| Organization, Plan of Business Operations | Note
1 - Organization, Plan of Business Operations Origo
Acquisition Corporation, formerly known as CB Pharma Acquisition Corp. (the “Company”), was incorporated in the Cayman
Islands on August 26, 2014 as a blank check company whose objective is to acquire, through a merger, share exchange, asset acquisition,
share purchase, recapitalization, reorganization or other similar business combination, one or more businesses or entities (a
“Business Combination”). The Company’s effort to identify a prospective target business is not limited to a
particular industry or geographic region of the world. All
activity through February 28, 2018 relates to the Company’s formation, the initial public offering (“Initial Public
Offering”) and a search for a Business Combination candidate. The Company is an early stage and emerging growth company
and, as such, the Company is subject to all of the risks associated with early stage and emerging growth companies. The
registration statement for the Company’s Initial Public Offering was declared effective on December 12, 2014. The Company
consummated the Initial Public Offering of 4,000,000 units (“Units”) at $10.00 per Unit on December 17, 2014, generating
gross proceeds of $40 million (Note 3). On December 24, 2014, the Company consummated the closing of the sale of 200,000 additional
Units upon receiving notice of EarlyBirdCapital, Inc.’s (“EBC”), the representative of the underwriters in the
Initial Public Offering election to exercise its over-allotment option, generating an additional gross proceeds of $2 million
(“Over-allotment”). Simultaneously
with the closing of the Initial Public Offering and the Over-allotment, the Company consummated the private placement (“Private
Placement”) selling 286,000 units (“Private Placement Units”) at a price of $10.00 per Unit, to Fortress Biotech,
Inc. (“Fortress”), formerly known as Coronado Biosciences, Inc., an affiliate of the Company’s former executive
officers and the holder of a majority of the Company’s Ordinary Shares prior to the Initial Public Offering, and EBC, generating
an aggregate of $2.86 million in gross proceeds (Note 4). An
aggregate amount of approximately $42.85 million (approximately $10.20 per Unit) from the net proceeds of the sale of the Units
in the Initial Public Offering, the Over-Allotment, and the Private Placement Units, net of fees of approximately $1.84 million
associated with the Initial Public Offering, inclusive of approximately $1.37 million of underwriting fees, was placed in a trust
account (“Trust Account”) immediately after the sales and invested in U.S. government treasury bills. In connection
with the Initial Extension, Second Extension, Third Extension, Fourth Extension as discussed below, an aggregate of approximately
$10.76 million, $380,600, $11.8 million, and $3.7 million was removed from the Trust Account in June 2016, December 2016, March
2017, and September 2017, respectively, to fund conversions of ordinary shares. In addition, the Company’s management deposited
an aggregate of approximately $682,000 in the Trust Account to increase the conversion amount per share in any subsequent Business
Combination or liquidation out of loans from the new management and EBC during the year ended November 30, 2017. During the three
months ended February 28, 2018, the Company deposited an addition of approximately $123,000 to the Trust Account. In connection
with the Fifth Extension in March 2018 as described below, an aggregate of approximately $312,000 was removed from the Trust Account
to fund conversions of ordinary shares, and the Company has deposited an aggregate of $65,000 to the Trust Account subsequent
to February 28, 2018 to increase the conversion amount per share in any subsequent Business Combination or liquidation. The
Company’s management has broad discretion with respect to the specific application of the net proceeds of the Initial Public
Offering and the Private Placement, although substantially all of the net proceeds are intended to be applied to consummating
a Business Combination. On
June 10, 2016, the Company held an extraordinary general meeting of shareholders (the “June Meeting”). At the June
Meeting, the shareholders approved each of the following items: (i) an amendment to the Company’s Amended and Restated Memorandum
and Articles of Association (the “Charter”) to extend the date by which the Company has to consummate a business combination
(“Liquidation Date”) from June 12, 2016 to December 12, 2016 (the “Initial Extension”), (ii) an amendment
to the Charter to allow the holders of the Company’s ordinary shares issued in the Company’s Initial Public Offering
to elect to convert their Public Shares (as defined below) into their pro rata portion of the funds held in the Trust Account,
and (iii) to change the Company’s name from “CB Pharma Acquisition Corp.” to “Origo Acquisition Corporation”. In
