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Convertible Promissory Notes Payable
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9 Months Ended |
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Sep. 30, 2014
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| Convertible Promissory Notes Payable [Abstract] | |
| CONVERTIBLE PROMISSORY NOTES PAYABLE | NOTE F - CONVERTIBLE PROMISSORY NOTES PAYABLE
The Company entered into a Convertible Promissory Note on July 23, 2010 with Forge, LLC. The Convertible Promissory Note accrues interest at 18% per annum which is payable and due quarterly, and matured on July 23, 2012. The note holders have the option to convert any unpaid note principal and accrued interest to the Company's common stock at a rate of 75% of the average closing price of the last ten days of trading any time after the issuance date of the note.
On May 24, 2013 Actual Investments, LLC entered into a contemporaneous Agreement with Forge, LLC and the Company. Actual Investments, LLC purchased $70,000 of the outstanding obligation to Forge, LLC and the note is subject to new terms agreed upon between the Company and Actual Investments, LLC. Actual Investments, LLC has the option to purchase the remainder of the Forge, LLC debt. Modifications included adjusting the interest rate and conversion price to 8% per annum and $.0014 per share, respectively. The restructuring resulting in the Company recognizing a loss on the restricting of $4,420,171 or ($.04) per common stock.
In May 2013, the note holder converted $17,000 of the note into 12,142,857 shares of common stock. In February 2014, another $6,000 was converted into 10,000,000 shares of common stock. In July of 2014, another $14,000 was converted into 10,000,000 shares of common stock. In September 2014, another $16,800 was converted into 12,000,000 shares of common stock.
In accordance ASC 470-20, the company allocated, on a relative fair value basis, the net proceeds amongst the common stock, convertible notes and warrants issuable to the investors. During the nine months ended September 30, 2014 and 2013 the Company recognized a gain of $12,971 and a loss of $461,792 in the beneficial conversion feature, respectively. |