Company Quick10K Filing
Gala Pharmaceutical
Price0.00 EPS-0
Shares108 P/E-0
MCap0 P/FCF-0
Net Debt0 EBIT-3
TEV0 TEV/EBIT-0
TTM 2019-05-31, in MM, except price, ratios
10-Q 2019-05-31 Filed 2019-07-23
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10-K 2017-11-30 Filed 2018-04-06
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10-K 2016-11-30 Filed 2017-03-09
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10-K 2014-11-30 Filed 2015-03-13
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10-K 2013-11-30 Filed 2014-04-18
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10-K 2012-11-30 Filed 2013-03-14
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10-Q 2012-05-31 Filed 2012-07-18
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10-K 2011-11-30 Filed 2012-03-13
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8-K 2020-04-29
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8-K 2018-01-10

GLAG 10Q Quarterly Report

Item 2 Management's Discussion and Analysis of Financial Condition and Results of Operations
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Item 4. Controls and Procedures
Part II - Other Information
Item 1. Legal Proceedings
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds Securities
Item 3. Defaults Upon Senior Securities
Item 4. Mine Safety Disclosures
Item 5. Other Information
Item 6. Exhibits
EX-31.1 gala_ex3101.htm
EX-32.1 gala_ex3201.htm

Gala Pharmaceutical Earnings 2017-08-31

Balance SheetIncome StatementCash Flow
0.4-0.3-1.0-1.6-2.3-3.02012201420172020
Assets, Equity
0.1-0.4-0.8-1.3-1.7-2.22012201420172020
Rev, G Profit, Net Income
0.30.20.1-0.1-0.2-0.32012201420172020
Ops, Inv, Fin

10-Q 1 galaglobal_10q-083117.htm FORM 10-Q

Table of Contents

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

þ  QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended August 31, 2017

 

o TRANSITION REPORT UNDER SECTION 13 OR 15 (d) OF THE EXCHANGE ACT

 

For the transition period from _________ to _________

 

Commission File Number: 333-172744

 

GALA GLOBAL INC.

(Name of Small Business Issuer in its charter)

 

Nevada 42-1771014
(state or other jurisdiction of incorporation or organization) (I.R.S. Employer I.D. No.)
   

 

2780 South Jones Blvd. #3725

Las Vegas, Nevada 89146

(Address of principal executive offices)

 

(775) 321-8238

Issuer’s telephone number

 

Indicate by check mark whether the registrant (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was require to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes   þ   No o

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company”, and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one)

  Large accelerated filer  o Accelerated filer  o
  Non-accelerated filer  o Smaller reporting company  x
  Emerging growth company  o  

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  Yes o     No þ 

 

APPLICABLE ONLY TO CORPORATE ISSUERS

 

As of October 11, 2017, the registrant had 39,801,590 shares of common stock outstanding.

 

 

 

 

 

   
 

 

GALA GLOBAL INC.

 

Table of Contents

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

   
 

 

GALA GLOBAL INC.

 

 

Condensed Consolidated Financial Statements

(unaudited)

 

For the Three and Nine Month Periods Ended August 31, 2017 and 2016, and the year ended November 30, 2016

 

 

Condensed Consolidated Balance Sheets (unaudited) 4
   
Condensed Consolidated Statements of Operations (unaudited) 5
   
Condensed Consolidated Statements of Cash Flows (unaudited) 6
   
Notes to the Condensed Consolidated Financial Statements (unaudited) 7
   

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 3 
 

 

GALA GLOBAL INC.

Condensed Consolidated Balance Sheets

(unaudited)

 

   August 31,
2017
$
   November 30,
2016
$
 
         
ASSETS          
           
Current assets          
           
Cash   60,540    10,841 
Loan receivable – related party   20,000     
Prepaid expenses   68,316     
Prepaid expenses – related party   110,000     
Inventory   2,241    2,241 
           
Total current assets   261,097    13,082 
           
Equipment   100,000     
           
Total assets   361,097    13,082 
           
LIABILITIES AND STOCKHOLDERS’ DEFICIT          
           
Current liabilities          
           
Accounts payable and accrued liabilities   26,867    20,052 
Accounts payable and accrued liabilities – related party   21,959    94,039 
Due to related parties   33,367    249,835 
Loans payable   42,200    75,200 
Loans payable - related parties   20,564    22,064 
Convertible note, net of unamortized discount of $186,149 and $nil, respectively   93,851     
Derivative liabilities   513,297     
           
Total liabilities   752,105    461,190 
           
STOCKHOLDERS’ DEFICIT          
           
Preferred stock
          
Authorized: 10,000,000 shares with a par value of $0.001 per share          
Issued and outstanding: 500,000 shares   500    500 
           
Common stock
            
Authorized: 500,000,000 shares with a par value of $0.001 per share           
Issued and outstanding: 38,301,590 and 1,369,224 shares, respectively   38,302    1,369 
Additional paid-in capital   2,215,788    786,736 
Deferred compensation   (309,223)    
Accumulated Deficit   (2,336,375)   (1,236,713)
           
Total stockholders’ deficit   (391,008)   (448,108)
           
Total liabilities and stockholders’ deficit   361,097    13,082 

 

 

 

(The accompanying notes are an integral part of these unaudited condensed consolidated financial statements)

 

 4 
 

 

GALA GLOBAL INC.

Condensed Consolidated Statements of Operations

(unaudited)

 

   Three months
ended
August 31,
2017
$
   Three months
ended
August 31,
2016
$
   Nine months ended
August 31,
2017
$
   Nine months ended
August 31,
2016
$
 
                 
Operating expenses                    
                     
Consulting fees   23,852        23,852    17,500 
Consulting fees – related party   164,736    9,114    210,845    24,479 
General and administrative   28,822    8,638    54,075    38,125 
General and administrative – related party   68,344    9,000    124,865    27,000 
Rent   1,050    22,500    3,500    37,500 
                     
Total operating expense   286,804    49,252    417,137    144,604 
                     
Loss before other expense   (286,804)   (49,252)   (417,137)   (144,604)
                     
Other expense                    
                     
Change in fair value of derivative liability   (197,308)       (207,340)    
Interest expense   (89,656)   (540)   (265,430)   (1,093)
Loss on settlement of notes payable   (93,050)       (93,050)    
Loss on settlement of notes payable – related party   (28,371)       (116,705)    
                     
Total other expense   (408,385)   (540)   (682,525)   (1,093)
                     
Net loss   (695,189)   (49,792)   (1,099,662)   (145,697)
                     
Net loss per share, basic and diluted   (0.02)   (0.04)   (0.06)   (0.11)
                     
Weighted average common shares outstanding   36,913,138    1,369,224    19,368,632    1,363,494 

 

 

 

(The accompanying notes are an integral part of these unaudited condensed consolidated financial statements)

 

 5 
 

 

GALA GLOBAL INC.