connection with the Initial Extension, effective as of June 10, 2016, (i) each of Lindsay A. Rosenwald, Michael Weiss, George
Avgerinos, Adam J. Chill, Arthur A. Kornbluth and Neil Herskowitz resigned from his position as an officer and/or director of
the Company and (ii) Edward J. Fred and Jose M. Aldeanueva were appointed as Chief Executive Officer and President and Chief Financial
Officer, Secretary and Treasurer, respectively, of the Company and Edward J. Fred, Jose M. Aldeanueva, Stephen Pudles, Jeffrey
J. Gutovich and Barry Rodgers became directors of the Company. On May 20, 2016, the Initial Shares (as defined below) were transferred
to the new management in connection with the resignation of the then-officers and directors of the Company upon the consummation
of the Initial Extension. At
the June Meeting, shareholders holding 1,054,401 Public Shares exercised their right to convert such Public Shares into a pro
rata portion of the funds in the Trust Account. As a result, an aggregate of approximately $10.76 million (or approximately $10.20
per share) was removed from the Trust Account to pay such holders. In connection with the Initial Extension, the new management
of the Company provided a loan to the Company of $0.20 for each Public Share that was not converted, for an aggregate amount of
approximately $629,000, which was deposited in the Trust Account. On
December 12, 2016, the Company held its annual general meeting of shareholders (the “December Meeting”). At the December
Meeting, the shareholders approved an amendment to extend the Liquidation Date from December 12, 2016 to March 12, 2017 (the
“Second Extension”). At the meeting, shareholders holding 36,594 Public Shares exercised their right to convert such
shares into a pro rata portion of the funds in the Trust Account. As a result, an aggregate of approximately $380,600 (or approximately
$10.40 per share) was removed from the Trust Account in December 2016 to pay such shareholders. In connection with the Second
Extension, the Company’s management provided a loan to the Company for an aggregate amount of $320,000, of which an aggregate
of approximately $311,000, or $0.10 for each Public Share that was not converted, was deposited in the Trust Account to increase
the conversion amount per share in any subsequent Business Combination or liquidation to approximately $10.50 per share. On
March 10, 2017, the Company held another extraordinary general meeting of shareholders (the “March Meeting”) and requested
shareholders’ approval to extend the Liquidation Date from March 12, 2017 to September 12, 2017 (the “Third Extension”).
At the March Meeting, shareholders holding 1,123,568 Public Shares exercised their right to convert such shares into a pro rata
portion of the funds in the Trust Account. As a result, an aggregate of approximately $11.8 million (or approximately $10.50 per
share) was removed from the Trust Account in March 2017 to pay such shareholders. In connection with the Third Extension, the
Company’s management agreed to provide a loan to the Company for $0.025 for each Public Share that was not converted, or
approximately $50,000, for each calendar month (commencing on March 12, 2017 and on the 12th day of each subsequent month), or
portion thereof, to be deposited in the Company’s Trust Account. As of September 12, 2017, the conversion amount per share
at the meeting for such Business Combination or the Company’s subsequent liquidation was approximately $10.65 per share.
The loan did not bear interest and will be repayable by the Company to the lenders upon consummation of an initial Business Combination. On
September 11, 2017, the Company held another extraordinary general meeting of shareholders (the “September Meeting”)
and requested shareholders’ approval to extend the Liquidation Date from September 12, 2017 to March 12, 2018 (the “Fourth
Extension”). At the September Meeting, shareholders holding 343,806 Public Shares exercised their right to convert such
shares into a pro rata portion of the funds in the Trust Account. As a result, an aggregate of approximately $3.7 million (or
approximately $10.65 per share) was removed from the Trust Account in September 2017 to pay such shareholders. In connection with
the Fourth Extension, the Company’s management agreed to provide a loan to the Company for $0.025 for each Public Share
that was not converted for each calendar month (commencing on September 12, 2017 and on the 12th day of each subsequent month),
or portion thereof, to be deposited in the Company’s Trust Account. If the Company takes the full time through March 12,
2018 to complete the initial Business Combination, the conversion amount per share at the meeting for such Business Combination
or the Company’s subsequent liquidation will be approximately $10.80 per share. The loan will not bear interest and will
