Quarterly report pursuant to Section 13 or 15(d)

NOTE 4. NOTES PAYABLE

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NOTE 4. NOTES PAYABLE
9 Months Ended
Dec. 31, 2011
Debt Disclosure [Text Block]

NOTE 4. NOTES PAYABLE


Notes payable, all current liabilities and unsecured, consist of the following at December 31, 2011 and March 31, 2011:


  December 31, 2011 March 31, 2011
  Principal Balance    Accrued Interest   Principal Balance   Accrued Interest 
12% Notes payable, past due   $ 185,000     $ 291,377     $ 185,000     $ 270,562  
10% Note payable, past due     5,000       6,188       5,000       4,875  
Law Firm Note, past due     34,610       2,480       —         —    
Tonaquint Note     360,186       1,776       —         —    
Total   $ 584,796     $ 301,821     $ 190,000     $ 275,437  

LAW FIRM NOTE


On August 2 2011, we entered into a Promissory Note with our intellectual property law firm for the amount of $49,610, which represented the amount we owed to that firm. The Promissory Note calls for monthly payments of $5,000 from August 2011 through December 2011. From the period August 2 through December 31, 2011, we made three $5,000 payments, and as a result, have reduced the note balance to $34,610 as of December 31, 2011. The note bears interest at 10% per annum.


TONAQUINT NOTE


On June 28, 2011, we entered into a Termination Agreement with Tonaquint, Inc. (See Note 5) under which both parties agreed that in consideration of the termination of a warrant, the waiving of all fees, penalties, the creation of the selling program and other factors, we agreed to issue an unsecured non-convertible promissory note (the "New Note") in the principal amount of $360,186, which provides for annual interest at a rate of 6%, payable monthly in either cash or our stock, at our option. The New Note has a maturity date of April 30, 2012.