UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

[X]   Quarterly Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended September 30, 2015

[  ]   Transition Report pursuant to 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from __________ to__________

Commission File Number: 000-55155

Nano Mobile Healthcare, Inc.

(Exact name of registrant as specified in its charter)

3 Columbus Circle, 15th Floor

New York, NY 10019

(Address of principal executive offices)

(713) 973-5738

(Registrant’s telephone number)

(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

[X] Yes [  ] No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
[X] Yes [  ] No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

[  ] Yes [X] No

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: 341,699,478 shares of common stock as of November 10, 2015.

TABLE OF CONTENTS

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

Our financial statements included in this Form 10-Q are as follows:

These financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and the SEC instructions to Form 10-Q. In the opinion of management, all adjustments considered necessary for a fair presentation have been included. Operating results for the interim period ended September 30, 2015 are not necessarily indicative of the results that can be expected for the full year.

NANO MOBILE HEALTHCARE, INC.

BALANCE SHEETS

AS OF SEPTEMBER 30, 2015

(UNAUDITED)

See accompanying notes to unaudited financial statements

NANO MOBILE HEALTHCARE, INC.

STATEMENTS OF OPERATIONS

FOR THREE MONTHS ENDED SEPTEMBER 30, 2015 AND 2014

(UNAUDITED)

See accompanying notes to unaudited financial statements

NANO MOBILE HEALTHCARE, INC.

STATEMENTS OF CASH FLOWS

FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2015 AND 2014

(UNAUDITED)

See accompanying notes to unaudited financial statements.

NANO MOBILE HEALTHCARE, INC

NOTES TO THE FINANCIAL STATEMENTS

September 30, 2015

(UNAUDITED)

NOTE 1 – BASIS OF PRESENTATION AND GOING CONCERN

Basis of Presentation

The accompanying unaudited interim financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules of the Securities and Exchange Commission, and should be read in conjunction with the audited financial statements and notes thereto contained in the Company’s most recent Annual Financial Statements filed with the SEC on Form 10-K. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and the results of operations for the interim period presented have been reflected herein. The results of operations for the interim period are not necessarily indicative of the results to be expected for the full year. Notes to the financial statements which would substantially duplicate the disclosures contained in the audited financial statements for the most recent fiscal period, as reported in the Form 10-K, have been omitted.

Going concern

The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has incurred cumulative net losses of $6,567,404 since its inception and requires capital for its contemplated operational and marketing activities to take place. The ability of Nano Mobile Healthcare, Inc to continue as a going concern is dependent on the Company generating cash from the sale of its common stock and/or obtaining debt financing and attaining future profitable operations. Management’s plans include selling its equity securities and obtaining debt financing to fund its capital requirement and ongoing operations; however, there can be no assurance the Company will be successful in these efforts. The ability to successfully resolve these factors raise substantial doubt about the Company’s ability to continue as a going concern. The financial statements of the Company do not include any adjustments that may result from the outcome of these aforementioned uncertainties.

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Fair Value of Financial Instruments

The carrying amounts reflected in the balance sheets for cash, accounts payable and accrued expenses approximate the respective fair values due to the short maturities of these items.

As required by the Fair Value Measurements and Disclosures Topic of the FASB ASC, fair value is measured based on a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows: (Level 1) observable inputs such as quoted prices in active markets; (Level 2) inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and (Level 3) unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.

The three levels of the fair value hierarchy are described below:

Level 1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities;

Level 2: Quoted prices in markets that are not active, or inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability;

Level 3: Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (supported by little or no market activity).

A financial instrument’s categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement.

NANO MOBILE HEALTHCARE, INC

NOTES TO THE FINANCIAL STATEMENTS

September 30, 2015

(UNAUDITED)

Financial assets and liabilities measured at fair value on a recurring basis are summarized below for September 30, 2015:

Financial assets and liabilities measured at fair value on a recurring basis are summarized below for June 30, 2015:

Investment Securities

The Company has elected to account for its investments in securities at fair value under the fair value option provisions of FASB ASC 825, Financial Instruments (“FASB ASC 825”). The primary reason for electing the fair value option when it first became available in 2008, was to reduce the burden of monitoring the differences between the cost and the fair value of the Company’s investments, previously classified as available for sale securities, including the assessment as to whether the declines are temporary in nature and to further remove an element of management judgment. In addition, the election was made for certain investments that were previously required to be accounted for under the equity method because their fair value measurements were readily obtainable.

Such financial assets accounted for at fair value include in general, securities that would otherwise qualify for available for sale treatment.

The changes in fair value (realized and unrealized gains and losses) of these instruments for which the Company has elected the fair value option are recorded in principal transactions and other income in the statements of operations. All of the investments for which the Company has elected the fair value option are included as a component of securities available for sale, at fair value in the balance sheets. The Company recognized net losses of $0 and $14,000 related to changes in fair value of investments that are included as a component of other investments, at fair value during the three months ended September 30, 2015 and 2014, respectively.

Income (Loss) Per Share

Basic income (loss) per share is calculated by dividing the Company’s net loss applicable to common shareholders by the weighted average number of common shares during the period. Diluted earnings per share is calculated by dividing the Company’s net income available to common shareholders by the diluted weighted average number of shares outstanding during the year. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted for any potentially dilutive debt or equity. The following table sets forth the computation of basic and diluted net loss per share of common stock:

As of September 30, 2015, the Company only had 450,000,000 shares authorized. Since the weighted average shares exceed the authorized shares the Company determined the max authorized shares limit to be used in the diluted earnings per share calculation.

NANO MOBILE HEALTHCARE, INC

NOTES TO THE FINANCIAL STATEMENTS

September 30, 2015

(UNAUDITED)

NOTE 3 – PREPAID EXPENSES

During the three months ended September 30, 2015, the Company prepaid interest of $27,375 on convertible notes. As of September 30, 2015 and June 30, 2015, the balance that remained capitalized as prepaid expenses was $33,108 and $41,637, respectively.

NOTE 4 – SECURITIES AVAILABLE FOR SALE

On January 16, 2014, the Company acquired 2,000,000 restricted common shares of a publicly traded company. The investment was acquired at market value of $0.03 per share, and is held for future trade. The value of the investment will be adjusted quarterly to reflect the change in market value of the holding. The investment does not represent a controlling interest in the publicly traded company. The company has elected the fair value option under ASC 825 allowing gains and losses to be recorded in earnings each period. From receipt of the shares on January 16, 2014 through September 30, 2015 the securities were reduced in value from $60,000 to $400 due to a change in the publicly traded company’s stock price. These securities are measured under level 1 of ASC 820.

The Company reported an unrealized loss on investment of $0 and $14,000 during the three months ending September 30, 2015 and 2014, respectively.

NOTE 5 – RELATED PARTY TRANSACTIONS

During the three months ended September 30, 2015 and 2014, the Company received cash advances from its majority shareholder in the amount of $280,952 and 316,287, of which $292,611 and $0 was repaid during the same period. As of September 30, 2015 and 2014, there was a balance due to the shareholder of $388,791 and $400,450, respectively. All amounts advanced to the Company are unsecured, non-interest bearing and due upon demand.

NOTE 6 – LOANS PAYABLE

On July 1, 2015, the Company issued a promissory note in the amount of $22,500 for $15,000 cash. The note was due on July 1, 2016 and bears interest at 15% per annum. During the three month period ended September 30, 2015, the Company has repaid $18,296 of the note payable and the note is shown net unamortized discount of $4,204.

On September 1, 2015, the Company issued a promissory note in the amount of $26,233 for $17,500 cash. The note was due on August 31, 2016 and bears interest at 15% per annum. During the three month period ended September 30, 2015, the Company has repaid $8,154 of the note payable and the note is shown net unamortized discount of $14,483.

NOTE 7 – CONVERTIBLE NOTE PAYABLE

On April 18, 2014, the Company issued a convertible promissory note in which the Company will be taking tranche payments on pre-defined dates, the total of these payments cannot exceed $650,000. There is an original discount component of 10% per tranche and an additional expense fee of $5,000. Therefore, the funds available to the Company will be $650,000 and the liability (net of interest) will be $750,000 when all disbursements have been received by the Company. Each tranche is accounted for separately with each principal and OID balance becoming due 18 months after receipt. Each tranche bears interest at 8% per annum. The loan is secured by shares of the Company’s common stock. Each portion of the loan becomes convertible 180 days after date of the note. The loan and any accrued interest can then be converted into shares of the Company’s common stock at a rate of 50% multiplied by the market price, which is the lowest quoted price for the common stock during the 20 trading day period ending on the latest complete trading day prior to the conversion date.

During the year ended June 30, 2015, the Company received six additional tranche disbursements of $50,000 on July 15, 2014, $100,000 on September 30, 2014, $50,000 on November 3, 2014, $50,000 on December 1, 2014, $50,000 on December 29, 2014, and $50,000 on February 2, 2015.

On July 20, 2015, the Company entered into a settlement agreement with the holder of the convertible note. Under the agreement the note holder agreed not to seek to enforce its rights or remedies under the Note in relation to the notice of conversion issued to convert a balance of the note amounting to $57,933; to not to exercise its rights of conversion pursuant to the Note, and if an event of default occurs, the Holder agrees not to sell any shares of common stock of the Company having an aggregate conversion value of $30,000 or more per week until such time as it has sold all of the Company’s common stock that it owns.

NANO MOBILE HEALTHCARE, INC

NOTES TO THE FINANCIAL STATEMENTS

September 30, 2015

(UNAUDITED)

Under the agreement the Company agreed to a penalty in relation to the issuance of a note in the amount of $95,000; to release the holder from its obligation to advance additional funds to the Company; and to pay or refinance the amount due under the note plus accrued interest in four installment payments due on July 20, 2015, August 10, 2015, September 14, 2015 and October 12, 2015. In accordance with the agreement, the Company made the payments due on July 20, 2015 and August 10, 2015.

In respect of prepayment penalties payable to the Holder pursuant to the Note, the Company agreed to issue to the Holder additional convertible promissory notes with each having the same form, terms, and conditions as the original note. The value of the notes, which are due by each installment payment date, are equal to 30% of the payment delivered. During the three months ended September 30, 2015, the Company issued two notes related to the prepayment penalties of the installments due on July 20, 2015 and August 10, 2015 of $35,399 and $35,610, respectively.

After the payment was made on August 10, 2015, the Company and the note holder agreed to forgo the final two payments, cancel the settlements agreement, and therefore allow the noteholder to convert the notes as agreed to in the original note agreement. During the three months ended September 30, 2015, the Company converted $5,000 of the penalty note issued on July 20, 2015 into 5,000,000 shares of common stock.

