PROMISSORY NOTES PAYABLE	9 Months Ended
Apr. 30, 2021
Notes to Financial Statements
PROMISSORY NOTES PAYABLE	8. PROMISSORY NOTES PAYABLE SHORT-TERM NOTES PAYABLE On June 9, 2020, the Company issued a short-term unsecured convertible promissory note for $25,000, with interest at 12% interest per annum and maturing on September 7, 2020. The unsecured convertible promissory note was convertible into shares of common stock of the Company at $0.20 per share, which was in excess of the closing market price of the Company’s common stock on June 9, 2020 of $0.07 per share. On August 31, 2020, the principal balance of the unsecured convertible promissory note of $25,000, plus accrued interest payable of $682, was repaid through conversion into 128,410 shares of common stock. On October 29, 2020, the Company issued a short-term unsecured promissory note to Daniel Crosser, who is an approximate 13% shareholder of the Company, for $100,000, with interest at 10% per annum. The note matures on April 29, 2021, with the principal balance outstanding, plus accrued but unpaid interest, being due and payable on the maturity date. As of April 30, 2021, accrued interest related to the unsecured promissory note was $5,083. On April 29, 2021, the maturity date of this note was extended to July 31, 2021. On November 10, 2020, the Company issued a short-term unsecured promissory note to Daniel Crosser, who is an approximate 13% shareholder of the Company, for $200,000, with interest at 5% per annum. The note was scheduled to mature on February 8, 2021, with the principal balance outstanding, plus accrued but unpaid interest, being due and payable on the maturity date. As of April 30, 2021, accrued interest related to the unsecured promissory note was $4,708. On February 8, 2021, the maturity date of this note was extended to June 30, 2021. On December 10, 2020, the Company issued a short-term unsecured promissory note to Daniel Crosser, who is an approximate 13% shareholder of the Company, for $160,000, with interest at 5% per annum. The proceeds under this promissory note were received by the Company in November 2020. The note was scheduled to mature on March 10, 2021, with the principal balance outstanding, plus accrued but unpaid interest, being due and payable on the maturity date. As of April 30, 2021, accrued interest related to the unsecured promissory note was $3,496. On February 26, 2021, the maturity date of this note was extended to June 30, 2021. On December 21, 2020, the Company issued a short-term promissory note to Daniel Crosser, who is an approximate 13% shareholder of the Company, for $40,000, without interest, with a scheduled maturity date of January 31, 2021. On January 31, 2021, the maturity date of this note was extended to June 30, 2021. On December 23, 2020, the Company issued a short-term promissory note to John Morgan, an officer of the Company, for $20,000, without interest. The note was repaid on January 7, 2021. Between December 15, 2020 and December 26, 2020, the Company’s subsidiary Mistress Movie LLC issued six short-term promissory notes to Cross Entertainment, LLC, a related party, aggregating $170,000, without interest, with a scheduled maturity date of February 28, 2021. As of January 31, 2021, $60,000 had been repaid and the remaining principal amount of $110,000 was due on these notes. On February 26, 2021, the maturity date of the $110,000 principal amount of the notes were extended to June 30, 2021. On December 26, 2020, the Company issued a short-term promissory note to Cross Entertainment, LLC, a related party, for $110,000, without interest, with a scheduled maturity date of June 30, 2021. The Company received proceeds of $10,000 on this note through April 30, 2021. On January 31, 2021, the principal balance of the note dated January 7, 2021 of $85,000 was transferred to this note. As of April 30, 2021, principal amount of $95,000 was due on this note. On January 5, 2020, the Company issued a short-term promissory note to Lawrence M. Silver, who is an approximate 9% shareholder of the Company, for $70,000, without interest, with a scheduled maturity date of January 31, 2021. On January 31, 2021, the maturity date of this note was extended to June 30, 2021. On January 7, 2021, the Company issued a short-term promissory note to Cross Entertainment, LLC, a related party, for $145,000, without interest, with a scheduled maturity date of January 31, 2021. Proceeds on this note were $145,000, of which $60,000 was repaid and the balance of $85,000 was transferred to the note dated December 26, 2020 as described above. As of April 30, 