Kartoon Studios, Inc. Quarterly report pursuant to sections 13 or 15(d)

Quarterly report pursuant to sections 13 or 15(d)

4. Notes Payable (Tables)

4. Notes Payable (Tables)

3 Months Ended

Mar. 31, 2013

Black-Scholes valuation for the warrants

The warrants were valued in the amount of $379,688, based on the Black-Scholes valuation using the following assumptions:

Risk-free interest rate	0.73%
Expected life in years	5
Dividend yield	0
Expected volatility	63.65%

Debt Discount for the convertible feature of the debenture was valued in the amount of $269,284 using the Black-Scholes calculation with the following assumptions:

Risk-free interest rate	0.31%
Expected life in years	2
Dividend yield	0
Expected volatility	60.01%

Notes payable and accrued interest

As of March 31, 2013 and December 31, 2012, the Company had the following notes payable and accrued interest balances outstanding:

	3/31/2013			12/31/2012
Debenture - $1,000,000 16% senior secured convertible	$	1,000,000		$	1,000,000
Debt Discount		(404,025	)		(485,147	)
Total Notes Payable		595,975			514,853
Less: Current Portion		250,000			–
Long Term Portion	$	345,975		$	514,853

Accrued Interest
Debenture - $1,000,000 16% senior secured convertible Issued June 27,2012	$	26,667		$	26,667
Debenture - $2,500,000 Terminated June 2009		19,049			19,049
Accrued Interest - Current Portion	$	45,716		$	45,716

Schedule of Maturities of long-term debt

Maturities requirements on long-term debt subject to mandatory redemption are as follow:

2013	$	250,000
2014		750,000
2015		–
2016		–
2017		–
Total	$	1,000,000