NOTE

CONVERTIBLE NOTES PAYABLE

The following table summarizes the convertible debt outstanding as of

March 31, 2019.

						Carrying amount
Date of	Maturity	Interest		Principal at		Short term				Long term
issuance	date	rate		March 31, 2019		Related		Non related		Related		Non related
8/29/2008	4/1/2020		10%	$	1,770,000	$	-0-	$	-0-	$	1,770,000	$	-0-
12/16/2008	4/1/2020		12%		4,000,000		-0-		-0-		4,000,000		-0-
12/16/2008	4/1/2021		12%		200,000		-0-		-0-		-0-		200,000
Total				$	5,970,000	$	-0-	$	-0-	$	5,770,000	$	200,000

The following table summarizes the convertible debt outstanding as of

December 31, 2018.

						Carrying amount
Date of	Maturity	Interest		Principal at		Short term				Long term
issuance	date	rate		December 31, 2018		Related		Non related		Related		Non related
8/29/2008	4/1/2020		10%	$	1,770,000	$	-0-	$	-0-	$	1,770,000	$	-0-
12/16/2008	4/1/2020		12%		4,000,000		-0-		-0-		4,000,000		-0-
12/16/2008	4/1/2021		12%		200,000		-0-		-0-		-0-		200,000
Total				$	5,970,000	$	-0-	$	-0-	$	5,770,000	$	200,000

10%

Convertible Notes

During

1999,

the Company issued

10%

Convertible Notes payable in the amount of

$862,500

pursuant to a Confidential Private Placement Memorandum. There were costs of

$119,625

associated with this offering. The net proceeds to the Company were

$742,875.

The notes bear interest at

10%

annually, payable semi-annually. The notes were convertible after maturity, which was

June 30, 2004,

into shares of common stock of the Company at

$1.25

per share. On

September 30, 2018,

the final

$50,000

note was repaid in full along with the accrued interest of

$96,949.

As of

March 31, 2019,

$862,500

of the Convertible Notes had been repaid in cash or converted into

1,495,179

shares of common stock of the Company leaving an outstanding principal balance of $-

Convertible Debentures

August 2008

August 29, 2008,

the Company sold

$2,270,000

of convertible debentures and warrants to purchase an aggregate of

4,540,000

shares of our common stock to

four

accredited investors including our then Chief Executive Officer and Director, Cornelis F. Wit (“Mr. Wit”) and

one

of our then Directors. The convertible debentures, which bear interest at

10%

per annum, were due on

August 29, 2010.

The convertible debentures are convertible at any time at the option of the holder into shares of our common stock based upon a conversion rate of

$0.50

per share.

September 30, 2009,

the Company and

two

Affiliates of the Company extended

$1,920,000

of the convertible debentures until

August 29, 2013

in accordance with the terms of a Secured Convertible Debenture issued on that date. The expiration date of the warrants associated with the debentures was also extended to

August 29, 2013.

February 22, 2013,

the Company and Mr. Wit extended the maturity date of

$1,770,000

of the convertible debentures to

January 1, 2016.

The expiration date of the warrants associated with the debentures was also extended to

January 1, 2016.

February 22, 2013,

the Company and Mr. van Kesteren extended the maturity date of

$150,000

of the convertible debentures due to our former Director, Guus van Kesteren (“Mr. van Kesteren”) to

January 1, 2015.

The expiration date of the warrants associated with the debentures was also extended to

January 1, 2015.

April 21, 2014,

the Company and Mr. van Kesteren extended the maturity date of his

$150,000

of convertible debentures to

April 1, 2016.

The expiration date of the warrants associated with the debentures was also extended to

April 1, 2016.

July 31, 2014

Mr. van Kesteren’s term on the Board of Directors ended. Effective on the same date, his convertible note in the amount of

$150,000

was reclassified from Related Party to Non-Related Party.

January 31, 2015,

the Company and Mr. Wit extended the maturity date of the

$1,770,000

of convertible debentures to

April 1, 2017.

The expiration date of the warrants associated with the debentures was also extended to

April 1, 2017.

June 30, 2015,

the Company and Mr. van Kesteren extended the maturity date of

$150,000

of convertible debentures to

April 1, 2017.

The expiration date of the warrants associated with the debentures was also extended to

April 1, 2017.

June 30, 2016,

the Company and Mr. Wit extended the maturity date of the

$1,770,000

of convertible debentures to

April 1, 2020.

The expiration date of the warrants associated with the debentures was also extended to

April 1, 2020.

June 30, 2016,

the Company and Mr. van Kesteren extended the maturity date of

$150,000

of convertible debentures to

April 1, 2018.

The expiration date of the warrants associated with the debentures was also extended to

April 1, 2018.

June 30, 2017,

the Company and Mr. van Kesteren extended the maturity date of

$150,000

of convertible debentures to

April 1, 2019.

The expiration date of the warrants associated with the debentures was also extended to

April 1, 2019.

The

$150,000

of convertible debentures was repaid in full on

June 30, 2018.

December 2008

December 16, 2008,

the Company sold

$5,075,000

of convertible debentures and warrants to purchase an aggregate of

10,150,000

shares of common stock to

eleven

accredited investors, including our then Chief Executive Officer and Director, Cornelis F. Wit (“Mr. Wit”), our then Chief Operating Officer and President, Stephen E. Johnson (“Mr. Johnson”), our then Chief Technology Officer, Randall G. Smith (“Mr. Smith”), our then Chief Financial Officer, Ronald T. Linares and

four

of our then Directors. The convertible debentures, which bear interest at

12%

per annum, were due on

December 16, 2010.

