|
RELATED PARTY DEBT AGREEMENTS
|
9 Months Ended | |
|---|---|---|
|
Mar. 31, 2015
|
||
| Debt Disclosure [Abstract] | ||
| RELATED PARTY DEBT AGREEMENTS |
NOTE 4 RELATED PARTY DEBT AGREEMENTS Between October 2011 and October 2013, the Company has entered into and/or amended various debt agreements with Esenjay Investments, LLC (“Esenjay”), with an aggregate borrowing limit of $3,250,000. Esenjay is deemed to be a related party as Mr. Michael Johnson, the sole shareholder and a director of Esenjay is a current member of our board of directors and a major shareholder of the Company (with beneficial ownership of approximately 51% as of March 31, 2015). During our fiscal year ended June 30, 2014, a total of $3,136,000 of debt principal, which represented the total principal outstanding under these various debt agreements with Esenjay was converted to equity, which resulted in ending balances of $0 at June 30, 2014. The exchanges were accounted for as a capital transaction in accordance with ASC Topic No. 470-50-40, “Debt, Modifications and Extinguishments”. Accordingly, no gain or loss was recognized. Between July 1, 2014 and March 31, 2015, the Company borrowed an aggregate of $925,000 pursuant to these various debt agreements with Esenjay and at March 31, 2015 total unused credit amount under these various debt instruments was $2,325,000. Under the terms of these debt agreements, additional borrowings are subject to pre-approval by Esenjay and Esenjay has no obligation to loan additional funds under these facilities. For the takedowns, the interest rate is 6% and the notes mature December 31, 2015. At March 31, 2015, the outstanding balance under these various debt instruments with Esenjay was $925,000. Esenjay has the option to convert any or all of the remaining amount outstanding under these debt instruments into shares of our common stock at a conversion price of $0.30 per share until December 31, 2015. |