Note 7 - Convertible Notes Payable | 12 Months Ended |
Jun. 30, 2014 |
Notes | |
Note 7 - Convertible Notes Payable | NOTE 7 – CONVERTIBLE NOTES PAYABLE |
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| | | June 30, | June 30, |
Convertible notes | 2014 | 2013 |
| Note #1 | 28,851 | 28,851 |
| Note #2 | - | 42,500 |
| Note #3 | - | 32,500 |
| Note #4 | - | 37,500 |
| Note #5 | 13,503 | 25,000 |
| Note #6 | - | 9,500 |
| Note #7 | 47,500 | 47,500 |
| Note #8 | 37,500 | - |
| Note #9 | 14,500 | - |
| Note #10 | 5,000 | - |
| Note #11 | 12,000 | - |
| Note #12 | 6,500 | - |
| Note #13 | 5,000 | - |
| Note #14 | 22,222 | - |
| Note #15 | 37,500 | - |
| Note #16 | 2,500 | - |
| Note #17 | 4,941 | - |
| Note #18 | 5,000 | - |
| Note #19 | 3,000 | - |
| Note #20 | 2,500 | - |
| Note #21 | 16,550 | - |
Total convertible note, principal | $ 264,567 | $ 223,351 |
| | Debt discount | (6,973) | (96,528) |
Total convertible note, net of discount | 257,594 | 126,823 |
| | Accrued interest | 15,715 | 7,640 |
| | | $ 530,904 | $ 261,286 |
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Note #1 |
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On July 20, 2011, the Company entered into a convertible note payable in the amount of $10,000. The note bears interest at 8.50 percent per annum and has a maturity date of July 20, 2014. The creditor has the option at any time to convert the principal and any accrued interest into common stock of the Company according to the following stock prices: year one, $0.75 per share; year two, $1.00 per share; and year three, $1.25 per share. The entire note with a principal balance of $10,000 along with $1,306.44 was assigned to a third party. In addition the Company assigned another note payable in the amount of $30,000 and accrued interest of $2,544 to the third party. The total aggregate amount assigned to the third party was $43,851. The terms of the assigned notes were amended. The amended terms are: |
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The assigned notes bear interest at 10% |
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The assigned notes are due on demand |
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F-14 |
The principal balance of the note along with accrued interest is convertible at any time, at the option of the note holder, into the Company's common stock at a price of 45 percent of the current market price. The current market price is defined as the average of the lowest three trading prices for the Common Stock during the ten day period on the latest complete trading day prior to the conversion date. As a result of this note assignment the Company determined that a beneficial conversion feature existed and because the assigned note is due on demand the full amount of the beneficial conversion feature of $43,851 was recorded to interest expense. |
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During the year ended June 30, 2013, $15,000 of the note was converted into 140,845 shares of common stock by the note holder (see note 6). |
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As of June 30, 2014, principal balance of $28,851 (June 30, 2013 - $28,851) was recorded. |
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Note #2 |
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On November 6, 2012, the Company borrowed $42,500 from an unrelated third party entity in the form of a convertible note, $33,000 of which was received in cash and $9,500 of which was for professional fees. The note bears interest at 8 percent per annum with principal and interest due in full on August 8, 2013.During the year ended June 30, 2014, the Company accrued $0 (June 30, 2013 - $1,700) in interest expense. |
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After 180 days from issuance, the note may be converted at the option of the holder into common stock of the Company. The conversion price is 55% of the market price, where market price is defined as “the average of the lowest three trading prices for the Common Stock during the ten day period on the latest complete trading day prior to the conversion date.” |
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Upon the holder’s option to convert becoming active the Company recorded a debt discount and derivative liability of $67,368 being the fair value of the conversion feature which was determined using the Black-Scholes valuation model. The debt discount is accreted to the statement of operations using the effective interest rate method over the term of the note or to the date of conversion, and the derivative liability is revalued at each reporting date to fair value. Any change in fair value is credited or charged to the statement of operations in the period. |
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During the year ended June 30, 2014, the Company recorded a gain of $32,749 (year ended June 30, 2013 - $23,137) due to the change in value of the derivative liability during the period, and debt discount of $6,027 (year ended June 30, 2013 - $36,473) was accreted to the statement of operations. |
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During the year ended June 30, 2014, the Company issued 118,056 common shares upon the conversion of $42,500 of the principal balance and $1,700 interest, and $11,488 of the derivative liability was re-classified as additional paid in capital upon conversion. |