The following details the disbursements as of September 30, 2015:

During the quarter ended September 30, 2015 and 2014, $16,683 and $745 of the debt discount related to the outstanding tranches was amortized, respectively.

The Notes are shown net of an unamortized original issue discount of $10,237 as of September 30, 2015.

The Company analyzed the conversion options embedded in the Convertible Promissory Notes for derivative accounting consideration under ASC 815, Derivatives and Hedging, and determined that seven tranches received on November 3, 2014, December 1, 2014, December 29, 2014, February 2, 2015, July 14, 2015, July 20, 2015, and August 20, 2015 were convertible during the quarter ended September 30, 2015.

NANO MOBILE HEALTHCARE, INC

NOTES TO THE FINANCIAL STATEMENTS

September 30, 2015

(UNAUDITED)

In accordance with the terms of the Note, the holder fully converted the tranche issued on April 21, 2014 during the year ended June 30, 2015 for 3,711,969 shares of common stock for principal and accrued interest of $116,943. The Company recorded a debt discount in the amount of $110,776 in connection with the initial valuation of the derivative liability of the note to be amortized utilizing the effective interest method of accretion over the term of the note. Further, the Company recognized a derivative liability of $192,038 and an initial loss of $81,262 based on the Black Scholes Merton pricing model.

On October 21, 2014, the Note issued on May 6, 2014 became convertible at the option of the holder. On this date the Company recorded a debt discount in the amount of $55,384 in connection with the initial valuation of the derivative liability of the note to be amortized utilizing the effective interest method of accretion over the term of the note. Further, the Company recognized a derivative liability of $95,215 and an initial loss of $39,831 based on the Black Scholes Merton pricing model.

In accordance with the terms of the Note, the holder fully converted the tranche during the year ended June 30, 2015 for 4,943,581 shares of common stock for principal and interest of $59,827.

On December 8, 2014, the Note issued on June 11, 2014 became convertible at the option of the holder. On this date the Company recorded a debt discount in the amount of $55,384 in connection with the initial valuation of the derivative liability of the note to be amortized utilizing the effective interest method of accretion over the term of the note. Further, the Company recognized a derivative liability of $90,678 and initial loss on derivative liability of $35,294 based on the Black Scholes Merton pricing model.

During the quarter ended September 30, 2015, the note was assigned to another lender. As of September 30, 2015, $55,384 of the debt discount has been amortized. The fair value of the derivative liability at September 30, 2015 and June 30, 2015 was $0 and $91,995, respectively resulting in a gain on the change in fair value of the derivative of $91,995 during the quarter ended September 30, 2015.

On January 12, 2015, the Note issued on July 16, 2014 became convertible at the option of the holder. On this date the Company recorded a debt discount in the amount of $55,384 in connection with the initial valuation of the derivative liability of the note to be amortized utilizing the effective interest method of accretion over the term of the note. Further, the Company recognized a derivative liability of $91,094 and initial loss on derivative liability of $35,710 based on the Black Scholes Merton pricing model.

During the quarter ended September 30, 2015, the note was assigned to another lender. As of September 30, 2015, $55,384 of the debt discount has been amortized. The fair value of the derivative liability at September 30, 2015 and June 30, 2015 was $0 and $96,644 resulting in a gain on the change in fair value of the derivative of $96,644.

On March 29, 2015, the Note issued on September 30, 2014 became convertible at the option of the holder. On this date the Company recorded a debt discount in the amount of $110,768 in connection with the initial valuation of the derivative liability of the note to be amortized utilizing the effective interest method of accretion over the term of the note. Further, the Company recognized a derivative liability of $182,755 and initial loss on derivative liability of $71,987 based on the Black Scholes Merton pricing model.

As of September 30, 2015, $69,757 of the debt discount has been amortized. The fair value of the derivative liability at September 30, 2015 and June 30, 2015 is $155,764 and $213,077 resulting in a gain on the change in fair value of the derivative of $57,313. The Note is shown net of a derivative debt discount of $54,931 at September 30, 2015.

On May 2, 2015, the Note issued on November 3, 2014 became convertible at the option of the holder. On this date the Company recorded a debt discount in the amount of $55,384 in connection with the initial valuation of the derivative liability of the note to be amortized utilizing the effective interest method of accretion over the term of the note. Further, the Company recognized a derivative liability of $94,120 and initial loss on derivative liability of $38,736 based on the Black Scholes Merton pricing model.

NANO MOBILE HEALTHCARE, INC

NOTES TO THE FINANCIAL STATEMENTS

September 30, 2015

(UNAUDITED)

As of September 30, 2015, $28,028 of the debt discount has been amortized. The fair value of the derivative liability at September 30, 2015 and June 30, 2015 was $78,863 and $109,960, respectively resulting in a gain on the change in fair value of the derivative of $31,097. The Note is shown net of a derivative debt discount of $27,368 at September 30, 2015.

On May 30, 2015, the Note issued on December 1, 2014 became convertible at the option of the holder. On this date the Company recorded a debt discount in the amount of $55,384 in connection with the initial valuation of the derivative liability of the note to be amortized utilizing the effective interest method of accretion over the term of the note. Further, the Company recognized a derivative liability of $95,257 and initial loss on derivative liability of $39,873 based on the Black Scholes Merton pricing model.

As of September 30, 2015, $18,512 of the debt discount has been amortized. The fair value of the derivative liability at September 30, 2015 and June 30, 2015 was $79,241 and $115,438 resulting in a gain on the change in fair value of the derivative of $36,197 during the three months ended September 30, 2015. The Note is shown net of a derivative debt discount of $36,872 at September 30, 2015.

On June 29, 2015, the Note issued on December 29, 2014 became convertible at the option of the holder. On this date the Company recorded a debt discount in the amount of $55,384 in connection with the initial valuation of the derivative liability of the note to be amortized utilizing the effective interest method of accretion over the term of the note. Further, the Company recognized a derivative liability of $102,520 and initial loss on derivative liability of $47,136 based on the Black Scholes Merton pricing model.

As of September 30, 2015, $14,298 of the debt discount has been amortized. The fair value of the derivative liability at September 30, 2015 and June 30, 2015 was $81,351 and $116,072, respectively resulting in a gain on the change in fair value of the derivative of $34,721 during the three months ended September 30, 2015. The Note is shown net of a derivative debt discount of $41,086 at September 30, 2015.

On August 1, 2015, the Note issued on February 2, 2015 became convertible at the option of the holder. On this date the Company recorded a debt discount in the amount of $55,384 in connection with the initial valuation of the derivative liability of the note to be amortized utilizing the effective interest method of accretion over the term of the note. Further, the Company recognized a derivative liability of $93,642 and initial loss on derivative liability of $38,258 based on the Black Scholes Merton pricing model.

As of September 30, 2015, $9,055 of the debt discount has been amortized. The fair value of the derivative liability at September 30, 2015 and June 30, 2015 was $82,954 and $0, respectively resulting in a gain on the change in fair value of the derivative of $10,688 during the three months ended September 30, 2015. The Note is shown net of a derivative debt discount of $46,329 at September 30, 2015.

On July 20, 2015, the Note issued on July 20, 2015 became convertible at the option of the holder. On this date the Company recorded a debt discount in the amount of $95,000 in connection with the initial valuation of the derivative liability of the note to be amortized utilizing the effective interest method of accretion over the term of the note. Further, the Company recognized a derivative liability of $119,837 and initial loss on derivative liability of $24,837 based on the Black Scholes Merton pricing model.

In accordance with the terms of the Note, the holder partially converted the note during the quarter ended September 30, 2015 for 5,000,000 shares of common stock for principal of $5,000. The fair value of at the date of conversion of $9,686 was written off to additional paid in capital.

As of September 30, 2015, $41,595 of the debt discount has been amortized. The fair value of the derivative liability at September 30, 2015 and June 30, 2015 was $123,082 and $0, respectively resulting in a loss on the change in fair value of the derivative of $3,245 during the three months ended September 30, 2015. The Note is shown net of a derivative debt discount of $53,405 at September 30, 2015.

NANO MOBILE HEALTHCARE, INC

NOTES TO THE FINANCIAL STATEMENTS

September 30, 2015

(UNAUDITED)

On October 1, 2014, the Company issued a short-term convertible promissory note in the amount of $70,000 for $50,000 cash, an original issue discount of $12,500, and prepaid interest of $7,500. The note was due on March 30, 2015 and bears interest at 15% per annum, which was prepaid by the Company and is being amortized over the life of the loan. The loan is secured by shares of the Company’s common stock. The loan becomes convertible 180 days after date of the note. The loan and any accrued interest can then be converted into shares of the Company’s common stock at a rate of 50% multiplied by the market price, which is the lowest quoted price for the common stock during the 25 trading day period ending on the latest complete trading day prior to the conversion date. During the year ended June 30, 2015, $12,500 of the debt discount was been amortized. The note matured on March 30, 2015.

The Company elected to prepay the entire term’s interest of $7,500. This payment was capitalized as a prepaid asset and has been amortized over the term of the note. The interest expense related to this loan was $0 for the quarter ending September 30, 2015 and 2014.

On March 30, 2015, the Note became convertible at the option of the holder. On this date the Company recorded a debt discount in the amount of $70,000 in connection with the initial valuation of the derivative liability of the note to be amortized utilizing the effective interest method of accretion over the term of the note. Further, the Company recognized a derivative liability of $70,014 and initial loss of $14 based on the Black Scholes Merton pricing model.

As of June 30, 2015, $70,000 of the debt discount has been amortized. The fair value of the derivative liability at June 30, 2015 is $20,632.

As of September 30, 2015 and June 30, 2015, the holder of the note exercised his right to convert $14,000 and $56,000 of the note balance into 2,222,222 and 3,188,125 shares of common stock, respectively. The fair value of the derivative liability related to the converted debt as of September 30, 2015 and June 30, 2015 was $13,784 and $79,464, respectively.

On November 17, 2014, the Company issued a short-term convertible promissory note in the amount of $70,000, which consisted of cash proceeds of $50,000, a debt discount of $12,500 and prepaid interest of $7,500. The note is due on November 14, 2015 and bears interest at 15% per annum, which was prepaid by the Company and is being amortized over the life of the loan. The loan is secured by shares of the Company’s common stock. The loan becomes convertible 180 days after date of the note. The loan and any accrued interest can then be converted into shares of the Company’s common stock at a rate of 50% multiplied by the market price, which is the lowest quoted price for the common stock during the 25 trading day period ending on the latest complete trading day prior to the conversion date. As of September 30, 2015, $10,946 of the debt discount has been amortized. The Note is shown net of an unamortized debt discount of $1,554 at September 30, 2015.

