The total purchase price was US$1,038,653, which was satisfied by a cash payment of $575,000, the issuance of 1,474,612 common shares at an issue price of $0.25 per share (issued to Douglas Staufer, the founder of Emerald Forest, and two individual creditors of Emerald Forest resident in Colorado), and the issuance of a promissory note in the amount of $95,000 for a term of two years, bearing interest at the rate of 7% per annum.
Staufer will continue to lead the business and, as part of a broader compensation arrangement, he will receive 300,000 options that will vest over time with an exercise price of $0.25. The company satisfied the cash portion of the purchase price from a portion of the proceeds of the financing completed at the time of the qualifying transaction in April, 2010.
“We’re pleased to achieve this important first milestone in our strategy to become a low-cost, high-quality producer and marketer of Xylitol and Xylitol-based products,” said Andrew Reid, Xylitol Canada’s president and CEO. “Emerald Forest will expand our sales and presence in health and diabetic markets across North America and we expect the transaction to be accretive in the current fiscal year.”
Source: Xylitol Canada
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