2021, there was no amounts due and payable on this note. On January 29, 2021, the Company issued a short-term promissory note to Cross Entertainment, LLC, a related party, for $85,000, without interest, with a scheduled maturity date of February 28, 2021. As of April 30, 2021, principal of $15,000 was due on this note. On February 26, 2021, the maturity date of this note was extended to June 30, 2021. On February 11, 2021, the Company issued a short-term promissory note to Lawrence M. Silver, who is an approximate 9% shareholder of the Company, for $100,000, without interest, with a scheduled maturity date of June 30, 2021. On April 20, 2021, the Company issued a short-term promissory note to Cross Entertainment, LLC, a related party, for $1,500, without interest, with a scheduled maturity date of May 20, 2021. The note was repaid on April 21, 2021. On April 21, 2021 the Company issued a short-term unsecured promissory note to Daniel Crosser, who is an approximate 13% shareholder of the Company, for $15,000, with interest at 10% per annum. The note matures on May 21, 2021, with the principal balance outstanding, plus accrued but unpaid interest, being due and payable on the maturity date. As of April 30, 2021, accrued interest related to the unsecured promissory note was $37. On May 21, 2021, the maturity date of this note was extended to July 31, 2021. LONG-TERM NOTES PAYABLE On September 16, 2020, the Company issued a two-year unsecured convertible promissory note payable for $100,000, with interest at 5% per annum and maturing on September 15, 2022. The note was originally convertible into shares of common stock of the Company at $0.80 per share, which was above the closing market price of the Company’s common stock of $0.26 per share on September 16, 2020. This note was amended on December 15, 2020 to make it convertible into shares of common stock of the Company at $0.40 per share, which was below the closing market price of the Company’s common stock of $0.59 per share on December 15, 2020. As a result of the December 15, 2020 amendment to this convertible promissory note payable, the Company recognized a beneficial conversion feature on such date to recognize the difference between the closing market price of the common stock and the amended conversion price, which resulted in the Company recording a discount on debt aggregating $48,010. This debt discount is being presented as a reduction to the carrying amount of the related convertible promissory note payable in the consolidated balance sheet and is being amortized to operations as interest expense from December 15, 2020 through September 16, 2022, the maturity date of the note. For the three months and nine months ended April 30, 2021, debt discount charged to operations as interest expense was $3,430 and $10,288, respectively, which resulted in unamortized debt discount of $37,722 at April 30, 2021. If the closing price of the Company’s common stock reaches $0.60 per share or greater (decreased from $1.20 per share as part of the December 15, 2020 amendment to the note), the outstanding principal and all accrued interest on this note shall automatically convert into common stock at the specified conversion rate. As of April 30, 2021, accrued interest payable related to the unsecured convertible promissory note payable was $3,096. On October 26, 2020, Rivulet Films issued a multiple advance promissory note (the “Note”) to Lawrence Silver, an approximate 11% shareholder of the Company, for $1,000,000, with interest at 10% per annum. The Note matures on October 6, 2022, with the principal balance outstanding, plus accrued but unpaid interest, being due and payable on the maturity date. The Note is secured by a first lien security interest on all of the assets of Rivulet Films (including its equity interest in PBP Productions LLC), personal guarantees of the Company’s officers, Michael Witherill and Aaron Klusman, and a corporate guarantee of the Company. Rivulet Films is required to use borrowings under the Note primarily to pay production costs associated with the movie production currently entitled “Please Baby Please”. Borrowings under this Note may be repaid at any time and reborrowed until the maturity date. Rivulet Films is required to apply any other funds received by it for the purpose of film financing and then any excess proceeds to pay any principal and interest owing under this Note. As of April 30, 2021, principal borrowings outstanding under the Note were $1,000,000, and related accrued interest was $52,166, which has been capitalized as project development costs (see Note 7).