The Company elected to prepay the entire term’s interest of $7,500. This payment was capitalized as a prepaid asset and has been amortized over the term of the note. The interest expense related to this loan was $1,885 and $0 for the quarter ending September 30, 2015 and 2014. As of September 30, 2015 and June 30, 2015 the remaining prepaid interest balance was $353 and $2,838, respectively.

On May 16, 2015, the Note became convertible at the option of the holder. On this date the Company recorded a debt discount in the amount of $70,000 in connection with the initial valuation of the derivative liability of the note to be amortized utilizing the effective interest method of accretion over the term of the note. Further, the Company recognized a derivative liability of $93,179 and initial loss of $23,179 based on the Black Scholes Merton pricing model.

As of September 30, 2015 and June 30, 2015, the holder of the note exercised his right to convert $20,000 and $35,000 of the note balance into 8,695,652 and 4,404,515 shares of common stock. The fair value of the derivative liability related to the converted debt at September 30, 2015 and June 30, 2015 was $57,121 and $54,324, respectively.

NANO MOBILE HEALTHCARE, INC

NOTES TO THE FINANCIAL STATEMENTS

September 30, 2015

(UNAUDITED)

As of September 30, 2015, $56,972 of the debt discount has been amortized. The fair value of the derivative liability at September 30, 2015 and June 30, 2015 was $17,845 and $56,108, respectively resulting in a loss on the change in fair value of the derivative of $18,858. The Note is shown net of a derivative discount of $13,208 at September 30, 2015.

On December 23, 2014, the Company issued a short-term convertible promissory note in the amount of $70,000, which consisted of cash proceeds of $50,000, a debt discount of $12,500 and prepaid interest of $7,500. The note is due on December 18, 2015 and bears interest at 15% per annum, which was prepaid by the Company and is being amortized over the life of the loan. The loan is secured by shares of the Company’s common stock. The loan becomes convertible 180 days after date of the note. The loan and any accrued interest can then be converted into shares of the Company’s common stock at a rate of 50% multiplied by the market price, which is the lowest quoted price for the common stock during the 25 trading day period ending on the latest complete trading day prior to the conversion date. During the year ended June 30, 2015, $6,562 of the debt discount has been amortized. The Note is shown net of an unamortized debt discount of $2,743 at September 30, 2015.

The Company elected to prepay the entire term’s interest of $7,500. This payment was capitalized as a prepaid asset and has been amortized over the term of the note. The interest expense related to this loan was $1,896 and $0 for the year ending September 30, 205 and 2014. As of September 30, 2015, the remaining prepaid interest balance was $782.

On June 21, 2015, the Note became convertible at the option of the holder. On this date the Company recorded a debt discount in the amount of $70,000 in connection with the initial valuation of the derivative liability of the note to be amortized utilizing the effective interest method of accretion over the term of the note. Further, the Company recognized a derivative liability of $104,711 and initial loss of $34,711 based on the Black Scholes Merton pricing model.

As of September 30, 2015, $39,278 of the debt discount has been amortized. The fair value of the derivative liability at September 30, 2015 and June 30, 2015 was $94,438 and $116,694 resulting in a loss on the change in fair value of the derivative of $22,256. The Note is shown net of a derivative discount of $30,722 at September 30, 2015.

NANO MOBILE HEALTHCARE, INC

NOTES TO THE FINANCIAL STATEMENTS

September 30, 2015

(UNAUDITED)

On January 13, 2015, the Company issued a short-term convertible promissory note in the amount of $74,000. The note is due on October 15, 2015 and bears interest at 8% per annum. The loan is secured by shares of the Company’s common stock. The loan becomes convertible 180 days after date of the note. The loan and any accrued interest can then be converted into shares of the Company’s common stock at a rate of 58% multiplied by the market price, which is the average of the lowest three quoted prices for the common stock during the 10 trading day period ending on the latest complete trading day prior to the conversion date.

On July 12, 2015, the Note became convertible at the option of the holder. On this date the Company recorded a debt discount in the amount of $74,000 in connection with the initial valuation of the derivative liability of the note to be amortized utilizing the effective interest method of accretion over the term of the note. Further, the Company recognized a derivative liability of $59,654 based on the Black Scholes Merton pricing model.

As of September 30, 2015, the holder of the note exercised his right to convert $76,960 of the note balance and accrued interest into 15,175,261 shares of common stock. The fair value of the derivative liability related to the converted debt at September 30, 2015 was $124,660.

On January 26, 2015, the Company issued a convertible promissory note in which the Company will be taking tranche payments based on amounts determined by the note holder for total payments of not more than $250,000. There is an original discount component of $25,000. Therefore, the funds available to the Company will be $225,000 and the liability (net of interest) will be $250,000 when all disbursements have been received by the Company. Each tranche is accounted for separately with each principal and OID balance becoming due 24 months after receipt. Each tranche bears interest at 12% per annum. The loan is secured by shares of the Company’s common stock. Each portion of the loan becomes convertible immediately upon issuance. The loan and any accrued interest can then be converted into shares of the Company’s common stock at a rate of the lesser of $0.045 per share or 60% multiplied by the market price per share, which is the lowest quoted price for the common stock during the 25 trading day period ending on the latest complete trading day prior to the conversion date. During the period ended June 30, 2015, the Company has received two tranche disbursements of $75,000 on January 26, 2015 and 25,000 on April 28, 2015.

As of September 30, 2015, $3,068 of the debt discount has been amortized. The Notes are shown net of an unamortized debt discount of $6,932 at September 30, 2015.

On January 26, 2015, the first tranche became convertible at the option of the holder. On this date the Company recorded a debt discount in the amount of $82,500 in connection with the initial valuation of the derivative liability of the note to be amortized utilizing the effective interest method of accretion over the term of the note. Further, the Company recognized a derivative liability of $135,740 and initial loss on derivative liabilities of $53,240 based on the Black Scholes Merton pricing model.

As of September 30, 2015, the holder of the note exercised his right to convert $26,952 of the note balance into 14,700,000 shares of common stock. The fair value of the derivative liability related to the converted debt at September 30, 2015 was $84,162.

As of September 30, 2015, $39,504 of the debt discount has been amortized. The fair value of the derivative liability at September 30, 2015 and June 30, 2015 was $6,017 and $152,892 resulting in a gain on the change in fair value of the derivative of $62,713. The Note is shown net of a derivative discount of $42,996 at September 30, 2015.

NANO MOBILE HEALTHCARE, INC

NOTES TO THE FINANCIAL STATEMENTS

September 30, 2015

(UNAUDITED)

On April 28, 2015, the second tranche became convertible at the option of the holder. On this date the Company recorded a debt discount in the amount of $27,500 in connection with the initial valuation of the derivative liability of the note to be amortized utilizing the effective interest method of accretion over the term of the note. Further, the Company recognized a derivative liability of $44,209 and initial loss on derivative liabilities of $16,709 based on the Black Scholes Merton pricing model.

As of September 30, 2015, $5,839 of the debt discount has been amortized. The fair value of the derivative liability at September 30, 2015 and June 30, 2015 was $3,137 and $54,756, respectively resulting in a gain on the change in fair value of the derivative of $51,619. The Note is shown net of a debt discount of $21,661 at September 30, 2015.

On April 15, 2015, the Company issued a short-term convertible promissory note in the amount of $70,000 for $50,000 cash, an original issue discount of $9,500, and prepaid interest of $10,500. The note is due on April 15, 2016 and bears interest at 15% per annum, which was prepaid by the Company and is being amortized over the life of the loan. The loan is secured by shares of the Company’s common stock. The loan becomes convertible 180 days after date of the note. The loan and any accrued interest can then be converted into shares of the Company’s common stock at a rate of 50% multiplied by the market price, which is the lowest quoted price for the common stock during the 25 trading day period ending on the latest complete trading day prior to the conversion date. As of the quarter ended September 30, 2015, $4,361 of the debt discount has been amortized and the note is shown net $5,139 in unamortized debt discount. As of September 30, 2015, the note has not become convertible.

On May 20, 2015, the Company issued a convertible promissory note in the amount of $43,000 for $43,000 cash. The note is due on February 22, 2016 and bears interest at 8% per annum. The loan becomes convertible 180 days after date of the note. The loan can then be converted into shares of the Company’s common stock at a rate of 58% multiplied by the market price, which is the average of the lowest three (3) quoted price for the common stock during the 10 trading day period ending on the latest complete trading day prior to the conversion date. As of September 30, 2015, the note has not become convertible.

On June 7, 2015, the Company issued a short-term convertible promissory note in the amount of $70,000 for $50,000 cash, an original issue discount of $9,500, and prepaid interest of $10,500. The note is due on June 8, 2016 and bears interest at 15% per annum, which was prepaid by the Company and is being amortized over the life of the loan. The loan is secured by shares of the Company’s common stock. The loan becomes convertible 180 days after date of the note. The loan and any accrued interest can then be converted into shares of the Company’s common stock at a rate of 50% multiplied by the market price, which is the lowest quoted price for the common stock during the 25 trading day period ending on the latest complete trading day prior to the conversion date. As of September 30, 2015, $2,977 of the debt discount has been amortized and the note is shown net $6,523 in unamortized debt discount. As of September 30, 2015, the note has not become convertible.

On June 19, 2015, the Company issued a short-term convertible promissory note in the amount of $37,500 for $25,000 cash, an original issue discount of $6,875, and prepaid interest of $5,625. The note is due on June 19, 2016 and bears interest at 15% per annum, which was prepaid by the Company and is being amortized over the life of the loan. The loan is secured by shares of the Company’s common stock. The loan becomes convertible 180 days after date of the note. The loan and any accrued interest can then be converted into shares of the Company’s common stock at a rate of 50% multiplied by the market price, which is the lowest quoted price for the common stock during the 25 trading day period ending on the latest complete trading day prior to the conversion date. As of September 30, 2015, $1,935 of the debt discount has been amortized and the note is shown net $4,940 in unamortized debt discount. As of September 30, 2015, the note has not become convertible.

On June 28, 2015, the Company issued a convertible promissory note in the amount of $150,000 for $100,000 cash, an original issue discount of $50,000. The note is due on December 28, 2016 and bears interest at 15% per annum. The loan becomes convertible 180 days after date of the note. The loan can then be converted into shares of the Company’s common stock at a rate of 50% multiplied by the market price, which is the lowest quoted price for the common stock during the 25 trading day period ending on the latest complete trading day to the conversion date. As of September 30, 2015, $8,561 of the debt discount has been amortized and the note is shown net $41,439 in unamortized debt discount. As of September 30, 2015, the note has not become convertible.

