Note payable

9 Months Ended

Mar. 31, 2022

Debt Disclosure [Abstract]

Note payable

22. Note payable

Note Payable Due to Bank

During October 2011, we entered into a revolving demand note (line of credit) arrangement with HSBC Bank USA, with a revolving borrowing limit of $150,000. The line of credit bears a variable interest rate of 0.25% above the prime rate (5.5% as of December 20, 2018). In the event the deposit account is not established or minimum balance maintained, HSBC can charge a higher rate of interest of up to 4.0% above prime rate. As of March 31, 2022 and June 30, 2021, the loan principal balance was $25,982 and $25,982, respectively.

Notes Payable Due to Non-related Parties

On June 15, 2018, the Company entered into a promissory note with an accredited investor. The original principal amount was $20,000 and the note bears 8% interest per annum. The note was payable upon demand. As of March 31, 2022 and June 30, 2021, this note had a balance of $20,000 and $20,000, with unpaid accrued interest expenses of $13,800 and $11,000, respectively.

On October 6, 2020, the Company entered into a promissory note with Darryl Kuecker, and Shirley Ann Hunt (the “Trustee”) for borrowing $1,390,000 with annual interest rate of 6% due in 30 years. Darryl Kuecker, Trustee of the 2002 Darry Kuecker Revocable Trust as to an undivided 36% interest, and Shirley Ann Hunt, Trustee of the 2002 Shirley Ann Hunt Revocable Trust as to an undivided 64% interest. Principal and interest shall be payable on monthly basis, in installments of $8,333.75, beginning on November 1, 2020 and until September 1, 2050. Payments to be divided and made separately to each beneficiary per the beneficiary’s instruction: $3,000.15 to Darryl Kuecker, Trustee and $5,333.60 to Shirley Hunt, Trustee. As of March 31, 2022 and June 30, 2021, the Company had an outstanding balance of $1,366,476 and $1,378,222, respectively. For the periods ended March 31, 2022 and year ended June 30, 2021, the Company paid interest expense of $112,817 and $57,892, respectively.

On May 12, 2021, the Company issued a promissory note to the Lemon Glow shareholders. The original principal amount was $3,976,000 and the note bears interest at the rate of 5% per year 36 monthly payments commencing on June 15, 2021. As of March 31, 2022 and June 30, 2021, the note had a remaining balance of $3,463,389 and $3,626,000, respectively. As of March 31, 2022 and June 30, 2021, the note had accrued interest balance of $132,533 and $0, respectively.

On May 17, 2021, the Company issued a note to Hyundai financing in total principal amount of $13,047. The monthly payment was $251 per month. During the period ended March 31, 2022, the loan has been fully paid off. As of March 31, 2022 and June 30, 2021, the note had an outstanding balance of $0 and $13,047, respectively.

Notes Payable Due to Related Parties

On January 23, 2013, the Company issued a promissory note to a former employee of the Company. The original principal amount was $40,000 and the note bears no interest. The note was payable upon demand. As of March 31, 2022 and June 30, 2021, this note had a balance of $0 and $15,427, respectively.

Sugarmade, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

March 31, 2022