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SUBSEQUENT EVENTS
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9 Months Ended |
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Jun. 30, 2011
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NOTE 10 — SUBSEQUENT EVENTS
On August 12, 2011, the Company entered into an agreement with one of our directors, modifying the terms of the long term line of credit facility entered into on August 17, 2010. Under the revised agreement, we extended the term another 24 months, and reduced the credit facility to $2,000, with an annual interest rate of 7.75% on any outstanding balance.
For any outstanding balance at month end under the credit facility, the director will receive warrant coverage of 15% to purchase common shares of the Company at an exercise price of the then current stock price.
Additionally under the revised agreement, during the next 24 months the Company may require the director to purchase shares of Common Stock at the then current stock price. The aggregate purchase price of all shares purchased shall not exceed $2,000.
This agreement will terminate by mutual consent of the Company and the director or upon certain events of default.
For the dollar amount of Common Stock purchased, the director will receive warrant coverage of 15% to purchase shares of Common stock of the Company at an exercise price of the then current stock price.
Finally, Bruce Widener agreed that, upon the exercise of the share purchase commitment in whole or in part by the Company, the director shall have the right to purchase up to 1,200,000 shares of Common Stock from Bruce Widener for a purchase price of $0.01 per share.
Management has evaluated all subsequent events or transactions occurring through the date the financial statements were issued.
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