Related Party Transactions

12 Months Ended

Jul. 31, 2014

Related Party Transactions

At July 31, 2014 and 2013, the Company had loans outstanding with its three directors (two of which are officers), in the total amount of $350,000. During December 2012, funds were advanced as per agreements dated December 18, 2012 in the total amount of $350,000 and at an interest rate of 6.0% per annum to cover the short-term cash needs of the Company. The agreements were amended on December 16, 2013 to extend the final maturity date to January 6, 2015 and increased the interest rate to 8.5% per annum. In the event that at least one-third and one-ninth of the amount due plus interest is not repaid by September 30, 2014 and December 25, 2014, respectively, certain penalties will apply. The Company has evaluated the modification of the loans under FASB ASC 470-50 and determined that the modification was not substantial and therefore did not constitute a debt extinguishment.

- Definition

The entire disclosure for related party transactions. Examples of related party transactions include transactions between (a) a parent company and its subsidiary; (b) subsidiaries of a common parent; (c) and entity and its principal owners; and (d) affiliates.

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