The combined entity of CanaFarma and KYC Inc. plans to pursue the development of a combined business after closing, and assuming the Merger is completed, the company projects the monthly expenses will be $130,555 per month, as described in the table set out below. 

CanaFarma plans to fund future capital expenditures primarily through revenue generated from CanaFarma product sales. Any remaining expenditures that exceed revenues may be funded from equity offerings or other alternative financing means. There may be circumstances where the reallocation of funds may be necessary in order to achieve its stated business objectives.

We also noted authorized shares of the issuer will consist of an unlimited number of Common Shares, and up to 1,000,000 Series A Preferred Shares. The total number of the Common Shares and Series A Preferred Shares to be issued and outstanding immediately following the closing is expected to be approximately 170,040,268 Resulting Issuer Shares and 228,000 Series A Preferred Shares.

Former CanaFarma shareholders are expected to hold 125,687,000 shares and 228,000 Series A Preferred Shares, representing approximately seventy-seven percent (77%) while former KYC Shareholders are expected to hold 44,353,268 shares representing approximately twenty-three percent (23%) of all outstanding securities. The chart below sets forth the origin of the Resulting Issuer shareholdings, see the chart below for this breakdown.

* All of the information in this article is taken directly from the December 2019 Prospectus, and edited for simplification.

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