Notes to Unaudited Condensed Consolidated Financial Statements

February 28, 2018

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”.

Origo Acquisition Corporation 

Notes to Unaudited Condensed Consolidated Financial Statements

February 28, 2018   

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.

Origo Acquisition Corporation 

Notes to Unaudited Condensed Consolidated Financial Statements

February 28, 2018   

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.

Origo Acquisition Corporation 

Notes to Unaudited Condensed Consolidated Financial Statements

February 28, 2018   

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.

Origo Acquisition Corporation 

Notes to Unaudited Condensed Consolidated Financial Statements

February 28, 2018   

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.

Note 2 - Significant Accounting Policies

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with United States generally accepted accounting principles (“U.S. GAAP”) for interim financial information and pursuant to rules and regulations of the Securities and Exchange Commission. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal accruals) considered for a fair presentation have been included. Operating results for the three months ended February 28, 2018 are not necessarily indicative of the results that may be expected for the year ending November 30, 2018. For further information refer to the financial statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for the year ended November 30, 2017, filed with Securities and Exchange Commission on February 5, 2018.

Emerging Growth Company

Section 102(b) (1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act of 1933, as amended (“Securities Act”) registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such an election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period, which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard.

Cash and Cash Equivalents

The Company considers all short-term investments with an original maturity of three months or less when purchased to be cash equivalents.

Cash and Marketable Securities Held in Trust Account

The amounts held in the Trust Account represent substantially all of the net proceeds of the Initial Public Offering, net of amounts removed from the Trust Account for conversions (see Note 1) and are classified as restricted assets since such amounts can only be used by the Company in connection with the consummation of a Business Combination. As of February 28, 2018, cash and marketable securities, which are classified as trading securities, held in the Trust Account consisted solely of funds held in U.S. Treasury Bills.

Origo Acquisition Corporation 

Notes to Unaudited Condensed Consolidated Financial Statements

February 28, 2018   

Ordinary Shares Subject to Possible Conversion

The Company accounts for its Ordinary Shares subject to possible conversion in accordance with the guidance in Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” Ordinary Shares subject to mandatory conversion (if any) are classified as a liability instrument and are measured at fair value. Conditionally redeemable Ordinary Shares (including Ordinary Shares that features conversion rights that are either within the control of the holder or subject to conversion upon the occurrence of uncertain events not solely within the Company’s control) are classified as temporary equity. At all other times, Ordinary Shares are classified as shareholders’ equity. The Company’s Ordinary Shares features certain conversion rights that are considered to be outside of the Company’s control and subject to occurrence of uncertain future events. Accordingly, Ordinary Shares subject to possible conversion at conversion value are presented as temporary equity, outside of the shareholders’ equity section of the Company’s balance sheet.

Concentration of Credit Risk

Financial instruments that potentially subject the Company to concentration of credit risk consist of cash accounts in a financial institution which, at times may exceed the Federal depository insurance coverage of $250,000. At February 28, 2018, the Company had not experienced losses on these accounts and management believes the Company is not exposed to significant risks on such accounts.

Fair Value of Financial Instruments

The fair value of the Company’s assets and liabilities, which qualify as financial instruments under ASC Topic 820, “Fair Value Measurements and Disclosures,” approximates the carrying amounts represented in the accompanying balance sheet, primarily due to their short-term nature.

Net Loss per Share

Loss per share is computed by dividing net loss by the weighted-average number of Ordinary Shares outstanding during the period. An aggregate of 896,311 and 2,444,498 Ordinary Shares subject to possible conversion at February 28, 2018 and 2017, respectively, have been excluded from the calculation of basic loss per Ordinary Share since such Ordinary Shares, if redeemed, only participate in their pro rata share of the earnings in the Trust Account. The Company has not considered the effect of (i) warrants sold in the Public Offering and Private Placement to purchase 2,243,000 Ordinary Shares of the Company, (ii) rights to acquire 448,600 Ordinary Shares of the Company and (iii) 400,000 Ordinary Shares, warrants to purchase 200,000 Ordinary Shares and rights to acquire 40,000 Ordinary Shares included in the unit purchase option sold to the underwriter, in the calculation of diluted loss per share, since the exercise of the unit purchase option and warrants as well as the conversion of rights is contingent on the occurrence of future events.

