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NOTE PAYABLE - RELATED PARTY
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6 Months Ended |
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Jun. 30, 2011
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| NOTE PAYABLE - RELATED PARTY |
NOTE 3 -NOTE PAYABLE – RELATED
PARTY:
On
March 9, 2007, the Company entered into a loan agreement with BCM
pursuant to which the Company agreed to repay $12,500 on or before
the earlier of (i) December 31, 2012 or (ii) the date that the
Company (or a wholly owned subsidiary of the Company) consummates a
merger or similar transaction with an operating business. BCM had
previously advanced the $12,500 on behalf of the Company. Prior to
being refinanced, interest accrued on the outstanding principal
balance of this loan on the basis of a 360-day year daily from
January 24, 2006, the effective date of the loan, until it was paid
in full at the rate of four percent (4%) per annum.
On
April 15, 2008, Messrs. Rapp and Wagenheim and Clifford Chapman, a
former director of the Company, loaned the Company $5,000, $3,000
and $2,000, respectively. The Company issued promissory notes
(each, a “April 15 Note” and together, the “April
15 Notes”) to Messrs Rapp,
Wagenheim and Chapman. Prior to each April 15 Note being refinanced
or repaid, as the case may be, each April 15 Note accrued interest
at an annual rate of 8.25%, and such principal and all accrued
interest was due and payable on or before the earlier of (i) the
fifth anniversary of the date of such April 15 Note or (ii) the
date on which the Company would have consummated a business
combination with a private company in a reverse merger or reverse
takeover transaction or other transaction after which the company
would have ceased to be a shell company.
On
March 16, 2009, the Company entered into a loan agreement with BCM
pursuant to which the Company agreed to repay $14,500 on or before
the earlier of (i) March 16, 2014 or (ii) the date that the Company
(or a wholly owned subsidiary of the Company) consummates a merger
or similar transaction with an operating business. Prior to being
refinanced, interest accrued on the outstanding principal balance
of this loan at an annual rate of 8.25%.
On
August 12, 2009, the Company entered into a loan agreement with BCM
pursuant to which the Company agreed to repay $12,000 on or before
the earlier of (i) August 12, 2013 or (ii) the date that the
Company (or a wholly owned subsidiary of the Company) consummates a
merger or similar transaction with an operating business. Prior to
being refinanced, interest accrued on the outstanding principal
balance of this loan at an annual rate of 8.25%.
On
March 31, 2011, the Company repaid a total of $2,000 on principal
and $484 of accrued interest to Mr. Chapman for full satisfaction
of his April 15 Note.
On
May 27, 2011, the Company entered into a loan payable agreement for
approximately $120,000 with BCM, which consolidated all of the
Company’s accrued interest-related party, related party
advances and note payable-related party outstanding as of such date
into one instrument as well as provided additional advances to the
Company. The loan is payable upon the consummation of the
Company’s initial business transaction, bears no interest and
contains a waiver of any and all rights to the funds in the trust
account resulting from the consummation of the proposed
offering.
Michael
Rapp, our President and director, Philip Wagenheim, our Secretary
and director, and Jason Eiswerth, our director, all serve as
management of BCM, a registered broker-dealer. BCM is also the lead
underwriter of the Company’s initial public
offering.
For
the three and six months ended June 30, 2011, interest expense from
notes payable—related party was $521 and $868, respectively.
For the three and six months ended June 30, 2010, interest expense
from notes payable—related party was $878 and $1,746,
respectively.
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