The convertible debentures are convertible at any time at the option of the holder into shares of our common stock based upon a conversion rate of

$0.50

per share.

September 30, 2009,

the Company and

eight

Affiliates of the Company extended

$4,980,000

of the convertible debentures until

December 16, 2013

in accordance with the terms of a Secured Convertible Debenture issued on that date. The expiration date of the warrants associated with the convertible debentures was also extended to

December 16, 2013.

February 22, 2013,

the Company and the holders agreed to extend the maturity date of

$4,505,000

of the convertible debentures including

$4,475,000

due to Mr. Wit,

$25,000

due to Mr. Johnson and

$5,000

due to Mr. Smith, to

January 1, 2016.

The expiration date of the warrants associated with the debentures was also extended to

January 1, 2016.

February 27, 2013,

the Company and our former director Mr. Veatch extended the maturity date of

$15,000

of the convertible debentures to

January 1, 2016.

The expiration date of the warrants associated with the debentures was also extended to

January 1, 2016.

March 6, 2013,

the Company and the holder extended the maturity date of

$200,000

of convertible debentures to

January 1, 2014.

The expiration date of the warrants associated with the debentures was also extended to

January 1, 2014.

March 12, 2013,

the Company and the holder agreed to extend the maturity date of

$100,000

of convertible debentures to

January 1, 2015.

The expiration date of the warrants associated with the debentures was also extended to

January 1, 2015.

December 2013,

the Company and

two

holders agreed to extend the maturity date of

$360,000

of the convertible debentures, including

$160,000

due to our then director, Guus van Kesteren (“Mr. van Kesteren”), to

January 1, 2016.

The expiration date of the warrants associated with the debentures was also extended to

January 1, 2016.

July 31, 2014

Mr. van Kesteren’s term on the Board of Directors ended. Effective on the same date, his convertible note in the amount of

$160,000

was reclassified from Related Party to Non-Related Party.

April 28, 2014,

the Company and the holder extended the maturity date of

$100,000

of convertible debentures to

April 1, 2016.

The expiration date of the warrants associated with the debentures was also extended to

April 1, 2016.

January 31, 2015,

the Company and Mr. Wit extended the maturity date of

$4,475,000

of convertible debentures to

April 1, 2017.

The expiration date of the warrants associated with the debentures was also extended to

April 1, 2017.

November 19, 2015,

the Company and Mr. Wit agreed to cancel

$420,000

of the debentures and

1,680,000

of unrelated warrants in exchange for

1,680,000

shares of our common stock.

April 27, 2015,

the Company and the holder extended the maturity date of

$200,000

of convertible debentures to

April 1, 2018.

The expiration date of the warrants associated with the debentures was also extended to

April 1, 2018.

April 30, 2015,

the Company and Mr. Johnson extended the maturity date of

$25,000

of convertible debentures to

April 1, 2018.

The expiration date of the warrants associated with the debentures was also extended to

April 1, 2018.

The convertible debentures were repaid in full on

December 14, 2016.

May 1, 2015,

the Company and Mr. van Kesteren extended the maturity date of

$160,000

of the convertible debentures to

April 1, 2017.

The expiration date of the warrants associated with the debentures was also extended to

April 1, 2017.

May 1, 2015,

the Company repaid

$5,000

of the convertible debentures to Mr. Smith.

May 7, 2015,

the Company and Mr. Veatch, extended the maturity date of

$15,000

of the convertible debentures to

April 1, 2018.

The expiration date of the warrants associated with the debentures was also extended to

April 1, 2018.

The

$15,000

of convertible debentures were repaid in full on

December 14, 2016.

June 30, 2015,

the Company and the holder extended the maturity date of

$100,000

of convertible debentures to

April 1, 2017.

The expiration date of the warrants associated with the debentures was also extended to

April 1, 2017.

June 30, 2016,

the Company and Mr. Wit extended the maturity date of

$4,055,000

of convertible debentures to

April 1, 2020.

The expiration date of the warrants associated with the debentures was also extended to

April 1, 2020.

August 31, 2017,

the Company repaid

$55,000

of the convertible debentures to Mr. Wit.

June 30, 2016,

the Company and Mr. van Kesteren extended the maturity date of

$160,000

of the convertible debentures to

April 1, 2018.

The expiration date of the warrants associated with the debentures was also extended to

April 1, 2018.

The

$160,000

of convertible debentures was repaid in full on

December 14, 2016.

June 30, 2016,

the Company and the holder extended the maturity date of

$100,000

of convertible debentures to

April 1, 2020.

The expiration date of the warrants associated with the debentures was also extended to

April 1, 2020.

August 31, 2017,

the Company repaid

$100,000

of convertible debentures to the holder.

June 30, 2017,

the Company and the holder extended the maturity date of

$200,000

of the convertible debentures to

April 1, 2021.

The expiration date of the warrants associated with the debentures was also extended to

April 1, 2021.

The principal payments required at maturity under the Company’s outstanding convertible debt at

March 31, 2019

are as follows:

Year	Amount
2019	$	-0-
2020		5,770,000
2021		200,000
Total	$	5,970,000