| Convertible Note Payable | 6. Convertible Note Payable Five convertible notes payable are
unsecured, bearing interest at 8% per annum, due on demand, and convertible into shares at the lenders’ option at a conversion
price of $0.005 per share. Interest has not been paid and is classified with accrued liabilities for financial statement purposes. There was no value assigned to the
conversion feature of these notes as the shares that would have been issued on conversion would not have been readily convertible
into cash. The principal and interest owing as at May 31, 2019 is as follows:
May 31, 2019 August 31, 2018
Date of Issue Principal Interest Principal Interest
May 17, 2013 $ 10,000 $ 4,833 $ 10,000 $ 4,234
September 11, 2015 10,000 2,976 10,000 2,378
November 12, 2015 5,000 1,420 5,000 1,121
November 13, 2015 5,000 1,419 5,000 1,120
April 11, 2016 500 126 500 96
$ 30,500 $ 10,774 $ 30,500 $ 8,949 Two convertible notes payable bear
interest at 8% per annum, are due on demand, and convertible at a conversion price of $0.5625 per share at the lender’s option.
The interest is classified as accrued liabilities for financial statement purposes. One note for $20,000 was issued
for which no value was assigned to the conversion feature as the shares that would have been issued on conversion would not have
been readily convertible into cash.
May 31, 2019 August 31, 2018
Date of Issue Principal Interest Principal Interest
July 11, 2016 $ 20,000 $ 4,620 $ 20,000 $ 3,424
The other note for $20,000 was issued
on October 31, 2016, when the market price per share was $1.48. The conversion feature was valued at $20,000. $1,200 was accreted
and charged to interest during the nine months ended May 31, 2019 ($1,600 for the year ended August 31, 2018). At May 31, 2019,
the unamortized discount was $15,867.
May 31, 2019 August 31, 2018
Principal Interest Principal Interest
Proceeds on issue $ 20,000 - $ 20,000 -
Value assigned to conversion feature 20,000 - 20,000 -
Value of convertible note payable at issuance - - - -
Accretion charges $ 4,133 - $ 2,933 -
Interest - $ 4,129 - $ 2,933
Balance, convertible note payable, end of period $ 4,133 $ 4,129 $ 2,933 $ 2,933 One convertible note payable bears
interest at 10% per annum, is due on demand and convertible at a conversion price of $0.10 per share at the lender’s option.
The interest is classified as accrued liabilities for financial statement purposes. There was no beneficial conversion
feature at the time of issuance and, accordingly, no value has been assigned to the conversion feature.
May 31, 2019 August 31, 2018
Date of Issue Principal Interest Principal Interest
April 17, 2017 $ 20,000 $ 4,241 $ 20,000 $ 2,745
One convertible note payable bear
interest at 8% per annum, is due on demand and convertible at a conversion price of $0.02 per share at the lender’s option.
There was no beneficial conversion feature at the time of issuance and, accordingly, no value has been assigned to the conversion
feature.
May 31, 2019 August 31, 2018
Date of Issue Principal Interest Principal Interest
April 04, 2018 $ 25,000 $ 2,309 $ 25,000 $ 813
A summary of the value assigned
to the convertible debt and accrued interest thereon is as follows:
May 31, 2019 August 31, 2018
Conversion price of notes Convertible
Interest Convertible
Interest
$ 0.005 $ 30,500 $ 10,774 $ 30,500 $ 8,949
$ 0.5625 24,133 8,749 22,933 6,357
$ 0.10 20,000 4,241 20,000 2,745
$ 0.02 25,000 2,309 25,000 813
$ 99,633 $ 26,073 $ 98,433 $ 18,864 |
