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NOTES PAYABLE
9 Months Ended
Sep. 30, 2014
NOTES PAYABLE [Abstract]  
NOTES PAYABLE

NOTE 2 – NOTES PAYABLE

 

On January 27, 2010, the Company executed a Promissory Note Secured by a Deed of Trust with Assignment of Rents in the principal amount of $1,000,000.  The holder of the note was entitled to receive the entire principal amount with all accrued interest, at 7% interest per annum, payable on or before January 27, 2012.  On January 25, 2012, the maturity date of the note was extended to January 27, 2015.

 

On July 10, 2012, the Company executed a Promissory Note Secured by a Deed of Trust with Assignment of Rents in the principal amount of $100,000.  The holder of the note was entitled to receive the entire principal amount with all accrued interest, at 7% interest per annum, payable on or before December 31, 2012.  On November 2, 2012, the maturity date of the note was extended to January 10, 2014.

 

On August 31, 2012, the Company executed a Promissory Note Secured by a Deed of Trust with Assignment of Rents in the principal amount of $50,000.  The holder of the note was entitled to receive the entire principal amount with all accrued interest, at 7% interest per annum, payable on or before December 31, 2012.  On November 2, 2012, the maturity date of the note was extended to January 10, 2014.

 

The January 27, 2010, July 10, 2012 and August 31, 2012 Promissory Notes were secured by a deed of trust with assignment of rents on the Company's principal office building and a second commercial building the Company owned in Salt Lake City, Utah.  Also, the Note holder was entitled to collect rents and lease amounts, if any, from the buildings upon any default and could at its option elect to foreclose on the properties.  The Company could make payments prior to the due date and any payments were to be applied first to the reduction of interest and the balance to the outstanding principal.   In the event that the Company failed to pay any amount when due, then the amount owing would become immediately due and a default interest rate of 15% would apply to the principal amount. On June 6, 2013, the Company sold its principal office building and second commercial building in Salt Lake City, Utah for a total of $1,850,000.  The proceeds of the sale satisfied the $1,340,597 in Promissory Notes dated January 27, 2010, July 10, 2012 and  August 31, 2012 in full including all accrued interest, with the remaining cash proceeds of $509,023 remitted directly to the Company.  A gain of $143,290 was recognized on the sale of these assets during the year ended December 31, 2013.

On December 2, 2011, the Company assumed a Promissory Note in the principal amount of $30,000 as part of its acquisition of Asher, LLC.  The holder of the note is entitled to receive the entire principal amount with all accrued interest, at 5% interest per annum, on or before January 1, 2014.  As of December 31, 2013, the principal and interest on this note had been satisfied in full. 

 

On August 28, 2013 the Company entered into a $42,738 financing agreement for payment of its business insurance.  The financing agreement carries a 5.24% annual rate of interest and requires the Company to make 10 monthly payments of $4,377. During the three month period ended September 30, 2014, the Company made principal payments of $12,821 and interest of $310. For the nine month period ended September 30, 2014, the Company made principal payments of $25,642 and interest of $620As of August 31, 2014, the principal and interest on this note had been satisfied in full.

 

On September 2, 2014 the Company entered into a $44,281 financing agreement for payment of its business insurance.  The financing agreement carries a 5.24% annual rate of interest and requires the Company to make 9 monthly payments of $5,028.  During the three and nine month period ended September 30, 2014, the Company made principal payments of $4,920 and interest of $108.