Kallo Inc. (KALO)

[BingBing90]

75% of average of the previous two lowest trading
days over the last 15 trading days
Promissory note of $40,000

8%
December 11, 2015
75% of average of the previous two lowest trading
days over the last 15 trading days
Promissory note of $100,000

10%
December 21, 2015
65% of lowest trading day over the last 15
trading days
Promissory note of $100,000

12%
July 8, 2015
55% of the lowest trading price over the last 20
trading days
Promissory note of $50,000

8%
October 5, 2015
60% of the lowest trading price over the last 15
trading days
Promissory note of $87,500

8%
January 15, 2016
70% of average of two lowest closing bid price
over the last 15 trading days
Promissory note of $66,667

12%
February 3, 2016
60% of the lowest trading price over the last 25
trading days
Promissory note of $55,000

10%
February 12, 2016
63% of the lowest trading price over the last 25
trading days
Promissory note of $38,889

8%
December 18, 2016
65% of the lowest trading price over the last 20
trading days
Promissory note of $50,000

12%
February 3, 2017
65% of the lowest trading price over the last 25
trading days

During the quarter ended March 31, 2015, at the commitment dates, the initial fair values of the embedded conversion feature for the new convertible promissory notes were estimated at $782,310 and recorded as derivative liabilities, resulting in a Day 1 loss of $375,682. On March 31, 2015, all the derivative liabilities were valued at $1,035,028 which resulted in gain in a further gain in fair value of $83,672 for the period ended March 31, 2015. The original issue discount for the new convertible promissory notes was $41,428 and $406,628 was allocated to the embedded derivative liabilities. The debt discounts are amortized over the terms of the respective Notes and were $526,949 at March 31, 2015 resulting in net finance charge of $169,932 for the period ended March 31, 2015 included in the consolidated statement of operations. The fair value of the embedded conversion feature is estimated at the end of each quarterly reporting period using the Black Scholes model.