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8) Loans Payable
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3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2013
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| 8) Loans Payable: | 8) LOANS PAYABLE:
Loans payable consist of the following at March 31, 2013 and December 31, 2012:
(a) In 2006, the Company borrowed the sum of $16,000 from Louis Savaglio, an independent third party. The loan is payable on demand and bears interest at the rate of 6.75% per annum. On November 30, 2009, the Company had repaid $5,000 with the issuance of 99,100 shares of common stock. On July 14, 2011 Mr. Savaglio assigned $10,000 of his debt together with accrued interest of $3,156 to four entities unrelated to the Company. Each new entity has a note for $3,289 carrying interest at 6%. Subsequently those four entities converted their loans into 13,462,000 shares of the Company’s common stock. The balance due to Mr. Savaglio as of March 31, 2013 and December 31, 2012 was $1,000.
(b) On September 15, 2011, the Company borrowed $150,000 from an unrelated third party. The loan was due on October 15, 2011 together with interest at a rate of 25% per annum. As of March 31, 2013, the accumulated interest on this loan was $47,015. The Company is not in compliance with the repayment terms of the loan as it was not repaid on its maturity date and is currently in technical default.
(c) On November 15, 2011, the Company borrowed $50,000 from an unrelated third party. The loan was due and payable upon the Company filing its Regulation D Offering with the SEC which occurred on August 1, 2011. The note accrues interest at a rate of 4.0% per annum. As of March 31, 2013, the accumulated interest on this loan was $3,629; the Company is not in compliance with the repayment terms of the loan and is currently in technical default.
(d) On June 30, 2012, July 24, 2012, September 25, 2012 and November 8, 2012. The Company borrowed $25,000, $50,000, $15,000 and $20,000 from an unrelated third party. These notes accrue interest at a rate of 0% per annum. On February 7, 2013 the amount of $20,000 was repaid plus accrued interest of $3,529.
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