NANO MOBILE HEALTHCARE, INC

NOTES TO THE FINANCIAL STATEMENTS

September 30, 2015

(UNAUDITED)

On June 29, 2015, the Company issued a convertible promissory note in which the Company will be taking tranche payments based on amounts determined by the note holder for total payments of not more than $100,000. There is an original discount component of $10,000. Therefore, the funds available to the Company will be $90,000 and the liability (net of interest) will be $100,000 when all disbursements have been received by the Company. Each tranche is accounted for separately with each principal and OID balance becoming due 24 months after receipt. Each tranche bears interest at 15% per annum. Each portion of the loan becomes convertible immediately upon issuance. The loan and any accrued interest can then be converted into shares of the Company’s common stock at a rate of the lesser of $0.02 per share or 50% multiplied by the market price per share, which is the lowest quoted price for the common stock during the 25 trading days immediately preceding the conversion date. During the period ended June 30, 2015, the Company has received one tranche disbursements of $30,000 on June 29, 2015.

As of September 30, 2015, $382 of the debt discount has been amortized. The Note is shown net of an unamortized debt discount of $2,618 at September 30, 2015.

On June 29, 2015, the first trance became convertible at the option of the holder. On this date the Company recorded a debt discount in the amount of $33,000 in connection with the initial valuation of the derivative liability of the note to be amortized utilizing the effective interest method of accretion over the term of the note. Further, the Company recognized a derivative liability of $67,818 and initial loss on derivative liabilities of $34,818 based on the Black Scholes Merton pricing model. As of September 30, 2015, $4,193 of the debt discount has been amortized. The fair value of the derivative liability at September 30, 2015 and June 30, 2015 is $54,834 and $79,497, respectively resulting in a gain on the change in fair value of the derivative of $24,663 The Note is shown net of a derivative debt discount of $28,807 at September 30, 2015.

On July 7, 2015, the Company issued a convertible promissory note in the amount of $40,000 for $38,000 cash. The note is due on June 30, 2016 and bears interest at 8% per annum. The loan is secured by shares of the Company’s common stock. The loan becomes convertible as of the date of the note. The loan and any accrued interest can then be converted into shares of the Company’s common stock at a rate of 60% multiplied by the market price, which is the lowest quoted price for the common stock during the 25 trading day period ending on the latest complete trading day prior to the conversion date. During the three months ended September 30, 2015, $474 of the debt discount has been amortized. The Note is shown net of an unamortized debt discount of $1,526 at September 30, 2015.

On July 7, 2015, the note became convertible at the option of the holder. On this date the Company recorded a debt discount in the amount of $40,000 in connection with the initial valuation of the derivative liability of the note to be amortized utilizing the effective interest method of accretion over the term of the note. Further, the Company recognized a derivative liability of $60,307 and initial loss on derivative liabilities of $20,307 based on the Black Scholes Merton pricing model.

As of September 30, 2015, $9,471 of the debt discount has been amortized. The fair value of the derivative liability at September 30, 2015, was $47,938 resulting in a gain on the change in fair value of the derivative of $12,369. The Note is shown net of a derivative discount of $30,529 at September 30, 2015.

On July 24, 2015, the Company issued a convertible promissory note in the amount of $56,250 for $50,000 cash. The note is due on April 24, 2016 and bears interest at 10% per annum, which was prepaid by the Company and is being amortized over the life of the loan. The loan is secured by shares of the Company’s common stock. The loan becomes convertible as of the date of the note. The loan and any accrued interest can then be converted into shares of the Company’s common stock at a rate of 50% multiplied by the market price, which is the lowest quoted price for the common stock during the 20 trading day period ending on the latest complete trading day prior to the conversion date. The Note is shown net of an unamortized debt discount of $4,705at September 30, 2015.

NANO MOBILE HEALTHCARE, INC

NOTES TO THE FINANCIAL STATEMENTS

September 30, 2015

(UNAUDITED)

On July 24, 2015, the note became convertible at the option of the holder. On this date the Company recorded a debt discount in the amount of $56,250 in connection with the initial valuation of the derivative liability of the note to be amortized utilizing the effective interest method of accretion over the term of the note. Further, the Company recognized a derivative liability of $101,339 and initial loss on derivative liabilities of $45,089 based on the Black Scholes Merton pricing model.

As of September 30, 2015, $13,909 of the debt discount has been amortized. The fair value of the derivative liability at September 30, 2015, was $79,501 resulting in a gain on the change in fair value of the derivative of $21,838. The Note is shown net of a derivative discount of $42,341 at September 30, 2015.

On August 3, 2015, the Company issued a convertible promissory note in the amount of $75,000 for $50,000 cash, an original issue discount of $13,750 and prepaid interest of $11,250. The note is due on January 29, 2016 and bears interest at 15% per annum, which was prepaid by the Company and is being amortized over the life of the loan. The loan is secured by shares of the Company’s common stock. The loan becomes convertible 180 days after date of the note. The loan and any accrued interest can then be converted into shares of the Company’s common stock at a rate of 50% multiplied by the market price, which is the lowest quoted price for the common stock during the 25 trading day period ending on the latest complete trading day prior to the conversion date. During the three months ended September 30, 2015, $1,555 of the debt discount has been amortized. The Note is shown net of an unamortized debt discount of $12,195 at September 30, 2015. As of September 30, 2015, the note has not become convertible.

On August 5, 2015, the Company issued a convertible promissory note in the amount of $37,500 for $25,000 cash, an original issue discount of $6,875 and prepaid interest of $5,625. The note is due on January 29, 2017 and bears interest at 15% per annum, which was prepaid by the Company and is being amortized over the life of the loan. The loan is secured by shares of the Company’s common stock. The loan becomes convertible 180 days after date of the note. The loan and any accrued interest can then be converted into shares of the Company’s common stock at a rate of 50% multiplied by the market price, which is the lowest quoted price for the common stock during the 25 trading day period ending on the latest complete trading day prior to the conversion date. During the three months ended September 30, 2015, $709 of the debt discount has been amortized. The Note is shown net of an unamortized debt discount of $6,166 at September 30, 2015. As of September 30, 2015, the note has not become convertible.

On August 12, 2015, the Company issued a convertible promissory note in the amount of $50,000 for $44,000 cash, an original issue discount of $6,000. The note is due on February 12, 2016 and bears interest at 12% per annum, which was prepaid by the Company and is being amortized over the life of the loan. The loan is secured by shares of the Company’s common stock. The loan becomes convertible as of the date of the note. The loan and any accrued interest can then be converted into shares of the Company’s common stock at a rate of 50% multiplied by the market price, which is the lesser of lowest quoted price for the common stock during the previous 20 trading day period ending on the conversion date and the lowest trading price on the 30^th trading day after the funding of the note. During the three months ended September 30, 2015, $1,598 of the debt discount has been amortized. The Note is shown net of an unamortized debt discount of $4,402 at September 30, 2015.

On August 12, 2015, the note became convertible at the option of the holder. On this date the Company recorded a debt discount in the amount of $50,000 in connection with the initial valuation of the derivative liability of the note to be amortized utilizing the effective interest method of accretion over the term of the note. Further, the Company recognized a derivative liability of $358,250 and initial loss on derivative liabilities of $308,250 based on the Black Scholes Merton pricing model.

As of September 30, 2015, $13,315 of the debt discount has been amortized. The fair value of the derivative liability at September 30, 2015, was $69,291 resulting in a gain on the change in fair value of the derivative of $288,959. The Note is shown net of a derivative discount of $36,685 at September 30, 2015.

NANO MOBILE HEALTHCARE, INC

NOTES TO THE FINANCIAL STATEMENTS

September 30, 2015

(UNAUDITED)

On August 12, 2015, the Company issued a convertible promissory note in the amount of $115,000 for $115,000 cash. The note is due on August 12, 2016 and bears interest at 12% per annum, which was prepaid by the Company and is being amortized over the life of the loan. The loan is secured by shares of the Company’s common stock. The loan becomes convertible as of the date of the note. The loan and any accrued interest can then be converted into shares of the Company’s common stock at a rate of 50% multiplied by the market price, which is the lesser of lowest quoted price for the common stock during the previous 20 trading day period ending on the conversion date and the lowest trading price on the 30^th trading day after the funding of the note.

On August 12, 2015, the note became convertible at the option of the holder. On this date the Company recorded a debt discount in the amount of $115,000 in connection with the initial valuation of the derivative liability of the note to be amortized utilizing the effective interest method of accretion over the term of the note. Further, the Company recognized a derivative liability of $215,932 and initial loss on derivative liabilities of $100,932 based on the Black Scholes Merton pricing model.

As of September 30, 2015, the holder of the note exercised his right to convert $48,806 of the note balance into 27,214,714 shares of common stock. The fair value of the derivative liability related to the converted debt at September 30, 2015 was $78,557.

As of September 30, 2015, $15,438 of the debt discount has been amortized. The fair value of the derivative liability at September 30, 2015, was $99,429 resulting in a gain on the change in fair value of the derivative of $37,946. The Note is shown net of a derivative discount of $99,562 at September 30, 2015.

On September 8, 2015, the Company issued a short-term convertible promissory note in the amount of $70,000 for $50,000 cash, an original issue discount of $9,500, and prepaid interest of $10,500. The note is due on September 9, 2016 and bears interest at 15% per annum, which was prepaid by the Company and is being amortized over the life of the loan. The loan is secured by shares of the Company’s common stock. The loan becomes convertible 180 days after date of the note. The loan and any accrued interest can then be converted into shares of the Company’s common stock at a rate of 50% multiplied by the market price, which is the lowest quoted price for the common stock during the 25 trading day period ending on the latest complete trading day prior to the conversion date. During the year ended September 30, 2015, $569 of the debt discount has been amortized and the note is shown net $8,931 in unamortized debt discount. As of September 30, 2015, the note has not become convertible.

Derivative liability for these notes were valued under the Black-Scholes model, with the following assumptions:

NANO MOBILE HEALTHCARE, INC

NOTES TO THE FINANCIAL STATEMENTS

September 30, 2015

(UNAUDITED)

As of September 30, 2015, the company had the below commitments related to its outstanding convertible notes payable.

NOTE 8 – COMMON STOCK

On August 24, 2015, the Company filed with the Secretary of State of the State of Delaware a Certificate of Designations of Rights, Preferences, Privileges and Restrictions of Series A Convertible Preferred Stock.

