Quarterly report pursuant to Section 13 or 15(d)

STOCKHOLDERS' DEFICIT

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STOCKHOLDERS' DEFICIT
6 Months Ended
Dec. 31, 2016
Stockholders' Equity Note [Abstract]  
Stockholders' Equity Note Disclosure [Text Block]
NOTE 6 – STOCKHOLDERS’ DEFICIT
 
Preferred Stock:
 
The total number of preferred shares authorized and that may be issued by the Company is 10,000,000 preferred shares with a par value of $0.01. These preferred shares have no rights to dividends, profit sharing or liquidation preferences.
 
Of the total preferred shares authorized, pursuant to the Certificate of Designation filed on December 9, 2014, 500,000 have been designated as Series A preferred stock, with a par value of $0.01 (“Series A Preferred Stock”).
 
Of the total preferred shares authorized, pursuant to the Certificate of Designation filed on June 16, 2015, up to five shares have been designated as Series B preferred stock, with a par value of $0.01 (“Series B Preferred Stock”). Each holder of outstanding shares of Series B Preferred Stock shall be entitled to voting power equivalent to the number of votes equal to the total number of shares of common stock outstanding as of the record date for the determination of stockholders entitled to vote at each meeting of stockholders of the Company and entitled to vote on all matters submitted or required to be submitted to a vote of the stockholders of the Company.
 
Common Stock:
 
Shares issued for services
 
On November 1, 2015, the Company entered into an agreement with a consultant to provide services over a nine month period. On August 8, 2016, the Board of Directors authorized the issuance of 2,120,000 shares of common stock valued at $0.015 per share to the consultant. The Company has recorded $3,495 of consulting expense for the six months ended December 31, 2016 related to this agreement as the majority of the expense was recorded in fiscal 2016.
 
On January 31, 2016, the Company entered into an agreement with a consultant to provide services over a five month period in exchange for 9,000,000 shares of common stock. On August 23, 2016, the Board of Directors authorized the issuance of 9,000,000 shares of common stock valued at $0.0104 per share to the consultant. These services were expensed during the year ended June 30, 2016.
 
On July 14, 2016, the Company agreed to an addendum with a consultant to two consulting agreements entered into on May 7, 2015 and April 22, 2016, respectively. The Company currently owed the consultant $60,000 related to the May 7, 2015 agreement for monthly consulting fees and $100,000 related to the April 22, 2016 agreement, which was comprised of a $10,000 retainer and $90,000 for three reports issued by the consultant. The Company has agreed to issue 6,000,000 shares of common stock in consideration of the $60,000 in outstanding fees related to the May 7, 2015 agreement and an additional 6,000,000 shares in forgiveness of future monthly consulting fees, valued at $95,400. In addition, the Company has agreed to issue 10,000,000 shares of common stock in consideration for the $100,000 in outstanding fees related to the April 22, 2016 agreement. The shares were issued on November 4, 2016 and an additional loss on settlement of debt was recorded of $94,400 based on the fair market value of $349,800 for 22,000,000 shares on July 14, 2016 (a share price of $0.0159).
 
On October 27, 2016, the Company entered into an agreement with a third party for professional services over a six month period commencing on October 10, 2016 in exchange for a monthly fee of $22,500, of which $10,000 a month is in cash and $12,500 per month is in shares of common stock. Additionally, the Company acknowledges an existing outstanding balance due of $20,500 for September services. The Company has recorded $37,500 of consulting expense related to the shares of common stock for the six months ended December 31, 2016 related to this agreement. These shares have not been issued as of the date of filing.
  
The Company recorded $140,841 of expense related to prior share grants for services previously recorded as prepaid expenses at June 30, 2016.
 
Shares issued for conversion of convertible debt
 
On August 18, 2016, pursuant to a conversion notice, $32,500 of principal and $2,885 of interest was converted at $0.00825 into 4,289,082 shares of common stock.
 
On August 25, 2016, pursuant to a conversion notice, $54,375 of interest was converted at $0.011625 into 4,677,420 shares of common stock.
 
On September 21, 2016, pursuant to a conversion notice, $25,000 of principal was converted at $0.010928 into 2,287,702 shares of common stock.
 
On September 28, 2016, pursuant to a conversion notice, $20,000 of principal was converted at $0.010928 into 1,830,162 shares of common stock.
 
On September 30, 2016, pursuant to a conversion notice, $17,500 of principal and $1,350 of interest was converted at $0.00781 into 2,413,590 shares of common stock.
 
On October 4, 2016, pursuant to a conversion notice, $25,000 of principal was converted at $0.010153 into 2,462,327 shares of common stock.
 
