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Related Party Transactions
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9 Months Ended |
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Mar. 31, 2013
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| Related Party Transactions [Abstract] | |
| Related Party Transactions Disclosure [Text Block] |
Note 5 Related Party Transactions
Effective September 1, 2011, the Company issued a $1,000,000 line of credit to a related party, which has common ownership with the Company. The line of credit was issued in order for the Company to obtain a higher interest rate on excess cash. The balance due on the line of credit as of March 31, 2013 and June 30, 2012 was $163,829 and $832,454, respectively, plus accrued interest of $0 and $31,547, respectively. The Company was obligated to fund the unused amount under the line of credit through maturity of the line of credit. The line of credit bears interest equal to the lower of 10%, or the Wall Street Journal Prime Rate (3.25% at June 30, 2012) plus 5%. The interest rate at March 31, 2013 was 8.25%. The line of credit is for a period of one year and matured on August 31, 2012. A late charge of 5% of the outstanding balance was charged on the line of credit on December 31, 2012. The line of credit is secured by one million shares of the related party’s common stock. As of March 31, 2013, there was no allowance for note loss recorded on the receivable.
During the three and nine months ended March 31, 2013, the Company incurred consulting expenses of $266,164 and $445,389, respectively and professional expenses of $25,500 and $109,500, respectively, for services performed by related parties of the Company and included in the statements of operations. As of March 31, 2013, $522,893 of related party expenses are recorded in accounts payable and accrued expenses – related party.
During the three and nine months ended March 31, 2012, the Company incurred consulting expenses of $40,000 and $125,000, respectively, for services performed by related parties of the Company and included in the statements of operations.
As of March 31, 2013, the due from related party was $128,546 for expenses paid on behalf of related parties. |