Note 6 - Acquisition of OCL Technologies Corp.

12 Months Ended

Dec. 31, 2020

Notes to Financial Statements

Mergers, Acquisitions and Dispositions Disclosures [Text Block]

6. ACQUISITION OF OCL TECHNOLOGIES CORP.  

During the year ended

December 31, 2020,

the Company acquired a

100%

interest in OCL Technologies Corp. (“OCL”) by issuing

12,500,000

shares with a fair value of

$1,380,427

and contingent consideration consisting of

12,500,000

non-transferable warrants with a fair value of

$414,128.

The transaction does

not

meet the definition of a business as defined in ASC

805

-

10.

As a result, the acquisition of OCL has been accounted for as an asset acquisition, whereby all of the assets acquired and liabilities assumed are assigned a carrying amount based on their relative fair values. Upon closing of the transaction, OCL became a subsidiary of the Company. The net assets acquired pursuant to the acquisition are as follows:

Purchase Price
Issuance of 12,500,000 shares	$	1,380,427
Contingent consideration - warrants		414,128
Transaction costs		54,532
Total Purchase Price	$	1,849,087

Contingent consideration consists of

12,500,000

non-transferable warrants that are exercisable into

12,500,000

common shares if certain criteria are met at an exercise price of

$0.001

for a period of

five

years from the date of issuance expiry

June 4, 2025.

No

share purchase warrants are exercisable until specific performance criteria have been met. Such criteria being

1

) revenue sales projections per OCL's

5

year proformas, or

2

) listing on a major US exchange, or

3

) change of control. The Company has estimated the fair value of the contingent consideration to be

$414,128.

Purchase Price Allocation
Cash	$	114,169
Accounts payable and due from related party		(232,021	)
Intangible asset		1,966,939
Total Purchase Price	$	1,849,087

During the year ended

December 31, 2020,

the Company impaired the intangible asset resulting an expense on the consolidated statement of operations of

$1,966,939.