Quarterly report pursuant to sections 13 or 15(d)

5. RELATED PARTY TRANSACTIONS

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5. RELATED PARTY TRANSACTIONS
6 Months Ended
Jun. 30, 2013
Notes to Financial Statements  
NOTE 5 - RELATED PARTY TRANSACTIONS

5.           RELATED PARTY TRANSACTIONS

 

Through December 31, 2011, the CEO advanced $257,820 to BTI to fund start-up costs and operations of the Company. Advances by the CEO carry an interest rate of 6.5% and were due on June 29, 2013. On May 7, 2012, the Company’s CEO and President entered into promissory notes to advance to the Company an aggregate of $40,000. The notes accrue interest at 6.5% per year were due June 30, 2013. As of June 30, 2013, and December 31, 2012, $53,689 and $44,090, respectively, of accrued interest had been included in accrued expenses on the accompanying balance sheet. On August 6, 2012, the outstanding notes of $297,820 were amended to extend the maturity dates to June 29, 2014. On August 2, 2013, the outstanding notes of $297,820 were amended to extend the maturity dates to June 29, 2015. The CEO and President intend to, but are not legally obligated, to fund the Company’s operations in this manner until the Company raises sufficient capital.

 

On November 13, 2012, Jonathan B. Rome, the Company's Chief Operating Officer, and the Company entered into a securities purchase agreement pursuant to which Mr. Rome invested $625,000 in the Company's offering of common stock and warrants on Form S-1 to purchase an aggregate of 1,250,000 shares of the Company's common stock at $0.50 per share and 625,000 warrants to purchase 625,000 shares of its common stock. The exercise price of the warrants is $1.00 per share. The warrants have a five-year term.