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Subsequent Event-Freeform Development, Inc.
12 Months Ended
Jul. 31, 2017
Subsequent Event-Freeform Development, Inc. [Abstract]  
Subsequent Event-Freeform Development, Inc.

Note 15—Subsequent Event—Freeform Development, Inc.

 

In September 2017, the Company entered into an Agreement and Release with Freeform Development, Inc. (“Freeform”) and certain of its former employees, pursuant to which the Company obtained releases for the employees from their Freeform employment agreements in exchange for payments by us to satisfy certain of Freeform’s liabilities. The Company paid Freeform $125,000 in cash to pay its operating liabilities (with any excess to be refunded to the Company), and the Company paid the holders of Freeform’s convertible promissory notes cash of $97,567 and issued the noteholders a total of 126,679 shares of the Company’s Class B common stock. In addition, the Company issued a total of 192,953 shares of the Company’s Class B common stock to the employees and the employees entered into Employment Agreements with the Company. The aggregate consideration paid by the Company in connection with these matters was $833,000 consisting of cash of $223,000 and 319,632 shares of the Company’s Class B common stock with a fair market value of $611,000 on the date of issue. The Company is in process of reviewing the accounting for the transaction that will be recorded in the first quarter of fiscal 2018.