The Company issued convertible notes payable in 2017 and 2016. The outstanding balance and any accrued interest is due on maturity date. Under the agreement, the note can be convertible at holder’s discretion into common shares of the Company stock.

							Balance at
Convertible Note	Issuance Date	Maturity Date	Interest Rate		Original Borrowing		March 31, 2018

Note 1 EMA	February 5, 2016	February 6, 2017	10%		30,000	$	-
Note 3 Pinz	March 1, 2016	March 1, 2017	10%		30,556		-
Note 4 Typenex	June 7, 2016	February 28, 2019	8%	$	27,500		-
Note 5 Typenex	February 1, 2017	March 2, 2019	8%		25,000		-
Note 6 Adar	February 8, 2017	February 8, 2018	8%		30,000		-
Note 7 Adar BE#1	July 24, 2017	February 8, 2018	8%		15,000		-

Total							-

Debt Discount							-

Net balance						$	-

As of March 31, 2018, convertible notes payables had $0 balance and all convertible notes were converted into common shares of the Company’s stock

The company adopted the provision of FASB ASC Topic, “Derivatives and Hedging” (“ASC 815”) (previously EITF 07-5, “Determining Whether an Instrument (or an Embedded Feature) is Indexed to an Entity’s Own Stock”), as the convertible note agreement contained certain provision that the convertible note failed to pass the “fixed for fixed” criteria of the ASC 815, the conversion feature of the convertible debt should have to be bifurcated and recorded separately until the conversion date.

Based on ASC 815, the Company determined that the convertible debt contained embedded derivatives and full ratchet provision which the Company valued the embedded derivative using the Black-Scholes method. The following table represent fair value of embedded derivative movement from the date of issuance to March 31, 2018.

Embedded Derivative Liabilities		Fair Value at Date of Issuance		Fair Value at December 31, 2017		Changes In Fair Value		Fair Value at March 31, 2018

Note 1 - Issued in 2016	$	-	$	-	$	-	$	-
Note 3 - Issued in 2016		-		-		-		-
Note 4 - Issued in 2016		-		-		-		-
Note 5 - Issued in 2017		44,642		27,268		(27,268)		-
Note 6 - Issued In 2017		53,592		-		-		-
Note 7 - Issued In 2017		24,380		16,824		(16,824)		-
Warrant # 3 - Issued In 2017				5,847		(5,847)		-

Total					$	(49,939)	$	-

a) On February 5, 2016, the Company issued a one-year convertible note to an otherwise unaffiliated, non-institutional third party in the principal amount of $30,000. The note (i) is unsecured, (ii) bears interest at rate of ten (10) percent per annum, and (iii) was issued with an original issue discount of $3,500.

The principal is convertible into shares of the Company’s common stock at any time and from time-to-time at the instance of either the Company or the holder. The per-share conversion price is an amount equal to fifty percent (50%) of the lowest (20)-day volume weighted average closing bid price for the Company’s common stock, as reported in the Stock Market, for the twenty (20- trading days immediately preceding the date of the notice of conversion, subject to downward adjustment in the event that the Company issues any securities at a price per share lower than the then-current conversion price, provided, however, that in no event shall the conversion price per share be less than $.00001. The Company provided the holder with certain negative covenants and events of default, each standard for transactions of this nature.

Due to the "reset" and "dilutive issuance" clause in this note relating to the conversion price from dilutive share issuance, the Company has determined that the conversion feature is considered a derivative liability for the Company, which is detailed in Note 7.

The Company determined an initial derivative liability of $45,072, which is recorded as a derivative liability as of the date of issuance while also recording an $30,000 debt discount on its balance sheet and $15,072 derivative expense on its profit and loss in relation to the bifurcation of the embedded conversion options of the note. The debt discount is being amortized over the one-year term.

On February 7, 2017, EMA completed the final conversion and hereby surrendered the Note to the Company.

a) On February 24, 2016, the Company issued a one-year convertible note to an otherwise unaffiliated, non-institutional third party in the principal amount of $32,500. The note (i) is unsecured, (ii) bears interest at rate of ten (10) percent per annum, and (iii) was issued with an original issue discount of $7,500. In connection to the issuance of the Promissory Note, the Company also issued 4.47 common stock purchase warrants, with a term of three years, at an exercise price of $5,190.19 per share.

The principal is convertible into shares of the Company’s common stock at any time and from time-to-time at the instance of either the Company or the holder. The per-share conversion price is an amount equal to fifty cents ($0.50) and the holder of the note may convert any or all of the principal outstanding into shares of the Company’s common stock. However, in the event that Market Capitalization Falls below $15,000,000 at any time, then in such event (a) the Lender Conversion Price for all lender conversion occurring after the first date of such occurrence shall equal the lower of the lender conversion price and the market price as of any applicable date of Conversion, and (b) the true-up provision shall apply to all lender conversions that occur after the first date the market capitalization falls below $15,000,000. The Company provided the holder with certain negative covenants and events of default, each standard for transactions of this nature.

The Company determined an initial derivative liability of $16,773, which is recorded as a derivative liability as of the date of issuance. The debt discount is being amortized over the one-year term.

On June 7, 2016, the Company issued a one-year convertible note to an otherwise unaffiliated, non-institutional third party in the principal amount of $27,500. The note (i) is unsecured, (ii) bears interest at rate of eight (8) percent per annum, and (iii) was issued with an original issue discount of $2,500. The holder of the note may convert any or all of the principal outstanding into shares of the Company’s common stock at $.50 per shares. In connection with the issuance of the Promissory Note, the Company also issued 1.66 common stock purchase warrants, with a term of three years, at an exercise price of $13,214.88 per share.

