Quarterly report pursuant to Section 13 or 15(d)

Capital Lease Obligations

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Capital Lease Obligations
3 Months Ended
Mar. 31, 2015
Capital Lease Obligations [Abstract]  
Capital Lease Obligations

Note 6 – Capital Lease Obligations

 

The Company entered into a new lease agreement with Systems Trading, Inc. on May 1, 2014 to refinance all outstanding leases into one capital lease. This lease obligation is payable to Systems Trading, Inc. with monthly installments of $21,826 from June 1, 2014 through May 1, 2018. This lease is secured with the computer equipment and has been capitalized. Pursuant to Accounting Standards Codification (“ASC”) 470-50-40, Debt Modifications and Extinguishments-Derecognition, the Company determined that modification accounting applied to the refinancing. The new capital lease obligation has an effective interest rate of 7.22%.

 

Future minimum lease payments under the capital leases are as follows:

 

As of March 31, 2015   $ 807,570  
Less amount representing interest     (71,972 )
Total obligations under capital leases     735,598  
Less current portion of obligations under capital leases     (223,869 )
Long-term obligations under capital leases   $ 511,729  

 

Long-term obligations under capital leases at March 31, 2015 mature as follows:

 

For the Twelve Months Ending March 31,      
2015   $ 223,869  
2016     237,676  
2017     252,336  
2018     21,717  
    $ 735,598  

 

The assets held under the capital leases are included in property and equipment as follows:

 

Equipment   $ 1,603,461  
Less: accumulated depreciation     1,256,134  
    $ 347,327