NOTE 4. NOTES PAYABLE | 12 Months Ended |
Dec. 31, 2014 |
Notes to Financial Statements | |
NOTE 4. NOTES PAYABLE | | | 31-Dec-14 | | | 31-Dec-13 | |
Note payable to related party, unsecured, due 8/3/2012, interest rate 0%. | | $ | 1,950 | | | $ | 1,950 | |
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Notes payable to related party, unsecured, due 12/31/2012, interest rate 0%. | | $ | 11,810 | | | $ | 11,810 | |
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Note payable to related party, unsecured, $731,763, 5-years at 0% simple interest, due 7/1/2016, payment amounts vary each month, various late penalties. | | $ | 726,763 | | | $ | 726,763 | |
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Note payable to non-related party, unsecured, due 2/8/12, quarterly interest due, convertible at holder’s option at $0.3235688 per TBT - DE share, interest rate 30%. Currently in default. Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. | | $ | 10,000 | | | $ | 10,000 | |
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Note payable to non-related party, unsecured, due 2/8/12, quarterly interest due, convertible at holder’s option at $0.3235688 per TBT - DE share, interest rate 30%. Currently in default. Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. | | $ | 25,000 | | | $ | 25,000 | |
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Note payable to non-related party, unsecured, due 2/17/12, quarterly interest due, convertible at holder’s option at $0.3235688 per TBT - DE share, interest rate 30%. Currently in default. Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. | | $ | 25,000 | | | $ | 25,000 | |
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Note payable to non-related party, unsecured, due 2/18/12, quarterly interest due, convertible at holder’s option at $0.3235688 per TBT - DE share, interest rate 30%. Currently in default. Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. | | $ | 10,000 | | | $ | 10,000 | |
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Note payable to non-related party, unsecured, due 2/18/13, annual interest due, convertible at holder’s option at $0.3235688 per TBT-DE share, interest rate 18%. Currently in default. Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. | | $ | 750 | | | $ | 750 | |
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Note payable to non-related party, unsecured, due 2/18/13, annual interest due, convertible at holder’s option at $0.3235688 per TBT-DE share, interest rate 18%. Currently in default. Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. | | $ | 6,875 | | | $ | 6,875 | |
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Note payable to non-related party, unsecured, due 2/15/13, annual interest due, convertible at holder’s option at $0.3235688 per TBT-DE share, interest rate 12%. Currently in default. Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. | | $ | 2,500 | | | $ | 2,500 | |
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Note payable to non-related party, unsecured, due 2/20/13, annual interest due, convertible at holder’s option at $0.3235688 per TBT-DE share, interest rate 12%. Currently in default. Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. | | $ | 3,750 | | | $ | 3,750 | |
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Note payable to non-related party, unsecured, due 2/21/13, annual interest due, convertible at holder’s option at $0.3235688 per TBT-DE. share, interest rate 12%. Currently in default. Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. | | $ | 2,625 | | | $ | 2,625 | |
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Note payable to non-related party, unsecured, due 3/20/13, annual interest due, convertible at holder’s option at $0.3235688 per TBT-DE share, interest rate 12%. Currently in default. Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. | | $ | 5,433 | | | $ | 5,433 | |
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Note payable to non-related party, unsecured, due 3/22/13, annual interest due, convertible at holder’s option at $0.3235688 per TBT-DE share, interest rate 12%. Currently in default. Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. | | $ | 3,203 | | | $ | 3,203 | |
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Note payable to non-related party, unsecured, due 2/25/13, annual interest due, convertible at holder’s option at 51% of market as defined, interest rate 8%, conversion limited to total beneficial ownership of 4.99%. (Fully converted at December 31, 2014). | | $ | - | | | $ | 19,250 | |
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Note payable to non-related party, unsecured, due 4/19/13, annual interest due, convertible at holder’s option at 51% of market as defined, interest rate 8%, conversion limited to total beneficial ownership of 4.99%. Currently in default. Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue and/or the continued conversion of the company’s stock. | | $ | 6,605 | | | $ | 52,500 | |
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Note payable to non-related party, unsecured, due 08/29/2013, simple interest 8% convertible at holder’s option at $.249 per TBT-CA share. | | $ | 15,000 | | | $ | 15,000 | |
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Currently in default. | | | | | | | | |
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Note payable to non-related party, unsecured, due 03/01/2013, simple interest 9%. Currently in default. Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. | | $ | 5,000 | | | $ | 5,000 | |
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Note payable to non-related party, unsecured, due 12/13/2013, simple interest 7%. Currently in default. Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. Stock option issued as an additional transaction cost for receipt of funds from note payable. | | $ | 5,342 | | | $ | 5,342 | |
