Sugarmade Inc (SGMD)

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Several filings, but here is one..

Under the terms of the acquisition agreement, the Company is to pay Indigo Dye Group Corp., the owners of Budcars $700,000, and in turn received an option to acquire an additional 30%, which upon exercise will provide a controlling stake in the operation for the Company. The $700,000 investment is to be exclusively utilized for business expansion and operational purposes with zero funds used as consideration for the share purchase to the owners of BudCars or Indigo. Sugarmade plans to apply its operational expertise to enhance the business operations of Budcars, including geographic delivery expansion.



The specific terms of the agreement included the following:



1. Seven Hundred Thousand Dollars ($700,000) into Indigo for inventory, equipment, and marketing expenses.



2. Sugarmade will make the Investment in twelve monthly equal installments of $58,333 with the acceleration of the payment schedule possible depending on business growth, cash flow needs and capital availability.



3. Sugarmade will receive a Forty Percent (40%) equity in Indigo Dye upon execution of the final agreement. The value used for this transaction is $1,750,000 and each percentage (1%) of the company is worth $17,500.



4. The Parties agree the Investment will primarily be used for business expansion with the exact details of the spending to be further discussed and outlined in a final agreement. The Parties have discussed the additional amount required to open new locations. The estimated investments of each new location will require between $175,000 and $350,000, details of which will be agreed to at a later date.



5. An incentive being offered to Sugarmade as an inducement of the Seven Hundred Thousand Dollars ($700,000), Sugarmade and or its assigned will be granted an option to purchase additional Thirty Percent (30%) the equity of Indigo Dye. This option is being granted by Clinton Walker, therefore for the amount of $525,000 to be paid to Clinton Walker for the 30% of Indigo that he owns. This option will be valid for 36 months.



The operators of Budcars and the Company have recently announced the expansion of delivery services into additional areas of Northern California and most recently into the substantially sized Los Angeles marketplace. We are in the process of analyzing the entry in other California markets.

https://www.sec.gov/Archives/edgar/data/919175/000152013820000281/sgmd-1a.htm