On October 6, 2016, pursuant to a conversion notice, $1,000 of principal and $79 of interest was converted at $0.007095 into 152,034 shares of common stock.
 
On October 7, 2016, pursuant to a conversion notice, $25,000 of principal was converted at $0.009455 into 2,644,104 shares of common stock.
 
On October 7, 2016, pursuant to a conversion notice, $1,000 of principal and $79 of interest was converted at $0.00671 into 160,790 shares of common stock.
 
On October 14, 2016, pursuant to a conversion notice, $25,000 of principal was converted at $0.009455 into 2,644,104 shares of common stock.
 
On October 19, 2016, pursuant to a conversion notice, $25,000 of principal was converted at $0.008138 into 3,072,008 shares of common stock.
 
On October 21, 2016, pursuant to a conversion notice, $50,000 of principal was converted at $0.00775 into 6,451,613 shares of common stock.
 
On November 9, 2016, pursuant to a conversion notice, $54,375 of interest was converted at $0.008293 into 6,556,735 shares of common stock.
 
On November 21, 2016, pursuant to a conversion notice, $50,000 of principal was converted at $0.008138 into 6,144,016 shares of common stock.
 
On December 2, 2016, pursuant to a conversion notice, $25,000 of principal was converted at $0.007518 into 3,325,353 shares of common stock.
 
On December 8, 2016, pursuant to a conversion notice, $25,000 of principal was converted at $0.005193 into 4,814,173 shares of common stock.
 
On December 8, 2016, pursuant to a conversion notice, $36,500 of principal and $3,368 of interest was converted at $0.004235 into 9,413,932 shares of common stock.
 
On December 9, 2016, pursuant to a conversion notice, $1,000 of principal and $93 of interest was converted at $0.004235 into 258,019 shares of common stock.
 
On December 15, 2016, pursuant to a conversion notice, $35,000 of principal was converted at $0.005193 into 6,739,843 shares of common stock.
 
On December 16, 2016, pursuant to a conversion notice, $20,000 of principal and $1,881 of interest was converted at $0.004235 into 5,166,600 shares of common stock.
 
On December 23, 2016, pursuant to a conversion notice, $20,000 of principal was converted at $0.005193 into 3,851,339 shares of common stock.
 
Options:
 
On April 14, 2016 (“Grant Date”), the Board of Directors of the Company, through unanimous written consent, granted 71,500,000 and 71,500,000 stock options at an exercise price of $0.03 (market value of the Company’s stock on Grant Date), to its CEO and to a director, respectively. 23,833,333 of such stock options vested on April 14, 2016 and expire on April 14, 2021, 23,833,333 of such stock options shall vest on April 14, 2017 (first anniversary of Grant Date) and expire on April 14, 2021 and 23,833,334 of such stock options shall vest on April 14, 2018 (second anniversary of Grant Date) and expire on April 14, 2021. The fair value of each of the 71,500,000 options at Grant Date is $1,962,440 (aggregate total of $3,924,880).
 
The Company expensed $989,285 for these stock options during the six months ended December 31, 2016.
 
Warrants:
 
On July 8, 2016, the 2015 Warrant for 26,190,476 shares was fully exercised at a price of $0.012 per share for a total of $314,286 in connection with the July Letter Agreement (See Note 5).
 
On August 3, 2016, pursuant to the August Letter Agreement, the Company issued 240,000,000 warrants to purchase common stock. 200,000,000 of these warrants have exercise prices ranging from $0.012 to $0.020 per share and expire five months from the date of issuance. 40,000,000 of these warrants have an exercise price of $0.10 per share and expire two years from the date of issuance. These warrants were subsequently cancelled as discussed in Note 5.
  
On August 18, 2016, pursuant to the August Letter Agreement, 12,500,000 shares were exercised at a price of $0.012 per share under the first tranche of the Five Month Warrant or $150,000 in the aggregate. These shares were subsequently cancelled and a loss of $37,500 was recorded (See Note 5).
 
On November 9, 2016, the Company entered into an agreement (the “November Agreement”) to adjust the exercise price of a warrant, issued September 30, 2013, to purchase 3,000,000 shares of common stock of the Company.  Under the terms of the November Agreement, the exercise price for the shares underlying the warrant was reduced to $0.015 AUD or $0.0115 USD per share.  The November Agreement did not affect the remaining terms of the warrant. The Company recorded an additional expense of $3,299 AUD related to the repricing.
 
As of December 31, 2016, there were 240,000,000 warrants cancelled and 37,379,158 warrants outstanding and exercisable with expiration dates commencing December 2018 and continuing through November 2020.