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As of June 30, 2014, principal balance of $0 (June 30, 2013 – $42,500), accrued interest of $0 (June 30, 2013 - $1,700), debt discount of $0 (June 30, 2013 - $6,027) and a derivative liability of $0 (June 30, 2013 - $44,237) was recorded. |
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Note #3 |
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On December 26, 2012 the Company entered into a convertible note agreement. Pursuant to the agreement, the agreement was consummated on January 2, 2013 upon the Company’s receipt of $32,500 cash proceeds from the note. The note bears interest at 8 percent per annum with principal and interest due in full on September 30, 2013. During the year ended June 30, 2014, the Company accrued $0 (June 30, 2013 - $1,300) in interest expense. |
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F-15 |
After 180 days from issuance, the note may be converted at the option of the holder into common stock of the Company. The conversion price is 55% of the market price, where market price is defined as “the average of the lowest three trading prices for the Common Stock during the ten day period on the latest complete trading day prior to the conversion date.” |
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Upon the holder’s option to convert becoming active the Company recorded a debt discount and derivative liability of $41,012 being the fair value of the conversion feature which was determined using the Black-Scholes valuation model. The debt discount is accreted to the statement of operations using the effective interest rate method over the term of the note or to the date of conversion, and the derivative liability is revalued at each reporting date to fair value. Any change in fair value is credited or charged to the statement of operations in the period. |
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During the year ended June 30, 2014, the Company recorded a loss of $74,173 (year ended June 30, 2013 – gain $1,069) due to the change in value of the derivative liability during the period, and debt discount of $11,033 (year ended June 30, 2013 – $21,467) was accreted to the statement of operations. |
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During the year ended June 30, 2014, the Company issued 283,025 common shares upon the conversion of $32,500 of the principal balance and $1,300 interest, and $114,116 of the derivative liability was re-classified as additional paid in capital upon conversion. |
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As of June 30, 2014, principal balance of $0 (June 30, 2013 – $32,500), accrued interest of $0 (June 30, 2013 - $1,300), debt discount of $0 (June 30, 2013 - $11,033) and a derivative liability of $0 (June 30, 2013 - $39,943) was recorded. |
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Note#4 |
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On February 5, 2013 the Company borrowed $37,500 from an unrelated third party entity in the form of a convertible note. The note bears interest at 8 percent per annum with principal and interest due in full on November 7, 2013. During the year ended June 30, 2014, the Company accrued $0 (June 30, 2013 - $1,700) in interest expense. |
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After 180 days from issuance, the note may be converted at the option of the holder into common stock of the Company. The conversion price is 55% of the market price, where market price is defined as “the average of the lowest three trading prices for the Common Stock during the ten day period on the latest complete trading day prior to the conversion date.” |
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Upon the holder’s option to convert becoming active the Company recorded a debt discount and derivative liability of $116,141 being the fair value of the conversion feature which was determined using the Black-Scholes valuation model. The debt discount is accreted to the statement of operations using the effective interest rate method over the term of the note or to the date of conversion, and the derivative liability is revalued at each reporting date to fair value. Any change in fair value is credited or charged to the statement of operations in the period. |
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During the year ended June 30, 2014, the Company recorded a loss of $9,595 (year ended June 30, 2013 – gain of $59,478) due to the change in value of the derivative liability during the period, and debt discount of $17,727 (year ended June 30, 2013 - $19,773) was accreted to the statement of operations. |
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On November 8, 2013, the Company became delinquent on the note and pursuant to the note agreement the Company incurred a penalty of $16,300, bringing the total note balance to $53,800. |
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F-16 |
During the year ended June 30, 2014, the Company issued 550,980 common shares upon the conversion of $53,800 of the principal balance and $1,500 interest, and $66,258 of the derivative liability was re-classified as additional paid in capital upon conversion. |
