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Notes Payable
12 Months Ended
Sep. 30, 2016
Notes Payable:  
Notes Payable

4.

Notes Payable

 

(a)

On July 18, 2016, the Company entered into a loan agreement with a non-related party for proceeds of $121,000. The amount owing is unsecured, bears interest at 10% per annum, and is due on April 18, 2017, and is convertible into common shares of the Company at $0.50 per share. During the year ended September 30, 2016, the Company recorded a beneficial conversion feature of $121,000 (2015 - $nil), and recorded accretion expense of $32,679 (2015 - $nil). As at September 30, 2016, the carrying value of the note payable is $32,679 (2015 - $nil), the unamortized discount on the note is $88,321 (2015 - $nil), and accrued interest of $3,279 (2015 - $nil) has been recorded in accounts payable and accrued liabilities.

 

As an incentive for the loan, the Company issued 121,000 cashless warrants to the note holder as a bonus incentive, which has an exercise price of $0.50 per warrant until July 18, 2021. The fair value of the cashless warrants was $229,069, and was calculated using the Black-Scholes option pricing model assuming no expected dividends, volatility of 239%, and risk-free rate of 1%.

 

(b)

On September 28, 2016, the Company entered into a loan agreement with a non-related party for proceeds up to $550,000. On September 30, 2016, the Company received proceeds of $110,000. The amount owing is unsecured, bears interest at 10% per annum, and is due on September 30, 2017, and is convertible into common shares of the Company at $0.10 per share. During the year ended September 30, 2016, the Company recorded a beneficial conversion feature of $110,000 (2015 - $nil). As at September 30, 2016, the carrying value of the note payable is $nil (2015 - $nil), and the unamortized discount on the note is $110,000 (2015 - $nil).

 

As an incentive for the loan, the Company issued 121,000 cashless warrants to the note holder as a bonus incentive, which has an exercise price of $0.50 per warrant until September 30, 2021. The fair value of the cashless warrants was $65,990, and was calculated using the Black-Scholes option pricing model assuming no expected dividends, volatility of 233%, and risk-free rate of 1%.

 

(c)

On June 15, 2016, the Company entered into a loan agreement with a non-related party for proceeds up to $400,000. During the year ended September 30, 2016, the Company received proceeds of $303,000 (2015 - $nil) on the loan. The loan is unsecured, bears interest at 2.5% per annum, and is due on or before June 15, 2018. As at September 30, 2016, accrued interest of $1,289 (2015 - $nil) has been recorded in accounts payable and accrued liabilities.