GENERAL DEVELOPMENT OF THE BUSINESS OF THE COMPANY
The Company was incorporated on February 10, 2016 and to date has not carried on any active business or
operations. The principal business of the Company has been to identify and evaluate businesses and assets with a
view to completing a going public transaction and, having identified and evaluated such opportunities, to negotiate
an acquisition or participation subject to acceptance by the Exchange.
The Company entered into the Business Combination Agreement effective November 30, 2016 with
respect to the Acquisition of Galaxy by the Company. See “Acquisition and Related Transactions”.
To date, the Company has advanced loans in the aggregate principal amount of US$608,421.40 and
CDN$38,676.00 to Galaxy pursuant to a promissory note issued by Galaxy in favour of the Company. The loans are
non-interest bearing and repayable on demand, provided that in the event that the Business Combination Agreement
is terminated by Galaxy as a result of a material misrepresentation or material breach of the Business Combination
Agreement by the Company, or in the event that the Acquisition does not complete by April 30, 2017 as a result of
the failure of the Company to fulfill its obligations under the Business Combination Agreement, USD $250,000 of
such advances will be forgiven by the Company.
The Company completed a private placement, in two tranches, taking place on June 1, 2016 and September
23, 2016 of 15,775,000 Common Shares at an issue price of $0.02 per Common Share for aggregate gross proceeds
of $315,500. Under the first tranche, which closed on June 1, 2016, the Company issued 6,975,000 Common Shares
for proceeds of $139,500. Under the second tranche, which closed on September 23, 2016, the Company issued
8,800,000 Common Share for proceeds of $176,000.
Between November 15, 2016 and February 28, 2017 the Company completed private placements of
Convertible Debentures for aggregate gross proceeds of $1,024,000. The Convertible Debentures are convertible
into Common Shares at any time at the discretion of the holder, and will automatically convert into Common Shares
in connection with the satisfaction of all conditions to the Acquisition and listing on the Exchange, in each case at a
conversion price of $0.10 per share. The maturity date of the Convertible Debentures is two years from their date of
issue. The Convertible Debentures bear interest from the date of issue at a rate of 8% per annum, calculated and
payable on the earlier of maturity or the date of conversion to Common Shares. As of April 30, 2017, the
Convertible Debentures had accrued interest of $24,707. In the event that the Transaction and listing on the
Exchange does not occur prior to the date that is six months from the date of issue of the Convertible Debentures, a
penalty of 5% of the number of Common Shares that would be issuable upon conversion of the Convertible
Debentures will accrue for each month after such deadline, up to a maximum penalty of 15%. In connection with
the private placements of Convertible Debentures the Company paid aggregate finder’s fees of $29,925 cash and
issued 122,500 Common Shares to a finder at a deemed price of $0.15 per share.
On December 5, 2016, January 20, 2017, February 22, 2017, February 28, 2017 and March 31, 2017, the
Company completed the Private Placement of an aggregate 14,023,000 Subscription Receipts at a purchase price of
$0.25 per Subscription Receipt for aggregate gross proceeds of $3,505,750. In connection with the Private
Placement, the Company paid, or will pay upon the escrow release, aggregate finder’s fees of $264,990 and issued
1,049,200 common shares purchase warrants to finders, each of which is exercisable to purchase one Common
Share at a price of $0.40 per share for a period of 12 months from the applicable closing date. See “Plan of
Distribution” for a description of the terms of the Subscription Receipts.
Quelle: http://thecse.com/sites/default/files/...Form2A_Listing_CSE_SEDAR.PDF
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