Condensed Consolidated Statements of Cash Flows

(unaudited)

 

   For the Nine Months Ended
August 31, 2017
$
   For the Nine Months Ended
August 31, 2016
$
 
         
Operating activities          
           
Net loss for the period   (1,099,662)   (145,697)
           
Adjustments to reconcile net loss to net cash used in operating activities:          
Amortization of discount on convertible note   77,570     
Amortization of debt issuance costs   16,281     
Change in fair value of derivative liability   207,340     
Common shares issued for services and compensation – related party   210,777     
Common shares issued for services   8,852     
Derivative expense   161,353     
Expenses paid by related parties on behalf of the Company       8,157 
Loss on settlement of related party debt   116,705     
Loss on settlement of debt   93,050     
Stock-based compensation       17,500 
Stock-based compensation – related party       73,855 
           
Changes in operating assets and liabilities:          
Inventory       (4,340)
Prepaid expenses   (37,168)    
Prepaid expenses – related party   (10,000)    
Accounts payable and accrued liabilities   12,668    11,925 
Accounts payable and accrued liabilities – related party   16,566    (22,157)
           
Net cash used in operating activities   (225,668)   (60,757)
           
Investing activities          
Loan issued to related party   (20,000)    
Purchase of equipment   (100,000)    
           
Net cash used in investing activities   (120,000)    
           
Financing activities          
Proceeds from related party debt   28,867     
Repayments of related party debt       (6,100)
Proceeds from convertible note   250,000     
Proceeds from issuance of common shares   108,000     
Proceeds from note payable - related party   8,500    2,064 
Proceeds from loan payable       65,000 
           
Net cash provided by financing activities   395,367    60,964 
           
Increase in cash   49,699    207 
           
Cash, beginning of period   10,841    1,804 
           
Cash, end of period   60,540    2,011 
           
Supplemental disclosures (Note 10)          

 

(The accompanying notes are an integral part of these unaudited condensed consolidated financial statements)

 

 

 6 
 

GALA GLOBAL INC.

Notes to the Condensed Consolidated Financial Statements

For the Three and Nine Months Ended August 31, 2017 and 2016

(unaudited)

 

1.       Organization and Nature of Operations

 

Gala Global Inc. (the “Company”) was incorporated in the State of Nevada on March 10, 2010. The Company was formed to provide garment tailoring and alteration services.

 

The Company has expanded into the Hemp and Cannabidiol (“CBD”) industry. The expansion is focusing on the development, research, and commercialization of products derived from the Hemp and Cannabis plant. The Company currently is finalizing its marketing strategy for a new CBD flavored thin-film strip. The film strip delivery system uses a dissolving film strip that is absorbed in the mouth. The film-strip method is an advanced method of providing CBD for dietary supplement. The Company also is seeking acquisition candidates in this area of interest in the nutraceutical and pharmaceutical industries. The Company also plans to enter into the medical marijuana cultivation industry as approved in the United States and Canada to build legalized cultivation operations.

 

The Company’s services include the development of cannabinoid based health and wellness products; the development of medical grade compounds; the licensing of proprietary testing, genetics, labeling and packaging, tracking, production, and standardization methods for the medicinal herb industry.

 

On May 8, 2017, Gala Global Inc. and Controlled Environment Genomics, Inc. (“CEG”) entered into a definitive agreement whereby GLAG is acquiring 80% of CEG. The transaction will be closing shortly.

 

Controlled Environment Genomics, Inc. (CEG), Akron, Ohio, is a genomics company with expertise in digital plant gene sequencing, editing and cloning technologies. Genomics is an interdisciplinary field of science and branch of molecular biology focused on the structure, function, evolution and mapping of genomes, complete sets of DNA within single cells of an organism. CEG’s state-of-the-art genomics technology enables computerized genome sequencing and plant cloning using a fully automated turnkey solution for digitally sequencing the genomes of the world’s most desirable plant varieties based on flavor and nutrition.

 

On August 3, 2017, Controlled Environment Genomics Inc. had successfully filed a provisional patent application on its proprietary, fully automated, computer-controlled, genetically modified plant cloning technology through the company’s IP legal counsel Tucker Ellis LLP, Los Angeles, Calif.

 

Going Concern

 

These consolidated financial statements have been prepared on a going concern basis, which implies that the Company will continue to realize its assets and discharge its liabilities in the normal course of business. As at August 31, 2017, the Company has generated no revenues and has an accumulated deficit of $2,336,375. The continuation of the Company as a going concern is dependent upon the continued financial support from its management, and its ability to identify future investment opportunities and obtain the necessary debt or equity financing, and generating profitable operations from the Company’s future operations. These factors raise substantial doubt regarding the Company’s ability to continue as a going concern. These consolidated financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

 

2.Summary of Significant Accounting Policies

 

(a)Basis of Presentation

 

The consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States (“US GAAP”) and are expressed in U.S. dollars.

 

(b)Principles of Consolidation

 

These consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, Cannabis Ventures Inc. (USA), Cannabis Ventures Inc. (Canada), from the date of their acquisition by the Company effective June 26, 2014 and CBD Life, Inc. from June 26, 2014 (date of acquisition) to December 30, 2016 (date of dissolution). All inter-company transactions and balances have been eliminated on consolidation.

 

 

 

 

 7 
 

GALA GLOBAL INC.