PROMISSORY NOTES PAYABLE

9 Months Ended

Apr. 30, 2021

8. PROMISSORY NOTES PAYABLE

SHORT-TERM NOTES PAYABLE

On June 9, 2020, the Company issued a short-term unsecured convertible promissory note for $25,000, with interest at 12% interest per annum and maturing on September 7, 2020. The unsecured convertible promissory note was convertible into shares of common stock of the Company at $0.20 per share, which was in excess of the closing market price of the Company’s common stock on June 9, 2020 of $0.07 per share. On August 31, 2020, the principal balance of the unsecured convertible promissory note of $25,000, plus accrued interest payable of $682, was repaid through conversion into 128,410 shares of common stock.

On October 29, 2020, the Company issued a short-term unsecured promissory note to Daniel Crosser, who is an approximate 13% shareholder of the Company, for $100,000, with interest at 10% per annum. The note matures on April 29, 2021, with the principal balance outstanding, plus accrued but unpaid interest, being due and payable on the maturity date. As of April 30, 2021, accrued interest related to the unsecured promissory note was $5,083. On April 29, 2021, the maturity date of this note was extended to July 31, 2021.

On November 10, 2020, the Company issued a short-term unsecured promissory note to Daniel Crosser, who is an approximate 13% shareholder of the Company, for $200,000, with interest at 5% per annum. The note was scheduled to mature on February 8, 2021, with the principal balance outstanding, plus accrued but unpaid interest, being due and payable on the maturity date. As of April 30, 2021, accrued interest related to the unsecured promissory note was $4,708. On February 8, 2021, the maturity date of this note was extended to June 30, 2021.

On December 10, 2020, the Company issued a short-term unsecured promissory note to Daniel Crosser, who is an approximate 13% shareholder of the Company, for $160,000, with interest at 5% per annum. The proceeds under this promissory note were received by the Company in November 2020. The note was scheduled to mature on March 10, 2021, with the principal balance outstanding, plus accrued but unpaid interest, being due and payable on the maturity date. As of April 30, 2021, accrued interest related to the unsecured promissory note was $3,496. On February 26, 2021, the maturity date of this note was extended to June 30, 2021.

On December 21, 2020, the Company issued a short-term promissory note to Daniel Crosser, who is an approximate 13% shareholder of the Company, for $40,000, without interest, with a scheduled maturity date of January 31, 2021. On January 31, 2021, the maturity date of this note was extended to June 30, 2021.

On December 23, 2020, the Company issued a short-term promissory note to John Morgan, an officer of the Company, for $20,000, without interest. The note was repaid on January 7, 2021.

Between December 15, 2020 and December 26, 2020, the Company’s subsidiary Mistress Movie LLC issued six short-term promissory notes to Cross Entertainment, LLC, a related party, aggregating $170,000, without interest, with a scheduled maturity date of February 28, 2021. As of January 31, 2021, $60,000 had been repaid and the remaining principal amount of $110,000 was due on these notes. On February 26, 2021, the maturity date of the $110,000 principal amount of the notes were extended to June 30, 2021.

On December 26, 2020, the Company issued a short-term promissory note to Cross Entertainment, LLC, a related party, for $110,000, without interest, with a scheduled maturity date of June 30, 2021. The Company received proceeds of $10,000 on this note through April 30, 2021. On January 31, 2021, the principal balance of the note dated January 7, 2021 of $85,000 was transferred to this note. As of April 30, 2021, principal amount of $95,000 was due on this note.

On January 5, 2020, the Company issued a short-term promissory note to Lawrence M. Silver, who is an approximate 9% shareholder of the Company, for $70,000, without interest, with a scheduled maturity date of January 31, 2021. On January 31, 2021, the maturity date of this note was extended to June 30, 2021.

On January 7, 2021, the Company issued a short-term promissory note to Cross Entertainment, LLC, a related party, for $145,000, without interest, with a scheduled maturity date of January 31, 2021. Proceeds on this note were $145,000, of which $60,000 was repaid and the balance of $85,000 was transferred to the note dated December 26, 2020 as described above. As of April 30, 2021, there was no amounts due and payable on this note.