Use of Estimates

The preparation of financial statements in conformity with U.S. 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 expenses during the reporting period. Actual results could differ from those estimates.

Recent Accounting Pronouncements

Management does not believe that any other recently issued, but not yet effective, accounting standards if currently adopted would have a material effect on the accompanying financial statements.

Origo Acquisition Corporation 

Notes to Unaudited Condensed Consolidated Financial Statements

February 28, 2018   

Note 3 - Initial Public Offering

In December 2014, the Company consummated the Initial Public Offering and the Over-allotment of 4,200,000 Units. Each Unit consists of one ordinary share, $.0001 par value per share (“Ordinary Share”), one right (“Right”) to receive one-tenth of one Ordinary Share upon consummation of the Company’s initial Business Combination and one warrant entitling the holder to purchase one-half of one Ordinary Share (“Warrant”). The Units were sold at an offering price of $10.00 per Unit, generating gross proceeds of $42,000,000. Each Warrant entitles the holder to purchase one-half of one Ordinary Share at a price of $11.50 per full Ordinary Share commencing upon the Company’s completion of its initial Business Combination, and expiring five years from the completion of the Company’s initial Business Combination. The Company will not issue fractional shares. As a result, investors must exercise Warrants in multiples of two Warrants in whole and not in part, at a price of $11.50 per full share, subject to adjustment, to validly exercise the Warrants. The Company may redeem the Warrants at a price of $0.01 per Warrant upon 30 days’ notice, only in the event that the last sale price of the Ordinary Shares is at least $24.00 per share for any 20 trading days within a 30-trading day period (“30-Day Trading Period”) ending on the third day prior to the date on which notice of redemption is given, provided there is a current registration statement in effect with respect to the Ordinary Shares underlying such Warrants commencing five business days prior to the 30-Day Trading Period and continuing each day thereafter until the date of redemption. If the Company redeems the Warrants as described above, management will have the option to require all holders that wish to exercise Warrants to do so on a “cashless basis.” In accordance with the warrant agreement relating to the Warrants issued in the Initial Public Offering the Company is only required to use its best efforts to maintain the effectiveness of the registration statement covering the Warrants. If a registration statement is not effective within 90 days following the consummation of a Business Combination, Warrant holders may, until such time as there is an effective registration statement and during any period when the Company shall have failed to maintain an effective registration statement, exercise Warrants on a cashless basis pursuant to an available exemption from registration under the Securities Act of 1933, as amended. In the event that a registration statement is not effective at the time of exercise or no exemption is available for a cashless exercise, the holder of such Warrant shall not be entitled to exercise such Warrant for cash and in no event (whether in the case of a registration statement being effective or otherwise) will the Company be required to net cash settle the Warrant exercise. Additionally, in no event will the Company be required to net cash settle the Rights. If an initial Business Combination is not consummated, the Rights and Warrants will expire and will be worthless.

Note 4 - Private Placement

Simultaneously with the consummation of the Initial Public Offering and the Over-allotment, the Company consummated the Private Placement of 286,000 Private Placement Units at a price of $10.00 per Private Placement Unit, generating total proceeds of $2.86 million. Of the Private Placement Units, 265,000 were purchased by an Initial Shareholder that was an affiliate of the Company’s former executive officers and 21,000 were purchased by EBC, the representative of the underwriters of the Initial Public Offering. The Private Placement Units are identical to the Units sold in the Initial Public Offering, except the warrants included in the Private Placement Units will be non-redeemable, may be exercised on a cashless basis and may be exercisable for unregistered Ordinary Shares if the prospectus relating to the Ordinary Shares issuable upon exercise of the Warrants is not current and effective, in each case so long as they continue to be held by the initial purchasers or their permitted transferees. The holders of the Private Placement Units have agreed (A) to vote the Ordinary Shares included in the Private Placement Units (“Private Shares”) in favor of any initial Business Combination, (B) not to propose, or vote in favor of, an amendment to the Company’s amended and restated memorandum and articles of association with respect to the Company’s pre-Business Combination activities prior to the consummation of such a Business Combination unless the Company provides dissenting Public Shareholders with the opportunity to convert their Public Shares into the right to receive cash from the Company’s Trust Account in connection with any such vote, (C) not to convert any Private Shares into the right to receive cash from the Trust Account in connection with a shareholder vote to approve the Company’s initial Business Combination or a vote to amend the provisions of the Company’s amended and restated memorandum and articles of association relating to shareholders’ rights or pre-Business Combination activity and (D) that such Private Shares shall not participate in any liquidating distribution upon winding up if a Business Combination is not consummated within the required time period. Additionally, the purchasers have agreed not to transfer, assign or sell any of the Private Placement Units (except to certain permitted transferees) until the completion of the Company’s initial Business Combination. The holders have agreed not to sell their shares to the Company in any tender offer in connection with the initial Business Combination.

