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Short Term Related Party Convertible Notes Payable
3 Months Ended
Mar. 31, 2017
Related Party Transactions [Abstract]  
Short Term Related Party Convertible Notes Payable

NOTE 4 — 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 March 31, 2017 and 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 has 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 $411,517 and $382,808 at March 31, 2017 and December 31, 2016, respectively and was included in Accounts Payable and Accrued Expenses. Interest expense for the three months ended March 31, 2017 and 2016 was $28,709 and $34,181, respectively. 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.