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NOTE RECEIVABLE
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12 Months Ended | ||
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Dec. 31, 2014
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| Note Receivable [Abstract] | |||
| NOTE RECEIVABLE |
On December 11, 2014, Songstagram, Inc. ("Songstagram") and Rocky Wright issued secured promissory notes (collectively, the "Promissory Notes") in connection with advances that the Company made to Songstagram and Mr. Wright. The advances were made by the Company in connection with ongoing negotiations for a possible acquisition of Songstagram or its assets by the Company. Pursuant to the Promissory Notes, Songstagram has promised to pay the Company the principal sum of $475,000, together with interest at a rate equal to 8% per annum and Mr. Wright has promised to pay the Company the principal sum of $386,435, together with interest at a rate equal to 8% per annum. All unpaid principal, which totaled an aggregate of $861,435, together with any then unpaid and accrued interest and other amounts payable under the Promissory Notes, will be due and payable on the earlier of (i) the Company's demand for payment; or (ii) when, upon or after the occurrence of an event of default, the Company declares such amounts due and payable or such amounts are made automatically due and payable under the terms of the Promissory Notes. During any period in which an event of default has occurred and is continuing, Songstagram and Wright, as applicable, will pay interest on the unpaid principal balance at a rate of 13% per annum. The Promissory Notes may be prepaid without our prior written consent. The full amounts of the Promissory Notes are secured by all of Songstagram's assets and all of Mr. Wright's assets related to Songstagram, as applicable, in accordance with security agreements dated December 11, 2014, as described below.
In connection with the Promissory Notes, the Company entered into security agreements (collectively, the "Security Agreements") with each of Songstagram and Mr. Wright dated December 11, 2014. Pursuant to the Security Agreements, Songstagram and Mr. Wright, as applicable, have agreed to, among other things, (i) pay all secured obligations when due; (ii) upon or following the occurrence of an event of default, pay all of the Company's costs and expenses, including reasonable attorneys' fees, incurred by the Company in the perfection, preservation, realization, enforcement and exercise of the Company's rights, powers and remedies under the Security Agreements; and (iii) execute and deliver such documents as the Company deems necessary to create, perfect and continue the security interests.
In January 2015, the Company demanded payment on the Promissory Notes and Songstagram defaulted on the payment. As a result, the Company exercised its rights under the Security Agreements (see Note 11).
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