On January 29, 2021, the Company issued a short-term promissory note to Cross Entertainment, LLC, a related party, for $85,000, without interest, with a scheduled maturity date of February 28, 2021. As of April 30, 2021, principal of $15,000 was due on this note. On February 26, 2021, the maturity date of this note was extended to June 30, 2021.

On February 11, 2021, the Company issued a short-term promissory note to Lawrence M. Silver, who is an approximate 9% shareholder of the Company, for $100,000, without interest, with a scheduled maturity date of June 30, 2021.

On April 20, 2021, the Company issued a short-term promissory note to Cross Entertainment, LLC, a related party, for $1,500, without interest, with a scheduled maturity date of May 20, 2021. The note was repaid on April 21, 2021.

On April 21, 2021 the Company issued a short-term unsecured promissory note to Daniel Crosser, who is an approximate 13% shareholder of the Company, for $15,000, with interest at 10% per annum. The note matures on May 21, 2021, with the principal balance outstanding, plus accrued but unpaid interest, being due and payable on the maturity date. As of April 30, 2021, accrued interest related to the unsecured promissory note was $37. On May 21, 2021, the maturity date of this note was extended to July 31, 2021.

LONG-TERM NOTES PAYABLE

On September 16, 2020, the Company issued a two-year unsecured convertible promissory note payable for $100,000, with interest at 5% per annum and maturing on September 15, 2022. The note was originally convertible into shares of common stock of the Company at $0.80 per share, which was above the closing market price of the Company’s common stock of $0.26 per share on September 16, 2020.

This note was amended on December 15, 2020 to make it convertible into shares of common stock of the Company at $0.40 per share, which was below the closing market price of the Company’s common stock of $0.59 per share on December 15, 2020.

As a result of the December 15, 2020 amendment to this convertible promissory note payable, the Company recognized a beneficial conversion feature on such date to recognize the difference between the closing market price of the common stock and the amended conversion price, which resulted in the Company recording a discount on debt aggregating $48,010. This debt discount is being presented as a reduction to the carrying amount of the related convertible promissory note payable in the consolidated balance sheet and is being amortized to operations as interest expense from December 15, 2020 through September 16, 2022, the maturity date of the note. For the three months and nine months ended April 30, 2021, debt discount charged to operations as interest expense was $3,430 and $10,288, respectively, which resulted in unamortized debt discount of $37,722 at April 30, 2021.

If the closing price of the Company’s common stock reaches $0.60 per share or greater (decreased from $1.20 per share as part of the December 15, 2020 amendment to the note), the outstanding principal and all accrued interest on this note shall automatically convert into common stock at the specified conversion rate. As of April 30, 2021, accrued interest payable related to the unsecured convertible promissory note payable was $3,096.

On October 26, 2020, Rivulet Films issued a multiple advance promissory note (the “Note”) to Lawrence Silver, an approximate 11% shareholder of the Company, for $1,000,000, with interest at 10% per annum. The Note matures on October 6, 2022, with the principal balance outstanding, plus accrued but unpaid interest, being due and payable on the maturity date. The Note is secured by a first lien security interest on all of the assets of Rivulet Films (including its equity interest in PBP Productions LLC), personal guarantees of the Company’s officers, Michael Witherill and Aaron Klusman, and a corporate guarantee of the Company. Rivulet Films is required to use borrowings under the Note primarily to pay production costs associated with the movie production currently entitled “Please Baby Please”. Borrowings under this Note may be repaid at any time and reborrowed until the maturity date. Rivulet Films is required to apply any other funds received by it for the purpose of film financing and then any excess proceeds to pay any principal and interest owing under this Note. As of April 30, 2021, principal borrowings outstanding under the Note were $1,000,000, and related accrued interest was $52,166, which has been capitalized as project development costs (see Note 7).