12. Short-term convertible loan

3 Months Ended

Mar. 31, 2017

Debt Disclosure [Abstract]

12. Short-term convertible loan

12. Short-term Convertible Notes

The short-term convertible notes consist of the following:

	Interest rate	Maturity date	Principal Outstanding	Accrued interest	Unamortized Discount	March 31, 2017	December 31, 2016
Labrys Fund, LP	8.0%	August 2, 2017	$       110,000	$         1,374	$      (75,359)	$           36,015	$                -
Series L Convertible notes	0.0%	June 30, 2017 to July 17, 2017	539,969	-	(170,486)	369,483	250,258
			$    649,969	$  1,374	$ (245,845)	$       405,498	$    250,258
Disclosed as follows:
Short-term portion						$         405,498	$      250,258
Long-term portion						-	-
						$       405,498	$    250,258

Labrys Fund, LP

On February 2, 2017, The Company entered into a Securities Purchase Agreement with LABRYS FUND LP, in terms of the agreement the Company borrowed $110,000 in terms of an unsecured convertible promissory note with a maturity date of August 2, 2017. The note bears interest at a rate of 8% per annum. The note is only convertible upon a repayment default, at the lower of 60% of the lowest traded price over the preceding 30 day trading period prior to the issuance of this note or 60% of the lowest traded price 30 days prior to the conversion date. The Company issued 1,200,000 common shares to the note holder as a commitment fee which returnable shares will be returned to the company if fully repaid prior to August 2, 2017.

Series L convertible notes

The Company entered into Series L Convertible Securities Purchase Agreements with 8 individuals on December 30, 2016. In terms of these agreements, the Company borrowed an aggregate principal amount of $468,969 in terms of a senior ranking convertible promissory note with a maturity date six months from the issue date and bearing interest at 0% per annum. The notes are convertible at the option of the holder into shares of common stock of the Company at a conversion price of $0.03 per share, subject to certain recapitalization adjustments. On December 30, 2016 it was determined that the beneficial conversion feature related to the discounted note and warrant issuances amounting to $218,711 would be amortized over the life of the loans. The amortization charge of the debt discount for the three months ended March 31, 2017 was $109,355.

During January 2017, the Company borrowed a further aggregate principal amount of $71,000 in terms of three senior ranking convertible promissory notes with a maturity date six months from the issue date and bearing interest at 0% per annum. The notes are convertible at the option of the holder into shares of common stock of the Company at a conversion price of $0.03 per share, subject to certain recapitalization adjustments. In January 2017 it was determined that the beneficial conversion feature related to the discounted note and warrant issuances amounting to $104,793 would be amortized over the life of the loans. The amortization charge of the debt discount for the three months ended March 31, 2017 was $43,664.

In terms of the Series L Convertible notes issued above, during January 2017, the Company granted three year warrants to the Series L Convertible noteholders, exercisable for 2,366,667 shares of common stock at an exercise price of $0.03, subject to certain recapitalization adjustments, per share, expiring between January 16 and January 17, 2020. (Refer note 16 (b) below).