Quarterly report pursuant to Section 13 or 15(d)

Subsequent Events

v3.8.0.1
Subsequent Events
6 Months Ended
Dec. 31, 2017
Subsequent Events [Abstract]  
Subsequent Events

NOTE 11 – SUBSEQUENT EVENTS

 

Conversions

 

On January 2, 2018 pursuant to a conversion notice, $25,000 in principal and $1,178 in interest was converted at $0.07 into 402,121 shares of common stock.

 

On January 3, 2018 pursuant to a conversion notice, $25,200 in principal and $2,162 in interest was converted at $0.06 into 434,311 shares of common stock.

 

On January 4, 2018 pursuant to a conversion notice, $25,000 in principal and $1,372 in interest was converted at $0.07 into 398,854 shares of common stock.

 

On January 9, 2018 pursuant to a conversion notice, $40,000 in principal and $4,581 in interest was converted at $0.07 into 630,384 shares of common stock.

 

On January 12, 2018 pursuant to a conversion notice, $25,000 in principal and $1,233 in interest was converted at $0.08 into 345,396 shares of common stock.

 

On January 12, 2018 pursuant to a conversion notice, $7,500 in principal and $875 in interest was converted at $0.07 into 116,000 shares of common stock.

 

On January 26, 2018 pursuant to a conversion notice, $30,000 in principal and $1,793 in interest was converted at $0.09 into 353,259 shares of common stock.

 

On January 30, 2018 pursuant to a conversion notice, $40,000 in principal and $2,130 in interest was converted at $0.09 into 492,407 shares of common stock.

 

On February 4, 2018 pursuant to a conversion notice, $22,500 in principal and $2,650 in interest was converted at $0.08 into 314,571 shares of common stock.

 

December 29, 2017 Securities Purchase Agreement

 

The Company entered into an executory contract on December 29, 2017, whereby the Company entered into a securities purchase agreement with Eagle Equities, pursuant to which Eagle Equities purchased a convertible promissory note (the “Note”) from the Company in the aggregate principal amount of $532,435, such principal and the interest thereon convertible into shares of the Company’s common stock at the option of Eagle Equities at any time. The transactions closed on January 2, 2018.

 

The Note contains an original issue discount of $25,354 such that the purchase price is $507,081. The maturity date of the Note is December 29, 2018. The Note shall bear interest at a rate of 8% per annum, which interest shall be paid by the Company to Eagle Equities in shares of common stock upon receipt of a notice of conversion by the Company from Eagle Equities at any time.

 

Additionally, Eagle Equities has the option to convert all or any amount of the principal face amount of the Note, at any time, for shares of the Company’s common stock at a price equal to 60% of the lowest closing bid price of the Company’s common stock as reported on the OTC Markets Group, Inc. quotation system for the ten prior trading days, including the day upon which the Company receives a notice of conversion from Eagle Equities.

 

The Note may be prepaid with certain penalties until June 27, 2018.

 

The Company used all of the proceeds from the Note to pay off the remainder of its outstanding debt owed to Delafield Investments Limited, an affiliate of Magna Invests.

 

January 22, 2018 Securities Purchase Agreement

 
Effective January 22, 2018, the Company entered into a securities purchase agreement with Power Up Lending Group Ltd. (“Power Up”), pursuant to which Power Up purchased a convertible promissory note (the “Note”) from the Company in the aggregate principal amount of $153,000, such principal and the interest thereon convertible into shares of the Company’s common stock at the option of Power Up. The transactions closed on January 25, 2018 and the Company received payment on January 29, 2018 in the amount of $153,000 of which $2,500 was paid directly to legal fees and $500 to Power Up for due diligence fees resulting in net cash proceeds of $150,000.

 

The maturity date of the Note is January 22, 2019 (the “Maturity Date”). The Note shall bear interest at a rate of 8% per annum, which interest may be paid by the Company to Power Up in shares of common stock, but shall not be payable until the Note becomes payable, whether at the Maturity Date or upon acceleration or by prepayment. An aggregate total of $175,754 of this note was bifurcated with the embedded conversion option recorded as a derivative liability at fair value.

 

Additionally, Power Up has the option to convert all or any amount of the principal face amount of the Note, starting on July 21, 2018 and ending on the later of the Maturity Date and the date the Default Amount, hereinafter defined, is paid if an event of default occurs, for shares of the Company’s common stock at the then-applicable conversion price.

 

The conversion price for the Note shall be $0.065, subject to certain Market Price (as defined below) adjustment. If the Market Price is greater than or equal to $0.10, the conversion price shall be the greater of 65% of the Market Price (“Variable Conversion Price”) and $0.065. In the event Market Price is less than $0.10, the conversion price shall be the Variable Conversion Price. As defined in the Note, the “Market Price” shall be the average of the lowest three closing bid prices during the ten day trading period prior to and including the day the Company receives a notice of conversion from Power Up on the electronic quotation system or applicable principal securities exchange or trading market or, if no closing bid price of such security is available in any of the foregoing manners, the average of the closing bid prices of any market makers for such security that are listed in the “pink sheets” during the ten prior trading days, including the day upon which the Company receives a notice of conversion from Power Up. Notwithstanding the foregoing, Power Up shall be restricted from effecting a conversion if such conversion, along with other shares of the Company’s common stock beneficially owned by Power Up and its affiliates, exceeds 4.99% of the outstanding shares of the Company’s common stock.

 

The Note may be prepaid within 180 days of issuance with certain penalties.

 

Authorized Share Increase

 

Effective January 23, 2018, the stockholders have authorized an increase in the number of authorized shares of the Company’s common stock from 100,000,000 to 400,000,000.

 

Funding of Notes Receivable

 

On January 25, 2018, the Company received payment from GS Capital of the July 2017 Note Receivable in the amount of $160,000 that offset the July Back-End Note. Proceeds from the Note Receivable of $8,000 were paid directly to legal fees resulting in net cash proceeds of $152,000 received by the Company. As a result, the July Back-End Note is now convertible at a rate of 62% of the lowest trading bid price of the Common Stock for the ten prior trading days prior to the date the conversion notice is received (See Note 6).