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As of June 30, 2014, principal balance of $0 (June 30, 2013 – $27,500), accrued interest of $0 (June 30, 2013 - $1,500), debt discount of $0 (June 30, 2013 - $17,727) and a derivative liability of $0 (June 30, 2013 - $56,663) was recorded. |
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Note #5 |
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On March 27, 2013 the Company borrowed $25,000 from an unrelated third party entity in the form of a convertible note. Pursuant to the note agreement the Company was charged anoriginal issue discount of $2,778. The note bears no interest for the first three months. If the Company does not repay the note on or before 90 days from the effective date, a one-time interest charge of 12% shall be applied to the principle sum of the note. Principal and interest on the note are due in full on March 27, 2014.During the year ended June 30, 2014, the Company accrued $3,333 (June 30, 2013 - $0) in interest expense. |
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The principal balance of the note along with accrued interest is convertible at any time at the option of the note holder, into the Company's common stock at a price of the lessor of, $0.09, or 60 percent of the lowest trading price for the Common Stock during the twenty five day period on the latest complete trading day prior to the conversion date. |
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Upon the holder’s option to convert becoming active the Company recorded a debt discount and derivative liability of $36,222 being the fair value of the conversion feature which was determined using the Black-Scholes valuation model. The debt discount is accreted to the statement of operations using the effective interest rate method over the term of the note or to the date of conversion, and the derivative liability is revalued at each reporting date to fair value. Any change in fair value is credited or charged to the statement of operations in the period. |
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During the year ended June 30, 2014, the Company recorded a loss of $2,480 (year ended June 30, 2013 – $10,086) due to the change in value of the derivative liability during the period, and debt discount of $18,493 (year ended June 30, 2013 - $6,507) was accreted to the statement of operations. |
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During the year ended June 30, 2014, the Company issued 357,000 common shares upon the conversion of $14,275 of the principal balance, and $24,600 of the derivative liability was re-classified as additional paid in capital upon conversion. |
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As of June 30, 2014, principal balance of $13,503 (June 30, 2013 – $25,000), accrued interest of $3,333 (June 30, 2013 - $0), debt discount of $0 (June 30, 2013 - $18,493) and a derivative liability of $24,177 (June 30, 2013 - $46,308) was recorded. |
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Note #6 |
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On May 1, 2013 the Company entered into a convertible note agreement. Pursuant to the agreement, the agreement was consummated on May 2, 2013 upon the Company’s receipt of $-0- cash proceeds and $9,500 of which was for professional fees. The note bears interest at 8 percent per annum with principal and interest due in full on February 3, 2014. During the year ended June 30, 2014, the Company accrued $380 (June 30, 2013 - $0) in interest expense. |
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After 180 days from issuance, the note may be converted at the option of the holder into common stock of the Company. The conversion price is 55% of the market price, where market price is defined as “the average of the lowest three trading prices for the Common Stock during the ten day period on the latest complete trading day prior to the conversion date.” |
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F-17 |
Upon the holder’s option to convert becoming active the Company recorded a debt discount and derivative liability of $29,635 being the fair value of the conversion feature which was determined using the Black-Scholes valuation model. The debt discount is accreted to the statement of operations using the effective interest rate method over the term of the note or to the date of conversion, and the derivative liability is revalued at each reporting date to fair value. Any change in fair value is credited or charged to the statement of operations in the period. |
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During the year ended June 30, 2014, the Company recorded a loss of $22,460 (year ended June 30, 2013 – gain of $14,501) due to the change in value of the derivative liability during the period, and debt discount of $498 (year ended June 30, 2013 - $29,137) was accreted to the statement of operations. |
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On November 8, 2013, the Company became delinquent on the note and pursuant to the note agreement the Company incurred a penalty of $4,750, bringing the total note balance to $14,250. |
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During the year ended June 30, 2014, the Company issued 3,912,273 common shares upon the conversion of $14,250 of the principal balance and $380 interest, and $37,594 of the derivative liability was re-classified as additional paid in capital upon conversion. |