The Company determined an initial derivative liability of $17,166, which is recorded as a derivative liability as of the date of issuance while also recording an $17,166 debt discount on its balance sheet in relation to the bifurcation of the embedded conversion options of the note. The debt discount is being amortized over the one-year term.

On March 21, 2018, Typenex completed the final conversion and hereby surrendered the Note to the Company

On March 1, 2016, the Company issued a one-year convertible note to an otherwise unaffiliated, non-institutional third party in the principal amount of $30,556. The note (i) is unsecured, (ii) bears interest at rate of ten (10) percent per annum, and (iii) was issued with an original issue discount of $3,056.

The principal is convertible into shares of the Company’s common stock at any time and from time-to-time at the instance of either the Company or the holder. The per-share conversion price is an amount equal to sixty percent (60%) of the lowest (20)-day volume weighted average closing bid price for the Company’s common stock, as reported in the Stock Market, for the twenty (20)-trading days immediately preceding the date of the notice of conversion, subject to downward adjustment in the event that the Company issues any securities at a price per share lower than the then-current conversion price, provided. The Company provided the holder with certain negative covenants and events of default, each standard for transactions of this nature.

The Company determined an initial derivative liability of $28,885, which is recorded as a derivative liability as of the date of issuance while also recording an $30,556 debt discount on its balance sheet, and $(1,671) derivative expense on its profit and loss in relation to the bifurcation of the embedded conversion options of the note. The debt discount is being amortized over the one-year term.

On October 25, 2016, Pinz completed the final conversion and hereby surrendered the Note to the Company.

The Convertible note discussed in Note 6 had a reset provision and a dilutive issuance clause that gave rise to a derivative liability. The reset provided for the conversion price to be adjusted downward in the event that the Company issued any securities at a price per shares than the then-current conversion price; provided, however, the holder(s) of the note may convert any or all of the principal outstanding into shares of the Company’s common stock at a price equal to 50% and 60% of the lowest trading price of the common stock during the 20 trading days prior to issuing a notice of conversion to the Company and at $0.5 per shares.

The fair value of the derivative liability was recorded and shown separately under current liabilities. Changes in the fair value derivative liability were recorded in the consolidated statement of operations under other income (expenses).

The company evaluates all of its agreements to determine if such instruments have derivatives or contain features that qualify as embedded derivatives. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and is then re-valued at each reporting date, with changes in the fair value reported in the consolidated statements of operations. For stock-base derivative financial instruments, the Company uses a weighted average Black-Scholes-Merton option pricing model to value the derivative instrument at inception and on subsequent valuation dates. The classification of derivative instrument, including whether such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period. Derivative instrument liabilities are classified in the balance sheet as current or non-current based on whether or not net-cash settlement of the derivative instrument could be required within 12 months of the balance sheet date.

The range of significant assumptions which the Company used to measure the fair value of the derivative liability at March 31, 2018 was as follows:

Typenex Warrant 3 Converted		Inception		March 31, 2018
Stock price	$	0.69	$	-
Risk free rate		0.94%		-
Volatility		129.67%		-
Exercise prices	$	0.43	$	-
Terms (years)		2.73		-

Typenex Converted		Inception		March 31, 2018
Stock price	$	0.0024	$	-
Risk free rate		0.83%		-
Volatility		284.69%		-
Exercise prices	$	0.0012	$	-
Terms (years)		1		-

Adar Bay BE #1 Converted		Inception		March 31, 2018
Stock price	$	0.0009	$	-
Risk free rate		1.23%		-
Volatility		296.64%		-
Exercise prices	$	0.0005	$	-
Terms (years)		0.55		-

The following table represents the Company’s derivative liability activity for the embedded conversion features for the nine months ended March 31, 2018 and for the year ended June 2017:


Derivative liability balance, June 30, 2016	$	112,243
Issuance of derivative liability during the year ended June 30, 2016		98,234
Change in derivative liability during the year ended June 30, 2016		(112,436)
Derivative liability balance, June 30, 2017	$	98,041
Issuance of derivative liability during the three months ended September 30, 2017		24,380
Change in derivative liability during the three months ended September 30, 2017		(13,762)
Derivative liability balance, September 30, 2017	$	108,659
Issuance of derivative liability during the three months ended December 31, 2017		-
Change in derivative liability during the three months ended December 31, 2017		(58,720)
Derivative liability balance, December 31, 2017	$	49,939
Issuance of derivative liability during the three months ended March 31, 2018		-
Change in derivative liability during the three months ended March 31, 2018		(49,939)
Derivative liability balance, March 31, 2018	$	-

The Company accounts for income taxes using the asset and liability method which provides that deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial reporting and tax bases of assets and liabilities, and for operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using the currently enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company records a valuation allowance to reduce deferred tax assets to the amount that is believed more likely than not to be realized.

Deferred income taxes arise from the temporary between financial statement and income tax recognition of net operating losses. These loss carryovers are limited under the Internal Revenue Code should significant change in ownership occur.

For the nine months ended March 31, 2018 and 2017 the Company had net operating loss of approximately $183,952 and $225,143 respectively, that may be offset against future taxable income, if any, rateable through 2035. These carry-forwards are subject to review by the Internal Revenue Service.

The deferred tax assets of at each date of $12,921, and $78,800 created by the net operating losses have been offset by a 100% valuation allowance because the likelihood of realization of the tax benefit cannot be determined.

The effects of the temporary differences that give rise to significant portions of the deferred tax assets at March 31, 2018 and 2017 are as follows:

		March 31,		March 31,
		2018		2017
Deferred income tax assets
Federal	$	38,630	$	78,800
Valuation allowance		(38,630)		(78,800)

Net deferred income tax assets	$	-	$	-

There is no current or deferred tax expense for the six months ended March 31, 2018 and 2017.

The company includes interest and penalties arising from the underpayment of income taxes in the statements of operations in general and administrative expenses.