Origo Acquisition Corporation 

Notes to Unaudited Condensed Consolidated Financial Statements

February 28, 2018   

Note 5 - Related Party Transactions

Initial Shares

In August 2014, the Company issued 1,150,000 Initial Shares to the Initial Shareholders for an aggregate purchase price of $25,000. The Initial Shares included an aggregate of up to 150,000 shares subject to compulsory repurchase for an aggregate purchase price of $0.01 to the extent that the underwriters’ over-allotment option was not exercised in full or in part, so that the Initial Shareholders would collectively own 20.0% of issued and outstanding shares after the Initial Public Offering (excluding the sale of the Private Placement Units). On December 18, 2014, EBC notified the Company that it had elected to exercise a portion of the over-allotment option for 200,000 additional units at $10.00 per unit for an additional $2,000,000, The partial exercise resulted in a reduction of 50,000 Ordinary Shares subject to compulsory repurchase resulting in a total of 100,000 Ordinary Shares being repurchased for an aggregate amount of $0.01 on January 5, 2015. On May 20, 2016, the Initial Shares 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.

The Initial Shares are identical to the Ordinary Shares included in the Units sold in the Initial Public Offering. However, the holders of the Initial Shares have agreed (A) to vote their Initial Shares (as well as any shares acquired after the Initial Public Offering) in favor of any proposed Business Combination, (B) not to propose, or vote in favor of, an amendment to the amended and restated memorandum and articles of association with respect to pre-Business Combination activities prior to the consummation of such a Business Combination unless the Company provides dissenting Public Shareholders with the opportunity to convert their Public Shares into the right to receive cash from the Trust Account in connection with any such vote, (C) not to convert any Initial Shares (as well as any other shares acquired after the Initial Public Offering) into the right to receive cash from the Trust Account in connection with a shareholder vote to approve a proposed initial Business Combination (or sell any shares they hold to the Company in a tender offer in connection with a proposed initial Business Combination) or a vote to amend the provisions of the amended and restated memorandum and articles of association relating to shareholders’ rights or pre-Business Combination activity and (D) that the Initial Shares shall not participate in any liquidating distribution upon winding up if a Business Combination is not consummated. Additionally, the Initial Shareholders have agreed not to transfer, assign or sell any of the Initial Shares (except to certain permitted transferees) until (1) with respect to 50% of the Initial Shares, the earlier of one year after the date of the consummation of initial Business Combination and the date on which the closing price of Ordinary Shares equals or exceeds $12.50 per share (as adjusted for share splits, share dividends, reorganizations and recapitalizations) for any 20 trading days within any 30-trading day period commencing after initial Business Combination and (2) with respect to the remaining 50% of the Initial Shares, one year after the date of the consummation of initial Business Combination, or earlier, in either case, if, subsequent to initial Business Combination, the Company consummates a liquidation, merger, stock exchange or other similar transaction which results in all of shareholders having the right to exchange their Ordinary Shares for cash, securities or other property.

Loans from Related Party

Convertible Notes

As of February 28, 2018 and November 30, 2017, the Company had an aggregate of $325,000 in convertible promissory notes to Fortress outstanding. The loans are unsecured and non-interest bearing and are due upon consummation of a Business Combination. The holder has agreed to convert the principal balance of $325,000 in convertible promissory notes into 32,500 Units at a price of $10.00 per Unit upon consummation of a Business Combination. The terms of the units into which the convertible promissory note will convert will be identical to the Private Placement Units.

