Subsequent Events

12 Months Ended

Jun. 30, 2017

Subsequent Events

Subsequent Events

14.     SUBSEQUENT EVENTS

Management has evaluated subsequent events according to ASC TOPIC 855 as of the date of the financial statements and has determined that the following subsequent events are reportable.

On July 20, 2017, the Company created a wholly-owned subsidiary, called Parscale Digital, Inc., a Nevada corporation. On August 1, 2017, Parscale Digital entered into an agreement and plan of merger with Parscale Creative, Inc., a Nevada corporation, Parscale Digital being the surviving entity. Parscale Creative was founded by Brad Parscale, and included certain client relationships that were spun off from Mr. Parscale’s previous firm, Giles-Parscale, and is in the business of digital advertising, design, and website development. Under the terms of the agreement, the Company issued 90,000 shares of Series D preferred stock to Mr. Parscale. This transaction was announced and closed on August 1, 2017. Each share of Series D preferred stock has a face value of $100, and is convertible into common stock at a ratio of 2,500 shares of common stock per share of preferred stock, and pays a quarterly dividend, calculated as (1/90,000) x (5% of the Adjusted Gross Revenue) of the Company’s subsidiary Parscale Digital. Adjusted Gross Revenue shall mean the top line gross revenue of Parscale Digital, as calculated under GAAP (generally accepted accounting principles) less any reselling revenue attributed to third party advertising products or service, such as, but not limited to, search engine keyword campaign fees, social media campaign fees, radio or television advertising fees, and the like.

On July 31, 2017, the Company entered into an exchange agreement (the “Exchange Agreement”) with Bountiful Capital, LLC, a Nevada limited liability company (“Bountiful Capital”), pursuant to which Bountiful Capital has agreed to cancel certain promissory notes , and waive any unpaid interest thereunder, including the outstanding principal in the amount of $1,442,500, in exchange for the issuance by the Company of 14,425 shares of the Company’s newly designated Series C Preferred Stock (the “Series C Preferred Stock”) to Bountiful Capital. Pursuant to the terms of the Exchange Agreement, Bountiful Capital agreed that upon delivery of the Series C Preferred Stock to Bountiful Capital, the notes shall be deemed fully paid and satisfied, null and void and no interest, fees or principal shall be due thereon. Each share of Series C preferred stock has a face value of $100, and is convertible into common stock at a price of $0.01 per common share.

On August 1, 2017, the Company entered into a purchase agreement with Brad Parscale, to purchase his company, Parscale Media, a website hosting business. Under the terms of the agreement, the Company agreed to pay Mr. Parscale $1,000,000 in cash, upon closing the transaction, but in no event later than January 1, 2018.

On August 1, 2017, the Company signed a lease for approximately 8,290 square feet at 321 Sixth Street, San Antonio, TX 78215, for $9,800 per month, expiring July 31, 2022. This office space is primarily used by our subsidiary, Parscale Digital.

On August 1, 2017, we granted nonqualified stock options to purchase up to 10,000,000 shares of our common stock to Jill Giles, the creative director of Parscale Digital. The stock options vest at a rate of 1/36^th per month over three years, and are exercisable at a price of $0.01 per share, beginning August 1, 2018. 

The Company received the following advances on unsecured promissory notes:

- July 10, 2017, received $105,000;

- July 14, 2017, received $50,500;

- July 30, 2017, received $53,500;

- August 3, 2017, received $25,000;

- August 15, 2017, received $34,000; and

- August 28, 2017, received $92,000;