Post by
mrpancake on Dec 06, 2020 7:07am
a Black Friday to remember for Patriot One investors
1st quarter ending October 31st 2020
$4 MILLION loss from expected "sale" of SoTech that never happened (see note 10)
$7 MILLION on the balance sheet as Intangible assets (Note 12) Quasar, EhEye, Extract
$3-5 MILLION of the $25,582,433 goodwill should expensed (see note 5 & 6)
$3 MILLION+ loss from operations for the quarter
equals - a Black Friday all its own!
10. Investment in Sotech Secure, LLC As at July 31, 2020, the Company owns a 49% interest in Sotech Secure, LLC ("Sotech"), a Delaware Limited Liability Company with NanoBio Detection Systems LLC ("NanoBio") owning the remaining 51% interest. Management has considered several factors based on recent developments and determined that the Company no longer holds significant influence or joint control over Sotech. Accordingly, the Company has discontinued the use of the equity method for the Sotech investment during Q4 2020. The Company’s interest in Sotech has been recorded in the consolidated financial statements at its expected fair value of $4,021,200 (USD $3 million), with the difference between carrying value and fair value recorded as loss on investment. Despite the change in accounting treatment, management will continue to pursue all measures necessary to recover value from this investment.
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12. As at July 31, 2020, the carrying values of intangible assets are as follows:
Quasar Federal Systems, Inc.intellectual property in exchange for an aggregate cash consideration of $6,574,000 (US$5,000,000).
EhEye to be $1,250,000 (Note 5). In addition, the Company determined $235,000 of directly attributable development expenditures met the criteria for capitalization, of which $115,000 were capitalized in the year ended July 31, 2020.
5. Xtract purchase price included a cash payment of $6,000,000, a working capital adjustment and option holder payout of $1,546,526 and the issuance of 9,422,956 common shares of the Company ("Consideration Shares") at a fair value of $16,867,090.
EhEyeshare purchase agreement, the Company issued 1,636,363 shares at a fair value of $3,387,257.
6. Goodwill Balance (Xtract and EhEye) as at July 31, 2020 $ 25,582,433