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As of June 30, 2014, principal balance of $0 (June 30, 2013 – $9,500), accrued interest of $380 (June 30, 2013 - $0), debt discount of $0 (June 30, 2013 - $498) and a derivative liability of $0 (June 30, 2013 - $15,134) was recorded. |
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Note #7 |
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On May 24, 2013 the Company entered into a convertible note agreement. Pursuant to the agreement, the agreement was consummated on June 3, 2013 upon the Company’s receipt of $32,830 cash proceeds and $14,670 of which was for professional fees. The note bears interest at 8 percent per annum with principal and interest due in full on February 28, 2014. During the year ended June 30, 2014, the Company accrued $2,301 (June 30, 2013 - $0) in interest expense. |
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After 180 days from issuance, the note may be converted at the option of the holder into common stock of the Company. The conversion price is 55% of the market price, where market price is defined as “the average of the lowest three trading prices for the Common Stock during the ten day period on the latest complete trading day prior to the conversion date.” |
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Upon the holder’s option to convert becoming active the Company recorded a debt discount and derivative liability of $120,160 being the fair value of the conversion feature which was determined using the Black-Scholes valuation model. The debt discount is accreted to the statement of operations using the effective interest rate method over the term of the note or to the date of conversion, and the derivative liability is revalued at each reporting date to fair value. Any change in fair value is credited or charged to the statement of operations in the period. |
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During the year ended June 30, 2014, the Company recorded a loss of $5,099 (year ended June 30, 2013 – gain of $44,323) due to the change in value of the derivative liability during the period, and debt discount of $42,750 (year ended June 30, 2013 – $4,750) was accreted to the statement of operations. |
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As of June 30, 2014, principal balance of $47,500 (June 30, 2013 – $47,500), accrued interest of $2,301 (June 30, 2013 - $1,300), debt discount of $0 (June 30, 2013 - $42,750) and a derivative liability of $80,936 (June 30, 2013 - $75,837) was recorded. |
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F-18 |
Note #8 |
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On July 26, 2013 the Company entered into a convertible note agreement to borrow $37,500. Pursuant to the agreement, the Company received cash proceeds of $24,700 and $12,800 of which was for professional fees. The note bears interest at 8 percent per annum with principal and interest due in full on April 30, 2014. During the year ended June 30, 2014, the Company accrued $2,787 (June 30, 2013 - $0) in interest expense. |
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After 180 days from issuance, the note may be converted at the option of the holder into common stock of the Company. The conversion price is 55% of the market price, where market price is defined as “the average of the lowest three trading prices for the Common Stock during the ten day period on the latest complete trading day prior to the conversion date.” |
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Upon the holder’s option to convert becoming active the Company recorded a debt discount and derivative liability of $47,860 being the fair value of the conversion feature which was determined using the Black-Scholes valuation model. The debt discount is accreted to the statement of operations using the effective interest rate method over the term of the note or to the date of conversion, and the derivative liability is revalued at each reporting date to fair value. Any change in fair value is credited or charged to the statement of operations in the period. |
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During the year ended June 30, 2014, the Company recorded a loss of $16,037 (year ended June 30, 2013 - $0) due to the change in value of the derivative liability during the period, and debt discount of $37,500 (year ended June 30, 2013 - $0) was accreted to the statement of operations. |
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As of June 30, 2014, principal balance of $37,500 (June 30, 2013 – $0), accrued interest of $2,787 (June 30, 2013 - $0), debt discount of $0 (June 30, 2013 - $0) and a derivative liability of $63,897 (June 30, 2013 - $0) was recorded. |
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Note #9 |
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On October 4, 2013 the Company entered into a convertible note agreement to borrow $14,500. Pursuant to the agreement, the Company received no cash and $14,500, which was for professional fees. The note bears interest at 8 percent per annum with principal and interest due in full on July 8, 2014.During the year ended June 30, 2014, the Company accrued $855 (June 30, 2013 - $0) in interest expense. |
