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Note 2 - Short Term Related Party Convertible Notes Payable
 12 Months Ended
Dec. 31, 2016
Related Party Transactions [Abstract]  
Short Term Related Party Convertible Notes Payable

NOTE 2 — Short Term Related Party Convertible Notes Payable

 

The balance of short term convertible notes payable to officers and directors of the company is $752,625 at December 31, 2016. $380,696 of these notes have an original term of four years that accrue interest at 8% per annum compounded quarterly, mature on September 4, 2017, and have a note holder call provision. $371,929 of these notes, previously classified as long term, were classified as a current liability in September 2016 as they now mature within one year on September 4, 2017, have an original term of four years that accrue interest at 18% per annum compounded quarterly through March 30, 2016 and at 12% thereafter, and do not have a note holder call provision. Accrued interest for all convertible notes was $382,808 and $265,387 at December 31, 2016 and December 31, 2015, respectively and was included in Accounts Payable and Accrued Expenses. The notes and accrued interest are convertible into common stock at the option of the holder at $1.25 per share. The convertible notes are secured by all of the assets of the Company and are subordinated to amounts outstanding under the Company’s working capital bank line of credit with the Company’s bank.