Loan Payable to Officer

9 Months Ended

Sep. 30, 2011

Loan Payable to Officer

Loan Payable to Officer

4. Loan Payable to Officer

On February 3, 2011, the Company extended a revolving promissory note to borrow up to $700,000 from G. Ward Paxton, the Company’s Chairman, President and Chief Executive Officer through March 2012.

On February 3, 2011, we received a written commitment from our Chief Executive Officer to loan up to an additional $1,500,000 in the Company until March 2012, should such funding be required by the Company, on terms and conditions similar to the promissory note above.

Amounts borrowed from this officer accrue interest at a floating rate per annum equal to SVB’s prime rate plus 1% (5% at September 30, 2011).  All outstanding borrowings and accrued but unpaid interest is due on March 31, 2012.  As of September 30, 2011, the borrowings outstanding totaled $1,530,000 and accrued interest totaled $34,000.