24. SUBSEQUENT EVENTS
a) On January 6, 2020, the Company granted 100,000 stock options to consultants of the Company with an exercise price of $0.15 per option expiring January 6, 2022.
b) On January 6, 2020, the Company issued 800,000 common shares with a fair value of $68,000 pursuant to a supply agreement entered into with Vendure Genetics Labs Inc. dated December 26, 2018 and amended on December 16, 2019 for the supply of certain cannabis plants and intellectual property rights.
c) On January 17, 2020, the Company issued 58,823,529 with a fair value of $5,882,353 in relation to investment in SUHM.
d) On January 28, 2020, the Company issued 6,666,667 common shares of the Company upon conversion of the Special Warrants issued on September 19, 2019 (Note 18).
e) On January 30, 2020, the Company granted 15,000,000 stock options to consultants of the Company with an exercise price of $0.15 per option expiring January 30, 2022.
f) On January 31, 2020, the Company grated 1,000,000 stock options to consultants of the Company with an exercise price of $0.10 per option expiring January 31, 2022.
g) On March 10, 2020, the Company closed the acquisition of 100% of the issued and outstanding common shares of Sanna Health Corp. pursuant to a Share Purchase agreement dated March 10, 2020. As consideration, on March 10, 2020, the Company issued 76,666,666 common shares of the Company with a fair value of $4,600,000.
h) On March 15, 2020, 16,800,000 stock options with an exercise price of $0.55 expired without exercise.
i) On March 29,2020, 4,750,000 stock options with an exercise price of $0.168 expired without exercise.
j) In March 2020, the World Health Organization declared coronavirus COVID-19 a global pandemic. This contagious disease outbreak, which has continued to spread, and any related adverse public health developments, has adversely affected workforces, economies, and financial markets globally, potentially leading to an economic downturn. The impact on the Company is not currently determinable but management continues to monitor the situation.
k) On April 30, 2020, the Company granted 95,000,000 stock options to consultants and officers of the Company with an exercise price of $0.075 per option expiring on April 30, 2025.
l) On June 5, 2020, the Company issued 22,805,938 common shares of the Company with a fair value of $1,126,613 for consulting services.
39
AGRAFLORA ORGANICS INTERNATIONAL INC.
Notes to the Consolidated Financial Statements (Expressed in Canadian Dollars)
Year ended December 31, 2019
24. SUBSEQUENT EVENTS (CONTINUED)
m) On October 22, 2019, the Company entered into a Share Purchase Agreement and an Assignment and Assumption of Share Purchase Agreement to purchase 100% of the issued and outstanding shares of The Good Company GmbH, a German limited liability company on a pro-rata basis. On February 13, 2020, the Company closed the acquisition of 100% of the issued and outstanding shares of The Good Company GmbH. Total consideration paid includes cash payment of $1,000,000, issuance of 47,916,667 common shares of the Company and repayment of certain shareholder loans (issued on November 4, 2019 with a fair value of $10,302,083) and cash repayment of $1,202,674 Euro on the closing date (recorded as prepayments as at December 31, 2019).
Pursuant to the Share Purchase Agreement, the Company is to issue shares with a value of $5,000,000 if certain milestones are achieved or triggered within 18 months from the closing date.
The Company also agreed to make cash contributions to The Good Company to be used for working capital purposes of Farmako GmbH, the subsidiary of The Good Company, totaling $1,200,000, with $300,000 already paid on the closing date and $900,000 to be paid within 6 months of the closing date.
The assets and liabilities of The Good Company GmbH cannot be disclosed at this time because the Company is still in the process of completing the closing balance sheet and the valuation of assets and liabilities acquired.
n) Subsequent to year-end, the Company cancelled a total of 38,500,000 stock options. The options were held by various officers, directors and consultants of the Company with exercise prices of $0.31, $0.39, $0.325, $0.55 and $0.4.
o) Subsequent to year end, the Company closed two non-brokered private placement offering of 266,666,667 units of the Company and 20,700,000 units of the Company at a price of $0.075 per Unit for gross proceeds of $20,000,000 and $1,552,500 respectively. Each Unit shall consist of one common share and one transferable share purchase warrant. Each warrant is exercisable to purchase one common share of the Company for a period of five years at a price of $0.10 per share. The $20,000,000 tranche, consisted of the settlement of a convertible debenture (note 17) and debt owed to arm’s length parties of $17,666,208 and $2,333,792 respectively.
p) Subsequent to year-end, the Company issued 6,424,751 common shares with a fair value of $321,238 to settle of debt of $564,476, resulting in a gain on settlement of $243,239.
My take: Anybody who claims to know the implications is either a genius or a pumper. This is ridiculous for 5 1/2 months and demonstrates clearly the need for timely financial disclosure. And the ants are still there! Can 2B shares be far off?