As of November 30, 2016, the Company had an aggregate of $967,665 in convertible promissory notes to the new management outstanding. In December 2016 and January 2017, the new management loaned the Company an addition of $320,000 and $125,000, respectively, and amended the note in December 2016 and January 2017, pursuant to which: (i) the principal balance of the note was increased to $1,412,665, and (ii) the note will accrue interest, retroactively from its date of issuance in June 2016, at a rate of 13% per annum up to a maximum of $87,335 in interest, which interest will be payable on the due date for payment of the principal of the Note. As of February 28, 2018, the amount of accrued interest that was owed under the Note was $87,335.

Origo Acquisition Corporation 

Notes to Unaudited Condensed Consolidated Financial Statements

February 28, 2018   

The note was unsecured and payable at the consummation of a Business Combination. Upon consummation of a Business Combination, up to $175,000 of the principal balance of such note may be converted, at the holders’ option, into Units at a price of $10.00 per Unit. The terms of the units into which the convertible promissory note will convert will be identical to the Private Placement Units. If new management converts the entire $175,000 of the principal balance of the note, they would receive 17,500 Units.

Notes Payable  

As of February 28, 2018 and November 30, 2017, the Company had an aggregate of $361,590 and $211,575 outstanding in notes payable from the management and EBC, respectively.

During the three months ended February 28, 2018, the new management and EBC loaned the Company an aggregate of $70,590 and $61,590, respectively (totaling $132,180). The loans are unsecured and non-interest bearing and are due upon consummation of a Business Combination.

If a Business Combination is not consummated, the convertible notes and notes payable owed to Fortress, the new management and EBC will not be repaid by the Company and all amounts owed thereunder by the Company will be forgiven, except to the extent that the Company had funds available to it outside of the Trust Account.

Note 6 - Commitments and Contingencies

Underwriting Agreement

On December 12, 2014, the Company entered into an agreement with EBC (“Underwriting Agreement”). The Underwriting Agreement required the Company to pay an underwriting discount of 3.25% of the gross proceeds of the Initial Public Offering as an underwriting discount. The Company has further engaged EBC to assist the Company with its initial Business Combination. Pursuant to this arrangement, the Company anticipates that the underwriter will assist the Company in holding meetings with shareholders to discuss the potential Business Combination and the target business’ attributes, introduce the Company to potential investors that are interested in purchasing the Company’s securities, assist the Company in obtaining shareholder approval for the Business Combination and assist the Company with its press releases and public filings in connection with the Business Combination. The Company agreed to pay EBC a cash fee of 4% of the gross proceeds of the Initial Public Offering (or $1.68 million) for such services upon the consummation of its initial Business Combination (exclusive of any applicable finders’ fees which might become payable). The Company is not obligated to pay the 4% fee if no business combination is consummated. The 4% fee is an unrecognized contingent liability, as closing of a potential business combination was not considered probable as of February 28, 2018.

Other agreements

In August 2016, the Company entered into an agreement with a legal firm to assist the Company with a potential business combination and related securities and corporate work. The agreement called for a retainer of $37,500 and the Company has agreed to pay a portion of the invoices and the remaining amount will be deferred until the consummation of the Business Combination.

In December 2016, the Company entered into an agreement with a consultant for investor relations services. The agreement called for an initial payment of $13,000, and a deferred monthly fee of $8,000 until the consummation of the Business Combination. The Company agreed to pay the consultant all of the deferred fees plus a contingency fee of $20,000 upon consummation of the Business Combination.

As of February 28, 2018, the aggregate amount deferred for the legal firm and the consultant was approximately $1.5 million. The deferred amount is an unrecognized contingent liability, as closing of a potential business combination was not considered probable as of February 28, 2018.

Origo Acquisition Corporation 

Notes to Unaudited Condensed Consolidated Financial Statements

February 28, 2018   

Purchase Option

In December 2014, the Company sold to EBC, for $100, a unit purchase option to purchase up to a total of 400,000 units exercisable at $11.00 per unit (or an aggregate exercise price of $4,400,000) commencing on the consummation of a Business Combination. The unit purchase option expires on December 12, 2019. The units issuable upon exercise of this option are identical to the Units being offered in the Initial Public Offering. Accordingly, after the Business Combination, the purchase option will be to purchase 440,000 Ordinary Shares (which include 40,000 Ordinary Shares to be issued for the rights included in the units) and 400,000 Warrants to purchase 200,000 Ordinary Shares. The Company has agreed to grant to the holders of the unit purchase option, demand and “piggy back” registration rights for periods of five and seven years, respectively, from the effective date of the Initial Public Offering, including securities directly and indirectly issuable upon exercise of the unit purchase option.