Under the terms of the Certificate of Designation, 24,000,000 shares of the Company’s preferred stock will be designated as Series A Convertible Preferred. Each share of the Series A Convertible Preferred shall be convertible into five (5) shares of Common Stock without the payment of additional consideration by the holder thereof, subject to certain terms, conditions and adjustments as described in the Certificate of Designation. The holders of Series A Convertible Preferred shall be entitled to receive any dividends before the holders of the Common Stock, in an amount at least equal to the product of (x) the dividend payable on each share of Common Stock and (y) the number of shares of Common Stock issuable upon conversion of a share of Series A Convertible Preferred, in each case calculated on the record date for determination of holders entitled to receive such dividend. Each holder of outstanding Series A Convertible Preferred shall be entitled to vote with the holders of the Common Stock, as a single class, on all matters presented to the holders of Common Stock an as-converted basis calculated as of the record date for such vote.

On August 25, 2015, the Company entered into an exchange agreement with its majority shareholder, Nanobeak, LLC, pursuant to which Nanobeak exchanged 117,366,840 shares of the Company’s common stock in exchange for 23,473,368 shares of the Company’s Series A Convertible Preferred Stock.

During the three months ended September 30, 2015, the Company issued 73,007,588 shares of common stock valued at $191,719 for the conversion of notes payable.

NOTE 9 – STOCK WARRANTS

On December 16, 2013, the Board of Directors of the Company approved the election of William S. Rees, Jr. to serve as a member of the Board effective December 16, 2014. Mr. Rees has not yet been appointed to serve on any committee of the Board. There are no arrangements or understandings between Mr. Rees and any other person pursuant to which Mr. Rees was appointed as a director. The Company entered into an agreement with Mr. Rees pursuant to which it agreed to issue to him, in consideration of his services, a warrant to purchase up to 2,000,000 shares of the Company’s common stock for a period of five years at an exercise price of $0.05 per share. The Company determined the fair value of the warrants to be $99,764 using the Black Scholes Valuation Model. As of June 30, 2014 the warrants were fully vested and the Company recorded $99,764 as stock-based compensation expense.

On December 31, 2013, we issued to Accent Healthcare Advisors, LLC, a California limited liability company, as compensation for their past and future advisory services for the next several years in the bio-pharmaceutical and healthcare industries, a warrant to purchase up to 25,000,000 shares of the Company’s common stock, par value $.01 per share, for a period of seven years at an exercise price of $0.049 per share. The warrants issued vest immediately. The exercise price was calculated based on the prior ten days average closing price per share. The holder may not exercise the Warrant such that the number of shares of common stock beneficially owned by the holder and its affiliates exceeds 4.9% of the total outstanding shares of common stock of the Company. The fair value of the warrants using the Black Scholes valuation model was determined to be $2,994,407. The exercise price and number of Warrant Shares are subject to adjustment upon the subdivision or combination of the Company’s common stock. Further, upon the consolidation, merger or sale of the Company, the holder is entitled to receive, at the Company’s discretion, either (a) if the Warrant is exercised, the consideration payable with respect to or in exchange for those Warrant Shares that would have been received if no consolidation, merger or sale had taken place or (b) cash equal to the value of the Warrant as determined in accordance with the Black-Scholes option pricing formula. As of June 30, 2014 the stock-based compensation expense related to this issuance was $2,994,407.

NANO MOBILE HEALTHCARE, INC

NOTES TO THE FINANCIAL STATEMENTS

September 30, 2015

(UNAUDITED)

On November 27, 2013, the Company issued 3,875,000 warrants for the Company’s common stock as stock based compensation for a three year period, par value $.01 per share, at an exercise price per share equal to $0.05. The warrants issued vest immediately. The warrants are exercisable any time after November 27, 2013 for a period of five years from date of issuance. The fair value of the warrants using the Black Scholes Valuation Model was $204,904. As of June 30, 2014 the stock-based compensation expense related to this issuance was 204,904.

On December 10, 2013, the Company issued 5,000,000 warrants for the Company’s common stock as stock based compensation for a three year period, par value $.01 per share, at an exercise price per share equal to the closing price on December 10, 2013 of $0.0478. The warrants are exercisable any time after December 10, 2013 for a period of seven years from date of issuance. The fair value of the warrants using the Black Scholes Valuation Model was $238,925. As of June 30, 2014 the stock-based compensation expense related to this issuance was $238,925.

On July 1, 2014 the Company granted stock warrants for 200,000 shares of common stock for services, which vested immediately. These warrants had an expiration date of July 1, 2019, and were valued using the Black Scholes Valuation Model, the stock price at the grant date was $0.29/share, the exercise price is $0.12495/share, the value of the issuance is $58,000.

On January 15, 2015, the Company granted stock warrants for 8,000,000 shares of common stock for services, which vested immediately. These warrants had an expiration date of January 15, 2020, and were valued using the Black Scholes Valuation Model, the stock price at the grant date was $0.0332/share, the exercise price is $0.05/share, the value of the issuance was $263,669.

During the quarter ended September 30, 2015 and 2014, the Company issued 15,441,176 and 291,494 warrants, respectively for shares of common stock to lenders in connection with loans received by the Company. The warrants have anti-dilution provisions, including a provision for adjustments to the exercise price and to the number of warrant shares purchasable if we issue or sell common shares at a price less than the then current exercise price. We determined that the warrants were not afforded equity classification because the warrants are not considered to be indexed to our own stock due to the anti-dilution provision. Accordingly, the warrants are treated as a derivative liability and are carried at fair value. We estimate the fair value of these derivative warrants at each balance sheet date and the changes in fair value are recognized in earnings in the statement of operations until such time as the derivative warrants are exercised or expire.

On April 17, 2014 the Company granted stock warrants for 1,185,192 shares of common stock in association with a long-term loan at no cost to the lender. These warrants had an expiration date of April 17, 2019, and were valued using the Black Scholes Valuation Model, the stock price at the grant date was $0.09/share, the exercise price is $0.0701/share, the value of the issuance is $106,426.

On May 5, 2014 the Company granted stock warrants for 705,229 shares of common stock in association with a long-term loan at no cost to the lender. These warrants had an expiration date of May 5, 2019, and were valued using the Black Scholes Valuation Model, the stock price at the grant date was $0.09/share, the exercise price is $0.0589/share, the value of the issuance is $63,468.

On June 11, 2014 the Company granted stock warrants for 553,840 shares of common stock in association with a long-term loan at no cost to the lender. These warrants had an expiration date of June 11, 2019, and were valued using the Black Scholes Valuation Model, the stock price at the grant date was $0.1284/share, the exercise price is $0.0750/share, the value of the issuance is $71,110.

NANO MOBILE HEALTHCARE, INC

NOTES TO THE FINANCIAL STATEMENTS

September 30, 2015

(UNAUDITED)

On July 15, 2014 the Company granted stock warrants for 291,494 shares of common stock in association with a long-term loan at no cost to the lender. These warrants have an expiration date of July 15, 2019, and were valued using the Black Scholes Valuation Model, the stock price at the grant date was $0.24/share, the exercise price is $0.0143/share, the value of the issuance is $69,956.

On October 1, 2014 the Company granted stock warrants for 320,122 shares of common stock in association with a short-term loan at no cost to the lender. These warrants have a term of five years, and were valued using the Black Scholes Valuation Model, the stock price at the grant date was $0.164/share, the exercise price is $0.123/share, the value of the issuance is $52,498.

On November 17, 2014 the Company granted stock warrants for 807,692 shares of common stock in association with a long-term loan at no cost to the lender. These warrants have a term of five years, and were valued using the Black Scholes Valuation Model, the stock price at the grant date was $0.065/share, the exercise price is $0.049/share, the value of the issuance is $52,498.

On December 23, 2014 the Company granted stock warrants for 1,158,940 shares of common stock in association with a long-term loan at no cost to the lender. These warrants have a term of five years, and were valued using the Black Scholes Valuation Model, the stock price at the grant date was $0.045/share, the exercise price is $0.034/share, the value of the issuance is $52,152.

On April 15, 2015 the Company granted stock warrants for 1,185,102 shares of common stock in association with a short-term loan at no cost to the lender. These warrants have a term of five years, and were valued using the Black Scholes Valuation Model, the stock price at the grant date was $0.0443/share, the exercise price is $0.017/share, the value of the issuance is $52,081.

On June 7, 2015 the Company granted stock warrants for 2,187,500 shares of common stock in association with a short-term loan at no cost to the lender. These warrants have a term of five years, and were valued using the Black Scholes Valuation Model, the stock price at the grant date was $0.024/share, the exercise price is $0.009/share, the value of the issuance is $51,935.

On June 19, 2015 the Company granted stock warrants for 1,125,000 shares of common stock in association with a short-term loan at no cost to the lender. These warrants have a term of five years, and were valued using the Black Scholes Valuation Model, the stock price at the grant date was $0.025/share, the exercise price is $0.009/share, the value of the issuance is $27,794.

On June 28, 2015 the Company granted stock warrants for 5,357,143 shares of common stock in association with a long-term loan at no cost to the lender. These warrants have a term of five years, and were valued using the Black Scholes Valuation Model, the stock price at the grant date was $0.021/share, the exercise price is $0.008/share, the value of the issuance is $111,151.

On September 8, 2015 the Company granted stock warrants for 15,441,176 shares of common stock in association with a short-term loan at no cost to the lender. These warrants have a term of five years, and were valued using the Black Scholes Valuation Model, the stock price at the grant date was $0.0034/share, the exercise price is $0.001/share, the value of the issuance is $52,493.

We issued warrants to purchase 38,874,998 shares of common stock to non-employees during the year ended June 30, 2014, during such time the warrants were accounted for as equity. During the year end June 30, 2015, the Company issued convertible notes payable that provide for the issuance of shares of common stock that became convertible. The conversion term for the convertible notes are variable based on certain factors. As of September 30, 2015, the number of shares to be issued under the notes are indeterminate. Due to the fact that the number of shares issuable are indeterminate, the equity environment is tainted and the warrants are included in the value of the derivative. On the date the equity environment became tainted, the Company recorded a reduction to additional paid in capital in the amount of $6,157,610 in connection with the initial valuation of the derivative liability of the warrants based on the Black Scholes Merton pricing model. The derivative liability related to these warrants was $54,286 and $913,168 as of September 30, 2015 and June 30, 2015, respectively. During the three months ended September 30, 2015 and 2014, the Company recorded a gain of $858,882 and $0, respectively, related to the change in fair value on the warrants.

