SHARE-BASED EXPENSES

6 Months Ended

Jan. 31, 2015

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

SHARE-BASED EXPENSES

NOTE 3 -   SHARE-BASED EXPENSES

ASC 718 "Compensation – Stock Compensation" prescribes accounting and reporting standards for all share-based payment transactions in which employee services are acquired.  Transactions include incurring liabilities, or issuing or offering to issue shares, options,  and other equity instruments such as employee stock ownership plans and stock appreciation rights.  Share-based payments to employees, including grants of employee stock options, are recognized as compensation expense in the financial statements based on their fair values. That expense is recognized over the period during which an employee is required to provide services in exchange for the award, known as the requisite service period (usually the vesting period).

The Company accounts for stock-based compensation issued to non-employees and consultants in accordance with the provisions of ASC 505-50, "Equity – Based Payments to Non-Employees." Measurement of share-based payment transactions with non-employees is based on the fair value of whichever is more reliably measurable: (a) the goods or services received; or (b) the equity instruments issued.  The fair value of the share-based payment transaction is determined at the earlier of performance commitment date or performance completion date.

On October 16, 2014, the Company granted Robert Faber, the former sole officer and director of the Company an option (the "Option") to purchase all, or any portion of, 200,000 shares of common stock pursuant to an Option Agreement. The Option may be exercised by Mr. Faber until March 17, 2016 and can be exercised at any time, in any amounts and on indeterminate occasions. The exercise price for each share of common stock is $1.25. Mr. Faber agreed that he will not directly or indirectly sell, offer to sell, grant an option for the purchase or sale of, transfer, pledge, assign, hypothecate, gift, distribute or otherwise gift or otherwise encumber or transfer the Option or the underlying shares, as well as agreeing that he will not directly or indirectly engage in or effect, in any manner whatsoever, directly or indirectly, any short sales of the common stock of the Company or hedging transactions.

On October 16, 2014, the Company also granted Binyamin Gordon an option to purchase all, or any portion of, 2,500,000 shares of common stock pursuant to an Option Agreement. The option may be exercised by Mr. Gordon until March 2016 and can be exercised at any time, in any amounts and on indeterminate occasions. The exercise price for each share of common stock is $1.25. Mr. Gordon agreed that he will not directly or indirectly sell, offer to sell, grant an option for the purchase or sale of, transfer, pledge, assign, hypothecate, gift, distribute or otherwise gift or otherwise encumber or transfer the Option or the underlying shares, as well as agreeing that he will not directly or indirectly engage in or effect, in any manner whatsoever, directly or indirectly, any short sales of the common stock of the Company or hedging transactions.

During the period ending January 31, 2015, the Company recorded $5,191,122 share-based expenses on the above granted options based on the following assumptions:

Annualized volatility – 123.73%

Risk-free interest rate – 0.23%

Expected life – 18 months

Dividend yield – nil

Share price - $2.70 per share

Exercise price - $1.25 per share

At January 31, 2015, the Company had 2 options outstanding, with exercise price of $1.25 and remaining contract life of 1.126 years to purchase 2,700,000 shares of common stock.