Notes to the Condensed Consolidated Financial Statements

For the Three and Nine Months Ended August 31, 2017 and 2016

(unaudited)

 

 

2.Summary of Significant Accounting Policies (continued)

 

(c)Interim Financial Statements

 

The accompanying unaudited financial statements of the Company have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In management’s opinion the financial statements include all adjustments (consisting of normal recurring accruals) necessary in order to make the financial statements not misleading. Operating results for the nine months ended August 31, 2017 are not necessarily indicative of the results that may be expected for the year ended November 30, 2017. For more complete financial information, these unaudited financial statements should be read in conjunction with the audited financial statements for the year ended November 30, 2016 included in our Form 10-K filed with the SEC.

 

(d)Use of Estimates

 

The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The Company regularly evaluates estimates and assumptions related to the valuation of inventory, valuation of derivative liability and share-based compensation, and deferred income tax asset valuation allowances. The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by the Company may differ materially and adversely from the Company’s estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected.

 

(e)Inventory

 

Inventory is comprised of Vape Mods purchased for resale, and is recorded at the lower of cost or net realizable value on a first-in first-out basis. The Company establishes inventory reserves for estimated obsolete or unsaleable inventory equal to the difference between the cost of inventory and the estimated realizable value based upon assumptions about future market conditions.

 

(f)Equipment

 

Equipment is comprised of machinery capable of DNA fragment capabilities, is recorded at cost and amortized on a straight-line basis over an estimated useful life of five years.

 

(g)Financial Instruments

 

The Company’s financial instruments consist principally of cash, accounts payable and accrued liabilities, loans payable to related parties, loans payable, and amounts due to related parties. The recorded values of all these financial instruments approximate their current fair values because of the short term nature of these financial instruments.

 

(h)Revenue Recognition

 

The Company earns revenue from the sale of Vape Mods, which are modified electronic cigarettes and vape pens. Revenue will be recognized only when the price is fixed and determinable, persuasive evidence of an arrangement exists, the service has been provided, and collectability is assured. The Company is not exposed to any credit risks as amounts are prepaid prior to performance of services.

 

(i)Stock-based Compensation

 

The Company records stock-based compensation in accordance with ASC 718, Compensation – Stock Compensation using the fair value method. All transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable. Equity instruments issued to employees and the cost of the services received as consideration are measured and recognized based on the fair value of the equity instruments issued.

 

 

 8 
 

 

GALA GLOBAL INC.

Notes to the Condensed Consolidated Financial Statements

For the Three and Nine Months Ended August 31, 2017 and 2016

(unaudited)

 

 

2.Summary of Significant Accounting Policies (continued)

 

(j)Basic and Diluted Net Loss per Share

 

The Company computes net income (loss) per share in accordance with ASC 260, Earnings per Share. ASC 260 requires presentation of both basic and diluted earnings per share (“EPS”) on the face of the income statement. Basic EPS is computed by dividing net income (loss) available to common shareholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method. In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential shares if their effect is anti-dilutive. At August 31, 2017, the Company had 486,873 (November 30, 2016 – nil) potentially dilutive shares outstanding.

 

(k)Derivative Liability

 

From time to time, the Company may issue equity instruments that may contain an embedded derivative instrument which may result in a derivative liability. A derivative liability exists on the date the equity instrument is issued when there is a contingent exercise provision. The derivative liability is recorded at its fair value calculated by using an option pricing model such as a multi-nominal lattice model. The fair value of the derivative liability is then calculated on each balance sheet date with the corresponding gains and losses recorded in the consolidated statement of operations.

 

(l)Beneficial Conversion Features

 

From time to time, the Company may issue convertible notes that may contain an embedded beneficial conversion feature. A beneficial conversion feature exists on the date a convertible note is issued when the fair value of the underlying common stock to which the note is convertible into is in excess of the remaining unallocated proceeds of the note after first considering the allocation of a portion of the note proceeds to the fair value of the warrants, if related warrants have been granted. The intrinsic value of the beneficial conversion feature is recorded as a debt discount with a corresponding amount to additional paid in capital. The debt discount is amortized to interest expense over the life of the note using the effective interest method.

 

(m)Recent Accounting Pronouncements

 

The Company has implemented all new accounting pronouncements that are in effect and that may impact its financial statements and does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.

 

3.Deferred Compensation

 

Deferred compensation is comprised of common shares issued to officers and directors of the Company for compensation services. During the nine months ended August 31, 2017, the Company issued 26,000,000 common shares with a fair value of $520,000 for compensation of which $210,777 was expensed during the period and the remaining $309,223 was recorded as deferred compensation within shareholders’ equity.

 

4.Equipment

 

Cost

$

Accumulated amortization

$

August 31,

2017

$

November 30,

2016

$

         
Machinery 100,000 100,000

 

 

 

 9 
 

GALA GLOBAL INC.

Notes to the Condensed Consolidated Financial Statements

For the Three and Nine Months Ended August 31, 2017 and 2016

(unaudited)

 

 

5.Convertible Debenture

 

On May 15, 2017, the Company entered into a promissory note agreement with a non-related party for proceeds of $280,000, net of an original issuance discount and legal fees of $30,000 which were capitalized and amortized over the period of the convertible debenture. The promissory note is unsecured, bears interest at 10% per annum, and is due on November 30, 2017. The promissory note is convertible into common shares at the lesser of: (a) $0.35; or (b) 65% of the average of the three lowest volume weighted average price of the Company’s common shares in the 20 days preceding the notice of conversion limited by a conversion floor price of $0.05 per share.

 

The embedded conversion option qualifies for derivative accounting under ASC 815-15, Derivatives and Hedging. The fair value of the derivative liability resulted in a full discount of the $250,000 based on the net proceeds received from promissory note. The carrying value of the convertible debenture will be accreted over the term of the convertible debenture up to the face value of $280,000. As at August 31, 2017, the carrying value of the convertible debenture was $93,851 and the unamortized discount on the convertible debenture was $186,149, which includes $172,430 of unamortized discount on the convertible note and $13,719 of unamortized debt issuance costs incurred.