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After 180 days from issuance, the note may be converted at the option of the holder into common stock of the Company. The conversion price is 55% of the market price, where market price is defined as “the average of the lowest three trading prices for the Common Stock during the ten day period on the latest complete trading day prior to the conversion date.” |
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Upon the holder’s option to convert becoming active the Company recorded a debt discount and derivative liability of $46,454 being the fair value of the conversion feature which was determined using the Black-Scholes valuation model. The debt discount is accreted to the statement of operations using the effective interest rate method over the term of the note or to the date of conversion, and the derivative liability is revalued at each reporting date to fair value. Any change in fair value is credited or charged to the statement of operations in the period. |
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During the year ended June 30, 2014, the Company recorded a gain of $21,747 (year ended June 30, 2013 - $0) due to the change in value of the derivative liability during the period, and debt discount of $14,398 (year ended June 30, 2013 - $0) was accreted to the statement of operations. |
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As of June 30, 2014, principal balance of $14,500 (June 30, 2013 – $0), accrued interest of $855 (June 30, 2013 - $0), debt discount of $102 (June 30, 2013 - $0) and a derivative liability of $24,707 (June 30, 2013 - $0) was recorded. |
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F-19 |
Note #10 |
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On November 1, 2013 the Company borrowed $5,000 in the form of a convertible note payable. The note bears no interest and is due on demand. The note is convertible into shares of the Company’s common stock at a conversion price of $.00001. The Company analyzed the convertible debt for a beneficial conversion feature under ASC 470-20 on the date of the note and determined that a beneficial conversion feature exists. The intrinsic value of the beneficial conversion feature was determined to be $5,000 and was recorded as debt discount. During the year ended June 30, 2014, debt discount of $5,000 (year ended June 30, 2013 - $0) was accreted to the statement of operations. |
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As of June 30, 2014, principal balance of $5,000 (June 30, 2013 – $0) was recorded. |
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Note #11 |
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On November 8, 2013 the Company borrowed $12,000 in the form of a convertible note payable. The note bears no interest and is due on demand. The note is convertible into shares of the Company’s common stock at a conversion price of $.00001. The Company analyzed the convertible debt for a beneficial conversion feature under ASC 470-20 on the date of the note and determined that a beneficial conversion feature exists. The intrinsic value of the beneficial conversion feature was determined to be $12,000 and was recorded as debt discount. During the year ended June 30, 2014, debt discount of $12,000 (year ended June 30, 2013 - $0) was accreted to the statement of operations. |
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As of June 30, 2014, principal balance of $12,000 (June 30, 2013 – $0) was recorded. |
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Note #12 |
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On November 13, 2013 the Company entered into a convertible note agreement to borrow $6,500. Pursuant to the agreement, the Company received no cash and $6,500, which was for professional fees. The note bears interest at 8 percent per annum with principal and interest due in full on August 15, 2014. During the year ended June 30, 2014, the Company accrued $326 (June 30, 2013 - $0) in interest expense. |
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After 180 days from issuance, the note may be converted at the option of the holder into common stock of the Company. The conversion price is 31% of the market price, where market price is defined as “the average of the lowest three trading prices for the Common Stock during the ten day period on the latest complete trading day prior to the conversion date.” |
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Upon the holder’s option to convert becoming active the Company recorded a debt discount and derivative liability of $20,607 being the fair value of the conversion feature which was determined using the Black-Scholes valuation model. The debt discount is accreted to the statement of operations using the effective interest rate method over the term of the note or to the date of conversion, and the derivative liability is revalued at each reporting date to fair value. Any change in fair value is credited or charged to the statement of operations in the period. |
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During the year ended June 30, 2014, the Company recorded a gain of $292 (year ended June 30, 2013 - $0) due to the change in value of the derivative liability during the period, and debt discount of $6,053 (year ended June 30, 2013 - $0) was accreted to the statement of operations. |