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Note payable to non-related party, unsecured, due 01/31/2013, simple interest 18%. Currently in default. Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. | | $ | 3,938 | | | $ | 3,938 | |
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Note payable to non-related party, unsecured, due on demand, simple interest 7%, convertible at anytime into common stock at 65% of market closing price on previous day | | $ | - | | | $ | 25,000 | |
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Note payable to non-related party, unsecured, due 01/07/2014, simple interest 7%, default interest 10%, Currently in default. Principal balance including interest | | $ | 15,000 | | | $ | 15,000 | |
to be paid upon the receipt of equity funding and/or sales revenue. Stock option issued as an additional transaction cost for receipt of funds from note payable. |
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Note payable to non-related party, unsecured, due 01/15/2014, simple interest 7%, default interest 10%, Currently in default. Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. Stock option issued as an additional transaction cost for receipt of funds from note payable. | | $ | 5,000 | | | $ | 5,000 | |
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Note payable to non-related party, unsecured, due 01/20/2014, simple interest 7%, default interest 10%, Currently in default. Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. Stock option issued as an additional transaction cost for receipt of funds from note payable. | | $ | 65,272 | | | $ | 65,272 | |
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Note payable to non-related party, unsecured, due 03/28/2013, $13,000 in interest (1 month). Currently in default. Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. | | $ | 17,000 | | | $ | 32,000 | |
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Note payable to non-related party, unsecured, due 01/23/2014, simple interest 9%. Currently in default. Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. | | $ | 50,000 | | | $ | 50,000 | |
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Note payable to non-related party, unsecured, due 04/28/2014, simple interest 7%, default interest 10%, Currently in default. Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. Stock option issued as an additional transaction cost for receipt of funds from note payable. | | $ | 9,440 | | | $ | 9,440 | |
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Note payable to non-related party, unsecured, due 05/05/2014, simple interest 7%, default interest 10%, Currently in default. Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. Stock option issued as an additional transaction cost for receipt of funds from note payable. | | $ | 50,060 | | | $ | 50,060 | |
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Note payable to non-related party, unsecured, due 07/02/2014, simple interest 9%. Currently in default. Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. | | $ | 15,000 | | | $ | 15,000 | |
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Note payable to non-related party, unsecured, due 10/25/2013, simple interest 18%. Currently in default. Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. | | $ | 2,000 | | | $ | 2,000 | |
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Note payable to non-related party, unsecured, due 07/29/2014, simple interest 7%, default interest 10%, Currently in default. Principal balance including interestto be paid upon the receipt of equity funding and/or sales revenue. Stock option issued as an additional transaction cost for receipt of funds from note payable. | | $ | 1,900 | | | $ | 1,900 | |
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Note payable to non-related party, unsecured, due 09/19/2014, simple interest 7%, default interest 10%, Currently in default. Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. Stock option issued as an additional transaction cost for receipt of funds from note payable. | | $ | 10,000 | | | $ | 10,000 | |
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Note payable to non-related party, unsecured, due 09/19/2014, simple interest 7%, default interest 10%, Currently in default. Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. Stock option issued as an additional transaction cost for receipt of funds from note payable. | | $ | 65,000 | | | $ | 65,000 | |
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Note payable to non-related party, unsecured, due 09/29/2014, simple interest 7%, default interest 10%, stock option. Currently in default. Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. Stock option issued as an additional transaction cost for receipt of funds from note payable. | | $ | 20,000 | | | $ | 20,000 | |
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Note payable to non-related party, unsecured, due 12/27/2013, simple interest 9%. Currently in default. Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. | | $ | 15,000 | | | $ | 15,000 | |
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Note payable to non-related party, unsecured, due 10/28/2014, simple interest 7%, default interest 10%, Currently in default. Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. Stock option issued as an additional transaction cost for receipt of funds from note payable. | | $ | 2,500 | | | $ | 2,500 | |
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Note payable to non-related party, unsecured, due 10/29/2014, simple interest 7%, default interest 10%, Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenu. Stock option issued as an additional transaction cost for receipt of funds from note payable. | | $ | 10,000 | | | $ | 10,000 | |
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Note payable to non-related party, unsecured, due 11/10/2014, simple interest 7%, default interest 10%, Currently in default. Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. Stock option issued as an additional transaction cost for receipt of funds from note payable. | | $ | 5,000 | | | $ | 5,000 | |
