Annual report pursuant to Section 13 and 15(d)

Note 11 - NOTES PAYABLE-RELATED PARTY

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Note 11 - NOTES PAYABLE-RELATED PARTY
12 Months Ended
Dec. 31, 2013
Notes to Financial Statements  
Note 11 - NOTES PAYABLE-RELATED PARTY

As of December 31, 2013 and 2012, the Company received an advances from Jorge Andrade, director, and Neil Muller, President as loans from related parties. The loans are payable on demand and without interest

 

On January 22, 2013, the Company issued a unsecured promissory note payable for $200,000 due January 1, 2018, with a stated interest rate of 12% per annum beginning three months from issuance; payable monthly. Principal payments are due starting February 1, 2015 at $6,650 per month. The lender has an option to convert the note to licensing rights for the State of Oregon. The Company currently is in default of the required interest payments initially due starting April 22, 2013.

 

In connection with the issuance of the above described promissory note, the Company is obligated to issue 750,000 of its common stock.

 

The Company recorded a debt discount of $11,250 based on the fair value of the Company’s common stock at the issuance date of the promissory note. The discount is amortized ratably over the term on the notes. The note holder subsequently became an officer of the Company

 

During the year ended December 31, 2013, the Company received advances and issued notes in aggregate of $38,480, due on demand through July 14, 2014, non-interest bearing. The Balance as of December 31, 2013 was $28,480.