|9 Months Ended|
Sep. 30, 2017
NOTE 12 – MATERIAL TRANSACTIONS
In June 2015, the Company entered into a long-term tenancy agreement with First State Compassion Center, Inc. (“FSCC”) for the lease of its state-of-the-art medical cannabis facility in Delaware. FSCC is one of the companies to be awarded a medical marijuana license in the state.
In April 2015, the Company entered into a long-term agreement with two companies that have been awarded medical marijuana licenses in the state of Illinois to lease two of the Company’s state-of-the-art medical cannabis facilities in the state.
In August 2017, the Company issued 4,385,823 shares of common stock to retire promissory notes with principal balances of $2,050,000 plus accrued interest. On the transaction date, the fair value of the common stock was $0.63 per share, resulting in the company recording a non-cash loss on debt conversion of approximately $451,000.
These former noteholders also received, in September 2017, warrants to purchase 863,898 shares of common stock. The fair value of these warrants on the grant date was approximately $257,000, which made up most of the non-cash equity compensation of approximately $285,000 recorded by the Company in the third quarter, as further discussed in Note 7 above.
In September 2017, the Company entered into a letter of intent with Tikun Olam to expand the Company’s licensing of Tikun Olam’s unique cannabis strains into four additional legal cannabis states.