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Note payable to non-related party, unsecured, due 11/20/2014, simple interest 7%, default interest 10%, Currently in default. Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. Stock option issued as an additional transaction cost for receipt of funds from note payable. | | $ | 20,000 | | | $ | 20,000 | |
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Note payable to non-related party, unsecured, due 12/02/2014, simple interest 7%, default interest 10%, Currently in default. Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. Stock option issued as an additional transaction cost for receipt of funds from note payable. | | $ | 5,000 | | | $ | 5,000 | |
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Note payable to non-related party, unsecured, due 1/27/2014, simple interest 10%. Currently in default. Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. | | $ | 4,235 | | | $ | 5,000 | |
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Note payable to non-related party, unsecured, due 1/07/2015, simple interest 7%, default interest 10%, Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. Stock option issued as an additional transaction cost for receipt of funds from note payable. | | $ | 25,000 | | | $ | - | |
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Note payable to non-related party, unsecured, due 1/28/2015, simple interest 7%, default interest 10%, Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. Stock option issued as an additional transaction cost for receipt of funds from note payable. | | $ | 1,253 | | | $ | - | |
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Note payable to non-related party, unsecured, due 1/29/2015, simple interest 7%, default interest 10%. Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. Stock option issued as an additional transaction cost for receipt of funds from note payable. | | $ | 3,500 | | | $ | - | |
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Note payable to non-related party, unsecured, due 2/10/2015, simple interest 7%, default interest 10%, Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. Stock option issued as an additional transaction cost for receipt of funds from note payable. | | $ | 990 | | | $ | - | |
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Note payable to non-related party, unsecured, due 2/17/2015, simple interest 7%, default interest 10%, Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. Stock option issued as an additional transaction cost for receipt of funds from note payable. | | $ | 4,500 | | | $ | - | |
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Note payable to non-related party, unsecured, due 2/20/2015, simple interest 7%, default interest 10%, Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. Stock option issued as an additional transaction cost for receipt of funds from note payable. | | $ | 5,000 | | | $ | - | |
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Note payable to non-related party, unsecured, due 3/10/2015, simple interest 7%, default interest 10%, Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. Stock option issued as an additional transaction cost for receipt of funds from note payable. | | $ | 2,500 | | | $ | - | |
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Note payable to non-related party, unsecured, due 3/31/2015, simple interest 7%, default interest 10%, Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. Stock option issued as an additional transaction cost for receipt of funds from note payable. | | $ | 2,500 | | | $ | - | |
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Note payable to non-related party, unsecured, due 4/03/2015, simple interest 7%, default interest 10%, Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. Stock option issued as an additional transaction cost for receipt of funds from note payable. | | $ | 5,890 | | | $ | - | |
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Note payable to non-related party, unsecured, due 4/08/2015, interest up to 7%, convertible up to the due date. | | $ | 15,000 | | | $ | - | |
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Note payable to non-related party, unsecured, due 4/10/2015, simple interest 7%, default interest 10%, Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. Stock option issued as an additional transaction cost for receipt of funds from note payable. | | $ | 4,331 | | | $ | - | |
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Note payable to non-related party, unsecured, due 4/27/2015, simple interest 7%, default interest 10%, Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. Stock option issued as an additional transaction cost for receipt of funds from note payable. | | $ | 2,500 | | | $ | - | |
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Note payable to non-related party, unsecured, due 5/13/2015, simple interest 7%, default interest 10%, Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. Stock option issued as an additional transaction cost for receipt of funds from note payable. | | $ | 5,360 | | | $ | - | |
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Note payable to non-related party, unsecured, due 9/11/2014, simple interest 10%. Currently in default. Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. | | $ | 5,000 | | | $ | - | |
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Note payable to non-related party, unsecured, due 5/26/2015, simple interest 7%, default interest 10%, Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. Stock option issued as an additional transaction cost for receipt of funds from note payable. | | $ | 895 | | | $ | - | |
