Quarterly report pursuant to Section 13 or 15(d)


3 Months Ended
Mar. 31, 2024
Goodwill and Intangible Assets Disclosure [Abstract]  



Intangible asset represents $12,265,856 (December 31, 2023 - $12,733,885) for intellectual property (“Manna IP”) acquired under an asset purchase agreement with Manna Nutritional Group, LLC (“Manna”) dated September 10, 2021. The Manna IP encompasses patented technologies to naturally process and convert grains, pulses, and root vegetables, into low-starch, low-sugar, high-protein, fiber-rich baking flour products, as well as a wide range of breakfast cereals, juices, natural sweeteners, and baking enhancers. The Company paid $1,475,000 in cash and issued 147,600 prefunded warrants valued at $12,106,677 (the “Purchase Price”). Subject to a 9.99% stopper and SEC Rule 144 restrictions, the prefunded warrants will vest in tranches up until March 10, 2024 (all tranches have fully vested). When vested the tranches of prefunded warrants are convertible into an equal number of common shares.


On January 3, 2023, Manna satisfied all of its contractual obligations when the patent was approved by the US Patent and Trademark Office and the title was transferred to the Company. During the year ended December 31, 2023, the Company issued 141,175 shares in relation to this transaction. As at March 31, 2024 and December 31, 2023, there were 6,425 unconverted prefunded warrants outstanding.


Based on the terms above and in conformity with US GAAP, the Company accounted for purchase as an asset acquisition. The asset was available for use on January 3, 2023. The asset has a useful life of 20 years. The Company recorded $164,295 in amortization expense related to the Manna IP for the three months ended March 31, 2024 (March 31, 2023 - $163,750).


The estimated annual amortization expense for the next five years are as follows:


Period ending:   Amount  
Remaining 2024   $ 490,634  
2025     654,179  
2026     654,179  
2027     654,179  
2028     654,179  
Subsequent years     9,158,506  
Total   $ 12,265,856