March 2021 Warrant ExerciseOn March 15, 2021 the Company issued a news release indicating it had received $1.4 million in cash for the sale of common shares sold upon the exercise of 1,410,057 warrants.
On May 17, 2021 the Company issued its March 31, 2021 Q1 financial statements that recorded only 1,385,055 warrants had been exercised, with 25,002 having expired without being exercised. This meant that the Company recorded receipt of $1,385,055 from the transaction, $25,002 less than previously reported.
Mr. Veloso exercised 456,208 warrants, Mr. Paolucci the CFO exercised 83,333 and Mr. St. Aldwyn the Independent Lead Director exercised 41,666. The news release disclosed that Mr. Veloso had used the funds he had received in settling his 2020 bonus of $550,900 to acquire the 456,208 common shares upon exercise of the warrants, as well as the exercise of stock options, in March 2021.
Given the $550,900 2020 bonus was expensed in the 2020 audited statements, and the only balance (salary, bonus, fees or expenses) owing to Mr. Veloso and all other directors as at December 31, 2020 was $49,000, can the Company please confirm the dates in 2020 when Mr. Veloso was paid and received the $550,900 in funds from the bonus awarded in 2020?
Can the Company also confirm the date and amount of funds received from Mr. Veloso to exercise his 456,208 in warrants and for exercise of his stock options.
The news release also confirms that on March 12, 2021 Mr. Veloso was issued 399,000 shares at $1.22 per share in lieu of $486,780 in salary, and Mr. Paolucci was issued 100,000 shares at $1.22 per share in lieu of $122,000 in salary. Can the Company please confirm what salary time period was being addressed by these payments, given that the only salary amounts owing as at December 31, 2020 was the $49,000 noted above. Had Mr. Veloso not been paid from January 1 2021 to March 12, 2021, he would have been owed a total of $82,849 for his base family. Why did he receive $486,780?
I am cognizant that the Verde Financial Statements are not the easiest or most transparent financial statements to pick apart, so perhaps my analysis has overlooked information that might be available, or one or more of my calculations or assumptions are incorrect. Accordingly, I will be the most grateful if the Company can respond to these questions in sufficient detail in order to disclose and remove any errors on my part.
Cheers,
S.