 

6.Derivative Liability

 

The Company records the fair value of the conversion price of the convertible debentures, as disclosed in Note 3, in accordance with ASC 815, Derivatives and Hedging. The fair value of the derivative liability is revalued on each balance sheet date or upon conversion of the underlying convertible debenture into equity with corresponding gains and losses recorded in the consolidated statement of operations. The fair value of the derivative as of May 15, 2017 was $305,957 calculated using the binomial option pricing model. $250,000 was applied against the net proceeds received from promissory note as a conversion discount and the remaining $55,957 was included in interest expense. During the three months ended August 31, 2017, the Company recorded a loss on the change in fair value of the derivative liability of $197,308 (2016 - $nil). During the nine months ended August 31, 2017, the Company recorded a loss on the change in fair value of derivative liability of $207,340 (2016 - $nil). As at August 31, 2017, the Company recorded a derivative liability of $513,297 (November 30, 2016 - $nil).

 

The following inputs and assumptions were used to value the convertible debentures outstanding during the period ended August 31, 2017:

 

  Expected Volatility Risk-free
Interest Rate
Expected Dividend
Yield

Expected
Life

(in years)

         
May 15, 2017 convertible debenture:        
         
As at May 15, 2017 (date of issuance) 288% 1.02% 0% 0.5
As at May 31, 2017 (mark-to-market) 267% 1.08% 0% 0.5
As at August 31, 2017 (mark-to-market) 269% 1.01% 0% 0.5

 

7.Related Party Transactions

 

(a)As at August 31, 2017, the Company owed $33,367 (November 30, 2016 - $249,835) to a company controlled by a significant shareholder of the Company to fund payment of operating expenditures. During the period ended August 31, 2017, the Company settled $249,835 of related party debt with the issuance of 1,387,979 common shares. Refer to Note 7(b). The remaining amount owed is unsecured, non-interest bearing, and due on demand.

 

(b)As at August 31, 2017, the Company owed $18,500 (November 30, 2016 - $10,000) to a company controlled by a significant shareholder of the Company. The amount owed is unsecured, non-interest bearing, and due on demand.

 

 

 

 10 
 

GALA GLOBAL INC.

Notes to the Condensed Consolidated Financial Statements

For the Three and Nine Months Ended August 31, 2017 and 2016

(unaudited)

 

 

7.Related Party Transactions (continued)

 

(c)As at August 31, 2017, the Company owed $2,064 (November 30, 2016 - $2,064) to a significant shareholder of the Company. The amount is unsecured, bears interest at 3% per annum, and due 180 days from the date of issuance. As at August 31, 2017, accrued interest of $66 (November 30, 2016 - $15) has been included in accounts payable and accrued liabilities, related parties.

 

(d)As at August 31, 2017, the Company owed $nil (November 30, 2016 - $10,000) to the former spouse of a significant shareholder of the Company for a note issued on September 21, 2016. Under the terms of the note, the amount due was unsecured, bore interest at 3% per annum, and was due 180 days from the date of issuance. In July 2017, the Company issued 128,750 common shares with a fair value of $38,625 to settle $10,000 of principal balance and $254 of accrued interest.

 

(e)As at August 31, 2017, the Company owed $15,000 (November 30, 2016 - $79,333) to a significant shareholder of the Company, which has been recorded in accounts payable and accrued liabilities - related parties. The amount owed is unsecured, non-interest bearing, and due on demand. During the three and nine months ended August 31, 2017, the Company incurred $58,911 (2016 - $9,000) and $115,432 (2016 - $27,000) of consulting expense relating to services provided to the Company. During the nine months ended August 31, 2017, the Company settled $88,333 of related party debt with the issuance of 490,742 common shares. Refer to Note 7(a).

 

(f)On May 8, 2017, the Company entered into an agreement whereby the Company agreed to acquire 80% of the issued and outstanding common stock of Controlled Environment Genomics Inc ("CEG Inc"), in exchange for a new series of the Company’s preferred shares, and issue 5,000,000 restricted common shares in exchange for CEG's intellectual property. In the event that CEG, Inc. becomes its own public entity, the executive shall receive 51% ownership of the new entity, and the Company will retain the remaining 49%. As at May 31, 2017, the Company issued 5,000,000 common shares with a fair value of $100,000 to the Chief Executive Officer of the Company as a deposit for the proposed acquisition of intangible assets. As at August 31, 2017, the agreement to acquire the common stock of CEG Inc. and the intangible assets has not been finalized. Refer to Note 7(h).

 

(g)During the nine months ended August 31, 2017, the Company issued 26,000,000 common shares with a fair value of $520,000 to officers and directors of the Company as compensation for services for a period of one year. As at August 31, 2017, the Company recorded $309,223 as deferred compensation within shareholders’ equity. During the three and nine months ended August 31, 2017, the Company recorded compensation expense of $130,146 and $210,777 respectively.

 

(h)During the nine months ended August 31, 2017, the Company loaned $20,000 (November 30, 2016- $nil) to a company controlled by an officer of the Company for day-to-day expenses. The amount owing is unsecured, non-interest bearing, and due on demand.

 

8.Common Shares

 

(a)On January 30, 2017, the Company effected a share consolidation on a 100 old shares for 1 new share basis. The share consolidation has been applied retroactively to the earliest period presented.

 

(b)On March 22, 2017, the Company issued 490,742 common shares with a fair value of $176,667 to settle outstanding debt of $88,333 owed to a director of the Company. The transaction resulted in a loss on settlement of debt of $88,334, which was recorded in the consolidated statement of operations.

 

(c)On March 22, 2017, the Company issued 1,387,970 common shares to settle outstanding debt of $249,835 owed to a company controlled by a director of the Company.

 

(d)On March 30, 2017, the Company issued 10,000,000 common shares with a fair value of $200,000 to a director of the Company for compensation services for a period of twelve months from the date of issuance. As at August 31, 2017, deferred compensation of $115,068 has been recorded in deferred compensation.

 

 

 

 11 
 

GALA GLOBAL INC.

Notes to the Condensed Consolidated Financial Statements

For the Three and Nine Months Ended August 31, 2017 and 2016

(unaudited)

 

 

8.Common Shares (continued)

 

(e)On March 30, 2017, the Company issued 10,000,000 common shares with a fair value of $200,000 to a director of the Company for compensation services for a period of twelve months from the date of issuance. As at August 31, 2017, deferred compensation of $115,068 has been recorded in deferred compensation.