be repayable by the Company to the lenders upon consummation of an initial Business Combination. On
March 12, 2018, the Company held another extraordinary general meeting of shareholders (the “March 2018 Meeting”)
and requested shareholders’ approval to extend the Liquidation Date from March 12, 2018 to June 12, 2018 (the “Fifth
Extension”). Under Cayman Islands law, all amendments to the Charter take effect upon their approvals. Accordingly, the
Company has until June 12, 2018 to consummate an initial Business Combination. At the March 2018 Meeting, shareholders holding
28,801 Public Shares exercised their right to convert such shares into a pro rata portion of the funds in the Trust Account. As
a result, an aggregate of approximately $312,000 (or approximately $10.80 per share) was removed from the Trust Account subsequently
to pay such shareholders. In connection with the Fifth Extension, the Company’s management agreed to provide a loan to the
Company for $0.04 for each Public Share that was not converted for each calendar month (commencing on March 12, 2018 and on the
12th day of each subsequent month), or portion thereof, to be deposited in the Company’s Trust Account. If the Company takes
the full time through June 12, 2018 to complete the initial Business Combination, the conversion amount per share at the meeting
for such Business Combination or the Company’s subsequent liquidation will be approximately $10.92 per share. The loan will
not bear interest and will be repayable by the Company to the lenders upon consummation of an initial Business Combination. During
the three months ended February 28, 2018, the Company issued promissory notes to the new management and EBC for an aggregate of
$70,590 and $61,590, respectively, and deposited approximately $123,000 into the Trust Account. The loans are unsecured and non-interest
bearing and are due upon consummation of a Business Combination. The
Company’s current Chief Executive Officer has agreed that he will be personally liable under certain circumstances to ensure
that the proceeds in the Trust Account are not reduced by the claims of target businesses or vendors or other entities that are
owed money by the Company for service rendered, contracted for or products sold to the Company. However, such officer may not
be able to satisfy those obligations should they arise. The remaining net proceeds (not held in the Trust Account) may be used
to pay for business, legal and accounting due diligence on prospective acquisitions and continuing general and administrative
expenses. In addition, interest income earned on the funds in the Trust Account may be released to the Company to pay its income
or other tax obligations, and working capital requirements. With these exceptions, expenses incurred by the Company may be paid
prior to a Business Combination only from the net proceeds of the Initial Public Offering not held in the Trust Account; provided,
however, that in order to meet its working capital needs following the consummation of the Initial Public Offering, the Company’s
shareholders prior to the Initial Public Offering, including their subsequent transferees (collectively the “Initial Shareholders”),
officers and directors or their affiliates (including Fortress) may, but are not obligated to, loan the Company funds, from time
to time or at any time, in whatever amount they deem reasonable in their sole discretion. Each loan would be evidenced by a promissory
note. The notes would either be paid upon consummation of the Company’s initial Business Combination, without interest,
unless otherwise provided, or, at the lender’s discretion, converted upon consummation of the Company’s Business Combination
into additional Private Placement Units at a price of $10.00 per Unit. If the Company does not complete a Business Combination,
the loans would not be repaid. The
Company will either seek shareholder approval of any Business Combination at a meeting called for such purpose at which holders
of the outstanding Ordinary Shares sold in the Initial Public Offering (“Public Shareholders”) may seek to convert
such shares (“Public Shares”) into their pro rata share of the aggregate amount then on deposit in the Trust Account,
less any taxes then due but not yet paid, or provide Public Shareholders with the opportunity to sell their Public Shares to the
Company by means of a tender offer for an amount equal to their pro rata share of the aggregate amount then on deposit in the
Trust Account, less any taxes then due but not yet paid. The Company will proceed with a Business Combination only if it will
have net tangible assets of at least $5,000,001 upon consummation of the Business Combination and, solely if shareholder approval
is sought, a majority of the outstanding Ordinary Shares of the Company voted, are voted in favor of the Business Combination.
