Commitments and Contingencies
|6 Months Ended|
Jan. 31, 2017
|Commitments and Contingencies Disclosure [Abstract]|
|Commitments and Contingencies||
Note 9—Commitments and Contingencies
In the ordinary course of business, the Company may become a party to lawsuits involving various matters. The Company is unaware of any such lawsuits presently pending against it which individually or in the aggregate, are deemed to be material to the Company’s financial condition, or results of operations.
The Company has entered employment agreements with each of its executive level officers. Generally, the terms of each agreement are such that if the officer is terminated other than for cause, death or disability, or if the case of termination of employment with the Company is for good cause, the officer shall be entitled to receive severance payments equal to either six or 12 months of his/her then-current annual base salary plus any accrued bonus and six or 12 months of benefits coverage.
On April 15, 2016, the Company and the Company’s former Chief Scientific Officer (“CSO”) entered into a separation, release and consulting agreement, in which the CSO would voluntarily resign from the Company on June 18, 2016 and become a consultant of the Company. The terms of the agreement afforded no severance pay related to the termination of employment; however, the terms of the agreement provide for a fee of $30,000 per month for consulting services. The consulting agreement will terminate automatically on June 18, 2017, unless renewed by a written agreement of both parties or earlier terminated as provided within the agreement. On the date of termination of employment, the Company recorded a liability of $360,000 in its balance sheet as the consulting services to be performed are not substantive and the offsetting charge was recorded in research and development as other outside service fees. As of January 31, 2017, the Company has paid $180,000 against the liability.
On December 27, 2015, the Company and the Company’s former Chief Medical Officer (“CMO”) entered into a separation and release agreement pursuant to which the Company agreed to pay the former CMO $286,000, less applicable withholdings, in the form of salary continuation in accordance with the Company’s customary payroll practices. At the separation date, the Company recorded a liability of $286,000 on its condensed balance sheet and the offsetting charge was recorded in research and development as salary expense. As of January 31, 2017, the Company has paid the entire liability in full.
On December 31, 2014, the Company entered into a lease agreement for approximately 34,000 rentable square feet located at 5820 Nancy Ridge Drive, San Diego, California to serve as the Company’s new corporate headquarters and research and development laboratory. The lease term commenced on October 19, 2015 and expires 120 months after commencement. The lease agreement provides for base rent at $2.65 per rentable square foot, subject to a 3% rate increase on each annual anniversary of the first day of the first full month during the term of the lease agreement. The Company is required to share in certain operating expenses of the premises. In December 2014, pursuant to the lease agreement, the Company delivered a security deposit of approximately $90,000.
The entire disclosure for commitments and contingencies.
Reference 1: http://www.xbrl.org/2003/role/presentationRef