 

(f)On March 30, 2017, the Company issued 1,500,000 common shares with a fair value of $30,000 to the Chief Financial Officer of the Company for compensation services for a period of twelve months from the date of issuance. As at August 31, 2017, deferred compensation of $17,260 has been recorded in deferred compensation.

 

(g)On March 30, 2017, the Company issued 1,500,000 common shares with a fair value of $30,000 to an officer of the Company for compensation services for a period of twelve months from the date of issuance. As at August 31, 2017, deferred compensation of $17,260 has been recorded in deferred compensation.

 

(h)On May 17, 2017, the Company issued 1,500,000 common shares with a fair value of $30,000 to the Chief Executive Officer of the Company for compensation services for a period of twelve months from the date of issuance. As at August 31, 2017, deferred compensation of $21,206 has been recorded in deferred compensation.

 

(i)On May 17, 2017, the Company issued 5,000,000 common shares with a fair value of $100,000 to a company controlled by the Chief Executive Officer of the Company for the purchase of intangible assets, which has been recorded as related party prepaid deposit as the assets have not been transferred to the Company.

 

(j)On July 6, 2017, the Company issued 1,500,000 common shares at $0.08 per common share pursuant to private placement for proceeds of $120,000.

 

(k)On June 12, 2017, the Company issued 2,000,000 common shares for consulting services over a twelve month period with a fair value of $40,000.

 

(l)On June 13, 2017, the Company issued 1,500,000 common shares with a fair value of $30,000 to the Chief Operating Officer of the Company for compensation services for a period of twelve months from the date of issuance. As at August 31, 2017, deferred compensation of $23,361 has been recorded in deferred compensation.

 

(m)On July 21, 2017, the Company issued 553,625 common shares with a fair value of $166,088 to settle outstanding promissory notes and accrued interest of $44,666 resulting in a loss on settlement of debt of $121,422, including 128,750 common shares with a fair value of $38,625 to settle outstanding promissory notes and accrued interest of $10,254 resulting in a loss on settlement of debt of $28,371 to a related party.

 

9.Share Purchase Warrants

 

On May 15, 2017, the Company issued 486,783 share purchase warrants with an exercise price of $0.09 per share for a period of five years in conjunction with the issuance of convertible debt. The fair value of the share purchase warrants was $105,396, calculated using the binomial option pricing model assuming no expected dividends, volatility of 199%, expected life of 5 years, and a risk free rate of 1.05%. The fair value of the share purchase warrants were recorded in the consolidated statement of operations as interest expense.

 

Number of

warrants

Weighted average exercise price

$

     
Balance, November 30, 2016
Issued 486,783 0.09
     
Balance, August 31, 2017 486,783 0.09

 

 

 

 12 
 

GALA GLOBAL INC.

Notes to the Condensed Consolidated Financial Statements

For the Three and Nine Months Ended August 31, 2017 and 2016

(unaudited)

 

 

10.Supplemental Disclosures

 

   Nine months ended
August 31,
2017
$
   Nine months ended
August 31,
2016
$
 
Non-cash investing and financing activities:          
           
Common shares issued for consulting services – related party   210,777    70,937 
Common shares issued for consulting services   8,852    17,500 
Common shares issued for deposit on intangible assets – related party   100,000     
Common shares issued for prepaid expenses   31,148     
Common shares issued for deferred compensation   309,223     
Common shares issued for settlement of related party debt   348,422     
Common shares issued to settle third party debt   34,412     
Common shares issued to settle outstanding payables       25,000 
Expenses paid by related parties that increased related party debt   4,500    8,157 
Preferred shares issued to settle related party payables       24,167 
Preferred shares issued to settle related party debt       48,453 
           
Supplemental disclosures:          
           
Interest paid        
Income tax paid        

  

11.Subsequent Events

 

We have evaluated subsequent events through to the date of issuance of the condensed consolidated financial statements, and the following subsequent events:

 

(a)Subsequent to August 31, 2017, the Company issued 1,500,000 common shares to a non-related party for consulting services.

 

 

 

 

 

 

 

 

 

 

 

 13 
 

 

ITEM 2     MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

 

Safe Harbor Statement

 

This report on Form 10-Q contains certain forward-looking statements.  All statements other than statements of historical fact are “forward-looking statements” for purposes of these provisions, including any projections of earnings, revenues, or other financial items; any statements of the plans, strategies, and objectives of management for future operation; any statements concerning proposed new products, services, or developments; any statements regarding future economic conditions or performance; statements of belief; and any statement of assumptions underlying any of the foregoing. Such forward-looking statements are subject to inherent risks and uncertainties, and actual results could differ materially from those anticipated by the forward-looking statements.

 

These forward-looking statements involve significant risks and uncertainties, including, but not limited to, the following: competition, promotional costs, and risk of declining revenues.  Our actual results could differ materially from those anticipated in such forward-looking statements as a result of a number of factors.  These forward-looking statements are made as of the date of this filing, and we assume no obligation to update such forward-looking statements.  The following discusses our financial condition and results of operations based upon our financial statements which have been prepared in conformity with accounting principles generally accepted in the United States.  It should be read in conjunction with our financial statements and the notes thereto included elsewhere herein.

 

The following discussion should be read in conjunction with our financial statements, including the notes thereto, appearing elsewhere in this Form 10-Q.  The discussions of results, causes and trends should not be construed to imply any conclusion that these results or trends will necessarily continue into the future.

Business Expansion:

 

On May 8, 2017, Gala Global Inc. (“GLAG”) and Controlled Environment Genomics, Inc. (“CEG”) entered into a definitive agreement whereby GLAG is acquiring 80% of CEG. The transaction will be closing shortly.

 

Controlled Environment Genomics, Inc. (CEG), Akron, Ohio, is a genomics company with expertise in digital plant gene sequencing, editing and cloning technologies. Genomics is an interdisciplinary field of science and branch of molecular biology focused on the structure, function, evolution and mapping of genomes, complete sets of DNA within single cells of an organism. CEG’s state-of-the-art genomics technology enables computerized genome sequencing and plant cloning using a fully automated turnkey solution for digitally sequencing the genomes of the world’s most desirable plant varieties based on flavor and nutrition.

