Starstream Entertainment, Inc. (OTCBB:SSET) announced a private placement of promissory notes for gross proceeds of up to $600,000 with new lender, Timothy Nye, an individual who resides in New York State on February 10, 2014. Starstream Entertainment, LLC, a wholly owned subsidiary of the company is also a borrower in the transaction. The promissory note is fully negotiable.

The company will receive net proceeds of $560,000. The interest on loan will accrue at a rate of 1% per month, compounded monthly. The company may prepay the loan without penalty upon five days' prior written notice to the lender.

The first tranche of $200,000 will be made on or before February 10, 2014. The company and its subsidiary must repay the full amount outstanding under the loan upon the first to occur of an event of default mentioned in the loan agreement, the receipt by the borrowers of certain payments, proceeds or other consideration in connection with the loan collateral, or February 10, 2015. As consideration for entering into the agreement, the company will pay $25,000 as loan fee and lender's legal counsel fees of $15,000 from the proceeds of the transaction.

The loan fee and lender legal fees will be deducted from the initial advance and will be treated as part of the loan. The other tranches will be in increments of $50,000 at company's request. The loan is evidenced by promissory note.