Note 6. Notes Payable - Related Party

6 Months Ended

Jun. 30, 2013

Note Payable Related Party [Abstract]

Note Payable Related Party [Text Block]

6. Notes Payable – Related Party. Two $1,000,000 notes are payable under an unsecured loan agreement with Hayashibara Biochemical Laboratories, Inc. (“HBL”), a major stockholder, dated July 22, 1999. Although we are currently in repayment default on the notes, HBL has not demanded payment.

On January 10, 2011 a promissory note for the $200,000 was executed with Paul Tibbits, a director, which includes interest at 10% per annum, with no stated maturity date, and no collateral. As of June 30, 2013 this note is still outstanding.

The Company executed a note payable for $100,000, in exchange for accrued salaries of Martin Cummins through October 31, 2012, during the prior year ended December 31, 2012. The Company repaid $48,500 towards the outstanding note payable. The remaining principal balance is due in monthly payments of $8,500 through November 2013 and one final payment due in December 2013. The note carries no stated interest rate, and a default interest rate of 10%, and is unsecured. Although the term of the note ends with the last payment in December 2013, Martin Cummins’ employment contract expires on August 31, 2013.

Stephen Chen, ABI CEO, wired the Company money for working capital loans to be used for operations; total cash received through Dr. Chen for 2012 was $547,958. During 2013 cash received through Dr. Chen was $388,335. The working capital loans are short term, without due dates, and carry no stated interest rates or any other terms.

The Company continues to investigate the possibility of structural changes. The Company has received, and continues to receive, funds to support operations during the period of investigation under an interim agreement executed by the Company and the Yang Group of Taoyuan, Taiwan. During this interim period while the final agreement is being negotiated, the funds discussed above are being advanced to Dr. Stephen Chen, ABI CEO. Dr. Chen then advances the funds to the Company at his discretion. The Agreement executed by the parties contemplates the execution of comprehensive transaction documents by the Company and one or more Yang Group affiliated entities, upon the completion of ongoing negotiations. Additional amounts received by the Company under these arrangements are discussed in footnote 8, below.