NOTE 6 – NOTES PAYABLE

The Company has two non-collateral notes payable outstanding, that bear simple interest at 6% per annum. The first note is dated April 5, 2011 and is for $10,000. The second note is dated September 1, 2011 and is for $7,500.  The notes principle and interest are due three years from the date of issuance. As of September 30, 2013 total accrued interest on the notes is $2,446.

On June 12, 2013, a third non-collateral notes payable dated February 3, 2010 for $90,000, plus $18,000 of accrued interest was forgiven by the note holder. As a result the Company has recorded a $108,000 gain on forgiveness of debt.

During the period ended September 30, 2013, an individual advanced the Company $87,500 for a short term loan. The loan accrues interest at 6% and is due on demand. As of September 30, 2013 total accrued interest on the loan is $2,413.

During the period ended September 30, 2013, an individual advanced the Company $276,257 for a short term loan, $100,000 of which was repaid. The loan accrues interest at 6% and is due on demand. As of September 30, 2013, $176,252 and total accrued interest of $1,391 is due on the loan. Subsequent to September 30, 2013, all principle and interest on the loan was repaid in full.

As of September 30, 2013, the Company owed an individual $4,942. The loan accrues interest at 6% and is due on demand. The interest expense is recorded as additional paid in capital.

The Company also has financing loans for its product liability and Director and Officer insurance. As of September 30, 2013 and December 31, 2012 the loans have a balance of $31,140 and $5,346, respectively, they bear interest at 7.75% and are due within one year.

The five year maturity of these loans is as follows: