8M due when deal closes.
They have an option to take shares, at .10 in lieu of the $8m.
It is contemplated that Sky Unlimited will be compensated with cash and Sugarmade shares having a total value equaling one times annualized revenues realized by Sky Unlimited during 2018. At the projected $40,000,000 revenue realization for Sky Unlimited during 2018, it is contemplated that Sky Unlimited will be paid a total of $8,000,000 in cash and 32 million Sugarmade common shares, as follows:
1) Ten million shares upon the signing of the Letter of Intent. These shares will vest immediately, will be non-refundable, and will be subject to normal registration and resale provisions,
2) At closing and upon the completion of a successful audit of up to 2 calendar year’s financial, the Company will pay Sky Unlimited, 210,000,000 common shares,
3) Also, at closing. the Company will pay the owners a maximum value of 20% of the transaction value in cash, which is initially contemplated to be Eight Million Dollars ($8,000,000) or will allow Sky Unlimited to exercise an option to convert a portion of the cash payment, or the entire cash payment, into common shares at a price of $0.10 per share.
4) Revenue Tested Share Issuances. The Agreement also outlines specific incentives that are contemplated allowing Sky Unlimited to gain additional Company shares based on surpassing the specific $40 million annualized revenue goal and conversely to receive a smaller payment in Company shares should the revenue target not be reached. It is expected the specifics of these incentives will be fully outlined in the definitive agreement.
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