Convertible Notes

6 Months Ended

Dec. 31, 2014

Convertible Notes

Convertible Notes

5. Convertible Notes

As of December 31, 2014 and June 30, 2014 the balance owing on convertible notes was $425,000 and $525,000 respectively. The convertible promissory notes must be repaid by our Company within six months from the date of issuance; accrue interest at the rate of 14%; and are subject to conversion at the election of the investors at such time as our Company has raised a minimum of $500,000 in a subsequent equity financing. The conversion price will be the lower of 80% of the per share purchase price paid for by the new investors in the subsequent financing, or $0.50 per share. Unless these promissory notes are converted or repaid earlier, our Company must pay the note-holders the amount of the then accrued interest on the three, six, and nine month anniversaries of the issue date. As of December 31, 2014, one convertible promissory note, in the amount of $100,000, was converted to restricted common shares.

		As of December 31, 2014
Note Type and Investor
14% Notes Convertible at $0.50	Due Date		Balance		Discount		Carrying Value
Convertible Note	7/1/2016	$	25,000	$	—	$	25,000
Convertible Note	7/1/2016		25,000		—		25,000
Convertible Note	7/1/2016		40,000		—		40,000
Convertible Note	7/1/2016		50,000		—		50,000
Convertible Note	7/1/2016		25,000		—		25,000
Convertible Note	6/18/2014		25,000		—		25,000
Convertible Note	6/18/2014		25,000		—		25,000
Convertible Note	12/28/2014		25,000		—		25,000
Convertible Note	7/1/2016		10,000		—		10,000
Convertible Note	7/1/2016		25,000		—		25,000
Convertible Note	7/31/2014		25,000		—		25,000
Convertible Note	7/1/2016		25,000		—		25,000
Convertible Note	7/1/2016		100,000		—		100,000
Total Convertible Promissory		$	425,000			$	425,000
Notes