Quarterly report pursuant to Section 13 or 15(d)

INVESTMENT

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INVESTMENT
 6 Months Ended
Jun. 30, 2024
Investments, All Other Investments [Abstract]  
INVESTMENT

6. INVESTMENT

 

On June 18, 2023, the Company signed a memorandum of understanding with Radical Clean Solutions Ltd. (“RCS”) to purchase common shares issued by RCS. The Company paid RCS $225,000 for 14% of the issued and outstanding common shares of the Company. Under the terms of the MOU, the use of proceeds is exclusively for the advance purchase of hydroxyls generating devices for commercial sales into controlled environment agriculture, food manufacturing, warehousing and transportation verticals. The Company will receive one of five board of director seats of RCS and has a right of first refusal to maintain an ownership percentage in RCS of not less than 10% of the total issued and outstanding common shares. On October 1, 2023 the Company and RCS signed a definitive agreement to convert the advance into a 14% ownership investment in RCS.

 

As at June 30, 2024, the carrying value of the investment in RCS was $216,263 (December 31, 2023 - $223,801) adjusted for foreign exchange differences of $8,737 (December 31, 2023 - $1,199). As at June 30, 2024, the Company assessed the investment for the presence of the following impairment indications:

 

● A significant deterioration in the earnings performance, credit rating, asset quality, or business prospects of the investee
   
● A significant adverse change in the regulatory, economic, or technological environment of the investee
   
● A significant adverse change in the general market condition of either the geographic area or the industry in which the investee operates
   
● A bona fide offer to purchase, an offer by the investee to sell, or a completed auction process for the same or similar investment for an amount less than the carrying amount of that investment
   
● Factors that raise significant concerns about the investee’s ability to continue as a going concern, such as negative cash flows from operations, working capital deficiencies, or noncompliance with statutory capital requirements or debt covenants.

 

 

None of the above qualitative factors demonstrating potential impairment were present.