The Company accounted for the fair value of the unit purchase option, inclusive of the receipt of a $100 cash payment, as an expense of the Initial Public Offering resulting in a charge directly to shareholders’ equity. The Company estimated that the fair value of this unit purchase option to be approximately $2.92 million (or $7.30 per unit) using the Black-Scholes option-pricing model. The fair value of the unit purchase option granted to EBC was estimated as of the date of grant using the following assumptions: (1) expected volatility of 99.10%, (2) risk-free interest rate of 1.53% and (3) expected life of five years. The unit purchase option may be exercised for cash or on a “cashless” basis, at the holder’s option (except in the case of a forced cashless exercise upon the Company’s redemption of the Warrants, as described in Note 3), such that the holder may use the appreciated value of the unit purchase option (the difference between the exercise prices of the unit purchase option and the underlying Warrants and the market price of the Units and underlying Ordinary Shares) to exercise the unit purchase option without the payment of any cash. The Company will have no obligation to net cash settle the exercise of the unit purchase option or the Warrants underlying the unit purchase option. The holder of the unit purchase option will not be entitled to exercise the unit purchase option or the Warrants underlying the unit purchase option unless a registration statement covering the securities underlying the unit purchase option is effective or an exemption from registration is available. If the holder is unable to exercise the unit purchase option or underlying Warrants, the unit purchase option or Warrants, as applicable, will expire worthless.

Registration Rights

The Initial Shareholders are entitled to registration rights with respect to their initial shares (and any securities issued upon conversion of working capital loans) and the purchasers of the Private Placement Units are entitled to registration rights with respect to the Private Placement Units (and underlying securities), pursuant to an agreement dated December 12, 2014. The holders of the majority of the initial shares are entitled to demand that the Company register these shares at any time commencing three months prior to the first anniversary of the consummation of a Business Combination. The holders of the Private Placement Units (or underlying securities) are entitled to demand that the Company register these securities at any time after the Company consummates a Business Combination. In addition, the holders have certain “piggy-back” registration rights on registration statements filed after the Company’s consummation of a Business Combination.

Nasdaq Listing Rules

On February 21, 2017, the Company received a written notice (the “Notice”) from the Listing Qualifications Department of The Nasdaq Stock Market LLC (“Nasdaq”) indicating that the Company is not in compliance with Listing Rule 5550(a)(3) (the “Minimum Public Holders Rule”), which requires the Company to have at least 300 public holders for continued listing on the Nasdaq Capital Market. The Notice was only a notification of deficiency, not of imminent delisting, and had no current effect on the listing or trading of the Company's securities on the Nasdaq Capital Market. In April 2017, the Company submitted a plan to evidence compliance with the Minimum Public Holders Rule and Nasdaq granted the Company until August 21, 2017 to evidence compliance with the Minimum Public Holders Rule.

On August 23, 2017, the Company received a written notice from Nasdaq stating that the Company had not regained compliance with the Minimum Public Holders Rule for continued listing on Nasdaq. The notice further stated that, unless the Company requests an appeal of Nasdaq’s determination, trading of the Company’s securities will be suspended at the open of business on September 1, 2017 and Nasdaq will file a Form 25 to remove the Company’s securities from listing and registration on Nasdaq. As permitted under Nasdaq rules, the Company appealed the delisting determination.

Origo Acquisition Corporation 

Notes to Unaudited Condensed Consolidated Financial Statements

February 28, 2018   

On December 4, 2017, the Company received written notice from the Listing Qualifications Department of Nasdaq indicating that the Company did not satisfy Nasdaq Listing Rule 5620(a) (the “Annual Meeting Requirement”) because the Company did not timely hold an annual meeting for the fiscal year ended November 30, 2016 on or before November 30, 2017. The notice indicated that the Company’s non-compliance with the Annual Meeting Requirement could serve as an additional basis for the delisting of the Company’s securities from The Nasdaq Capital Market and, as such, the Company should present its plan to evidence compliance with that requirement for review by the Nasdaq Hearings Panel (the “Panel”).