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As of June 30, 2014, principal balance of $6,500 (June 30, 2013 – $0), accrued interest of $326 (June 30, 2013 - $0), debt discount of $447 (June 30, 2013 - $0) and a derivative liability of $20,315 (June 30, 2013 - $0) was recorded. |
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F-20 |
Note #13 |
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On November 18, 2013 the Company borrowed $5,000 in the form of a convertible note payable. The note bears no interest and is due on demand. The note is convertible into shares of the Company’s common stock at a conversion price of $.00001. The Company analyzed the convertible debt for a beneficial conversion feature under ASC 470-20 on the date of the note and determined that a beneficial conversion feature exists. The intrinsic value of the beneficial conversion feature was determined to be $5,000 and was recorded as debt discount. During the year ended June 30, 2014, debt discount of $5,000 (year ended June 30, 2013 - $0) was accreted to the statement of operations. |
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As of June 30, 2014, principal balance of $5,000 (June 30, 2013 – $0) was recorded. |
Note #14 |
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On December 9, 2013 the Company borrowed $20,000 from an unrelated third party entity in the form of a convertible note. Pursuant to the note agreement the Company was charged an original issue discount of $2,222. The note bears no interest for the first three months. If the Company does not repay the note on or before 90 days from the effective date, a one-time interest charge of 12% shall be applied to the principle sum of the note. Principal and interest on the note are due in full on December 9, 2014.During the year ended June 30, 2014, the Company accrued $2,667 (June 30, 2013 - $0) in interest expense. |
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The principal balance of the note along with accrued interest is convertible at any time at the option of the note holder, into the Company's common stock at a price of the lessor of, $0.09, or 60 percent of the lowest trading price for the Common Stock during the twenty five day period on the latest complete trading day prior to the conversion date. |
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Upon the holder’s option to convert becoming active the Company recorded a debt discount and derivative liability of $32,332 being the fair value of the conversion feature which was determined using the Black-Scholes valuation model. The debt discount is accreted to the statement of operations using the effective interest rate method over the term of the note or to the date of conversion, and the derivative liability is revalued at each reporting date to fair value. Any change in fair value is credited or charged to the statement of operations in the period. |
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During the year ended June 30, 2014, the Company recorded a loss of $7,458 (year ended June 30, 2013 – $10,086) due to the change in value of the derivative liability during the period, and debt discount of $15,798 (year ended June 30, 2013 - $6,507) was accreted to the statement of operations. |
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As of June 30, 2014, principal balance of $22,222 (June 30, 2013 – $0), accrued interest of $2,222 (June 30, 2013 - $0), debt discount of $6,424 (June 30, 2013 - $0) and a derivative liability of $39,790 (June 30, 2013 - $46,308) was recorded. |
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Note #15 |
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On January 17, 2014 the Company entered into a convertible note agreement to borrow $37,500. Pursuant to the agreement, the Company received no cash and $6,500, which was for professional fees. The note bears interest at 8 percent per annum with principal and interest due in full on October 22, 2014. During the year ended June 30, 2014, the Company accrued $1,348 (June 30, 2013 - $0) in interest expense. |
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After 180 days from issuance, the note may be converted at the option of the holder into common stock of the Company. The conversion price is 31% of the market price, where market price is defined as “the average of the lowest three trading prices for the Common Stock during the ten day period on the latest complete trading day prior to the conversion date.” |
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As of June 30, 2014, principal balance of $37,500 (June 30, 2013 – $0) and accrued interest of $1,348 was recorded. |
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F-21 |
Note #16 |
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On March 24, 2014 the Company borrowed $2,500 in the form of a convertible note payable. The note bears no interest and is due on demand. The note is convertible into shares of the Company’s common stock at a conversion price of $.00001. The Company analyzed the convertible debt for a beneficial conversion feature under ASC 470-20 on the date of the note and determined that a beneficial conversion feature exists. The intrinsic value of the beneficial conversion feature was determined to be $2,500 and was recorded as debt discount. During the year ended June 30, 2014, debt discount of $2,500 (year ended June 30, 2013 - $0) was accreted to the statement of operations. |