NANO MOBILE HEALTHCARE, INC

NOTES TO THE FINANCIAL STATEMENTS

September 30, 2015

(UNAUDITED)

In total the derivative liability related to the warrants as of September 30, 2015 and June 30, 2015 was $96,681 and $1,270,470, respectively and the Company recorded a gain in the change in fair value due to derivative warrant liability of $1,173,787 and $237,469 during the three months ended September 30, 2015 and 2014, respectively.

NOTE 10 – COMMITMENTS

On January 1, 2014, the Company entered into a Sub-License Agreement affiliated with the National Aeronautics and Space Administration (“NASA”) pursuant to which the Company was granted a royalty-bearing, non-transferable license to certain inventions and patent rights owned by NASA relating to chemical sensing nanotechnology, for use within the United States and its territories. The License is effective as of December 31, 2013 and subject to an initial five year term, during which the License will be exclusive to the Company. Following the initial five-year term, the License shall automatically convert to a non-exclusive license. The License may be terminated by NASA following a 30 day cure period, among other reasons, upon a breach of the License Agreement or upon its determination that the Company has failed to adequately develop or commercialize the licensed patents. Specific milestones and commercialization requirements are set forth in the License Agreement. NASA provides no warranties under the License Agreement and assumes no responsibility for our use, sale or other disposition of the licensed technology. We agree to indemnify NASA against all liabilities arising from such use, sale or other disposition. We must pay certain royalties in connection with the License as set forth in the License Agreement.

During the three months ended September 30, 2015 and 2014, the Company expensed $280,375 and 286,585.

In relation to a sub-licensing agreement with NASA, a shareholder has paid royalty fees applicable to 2014 on behalf of the Company. The $100,000 payment was an additional investment in the Company and is not required to be repaid. During the three months ending September 30, 2015 and 2014, $0 and $75,000 of the royalties were recognized as an expense.

NANO MOBILE HEALTHCARE, INC

NOTES TO THE FINANCIAL STATEMENTS

September 30, 2015

(UNAUDITED)

NOTE 11 – SUBSEQUENT EVENTS

On January 26, 2015, the Company issued a convertible promissory note in which the Company will be taking tranche payments based on amounts determined by the note holder for total payments of not more than $250,000. There is an original discount component of $25,000. Therefore, the funds available to the Company will be $225,000 and the liability (net of interest) will be $250,000 when all disbursements have been received by the Company. Each tranche is accounted for separately with each principal and OID balance becoming due 24 months after receipt. Each tranche bears interest at 12% per annum. The loan is secured by shares of the Company’s common stock. Each portion of the loan becomes convertible immediately upon issuance. The loan and any accrued interest can then be converted into shares of the Company’s common stock at a rate of the lesser of $0.045 per share or 60% multiplied by the market price per share, which is the lowest quoted price for the common stock during the 25 trading day period ending on the latest complete trading day prior to the conversion date. During the period ended June 30, 2015, the Company has received two tranche disbursements of $75,000 on January 26, 2015 and 25,000 on April 28, 2015. Subsequent to quarter end, the Company issued 24,605,000 shares for the conversion of $17,716 of the note payable.

On July 20, 2015, the Company entered into a settlement agreement with the holder of the convertible note. Under the agreement the note holder agreed to not to seek to enforce its rights or remedies under the Note in relation to the notice of conversion issued to convert a balance of the note amounting to $57,933; to not to exercise its rights of conversion pursuant to the Note, and if an event of default occurs, the Holder agrees not to sell any shares of common stock of the Company having an aggregate conversion value of $30,000 or more per week until such time as it has sold all of the Company’s common stock that it owns. Under the agreement the Company agreed to a penalty in relation to the issuance of a note in the amount of $95,000. Subsequent to quarter end, the Company issued 9,000,000 shares for the conversion of $9,000 of the note payable.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Forward-Looking Statements

Certain statements, other than purely historical information, including estimates, projections, statements relating to our business plans, objectives, and expected operating results, and the assumptions upon which those statements are based, are “forward-looking statements.” These forward-looking statements generally are identified by the words “believes,” “project,” “expects,” “anticipates,” “estimates,” “intends,” “strategy,” “plan,” “may,” “will,” “would,” “will be,” “will continue,” “will likely result,” and similar expressions. Forward-looking statements are based on current expectations and assumptions that are subject to risks and uncertainties which may cause actual results to differ materially from the forward-looking statements. Our ability to predict results or the actual effect of future plans or strategies is inherently uncertain. Factors which could have a material adverse affect on our operations and future prospects on a consolidated basis include, but are not limited to: changes in economic conditions, legislative/regulatory changes, availability of capital, interest rates, competition, and generally accepted accounting principles. These risks and uncertainties should also be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements.

Overview

We were incorporated in the State of Nevada on April 21, 2010. We were initially in the business of becoming a pharmaceutical manufacturer with the specific intention of bidding on South African government health care contracts and tenders. We abandoned that business plan when, on November 7, 2013, Nanobeak, LLC, a Delaware limited liability company (formerly Nanobeak, Inc., a California corporation) (“Nanobeak”) acquired a majority interest in our company through the stock purchase of a controlling interest in our company from Bayview Terrace Limited.

Since the change of control, we have implemented a new business plan. On January 1, 2014, Nanobeak entered into a License Agreement (the “License Agreement”) with the National Aeronautics and Space Administration (“NASA”) pursuant to which Nanobeak was granted a royalty-bearing, non-transferable license (the “License”) to certain inventions and patent rights owned by NASA relating to chemical sensing nanotechnology, for use within the United States and its territories.

The License is effective as of December 31, 2013 and subject to an initial five year term, during which the License will be exclusive to Nanobeak. Following the initial five-year term, the License shall automatically convert to a non-exclusive license. Under the License, Nanobeak is required to develop and commercialize the licensed patents. NASA provided no warranties under the License Agreement and assumed no responsibility for our use, sale or other disposition of the licensed technology. Nanobeak has agreed to indemnify NASA against all liabilities arising from such use, sale or other disposition.

Pursuant to Section 3.1.1 of the License Agreement, Nanobeak is permitted to sublicense its rights under the License Agreement to subcontractors. Effective as of February 20, 2014, Nanobeak has sublicensed such rights to us as set forth in a Sublicense Agreement.

The Sublicense Agreement grants patent rights to us on the same terms as such rights have been granted to Nanobeak under the License Agreement; provided, however, that the field of use for the patent rights granted to us is limited to disease detection.

We must pay to Nanobeak certain royalties in connection with the Sublicense Agreement, which royalties are equivalent to those owed by Nanobeak to NASA pursuant to the License Agreement. We must further comply with other obligations of Nanobeak under the License Agreement as though we were a party thereto, including achievement of practical application of the patent rights and certain reporting obligations.

The Sublicense Agreement will terminate upon the earlier of (i) termination of the License Agreement or (ii) termination by either party to the Sublicense Agreement as set forth therein.

As a result of the License Agreement and Sublicense Agreement, we are now a mobile health technology company that is developing personalized and point-of-care screening using applications based upon chemical sensing methods.

We have been developing a low cost point-of-care screening device that will detect and analyze common components from human breath and provide an early indication of chronic diseases such as heart failure and various forms of cancer, as well as contagious diseases such as strep throat. The principles of operation are driven by technology developed by NASA. The sensor can connect via Bluetooth to any capable smart device running an iOS or Android operating system. Development efforts on the sensor were concluded and the device is now in a clinical environment. The final development stage for the healthcare sensor will be formal clinical trials and ultimately to obtain FDA approval.

The current Breathalyzer has a small footprint and can easily be operated by anyone with minimal instruction. State-of-the art engineering design techniques, advanced nanotechnology, and bio-informatics have been combined to create the following three main pieces of the device that is now being used to collect sample data from test patients for certain key biomarkers in a clinical setting:

The sensor and related devices will ultimately be used to demonstrate an integrated approach that can be used to collect data from human breath and evaluate it for early disease screening purposes, effectively linking experts in the field, data scientists, and decision makers with results generated in real-time.

We have entered into a Strategic Partnership with Scripps Translational Sciences Institute (STSI) to assist in the development, advancement, and commercialization of the mobile technology. Scripps will also provide the testing, evaluation, and detection of certain combinations of Volatile Organic Compounds (VOCs) known as the breath signature and will assist in managing our clinical trials in partnership with several other research hospitals in the United States. These clinical trials will support the 510K that will be submitted to the FDA. It is expected that the contemplated clinical trials will take approximately four months with another four months expected for the 510K process within the FDA. We have not yet started the clinical trials. The clinical trials can cost as much as $5,000,000. We will first have to raise the money to commence the trials.

We have also entered into a Strategic Partnership with Theranostics Laboratory, a translational research company, with offices in the USA and New Zealand. Theranostics laboratory was founded at the Cleveland Clinic in 2010 and works on subcontracted research, in collaboration with the Auckland Bioengineering Institute (ABI), in New Zealand, and with NASA (via NASA Grant NCC 9-58).

The Auckland Bioengineering Institute is recognized as a world-leader in the field of personalized modeling and is part of the international Virtual Physiologic Human (VPH) project. The Institute has successfully commercialized numerous mHealth technologies, including wireless telemetry systems, wearable sensors and a needle-free injectable system into the US market.

The partnership between the Theranostics laboratory and the Auckland Bioengineering Institute (ABI) is a strategic alliance for us through which the lab will act as principal investigators for us in the areas of mobile strep detection, mobile virus detection and other related areas including breath sample conditioning methodologies. The partnership gives us access to world-class expertise and skill in the field of personalized modeling. It also provides us with cost-efficiencies working across multiple time zones, as well as insight into the Australasian MedTech market.

We have decided to work in conjunction with our majority shareholder, Nanobeak and NASA, to develop a mobile app to be used in connection with our sensor that will enable law enforcement to screen for marijuana use and deliver in-the-moment results to the officer’s smartphone, tablet or laptop in the field. We will not be distracted from our current efforts and resources in continuing to develop early lung cancer detection and detection for other diseases. The ability to go-to-market will be much faster than the process required for obtaining FDA approval for our lung cancer screening technology because the marijuana detection sensor for use by law enforcement will be exempt from the FDA approval process. With our President’s background and relationships, we believe we have an advantage when entering the law enforcement market with this product.

Results of operations for the three months ended September 30, 2015 and 2014

We have earned no revenues since our inception. We do not expect to earn any revenues until we complete our technology and bring it to market.