The Company timely requested a hearing and presented its plan to evidence compliance with the Minimum Public Holders Rule for the Panel’s consideration, subsequent to which the Panel granted the Company’s request for the continued listing of its securities on The Nasdaq Capital Market subject to the Company evidencing compliance with all applicable requirements for listing on Nasdaq by no later than February 19, 2018, including compliance with the applicable criteria for initial listing upon completion of the Company’s proposed business combination with Hightimes Holding Corp.

On February 20, 2018, the Company received written notice from Nasdaq indicating that the Panel determined to delist the Company’s securities and as a result, trading of the Company’s securities on Nasdaq was suspended effective with the open of business on Thursday, February 22, 2018, due to the Company’s non-compliance with certain requirements for continued listing on The Nasdaq Capital Market and the Company’s failure to complete its proposed Business Combination with HTH and evidence compliance with all applicable requirements for initial listing on Nasdaq on or before February 19, 2018, which was the deadline previously set by the Panel.

On March 27, 2018, the Company received written notice from Nasdaq indicating that it was not in compliance with Nasdaq Listing Rule IM-5101-2, since the Company had not consummated its initial business combination within 36 months of the effectiveness of its IPO registration statement, which occurred on December 12, 2014. The notice indicated that this matter serves as an additional basis for delisting the Company’s securities from Nasdaq and that this matter will therefore be considered by the Listing Council in connection with the Company’s appeal. The Company intends to address this matter in its appeal.

On April 6, 2018, the Company received written notice from Nasdaq indicating that it was not in compliance with Nasdaq Listing Rule 5250(f) since the Company has not yet paid $42,000 in annual listing fees due to Nasdaq. The notice indicated that the Company will be subject to delisting proceedings if it does not pay the outstanding balance in full. The notice also indicated that this matter serves as an additional basis for delisting the Company’s securities from Nasdaq and that this matter will therefore be considered by the Listing Council in connection with the Company’s appeal. The Company subsequently received an extension from Nasdaq pursuant to which it has until April 20, 2018 to pay the outstanding balance, which the Company expects to pay in a timely manner.

The Company subsequently requested a review of the Panel’s decision by the Nasdaq Listing and Hearing Review Council (the “ Listing Council ”), which request resulted in a stay of any formal delisting action by Nasdaq at least pending the ultimate outcome of the Listing Council’s review and the expiration of all relevant review and appeal periods. The Company intends to continue to take such action as necessary to maintain its Nasdaq listing (notwithstanding any suspension of trading on Nasdaq) and to obtain approval for the listing of the combined entity on Nasdaq upon the consummation of the proposed business combination by and between the Company and Hightimes. In that regard, at an extraordinary general meeting of shareholders held on March 12, 2018, the Company’s shareholders approved extending the date by which the Company must consummate its initial business combination through June 12, 2018. Given the Nasdaq trading suspension, trading in the Company’s securities under the current trading symbols (OACQF, OAQCF and OACCF) is taking place in the over-the-counter, OTC Markets system.  

The Company cannot assure that its securities will continue to be listed on Nasdaq in the future prior to an initial Business Combination. Additionally, in connection with the initial Business Combination, it is likely that Nasdaq will require the Company to file a new initial listing application and meet its initial listing requirements as opposed to its more lenient continued listing requirements. The Company cannot assure that it will be able to meet those initial listing requirements at that time.

Origo Acquisition Corporation 

Notes to Unaudited Condensed Consolidated Financial Statements

February 28, 2018   

Note 7 - Shareholder Equity

Preferred Shares

The Company is authorized to issue 1,000,000 preferred shares with a par value of $0.0001 per share with such designation, rights and preferences as may be determined from time to time by the Company’s board of directors.

As of February 28, 2018, there are no preferred shares issued or outstanding.

Ordinary Shares

The Company is authorized to issue 100,000,000 Ordinary Shares with a par value of $0.0001 per share.

