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Subsequent Events
12 Months Ended
Jun. 30, 2019
Subsequent Events [Abstract]  
Subsequent Events

18. Subsequent Events

 

On various dates subsequent to July 1, 2018 through the date of this report, the Company issued 115,385 shares of common stock, aggregating approximately $75,000.

 

On various dates subsequent to July 1, 2018 through the date of this report, the Company issued 446,352 shares of common stock, through cashless exercise of employee stock options.

 

On July 5, 2019, a note holder converted their $25,000 Note that had a conversion price of $0.50 per share into 50,000 shares of common stock.

 

On various dates subsequent to July 1, 2018 and through the date of this report, the Company entered into termination agreements with franchisees for refunds aggregating approximately $808,000. The Company considered the guidance in ASC 855, Subsequent Events, and determined that an accrual was required as of June 30, 2018. The accrual was accounted for as a provision for franchisee rescissions and refunds in the accompany consolidated financial statements.

 

On September 1, the company appointed Thomas McChesney as an independent members to its Board of Directors. McChesney, 73, spent his entire career working with emerging growth companies. He began as an OTC trader with both local and national brokerage firms and joined Paulson Investment Company in the OTC trading department. During the 1980’s, Paulson Investment began an investment banking arm of which Mr. McChesney became a part. From 1980 to 1995 when he resigned from the firm, he had a series of promotions from sales manager to Senior Vice President and eventually was named President in 1993. While at Paulson, Mr. McChesney also served on the Board of Directors for the NASDAQ listed holding company. After retiring from Paulson, Tom formed his own investment banking division of a small Portland firm where he consulted and helped companies raise capital for 8 years.

 

Mr. McChesney has served on the boards of numerous companies over the years and has consulted with many others. In 1995 he joined the Board of a small temporary staffing company, Labor Ready, where he led a $2 million equity financing for the bulletin board listed company. He remained on the board of Labor Ready for 21 years until retiring in March 2017. He chaired the compensation committee for a number those years. Today, Labor Ready is known as TrueBlue and is a $3 billion revenue company listed on the NYSE. From 2014 to 2018 Mr. McChesney was chairman of the consulting and investment firm Whitestone Investment, LLC, and from 2016 to 2018 he was an independent director of ImpactFlow, an online fundraising platform. Mr. McChesney also worked with Veana Therapeutics, Inc., a private biotechnology company, as a consultant from 2017 to 2019.

 

On September 1, 2019, Nick Yates resigned as Chief Executive Officer and assumed the role of Vice President, Sales and Marketing. Ryan Polk, current Chief Financial Officer, was assigned the responsibilities of interim-CEO. Following the appointment of a third independent member to the Board, the Board will name a permanent CEO. On October 4, Nick Yates resigned as Chairman of the Board and rescinded 9,500,000 performance based options granted to him during 2017 and 2018 including 2,500,000 of vested shares.