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As of June 30, 2014, principal balance of $2,500 (June 30, 2013 – $0) was recorded. |
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Note #17 |
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On March 28, 2014 the Company borrowed $5,000 in the form of a convertible note payable. The note bears no interest and is due on demand. The note is convertible into shares of the Company’s common stock at a conversion price of $.00001. The Company analyzed the convertible debt for a beneficial conversion feature under ASC 470-20 on the date of the note and determined that a beneficial conversion feature exists. The intrinsic value of the beneficial conversion feature was determined to be $5,000 and was recorded as debt discount. During the year ended June 30, 2014, debt discount of $5,000 (year ended June 30, 2013 - $0) was accreted to the statement of operations. |
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During the year ended June 30, 2014, the Company issued 5,895,000 common shares upon the conversion of $59 of the principal balance. |
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As of June 30, 2014, principal balance of $4,941 (June 30, 2013 – $0) was recorded. |
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Note #18 |
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On April 10, 2014 the Company borrowed $5,000 in the form of a convertible note payable. The note bears no interest and is due on demand. The note is convertible into shares of the Company’s common stock at a conversion price of $.00001. The Company analyzed the convertible debt for a beneficial conversion feature under ASC 470-20 on the date of the note and determined that a beneficial conversion feature exists. The intrinsic value of the beneficial conversion feature was determined to be $5,000 and was recorded as debt discount. During the year ended June 30, 2014, debt discount of $5,000 (year ended June 30, 2013 - $0) was accreted to the statement of operations. |
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As of June 30, 2014, principal balance of $5,000 (June 30, 2013 – $0) was recorded. |
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Note #19 |
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On April 18, 2014 the Company borrowed $3,000 in the form of a convertible note payable. The note bears no interest and is due on demand. The note is convertible into shares of the Company’s common stock at a conversion price of $.00001. The Company analyzed the convertible debt for a beneficial conversion feature under ASC 470-20 on the date of the note and determined that a beneficial conversion feature exists. The intrinsic value of the beneficial conversion feature was determined to be $3,000 and was recorded as debt discount. During the year ended June 30, 2014, debt discount of $3,000 (year ended June 30, 2013 - $0) was accreted to the statement of operations. |
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As of June 30, 2014, principal balance of $3,000 (June 30, 2013 – $0) was recorded. |
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F-22 |
Note #20 |
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On April 25, 2014 the Company borrowed $2,500 in the form of a convertible note payable. The note bears no interest and is due on demand. The note is convertible into shares of the Company’s common stock at a conversion price of $.00001. The Company analyzed the convertible debt for a beneficial conversion feature under ASC 470-20 on the date of the note and determined that a beneficial conversion feature exists. The intrinsic value of the beneficial conversion feature was determined to be $2,500 and was recorded as debt discount. During the year ended June 30, 2014, debt discount of $2,500 (year ended June 30, 2013 - $0) was accreted to the statement of operations. |
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As of June 30, 2014, principal balance of $2,500 (June 30, 2013 – $0) was recorded. |
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Note #21 |
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On May 2, 2014 the Company entered into a convertible note agreement to borrow $16,550. Pursuant to the agreement, the Company received no cash and $16,550 was for professional fees. The note bears interest at 8 percent per annum with principal and interest due in full on February 7, 2015. During the year ended June 30, 2014, the Company accrued $214 (June 30, 2013 - $0) in interest expense. |
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After 180 days from issuance, the note may be converted at the option of the holder into common stock of the Company. The conversion price is 31% of the market price, where market price is defined as “the average of the lowest three trading prices for the Common Stock during the ten day period on the latest complete trading day prior to the conversion date.” |
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As of June 30, 2014, principal balance of $16,550 (June 30, 2013 – $0) and accrued interest of $214was recorded. |
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