Throughout the meetings in connection with the First, Second, Third and Fourth Extension in 2016 and 2017, shareholders holding 2,558,369 Public Shares exercised their right to convert such Public Shares into a pro rata portion of the Trust Account (see Note 1). As a result, the Company has an aggregate of 2,977,631 Ordinary Shares outstanding as of February 28, 2018 and November 30, 2017. Of these, an aggregate of 896,311 and 922,276 Ordinary Shares subject to possible conversion were classified as temporary equity in the accompanying Balance Sheet as of February 28, 2018 and November 30, 2017, respectively.

Note 8 - Merger Agreement

Merger Agreement

On July 24, 2017, the Company entered into a Merger Agreement with HTH, which was later amended on September 27, 2017 (“Amended Merger Agreement”). Pursuant to the terms of the Amended Merger Agreement, the Merger Sub will merge with and into HTH, with HTH continuing as the surviving entity (the “Merger”) and all holders of HTH equity securities and warrants, options and rights to acquire or securities that convert into HTH equity securities (collectively, “HTH Securities”) will convert into Origo common shares and, with respect to options, options to acquire Origo common shares. More specifically at the effective time of the Merger (the “Effective Time”):

Origo Acquisition Corporation 

Notes to Unaudited Condensed Consolidated Financial Statements

February 28, 2018   

The Merger Agreement also provides that, immediately prior to the Effective Time, Origo will reincorporate under the laws of the State of Nevada, whether by reincorporation, statutory conversion or otherwise.

The obligations of each party to consummate the Merger are subject to the satisfaction or waiver of customary conditions and Closing deliverables, including (1) the Registration Statement having been declared and remain effective, (2) Origo’s shareholders having approved the Merger Agreement and the related transactions at the extraordinary general meeting of Origo shareholders, (3) any required governmental and third party approvals having been obtained, (4) the consents required to be obtained or made from any third party (other than a governmental authority) in order to consummate the transactions contemplated by the Merger Agreement shall have been obtained or made; (5) no governmental authority having enacted any law which has the effect of making the transactions or agreements contemplated by the Merger Agreement illegal or which otherwise prevents or prohibits consummation of the transactions contemplated by the Merger Agreement, (6) there shall be no pending action brought by a third party non-affiliate to enjoin or otherwise restrict the consummation of the Closing, (7) upon the Closing, after giving effect to the completion of Origo’s redemption of its public stockholders in connection with the Merger and the payment of all accrued and unpaid expenses, Origo shall have net tangible assets of at least $5,000,001 (which shall include the consolidated net tangible assets of HTH and its subsidiaries), (8) HTH shall have received its required stockholder approval, (9) the parties’ respective representations and warranties shall be true and correct as of the Closing Date (subject to certain materiality qualifiers), (10) each of the parties shall have performed in all material respects all of its obligations and complied in all material respects with all of its agreements and covenants under the Merger Agreement to be performed or complied with by it on or prior to the Closing Date, and (11) no event having occurred since the date of the Merger Agreement resulting in a material adverse effect upon the business, assets, liabilities, results of operations, prospects or condition of the other party and its subsidiaries, taken as a whole, or the other party’s ability to consummate the transactions contemplated by the Merger Agreement and ancillary documents on a timely basis (subject in each case to customary exceptions) (a “Material Adverse Effect”), which is continuing and uncured. The obligation of Origo and Merger Sub to consummate the Merger is also subject to the satisfaction or waiver or certain additional conditions.

Origo Acquisition Corporation 

Notes to Unaudited Condensed Consolidated Financial Statements

February 28, 2018   

Consulting Services Agreement

At the Closing, the successor will enter into a consulting services agreement with Oreva Capital Corp., a Delaware corporation, pursuant to which the consultant is to perform certain services for the successor, including administrative services, dealing with investment bankers, investor relations consultants and other members of the investment community (as authorized from time to time by the Board of Directors), and assisting in connection with proposed acquisitions, dispositions and financings. In consideration for such services, the successor will pay the consultant a monthly consulting fee of $35,000. Commencing in 2018, the consultant may elect to have all or any portion of the consulting fee deferred and paid in shares of the successor’s common stock, at a per share price equal to 100% of the closing price of the stock of the successor. Adam Levin, the Chief Executive Officer and a director of HTH, is the Managing Director of Oreva Capital Corp.