NOTE 5 – LOAN FROM DIRECTORS - RELATED PARTIES

During 2010, the Company received $89,000 in advances from a director. These advances are non-interest bearing and due on demand. The Company repaid a portion of these advances in fiscal 2011 and the total amount owed the director at March 31, 2013 and June 30, 2012 is $77,078 and $75,177, respectively.

During the nine months ended March 31, 2013, the company received loans totaling $13,099 from a director accruing interest at 5.25% and repayable in October 2012. These terms are being renegotiated however, the Company is in default at March 31, 2013. The Company has recognized accrued interest expense of $406 through March 31, 2013. The balance of principle at March 31, 2013 was $13,099.

During the nine months ended March 31, 2013, the company received loans, net of repayments, totaling $50,182 from our Chief Executive Officer who is also a director accruing interest at 5.25%. The Company has recognized accrued interest expense of $936 through March 31, 2013. The balance of principle at March 31, 2013 was $50,182. The due dates of the notes range from February 2013 (which is in default) through August 2013.