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Note payable to non-related party, unsecured, due 6/10/2015, simple interest 7%, default interest 10%, Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. Stock option issued as an additional transaction cost for receipt of funds from note payable. | | $ | 3,207 | | | $ | - | |
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Note payable to non-related party, unsecured, due 6/17/2015, simple interest 7%, default interest 10%, Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. Stock option issued as an additional transaction cost for receipt of funds from note payable. | | $ | 600 | | | $ | - | |
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Note payable to non-related party, unsecured, due 7/09/2015, simple interest 7%, default interest 10%, Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. Stock option issued as an additional transaction cost for receipt of funds from note payable. | | $ | 3,750 | | | $ | - | |
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Note payable to non-related party, unsecured, due 8/05/2015, simple interest 7%, default interest 10%, Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. Stock option issued as an additional transaction cost for receipt of funds from note payable. | | $ | 10,000 | | | $ | - | |
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Note payable to non-related party, unsecured, due 9/03/2015, simple interest 7%, default interest 10%, Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. Stock option issued as an additional transaction cost for receipt of funds from note payable. | | $ | 1,000 | | | $ | - | |
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Note payable to non-related party, unsecured, due 10/19/2015, simple interest 7%, default interest 10%, Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. Stock option issued as an additional transaction cost for receipt of funds from note payable. | | $ | 1,486 | | | $ | - | |
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Note payable to non-related party, unsecured, due 10/22/2015, simple interest 7%, default interest 10%, Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. Stock option issued as an additional transaction cost for receipt of funds from note payable. | | $ | 3,500 | | | $ | - | |
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Note payable to non-related party, unsecured, due 10/28/2015, simple interest 7%, default interest 10%, Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. Stock option issued as an additional transaction cost for receipt of funds from note payable. | | $ | 4,360 | | | $ | - | |
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Note payable to non-related party, unsecured, due 11/11/2015, simple interest 7%, default interest 10%, Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. Stock option issued as an additional transaction cost for receipt of funds from note payable. | | $ | 5,810 | | | $ | - | |
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Note payable to non-related party, unsecured, due 11/19/2015, simple interest 7%, default interest 10%, Principal balance including interest to be paid upon the receipt of equity funding and/or sales revenue. Stock option issued as an additional transaction cost for receipt of funds from note payable. | | $ | 15,000 | | | $ | - | |
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Note payable to non-related party, unsecured, due 12/02/2015, simple interest 7%, default interest 10%. | | $ | 214,334 | | | $ | - | |
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| | $ | 1,617,217 | | | $ | 1,375,861 | |
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Less note discounts | | | (5,000 | ) | | | (22,996 | ) |
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Less current - related parties | | | (697,225 | ) | | | (573,516 | ) |
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Less current – non-related parties | | | (871,694 | ) | | | (612,342 | ) |
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Long-term – related parties | | $ | 43,298 | | | $ | 167,007 | |
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Required principal payments from December 31, 2014 forward are as follows: |
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2015 | | | $ | 1,573,919 | | | | |
2016 | | | $ | 43,298 | | | | |
2017 | | | $ | - | | | | |
2018 | | | $ | - | | | | |
2019 | | | $ | - | | | | |
| | | $ | 1,617,217 | | | | |
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Interest expense under notes payable for the years ended December 31, 2013 and December 31, 2014 was $170,428 and $188,046, respectively. |
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During the years ended December 31, 2013 and December 31, 2014 the Company recognized a beneficial conversion feature expense on borrowing from convertible notes of $94,161and $32,996 respectively. During the years ended December 31, 2013 and December 31, 2014 the unamortized note discount from the beneficial conversion feature was $22,996 and $5,000, respectively. |
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In 2012 the company borrowed $110,000 under convertible notes with a variable conversion price based on a percentage of market price. Notes converted at December 31, 2013 and December 31, 2014 were $47,500 and $103,395, respectively. The Company determined that these notes have an embedded derivative and are therefore accounted for at fair value. The Company recorded fair market value adjustments for the years ended December 31, 2013 and December 31, 2014 of $11,969 and $21,559, respectively. The fair market value adjustments were based on the Black-Sholes method using the following assumptions: risk free rates ranging between 0.10% - 0.21%, dividend yield of 0%, expected life of 1 year, volatility between 128% - 354%. The fair value derivative liability under the notes as of December 31, 2013 and December 31, 2014 was $150,067 and $25,456 respectively. |