Our operating expenses decreased to $462,280 for the three months ended September 30, 2015, as compared with operating expenses of $757,350 for the three months ended September 30, 2014. Our operating expenses for the three months ended September 30, 2015 mainly consists of consulting expenses of $280,375, general and administrative expenses of $102,253, professional fees in the amount of $43,555 and compensation to our officers and directors of $36,097. Our operating expenses for the three months ended September 30, 2014 mainly consisted of consulting expenses of $286,585, professional fees of $137,520, stock based compensation of $127,956, royalty expense of $75,000, office expenses of $60,576, and travel of $42,941.

We anticipate our operating expenses will increase as we undertake our plan of operations. The increase will be attributable to administrative and operating costs associated with developing and commercializing our technology and our continued reporting obligations with the Securities and Exchange Commission.

We recognized other income of $869,542 for the three months ended September 30, 2015, as compared with other income of $215,516 for the three months ended September 30, 2014. Our income in 2015 was mainly attributable to a gain in the change in fair value due to derivative debt and warrant liability of $1,427,189, offset by interest expense of $557,647.

We incurred net income of $407,262 for the three months ended September 30, 2015, compared with a net loss of $541,834 for the three months ended September 30, 2014.

We have not attained profitable operations and are dependent upon obtaining financing to continue with our business plan. For these reasons, there is substantial doubt that we will be able to continue as a going concern.

Liquidity and Capital Resources

As of September 30, 2015, we had total current assets of $93,198, consisting of cash and prepaid expenses. We had current liabilities of $2,389,744 as of September 30, 2015. Accordingly, we had negative working capital of $2,296,546 as of September 30, 2015.

Operating activities used $508,298 in cash for period ended September 30, 2015, as compared with $589,275 for the period ended September 30, 2014. Our negative operating cash flow for the period ended September 30, 2015 was mainly attributable to a derivative gain, offset mainly by our net income and the amortization of debt discount.

Investing activities used $0 in cash for the period ended September 30, 2015, as compared with $12,149 in cash used in investing activities for the period ended September 30, 2014, associated with the purchase of fixed assets.

Financing activities for the period ended September 30, 2015 provided $318,402 in cash, as compared with cash flows provided by financing activities of $466,287 for the period ended September 30, 2014. Our positive cash flow for the period ended September 30, 2015 was mainly the result of proceeds from convertible notes and related party debt offset by payments on related party debt and convertible notes payable.

On April 18, 2014, we issued a convertible promissory note in which we will be taking tranche payments on pre-defined dates, the total of these payments cannot exceed $650,000. There is an original discount component of 10% per tranche and an additional expense fee of $5,000. Therefore, the funds available to us will be $650,000 and the liability (net of interest) will be $750,000 when we have received all disbursements. Each tranche is accounted for separately with each principal and OID balance becoming due 18 months after receipt. Each tranche bears interest at 8% per annum. The loan is secured by shares of our common stock. Each portion of the loan becomes convertible 180 days after date of the note. The loan and any accrued interest can then be converted into shares of our common stock at a rate of 50% multiplied by the market price, which is the lowest quoted price for the common stock during the 20 trading day period ending on the latest complete trading day prior to the conversion date.

Through September 30, 2015, we received nine tranche disbursements: $100,000 on April 21, 2014; $50,000 on May 6, 2014; $50,000 on June 11, 2014; $50,000 on July 16, 2014; $100,000 on September 30, 2014; $50,000 on November 3, 2014, $50,000 on December 1, 2014; $50,000 on December 29, 2014; and $50,000 on February 2, 2015.

On July 20, 2015, we entered into a settlement agreement with the holder of the convertible note entered into on April 18, 2014. Under the agreement the note holder agreed not to seek to enforce its rights or remedies under the Note in relation to the notice of conversion issued to convert a balance of the note amounting to $57,933; to not to exercise its rights of conversion pursuant to the Note, and if an event of default occurs, the holder agrees not to sell any shares of our common stock having an aggregate conversion value of $30,000 or more per week until such time as it has sold all of our common stock that it owns.

Under the agreement we agreed to a penalty in relation to the note in the amount of $95,000; to release the holder from its obligation to advance additional funds to us; and to pay or refinance the amount due under the note plus accrued interest in four installment payments due on July 20, 2015, August 10, 2015, September 14, 2015 and October 12, 2015.

In respect of prepayment penalties payable to the holder pursuant to the Note, we agreed to issue to the Holder additional convertible promissory notes with each having the same form, terms, and conditions as the original note. The value of the notes, which are due by each installment payment date, are equal to 30% of the payment delivered.

After refinancing the payments due on July 20, 2015 and August 10, 2015, we and the noteholder agreed to allow the note holder to convert the notes as agreed upon in the original note agreement. As such, in accordance with the agreement we only issued two additional notes related to the prepayment penalty discussed above. During the three months ended September 30, 2015, we issued two notes related to the prepayment penalties of the installments due on July 20, 2015 and August 10, 2015 of $35,399 and $35,610, respectively.

During the three months ended September 30, 2015, we converted $5,000 of the penalty note issued on July 20, 2015 into 5,000,000 shares of common stock. Subsequent to quarter end, we issued 9,000,000 shares for the conversion of $9,000 of the note payable.

During the quarter ended September 30, 2015, the note issued on June 11, 2014 was settled with cash.

On October 1, 2014, we issued a short-term convertible promissory note in the amount of $70,000 for $50,000 cash, an original issue discount of $12,500, and prepaid interest of $7,500. The note bears interest at a rate of 15% per annum. The loan and any accrued interest can be converted into shares of our common stock at a rate of 50% multiplied by the market price, which is the lowest quoted price for the common stock during the 25 trading day period ending on the latest complete trading day prior to the conversion date. The note matured on March 30, 2015.

We elected to prepay the entire term’s interest of $7,500. Through September 30, 2015, the holder of the note exercised his right to convert $70,000 of the note balance into 6,011,519 shares of common stock.

On November 17, 2014, we issued a short-term convertible promissory note in the amount of $70,000. The note bears interest at a rate of 15% per annum. The loan and any accrued interest can be converted into shares of our common stock at a rate of 50% multiplied by the market price, which is the lowest quoted price for the common stock during the 25 trading day period ending on the latest complete trading day prior to the conversion date.

We elected to prepay the entire term’s interest of $7,500. Through September 30, 2015, the holder of the note exercised his right to convert $55,000 of the note balance into 13,100,167 shares of common stock.

On December 23, 2014, we issued a short-term convertible promissory note in the amount of $70,000. The note bears interest at a rate of 15% per annum. The loan and any accrued interest can be converted into shares of our common stock at a rate of 50% multiplied by the market price, which is the lowest quoted price for the common stock during the 25 trading day period ending on the latest complete trading day prior to the conversion date. The note is due on December 18, 2015.

The Company elected to prepay the entire term’s interest of $7,500. As of September 30, 2015, the note has not been converted into shares of common stock.

On January 13, 2015, we issued a short-term convertible promissory note in the amount of $74,000. The note is due on October 15, 2015 and bears interest at 8% per annum. The loan is secured by shares of our common stock. The loan becomes convertible 180 days after date of the note. The loan and any accrued interest can then be converted into shares of our common stock at a rate of 58% multiplied by the market price, which is the average of the lowest three trading prices for the common stock during the 10 trading day period ending on the latest complete trading day prior to the conversion date.

As of September 30, 2015, the holder of the note exercised his right to convert $76,960 of the note balance and accrued interest into 15,175,261 shares of common stock.

On January 26, 2015, we issued a convertible promissory note giving us the option of taking tranche payments based on amounts determined by the note holder for total payments of not more than $250,000. There is an original discount component of 10% per tranche. Therefore, the funds available to us will be $225,000 and the liability (net of interest) will be $250,000 when all disbursements have been received by us. Each tranche is accounted for separately with each principal and OID balance becoming due 24 months after receipt. Each tranche bears interest at 12% per annum. The loan is secured by shares of our common stock. Each portion of the loan becomes convertible immediately upon issuance. The loan and any accrued interest can then be converted into shares of our common stock at a rate of the lesser of $0.045 per share or 60% multiplied by the market price per share, which is the lowest quoted price for the common stock during the 25 trading day period ending on the latest complete trading day prior to the conversion date.

During the period ended June 30, 2015, we have received two tranche disbursements of $75,000 on January 26, 2015 and 25,000 on April 28, 2015.

As of September 30, 2015, the holder of the note exercised his right to convert $26,952 of the note balance into 14,700,000 shares of common stock.

On April 15, 2015, we issued a short-term convertible promissory note in the amount of $70,000 for $50,000 cash, an original issue discount of $9,500, and prepaid interest of $10,500. The note is due on April 15, 2016 and bears interest at 15% per annum, which was prepaid by us and is being amortized over the life of the loan. The loan is secured by shares of our common stock. The loan becomes convertible 180 days after date of the note. The loan and any accrued interest can then be converted into shares of our common stock at a rate of 50% multiplied by the market price, which is the lowest quoted price for the common stock during the 25 trading day period ending on the latest complete trading day prior to the conversion date. As of September 30, 2015, the note has not become convertible.

On May 20, 2015, we issued a convertible promissory note in the amount of $43,000 for $43,000 cash. The note is due on February 22, 2016 and bears interest at 8% per annum. The loan becomes convertible 180 days after date of the note. The loan can then be converted into shares of our common stock at a rate of 58% multiplied by the market price, which is the average of the lowest three (3) quoted price for the common stock during the 10 trading day period ending on the latest complete trading day prior to the conversion date. As of September 30, 2015, the note has not become convertible.

On June 7, 2015, we issued a short-term convertible promissory note in the amount of $70,000 for $50,000 cash, an original issue discount of $9,500, and prepaid interest of $10,500. The note is due on June 8, 2016 and bears interest at 15% per annum, which was prepaid by us and is being amortized over the life of the loan. The loan is secured by shares of our common stock. The loan becomes convertible 180 days after date of the note. The loan and any accrued interest can then be converted into shares of our common stock at a rate of 50% multiplied by the market price, which is the lowest quoted price for the common stock during the 25 trading day period ending on the latest complete trading day prior to the conversion date. As of September 30, 2015, the note has not become convertible.

On June 19, 2015, we issued a short-term convertible promissory note in the amount of $37,500 for $25,000 cash, an original issue discount of $6,875, and prepaid interest of $5,625. The note is due on June 19, 2016 and bears interest at 15% per annum, which was prepaid by us and is being amortized over the life of the loan. The loan is secured by shares of our common stock. The loan becomes convertible 180 days after date of the note. The loan and any accrued interest can then be converted into shares of our common stock at a rate of 50% multiplied by the market price, which is the lowest quoted price for the common stock during the 25 trading day period ending on the latest complete trading day prior to the conversion date. As of September 30, 2015, the note has not become convertible.

