in the ordinary course of business. + References No definition available. + Details
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