Annual report pursuant to Section 13 and 15(d)

Notes Payable

v3.21.2
Notes Payable
12 Months Ended
Jul. 31, 2021
Debt Disclosure [Abstract]  
Notes Payable

Note 5 – Notes Payable

 

On April 27, 2020, the Company was granted a two-year loan (the “Loan”) from the Banc of California in the aggregate amount of $952,744, pursuant to the Paycheck Protection Program (the “PPP”) under the CARES Act, which was enacted March 27, 2020. Interest accrues at 1% per year, effective on the date of initial disbursement.

 

The Company submitted its application for full loan forgiveness on January 6, 2021. On February 12, 2021, the Company received notice that the full Loan amount of $952,744 and $8,046 of accrued interest had been forgiven. As a result, the Company recorded a $960,790 gain on extinguishment of debt in its consolidated statement of operations for the year ended July 31, 2021.

 

On June 18, 2020, the Company entered into a finance agreement with AFCO Premium Credit LLC (“AFCO”). Pursuant to the terms of the agreement, AFCO loaned the Company the principal amount of $551,803, which accrues interest at 3.381% per annum, to partially fund the payment of the premium of the Company’s director & officer insurance. The agreement requires the Company to make ten monthly payments of $56,039, including interest, starting on July 18, 2020. As of July 31, 2021, the outstanding balance related to this finance agreement was paid in full.

 

On July 1, 2021, the Company entered into a finance agreement with AFCO Premium Credit LLC (“AFCO”). Pursuant to the terms of the agreement, AFCO loaned the Company the principal amount of $1,355,919, which would accrue interest at 2.894% per annum, to partially fund the payment of the premium of the Company’s Director & Officer insurance. The agreement requires the Company to make eleven monthly payments of $125,056, including interest starting on July 18, 2021. At July 31, 2021, the outstanding balance related to this finance agreement was $1,234,133.

  

Future minimum payments under note payable liabilities as of July 31, 2021 are as follows:

 

Years ending July 31,      
2022   $ 1,234,133  
Total   $ 1,234,133