Note 4: Notes Payable and Accrued Interest - Related Parties

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Note 4: Notes Payable and Accrued Interest - Related Parties	3 Months Ended
	Mar. 31, 2012
Related Party Transactions Disclosure [Text Block]	Note 4:  Notes Payable and Accrued Interest - Related Parties As of March 31, 2012 and December 31, 2011, the Company had the following notes payable and accrued interest balances outstanding:     3/31/2012     12/31/2011   Related Party Note Payable to Company   $ -     $ 360,840   Accrued Interest on Related Party Note     -       22,142   Officer Loans to Company     232,573       311,988   Subordinated Officer Loans to Company     159,753       1,620,137   Accrued Interest on Subordinated Loans     37,361       24,090   Total Notes Payable and Accrued Interest     429,687       2,339,197   Less: Current Portion     -       -   Long Term Portion   $ 429,687     $ 2,339,197   On February 1, 2008, Isabel Moeller, sister of our Chief Executive Officer, Klaus Moeller, loaned $310,000 to the Company at an interest rate equal to 8% per annum as a short term note payable.  The funds were borrowed from Ms. Moeller in order to reduce outstanding obligations due to Genius Products at that time.  Subsequent agreements extended the maturity date to January 15, 2015 and reduced the stated interest rate to six (6%) percent per annum.  Payments were made on the outstanding principal in the amount of $14,000 and $10,000 on February 9, 2011 and April 27, 2011, respectively.  On April 1, 2011, Ms. Moeller converted $200,000 of the outstanding principle to 1,000,000 shares of the Company’s common stock.  On March 31, 2012, Ms. Moeller agreed to convert the remaining balance, including outstanding principal and interest, in the amount of $173,385.09 to 866,925 shares of common stock of the Company, or $0.20 per share.   The note has been fully repaid. Notes were issued in favor of four of the Officers for loans to the Company at various times during the years 2007 through 2009.  Subsequent agreements amended the stated interest rate to 6% per annum and extended the maturity to January 15, 2015.  Repayments were made on February 2, 2011 and April 27, 2011 in the aggregate amounts of $66,000 and $30,000, respectively.  The amount due to the Officers on these notes includes accrued but unpaid interest in the amounts of $38,410 and $34,956 as of March 31, 2012 and December 31, 2011, respectively. On March 31, 2011, four of the Officers agreed to convert accrued but unpaid salaries through December 31, 2010 to subordinated long term notes payable.  In February 2011, as a result of an agreement by each of the four Officers to retroactively decrease the amount of the annual salary for 2010 from $125,000 per annum per Officer to $80,000,  the amount of the notes were reduced to an aggregate of $1,620,137.  On March 31, 2012, three of the Officers agreed to convert the entire balance outstanding on their respective notes in the cumulative amount of $1,326,048, including principal and interest, to 6,630,241 shares of common stock of the Company as payment in full.  The remaining Officer converted a total of $246,113 of the outstanding balance for 1,230,566 shares of common stock of the Company.  All shares issued in exchange for the notes were valued at $0.20 per share.  The remaining note has a principal balance of $159,753, a maturity date of January 15, 2015 and a stated interest rate of six percent (6%) per annum.  There is no prepayment penalty.  As of March 31, 2012 and December 31, 2011, the accrued but unpaid interest totals $37,361 and $123,099, respectively.