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Notes Payable to Stockholder
9 Months Ended
Sep. 30, 2013
Notes Payable to Stockholder [Abstract]  
Notes Payable to Stockholder

5.

Notes Payable to Stockholder


Beginning on March 28, 2002 the Company executed a binding agreement with one of its principal stockholders, who is also the Chairman of the Board and an executive officer, to fund up to $6.1 million. Under the terms of the agreements, the Company can draw amounts as needed to fund operations. Amounts drawn bear interest at the BBA LIBOR Daily Floating Rate plus 1.4 percentage points (1.595% per annum at September 30, 2013), payable monthly and were to become due and payable on December 31, 2005 or upon a change in control of the Company or consummation of any other financing over $7.0 million. Beginning in March 2006, annually, through March 2013, the maturity date for the agreement was extended annually from December 31, 2007 to December 31, 2014.


On August 22, 2013 and September 19, 2013, the Company received $125,000 and $100,000 from the Company's Chairman and CEO as an advance for working capital needs. The loans bear interest at the same rate of interest as the credit facility provided by the stockholder under the note dated March 28, 2002.


At September 30, 2013 the Company had drawn the full funding amount under the agreement of $6.1 million plus an additional $3,479,192, for a total amount due of $9, 579,192.  


For the three months ended September 30, 2013 and 2012, the Company recorded $53,619 and $43,752 of interest expense, respectively, and for the nine-months ended September 30, 2013 and 2012, the Company recorded $156,666 and $122,617 respectively, of interest expense related to the notes payable, as noted above, which is included in interest expense in the accompanying condensed consolidated statements of operations.