Notwithstanding the foregoing, a Public Shareholder, together with any affiliate of his or any other person with whom he is acting
in concert or as a “group” (as defined in Section 13(d) (3) of the Exchange Act) will be restricted from seeking conversion
rights with respect to 30% or more of the Ordinary Shares sold in the Initial Public Offering. Accordingly, all shares purchased
by a holder in excess of 30% of the shares sold in the Initial Public Offering will not be converted to cash. In connection with
any shareholder vote required to approve any Business Combination, the Initial Shareholders have agreed (i) to vote any of their
respective shares, including the 1,050,000 Ordinary Shares issued in connection with the organization of the Company (the “Initial
Shares”), in favor of the initial Business Combination and (ii) not to convert such respective shares into a pro rata portion
of the Trust Account or seek to sell their shares in connection with any tender offer the Company engages in. If
the Company has not completed a Business Combination by June 12, 2018, pursuant to the amended Charter, it will trigger the automatic
liquidation of the Trust Account and the voluntary liquidation of the Company. If the Company is required to liquidate, Public
Shareholders are entitled to share ratably in the Trust Account, including any interest, and any net assets remaining available
for distribution to them after payment of liabilities. The Initial Shareholders have agreed to waive their rights to share in
any distribution with respect to their Initial Shares. On
December 19, 2016, the Company entered into a Merger Agreement (the “Merger Agreement”) with Aina Le’a Inc.,
a Delaware corporation (“Aina Le’a”), Aina Le’a Merger Sub, Inc., a Delaware corporation and a wholly-owned
subsidiary of Aina Le’a (“Merger Sub”), and Jose Aldeanueva, in the capacity as the representative for the stockholders
of the Company and their successors and assign (the “OAC Representative”). On
February 17, 2017, the Company sent a letter (the “Termination Letter”) to Aina Le’a to terminate the Merger
Agreement (1) pursuant to Sections 8.1(e) of the Merger Agreement because Aina Le’a breached the non-solicitation covenant
contained in Section 5.7 of the Merger Agreement and (2) pursuant to Section 8.1(f) because there has been a Material Adverse
Effect on Aina Le’a which is uncured and continuing. In addition, the Company provided notice of additional breaches by
Aina Le’a of the Merger Agreement based on information available to the Company as of the date of the Termination Letter,
including, among others, breaches of the following provisions: Section 5.1(a) (by failing to give the Company and its representatives
access to requested information about Aina Le’a and its operations, including without limitation Aina Le’a’s
ongoing financing activities), Section 5.8(iv) (failure to provide prompt notice of the filing of a foreclosure action on a parcel
of land material to the initial phase of Aina Le’a’s development project), Section 5.8(v) (failure to provide prompt
notice of the filing of a foreclosure action on a parcel of land material to the initial phase of Aina Le’a’s development
project), Sections 5.9 and 5.11 (Aina Le’a’s failure to use commercially reasonable efforts and to cooperate fully
with the Company and its representatives to prepare and file the Registration Statement). The Termination Letter served as a notice
to cure with respect to these provision to the extent required by Section 8.1(e) of the Merger Agreement. However, the Company
did not believe these breaches were curable and therefore the Termination Letter terminated the Merger Agreement immediately as
of February 17, 2017. On
February 22, 2017, the Company sent to Aina Le’a a supplement to the Termination Letter (the “Supplement”).
The Supplement noted that Aina Le’a’s Quarterly Report on Form 10-Q for the quarter ended December 31, 2016 (“From
10-Q”), which was filed on February 21, 2017, inaccurately described the Termination Letter. Furthermore, the Supplement
indicated that the Form10-Q contained further information that the Company believes demonstrated that a Material Adverse Effect
had occurred on Aina Le’a’s business and was continuing. The Supplement further reiterated that the termination of
the Merger Agreement was effective as of the date of the Termination Letter. On
July 24, 2017, the Company entered into a merger agreement, which was later amended on September 27, 2017 and February 28, 2018
(the “HTH Merger Agreement”), with Hightimes Holding Corp., a Delaware corporation (“HTH”), HTHC Merger
Sub, Inc., a Delaware corporation and a newly-formed wholly - owned subsidiary of Origo (“Merger Sub”). Pursuant to
the HTH Merger Agreement, subject to the terms and conditions set forth therein, at the closing of the transactions contemplated
by the HTH Merger Agreement (the “Closing”), the Company will merge with and into Merger Sub, with Merger Sub continuing
as the surviving entity (the “Merger”). Upon the consummation of the Merger, the Company will cease to exist and the
holders of the Company’s equity securities and warrants, options and rights to acquire or convert into the Company’s
equity securities will convert into the successor’s equity securities and warrants, options and rights to acquire or convert
into the successor’s equity securities (see Note 8). The Company’s board of directors has approved the HTH Merger
Agreement. Going
Concern The
accompanying financial statements have been prepared assuming the Company will continue as a going concern, which contemplates,
among other things, the realization of assets and satisfaction of liabilities in the normal course of business. As of February
28, 2018, the Company had approximately $3,000 in cash and cash equivalents, approximately $18,000 in interest income available
to the Company for working capital purposes from the Company's investments in the Trust account, and a working capital deficit
of approximately $3.1 million. Further, the Company has incurred and expects to continue to incur significant costs in pursuit
of its acquisition plans. Based on the foregoing, the Company may have insufficient funds available to operate its business through
the earlier of consummation of a Business Combination or June 12, 2018. Following the initial Business Combination, if cash on
hand is insufficient, the Company may need to obtain additional financing in order to meet its obligations. The Company
cannot be certain that additional funding will be available on acceptable terms, or at all. The Company’s plans to raise
capital or to consummate the initial Business Combination may not be successful. These matters, among others, raise substantial
doubt about the Company’s ability to continue as a going concern. The
accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue
as a going concern. |