On June 28, 2015, we issued a convertible promissory note in the amount of $150,000 for $100,000 cash, an original issue discount of $50,000. The note is due on December 28, 2016 and bears interest at 15% per annum. The loan becomes convertible 180 days after date of the note. The loan can then be converted into shares of our common stock at a rate of 50% multiplied by the market price, which is the lowest quoted price for the common stock during the 25 trading day period ending on the latest complete trading day to the conversion date. As of September 30, 2015, the note has not become convertible.

On June 29, 2015, we issued a convertible promissory note in which we will be taking tranche payments based on amounts determined by the note holder for total payments of not more than $100,000. There is an original discount component of $10,000. Therefore, the funds available to us will be $90,000 and the liability (net of interest) will be $100,000 when all disbursements have been received by us. Each tranche is accounted for separately with each principal and OID balance becoming due 24 months after receipt. Each tranche bears interest at 15% per annum. Each portion of the loan becomes convertible immediately upon issuance. The loan and any accrued interest can then be converted into shares of our common stock at a rate of the lesser of $0.02 per share or 50% multiplied by the market price per share, which is the lowest quoted price for the common stock during the 25 trading days immediately preceding the conversion date. The Company has received one tranche disbursements of $30,000 on June 29, 2015.

On June 29, 2015, the first tranche became convertible at the option of the holder.

On July 1, 2015, we issued a promissory note in the amount of $22,500 for $15,000 cash. The note is due on July 1, 2016 and bears interest at 15% per annum. During the three month period ended September 30, 2015, we have repaid $18,296 of the note payable.

On July 7, 2015, we issued a convertible promissory note in the amount of $40,000 for $38,000 cash. The note is due on June 30, 2016 and bears interest at 8% per annum. The loan is secured by shares of our common stock. The loan becomes convertible as of the date of the note. The loan and any accrued interest can then be converted into shares of our stock at a rate of 60% multiplied by the market price, which is the lowest quoted price for the common stock during the 25 trading day period ending on the latest complete trading day prior to the conversion date.

On July 24, 2015, we issued a convertible promissory note in the amount of $56,250 for $56,250 cash. The note is due on April 24, 2016 and bears interest at 10% per annum, which was prepaid by us and is being amortized over the life of the loan. The loan is secured by shares of our common stock. The loan becomes convertible as of the date of the note. The loan and any accrued interest can then be converted into shares of our common stock at a rate of 50% multiplied by the market price, which is the lowest quoted price for the common stock during the 20 trading day period ending on the latest complete trading day prior to the conversion date.

On August 3, 2015, we issued a convertible promissory note in the amount of $75,000, in which we received $50,000 cash. The note is due on January 29, 2016 and bears interest at 15% per annum, which was prepaid by us and is being amortized over the life of the loan. The loan is secured by shares of our common stock. The loan becomes convertible 180 days after date of the note. The loan and any accrued interest can then be converted into shares of our common stock at a rate of 50% multiplied by the market price, which is the lowest quoted price for the common stock during the 25 trading day period ending on the latest complete trading day prior to the conversion date. As of September 30, 2015, the note has not become convertible.

On August 12, 2015, we issued a convertible promissory note in the amount of $115,000, in which we received $115,000 cash. The note is due on August 12, 2016 and bears interest at 12% per annum. The loan is secured by shares of our common stock. The loan becomes convertible immediately upon issuance. The loan and any accrued interest can then be converted into shares of our common stock at a rate of the lower of 50% multiplied by the market price, which is the lowest quoted price for the common stock during the 20 trading day period ending on the latest complete trading day prior to the conversion date or 50% to the lowest trading price on the 30th day after the funding of the note.

As of September 30, 2015, the holder of the note exercised his right to convert $48,806 of the note balance into 27,214,714 shares of common stock.

On September 1, 2015, we issued a promissory note in the amount of $26,233 for $13,999 cash. The note is due on August 31, 2016 and bears interest at 15% per annum. During the three month period ended September 30, 2015, we have repaid $8,154 of the note payable.

On September 8, 2015, we issued a short-term convertible promissory note in the amount of $70,000 for $50,000 cash, an original issue discount of $9,500, and prepaid interest of $10,500. The note is due on September 9, 2016 and bears interest at 15% per annum, which we prepaid and is being amortized over the life of the loan. The loan is secured by shares of the Company’s common stock. The loan becomes convertible 180 days after date of the note. The loan and any accrued interest can then be converted into shares of the Company’s common stock at a rate of 50% multiplied by the market price, which is the lowest quoted price for the common stock during the 25 trading day period ending on the latest complete trading day prior to the conversion date. During the period ended September 30, 2015, $569 of the debt discount has been amortized and the note is shown net $8,931 in unamortized debt discount. As of September 30, 2015, the note has not become convertible.

As of September 30, 2015, we had $60,090 in cash. Until we are able to sustain our ongoing operations through sales revenue, we intend to fund operations through debt and/or equity financing arrangements, which may be insufficient to fund our capital expenditures, working capital, or other cash requirements. We do not have any formal commitments or arrangements for the sales of stock or the advancement or loan of funds at this time. There can be no assurance that such additional financing will be available to us on acceptable terms, or at all.

Off Balance Sheet Arrangements

As of September 30, 2015, there were no off balance sheet arrangements.

Going Concern

We have incurred cumulative net losses of $6,567,404 since our inception and require capital for our contemplated operational and marketing activities to take place. Our ability to continue as a going concern is dependent on us generating cash from the sale of our common stock and/or obtaining debt financing and attaining future profitable operations. Management’s plans include selling our equity securities and obtaining debt financing to fund our capital requirement and ongoing operations; however, there can be no assurance we will be successful in these efforts. The ability to successfully resolve these factors raise substantial doubt about our ability to continue as a going concern.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

A smaller reporting company is not required to provide the information required by this Item.

Item 4. Controls and Procedures

Disclosure Controls and Procedures

As required by Rule 13a-15 of the Securities Exchange Act of 1934, our principal executive officer and principal financial officer evaluated our company’s disclosure controls and procedures (as defined in Rules 13a-15(e) of the Securities Exchange Act of 1934) as of the end of the period covered by this report. Based on this evaluation, our principal executive officer and principal financial officer concluded that as of the end of the period covered by this report, these disclosure controls and procedures were not effective to ensure that the information required to be disclosed by our company in reports it files or submits under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the Securities Exchange Commission and to ensure that such information is accumulated and communicated to our company’s management, including our principal executive officer and principal financial officer, to allow timely decisions regarding required disclosure. The conclusion that our disclosure controls and procedures were not effective was due to the presence of the following material weaknesses in internal control over financial reporting which are indicative of many small companies with small staff: (i) inadequate segregation of duties and effective risk assessment; and (ii) insufficient written policies and procedures for accounting and financial reporting with respect to the requirements and application of both United States generally accepted accounting principles and Securities and Exchange Commission guidelines. Management anticipates that such disclosure controls and procedures will not be effective until the material weaknesses are remediated.

We plan to take steps to enhance and improve the design of our internal controls over financial reporting. During the period covered by this quarterly report on Form 10-Q, we have not been able to remediate the material weaknesses identified above. To remediate such weaknesses, we plan to implement the following changes during our fiscal year ending June 30, 2016, subject to obtaining additional financing: (i) appoint additional qualified personnel to address inadequate segregation of duties and ineffective risk management; and (ii) adopt sufficient written policies and procedures for accounting and financial reporting. The remediation efforts set out above are largely dependent upon our securing additional financing to cover the costs of implementing the changes required. If we are unsuccessful in securing such funds, remediation efforts may be adversely affected in a material manner.

Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues, if any, within our company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple error or mistake.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting during the quarter ended September 30, 2015 that have materially affected or are reasonably likely to materially affect, our internal control over financial reporting.

PART II – OTHER INFORMATION

Item 1. Legal Proceedings

We are not a party to any pending legal proceeding. We are not aware of any pending legal proceeding to which any of our officers, directors, or any beneficial holders of 5% or more of our voting securities are adverse to us or have a material interest adverse to us.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Aside from that provided below, there have been no issuances of securities without registration under the Securities Act of 1933 during the reporting period which were not previously included in a Quarterly Report on Form 10-Q or Current Report on Form 8-K.

During the three months ended September 30, 2015 and subsequent thereto, we issued 2,222,222 shares of common stock in conversion of an October 1, 2014 convertible note.

During the three months ended September 30, 2015 and subsequent thereto, we issued 8,695,652 shares of common stock in conversion of a November 17, 2014 convertible note.

During the three months ended September 30, 2015 and subsequent thereto, we issued 15,175,261 shares of common stock in conversion of a January 13, 2015 convertible note.

During the three months ended September 30, 2015 and subsequent thereto, we issued 41,305,000 shares of common stock in conversion of a January 26, 2015 convertible note.

During the three months ended September 30, 2015 and subsequent thereto, we issued 27,214,714 shares of common stock in conversion of an August 12, 2015 convertible note.

During the three months ended September 30, 2015 and subsequent thereto, we issued 14,000,000 shares of common stock in conversion of a note refinanced on July 20, 2015.

On August 25, 2015, we entered into an exchange agreement with our majority shareholder, Nanobeak, LLC, pursuant to which Nanobeak exchanged 117,366,840 shares of our common stock in exchange for 23,473,368 shares of our Series A Convertible Preferred Stock.

On September 8, 2015, we granted stock warrants for 15,441,176 shares of common stock in association with a short-term loan at no cost to the lender. These warrants have a term of five years and the exercise price is $0.001/share.

The above securities were issued in reliance upon the exemption from registration contained in Section 4(2) of the Securities Act of 1933, as amended, and Regulation D promulgated thereunder.

Item 3. Defaults upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

None.

Item 6. Exhibits

**Provided herewith

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

CERTIFICATIONS

I, Joseph C. Peters, certify that;

Date: November 16, 2015

CERTIFICATIONS

I, Joseph C. Peters, certify that;

Date: November 16, 2015

CERTIFICATION OF CHIEF EXECUTIVE OFFICER AND

CHIEF FINANCIAL OFFICER

PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the quarterly Report of Nano Mobile Healthcare, Inc. (the “Company”) on Form 10-Q for the quarter ended September 30, 2015 filed with the Securities and Exchange Commission (the “Report”), I, Joseph C. Peters, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

This certification has been furnished solely pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.