Derivative Liabilities

12 Months Ended

Jun. 30, 2016

Derivative Liabilities

Derivative Liabilities

6. Derivative liabilities

The derivative liability is derived from the conversion features in note 5 and stock warrant in note 7. All were valued using the weighted-average Black-Scholes-Merton option pricing model using the assumptions detailed below. As of June 30, 2016 and 2015, the derivative liability was $701,000 and $304,000, respectively. The Company recorded $397,000 loss and $82,737 loss from changes in derivative liability during the years ended June 30, 2016 and 2015, respectively. The Black-Scholes model with the following assumption inputs:

	June 30, 2016			June 30, 2015
Annual dividend yield		—			—
Expected life (years)		0.01			0.99
Risk-free interest rate		0.21	%		0.27	%
Expected volatility		449	%		377	%