 

CEG improves the most valuable crop varieties currently available on the market by utilizing proprietary Cloud computing-based digital cloning technologies to crossbreed crops that have advantageous traits with established varieties featuring the best genetic profiles for commercial production. The very best plant traits can be used to improve the most sought-after commercial varieties by adding characteristics like maximized yields and quality conducive to increased consumer demand and optimized production profitability.

 

CEG’s patent-pending digital cloning technology makes it possible for plant breeders to edit the original genetic profile of any crop by modifying it with specific genes that control traits like active compound production and/or nutritional/medicinal value, thus increasing business efficiencies while boosting commercial viability.

 

CEG Inc. designed its digital plant cloning incubation and growth chambers with plant breeders in mind. CEG incubation technology enables breeders to control temperature, light, humidity and more for agricultural biotechnology, phytopathology, entomology and other plant science research. Using CEG technology, plant breeders can quickly clone hybridized plants containing specific desirable genes and traits “on demand” in any geographical location.

 

 

 

 14 
 

 

RESULTS OF OPERATIONS

 

Working Capital

 

   August 31,
2017
$
   November 30,
2016
$
 
Current Assets   261,097    13,082 
Current Liabilities   (752,105)   (461,190)
Working Capital (Deficit)   (491,008)   (448,108)

  

Cash Flows

   Nine months ended May 31,
2017
$
   Nine months ended May 31,
2016
$
 
Cash Flows from (used in) Operating Activities   (225,668)   (60,757)
Cash Flows from (used in) Investing Activities   (120,000)    
Cash Flows from (used in) Financing Activities   395,367    60,964 
Net Increase (decrease) in Cash During Period   49,699    207 

 

Operating Expenses

 

Three Months Ended August 31, 2017 and 2016

 

During the three months ended August 31, 2017, the Company incurred operating expenses of $286,804 compared to $49,252 during the three months ended August 31, 2016. The increase in operating expenses is due to an increase in related party consulting fees of $155,622 related to the portion of deferred compensation expensed during the period relating to the issuance of common shares to officers and directors of the Company for services rendered, an increase of $59,344 in related party general and administrative costs for out of pockets incurred by officers and directors of the Company due to the increase in operating activity related to the proposed acquisition of CEG, an increase of $20,184 in general and administrative costs related to professional fees and day-to-day operating activities, and $23,852 in consulting fees related to services provided by outside consultants to the Company. The increases were offset by a decrease in rent of $21,450 as the Company moved from its previous head office location in order to preserve cash flow.

 

The Company incurred a net loss of $695,189 during the three months ended August 31, 2017 compared to a net loss of $49,792 during the three months ended August 31, 2016. In addition to operating expenses incurred during the three months ended August 31, 2017, the Company also recorded a loss on settlement of related party debt of $28,371 for the difference in the fair value of shares issued to a related party above the carrying value of related party debt, $93,050 loss on settlement of notes payable related to the difference in the fair value of shares issued to note holders above the carrying value of the notes payable, $197,308 for the change in fair value of the derivative liability, and $89,656 for interest and accretion expense related to the convertible debenture issued and share purchase warrants issued during the year. For the three months ended August 31, 2016, the Company had minimal other expense items.

 

Nine Months Ended August 31, 2017 and 2016

 

During the nine months ended August 31, 2017, the Company incurred operating expenses of $417,137 compared to $144,604 during the nine months ended August 31, 2016. The increase in operating expenses is due to the issuance of common shares to officers and directors of the Company totaling $520,000 of which $210,777 was expensed during the period and the remaining amount of $309,223 was recorded as deferred compensation for the fair value of future services due to the Company related to those share issuances. Furthermore, the Company incurred an increase of $45,000 for consulting and salary costs incurred for a new officer of the Company, $40,000 in compensation costs to the Chief Executive Officer of the Company, and $15,950 in general and administrative expense for out-of-pocket costs relating to the potential acquisition of CEG and for an overall increase in business activity in the current fiscal year compared to the prior fiscal year. The increases were offset by a decrease of $34,000 in rent expense as the Company is minimizing expenditures in order to maintain sufficient cash flow for future use.

 

 

 

 15 
 

 

The Company incurred a net loss of $1,099,662 during the nine months ended August 31, 2017 compared to a net loss of $145,697 during the nine months ended August 31, 2016. In addition to operating expenses incurred during the nine months ended August 31, 2017, the Company also recorded a loss on settlement of related party debt of $116,705 for the difference in the fair value of shares issued to a related party above the carrying value of related party debt, a loss of $93,050 for the settlement of non-related party notes payable for the difference in the fair value of shares issued to settle notes payable, a loss of $207,340 for the change in fair value of the derivative liability, and $265,430 for interest and accretion expense related to the issuance and revaluation of the convertible debenture issued during the period and for the fair value of share purchase warrants issued during the period of $105,396. For the nine months ended August 31, 2016, the Company had minimal other expense items.

 

Net Loss

 

During the three months ended August 31, 2017, the Company incurred a net loss of $695,189 or $0.02 loss per share compared to a net loss of $49,792 and loss per share of $0.04 during the three months ended August 31, 2017. During the nine months ended August 31, 2017, the Company incurred a net loss of $1,099,662 or $0.06 loss per share compared to a net loss of $145,697 or $0.11 loss per share during the nine months ended August 31, 2016. The increase in the net loss and loss per share amounts were due to greater expenditures relating to the fair value of share-based compensation that was issued during the current period.

 

Liquidity and Capital Resources

 

As of August 31, 2017, the Company has a working capital deficit of $491,008 and an accumulated deficit of $2,336,375 compared to a working capital deficit of $448,108 and an accumulated deficit of $1,236,713 at November 30, 2016. The increase in working capital deficit was due to the issuance of convertible debentures that were used for operating activities, and the derivative liability relating to the conversion feature of the convertible debentures that increased the overall working capital deficit.

