Notes Payable

9 Months Ended

Jul. 31, 2012

Debt Disclosure [Abstract]

Notes Payable

8. Notes Payable

At July 31, 2012 and October 31, 2011, notes payable to an officer and to stockholders consisted of the following:

	July 31, 2012		October 31, 2011
			(Audited)
Unsecured convertible note payable to major stockholder; principal and interest at 6% due on March 10, 2010.	$	—	$	64,000
Unsecured convertible note payable to major stockholder; principal and interest at 6% due on October 15, 2010.		—		30,000
Unsecured, interest-free convertible notes payable to former officer/director of the Company; principal due on payment schedule through May 2014.		135,111		160,000
Unsecured notes payable to officers/directors of the Company; principal and interest at 6% due on April 9, 2011.		—		164,000
Unsecured convertible note payable to various stockholders; principal and interest at 6% due between December 9, 2010 and March 31, 2011.		52,000		147,000
		187,111		565,000
Less current maturities		117,661		565,000
Long term portion of notes payable	$	69,450	$	—

On May 17, 2012, the Company repaid a $30,000 short term loan made by Mr. Newhuis to the Company in February 2012. No interest was accrued or paid on the loan.

Concurrent with his April 13, 2012 resignation as Chairman of the Board of Directors and Chief Executive Officer, the Company agreed to repay a total of $160,000 in principal loans due Michael Brennan over a 25-month payment schedule commencing May 1, 2012. As of July 31, 2012, payments have been made to Mr. Brennan to reduce the principal balance to $135,111. The agreement also provides for repayment of $24,339 in interest accrued on those loans and $13,120 in unpaid fees and expenses through his resignation date, the latter of which has been paid as of July 31, 2012.

In July 2012, the Company repaid a $30,000 loan made to the Company in February 2012 by an unaffiliated third party.

With the exception of the above $135,111 in notes payable to a former officer and director, all of the above notes payable were past due as of July 31, 2012. The Company is currently negotiating with holders of the remaining $52,000 in principal notes to either extend the maturity date or convert the notes into shares of common stock.