NOTE D CONVERTIBLE LOAN PAYABLE
On May 9, 2011 the Company received a $5,000 loan from an individual. The loan was convertible into 5% of the common stock of the Company if converted during the four-month conversion period beginning on the signing date. If the loan was not converted to common stock during the conversion period the loan becomes payable in full with 10% simple interest. Failure to pay back the loan in full with interest by the payment date will result in a penalty of 15% compounded daily of the remaining amount due until paid. The individual has the right to buy an additional 10.3% of the common stock of the Company for $10,300 during the conversion period. The loan is guaranteed by the sole officer and director of the Company.
The parties have agreed that no interest or penalties will be paid. Interest at a rate of 10% amounting to $57 for the three and nine month periods ended September 30, 2012 and $196 for the three and nine month periods ended September 30, 2011, has been imputed on the loan, and has been credited to additional paid-in capital.
On February 8, 2012 the holder of the convertible loan exercised his option to convert the loan into 590,293 newly issued shares of common stock of the Company at $0.008 per share.