 

During the nine months ended August 31, 2017, the Company issued the following common shares:

 

·Issuance of 490,742 common shares with a fair value of $176,667 to settle outstanding debt of $88,333 owed to a director of the Company;
·Issuance of 1,387,970 common shares to settle outstanding debt of $249,835 owed to a company controlled by a director of the Company;
·Issuance of 10,000,000 common shares with a fair value of $200,000 to a director of the Company for compensation services of one year, ending March 30, 2018;
·Issuance of 10,000,000 common shares with a fair value of $200,000 to a director of the Company for compensation services of one year, ending March 30, 2018;
·Issuance of 1,500,000 common shares with a fair value of $30,000 to the Chief Financial Officer of the Company for compensation services of one year, ending March 30, 2018;
·Issuance of 1,500,000 common shares with a fair value of $30,000 to an officer of the Company for compensation services of one year, ending March 30, 2018;
·Issuance of 1,500,000 common shares with a fair value of $30,000 to the Chief Executive Officer of the Company for compensation services of one year, ending May 17, 2018;
·Issuance of 5,000,000 common shares with a fair value of $100,000 to a company controlled by the Chief Executive Officer of the Company as a deposit for the purchase of intangible assets, which have not been finalized as of August 31, 2017;
·Issuance of 1,500,000 common shares with a fair value of $30,000 to a non-related company for consulting services of one year, ending June 12, 2018;
·Issuance of 500,000 common shares with a fair value of $10,000 to a non-related company for consulting services of one year, ending June 12, 2018;
·Issuance of 1,500,000 common shares with a fair value of $30,000 to the Chief Operating Officer of the Company for compensation services of one year, ending June 2018;
·Issuance of 1,500,000 common shares at $0.08 per share for proceeds of $120,000;
·Issuance of 128,750 common shares for settlement of $10,254 of debt to a related company; and
·Issuance of 424,875 common shares for settlement of $34,413 of debt to note holders.

 

Cash flow from Operating Activities

 

During the nine months ended August 31, 2017, the Company used cash of $225,668 in operating activities compared to the use of $60,757 of cash for operating activities during the nine months ended August 31, 2016. Overall, the cash used for operating activities increased to an overall increase in funding from financing activities which included $250,000 of proceeds from a convertible note payable, and $108,000 in proceeds from the issuance of common shares after accounting for a $12,000 payment for finder’s fees.

 

 

 

 

 16 
 

 

Cash flow from Investing Activities

 

During the nine months ended August 31, 2017, the Company used cash of $120,000 which included $100,000 for the purchase of equipment and $20,000 for a loan issued to a related party. During the nine months ended August 31, 2016, the Company did not have any investing activities.

  

Cash flow from Financing Activities

 

During the nine months ended August 31, 2017, the Company received cash of $395,367 from financing activities compared to $60,964 during the nine months ended August 31, 2016. The increase in the cash received from financing activities was due to the receipt of $250,000 from the issuance of a convertible debenture, $108,000 of proceeds received from the issuance of common shares after accounting for $12,000 of finder’s fees, $28,867 from related parties, and $8,500 from the issuance of a related party note payable. During the nine months ended August 31, 2016, the Company received $65,000 from issuance of a loan payable, $2,064 of proceeds from a related party which was offset by the repayment of $6,100 for related party debt.

 

Off-Balance Sheet Arrangements

 

We have no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.

 

Subsequent Events;

 

Subsequent to August 31, 2017, the Company issued 1,500,000 common shares to a non-related party for consulting services.

 

Going Concern

 

The continuation of the Company as a going concern is dependent upon the continued financial support from its management, and its ability to identify future investment opportunities and obtain the necessary debt or equity financing, and generating profitable operations from the Company’s future operations. These factors raise substantial doubt regarding the Company’s ability to continue as a going concern. These financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

 

Future Financings

 

We will continue to rely on equity sales of our common shares in order to continue to fund our business operations. Issuances of additional shares will result in dilution to existing stockholders. There is no assurance that we will achieve any additional sales of the equity securities or arrange for debt or other financing to fund planned acquisitions and activities.

  

Critical Accounting Policies

 

Our financial statements and accompanying notes have been prepared in accordance with United States generally accepted accounting principles applied on a consistent basis. The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods.

 

We regularly evaluate the accounting policies and estimates that we use to prepare our financial statements. A complete summary of these policies is included in note (1) of the notes to our financial statements. In general, management's estimates are based on historical experience, on information from third party professionals, and on various other assumptions that are believed to be reasonable under the facts and circumstances. Actual results could differ from those estimates made by management.

 

Use of Estimates

 

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes for the reporting period. Significant areas requiring the use of management estimates relate to the valuation of its mineral leases and claims and our ability to obtain final government permission to complete the project.

 

 

 

 17 
 

 

Stock-Based Compensation

 

The Company records stock-based compensation in accordance with ASC 718, Compensation – Stock Compensation, using the fair value method. All transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable. Equity instruments issued to employees and the cost of the services received as consideration are measured and recognized based on the fair value of the equity instruments issued.

 

Derivative Liability

 

From time to time, the Company may issue equity instruments that may contain an embedded derivative instrument which may result in a derivative liability. A derivative liability exists on the date the equity instrument is issued when there is a contingent exercise provision. The derivative liability is records at is fair value calculated by using an option pricing model such as a multi-nominal lattice model. The fair value of the derivative liability is then calculated on each balance sheet date with the corresponding gains and losses recorded in the consolidated statement of operations.

 

Beneficial Conversion Features

 

From time to time, the Company may issue convertible notes that may contain an embedded beneficial conversion feature. A beneficial conversion feature exists on the date a convertible note is issued when the fair value of the underlying common stock to which the note is convertible into is in excess of the remaining unallocated proceeds of the note after first considering the allocation of a portion of the note proceeds to the fair value of the warrants, if related warrants have been granted. The intrinsic value of the beneficial conversion feature is recorded as a debt discount with a corresponding amount to additional paid in capital. The debt discount is amortized to interest expense over the life of the note using the effective interest method.

 

Recently Issued Accounting Pronouncements

 

The Company has reviewed all the recently issued, but not yet effective, accounting pronouncements and does not believe that the future adoption of any such pronouncements may be expected to cause a material impact on its financial condition or the results of its operations as reported in its financial statements.

 

Contractual Obligations

 

We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

 

ITEM 3.     QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

 

We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

  

ITEM 4.     CONTROLS AND PROCEDURES

 

Management's Report on Internal Control over Financial Reporting.

 

Our Internal control over financial reporting is a process that, under the supervision of and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, was designed to provide reasonable assurances regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.  Our internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect our transactions and dispositions of our assets; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with authorizations of our management and our trustees; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of our assets that could have a material effect on our financial statements.

 

 

 

 

 18 
 

 

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that our controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

 

As management, it is our responsibility to establish and maintain adequate internal control over financial reporting. As of May 31, 2017, under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we evaluated the effectiveness of our internal control over financial reporting using criteria established in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission ("COSO"). Based on our evaluation, we concluded that the Company maintained effective internal control over financial reporting as of May 31, 2017, based on criteria established in the Internal Control Integrated Framework issued by the COSO.

 

This quarterly report does not include an attestation report of the company's registered public accounting firm regarding internal control over financial reporting.  Management's report was not subject to attestation by the company's registered public accounting firm pursuant to temporary rules of the Securities and Exchange Commission that permit the company to provide only management's report in this quarterly report.

 

Evaluation of disclosure controls and procedures.

 

As of May 31, 2017, the Company's chief executive officer and chief financial officer conducted an evaluation regarding the effectiveness of the Company's disclosure controls and procedures (as defined in Rules 13a-15(e) or 15d-15(e) under the Exchange Act.  Based upon the evaluation of these controls and procedures, our chief executive officer and chief financial officer concluded that our disclosure controls and procedures were not effective as of the date of filing this annual report applicable for the period covered by this report.

 

Changes in internal controls.

 

During the period covered by this report, no changes occurred in our internal control over financial reporting that materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

 

  

PART II – OTHER INFORMATION

 

ITEM 1.     LEGAL PROCEEDINGS

 

As of August 31, 2017 there are no material pending legal proceedings, other than ordinary routine litigation incidental to our business, to which we or any of our subsidiaries are a party or of which any of our properties is the subject.  Also, our management is not aware of any legal proceedings contemplated by any governmental authority against us.

 

 

 

 

 19 
 

 

 

ITEM 2.      UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS SECURITIES

 

For the nine months ended August 31, 2017, there were the following equity transactions.

 

(i)On March 22, 2017, the Company issued 490,742 common shares with a fair value of $176,667 to settle outstanding debt of $88,333 owed to a director of the Company for legal services.
(ii)On March 22, 2017, the Company issued 1,387,970 common shares to settle outstanding debt of $249,835 owed to a company controlled by a director of the Company.
(iii)On March 30, 2017, the Company issued 10,000,000 common shares with a fair value of $200,000 to a director of the Company for compensation services for a period of twelve months from the date of issuance. As at May 31, 2017, deferred compensation of $165,479 has been recorded in deferred compensation.
(iv)On March 30, 2017, the Company issued 10,000,000 common shares with a fair value of $200,000 to a director of the Company for compensation services for a period of twelve months from the date of issuance. As at May 31, 2017, deferred compensation of $165,479 has been recorded in deferred compensation.
(v)On March 30, 2017, the Company issued 1,500,000 common shares with a fair value of $30,000 to the Chief Financial Officer of the Company for compensation services for a period of twelve months from the date of issuance. As at May 31, 2017, deferred compensation of $24,822 has been recorded in deferred compensation.
(vi)On March 30, 2017, the Company issued 1,500,000 common shares with a fair value of $30,000 to an officer of the Company for compensation services for a period of twelve months from the date of issuance. As at May 31, 2017, deferred compensation of $24,822 has been recorded in deferred compensation.
(vii)On May 17, 2017, the Company issued 1,500,000 common shares with a fair value of $120,000 to the Chief Executive Officer of the Company for compensation services for a period of twelve months from the date of issuance. As at May 31, 2017, deferred compensation of $115,068.
(viii)On May 17, 2017, the Company issued 5,000,000 common shares with a fair value of $100,000 to a company controlled by the Chief Executive Officer of the Company as a deposit for the purchase of intangible assets.
(ix)On May 15, 2017, the Company issued 486,786 share purchase warrants with an exercise price of $0.09 per share exercisable over a period of five years.
(x)On July 6, 2017, the Company issued 1,500,000 common shares at $0.08 per common share pursuant to private placement for proceeds of $120,000.
(xi)On June 12, 2017, the Company issued 2,000,000 common shares for consulting services over a twelve month period with a fair value of $40,000.
(xii)On June 13, 2017, the Company issued 1,500,000 common shares with a fair value of $30,000 to the Chief Operating Officer of the Company for compensation services for a period of twelve months from the date of issuance.
(xiii)On July 21, 2017, the Company issued 553,625 common shares with a fair value of $166,088 to settle outstanding promissory notes and accrued interest of $44,666, which included 128,750 common shares with a fair value of $38,625 to settle outstanding promissory notes and accrued interest of $10,254.

 

 

 

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ITEM 3.      DEFAULTS UPON SENIOR SECURITIES 

  

None noted

  

ITEM 4.     MINE SAFETY DISCLOSURES

 

Not applicable to our Company.

 

ITEM 5.      OTHER INFORMATION

 

None noted

 

ITEM 6.     EXHIBITS

 

Exhibit

Number

Exhibit

Description

31.1 Certification of the Chief Executive Officer and Chief Financial Officer Pursuant to Rule 13a-14 or 15d-14 of the Exchange Act pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1 Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS XBRL Instance Document
101.SCH XBRL Taxonomy Extension Schema
101.CAL XBRL Taxonomy Extension Calculation Linkbase
101.LAB XBRL Taxonomy Extension Label Linkbase
101.PRE XBRL Taxonomy Extension Presentation Linkbase
101.DEF XBRL Taxonomy Extension Definition Linkbase


 

 

 

 

 

 

 

 

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SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on our behalf by the undersigned thereunto duly authorized.

 

  GALA GLOBAL INC.
    (REGISTRANT)
   
Date:  October 18, 2017 /s/   Timothy Madden
    Timothy Madden
    Chief Executive Officer
    (Authorized Officer for Registrant)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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