Boardwalktech Software Corp. — Interim / Quarterly Report 2021

Aug 28, 2020

Boardwalktech Software Corp. Condensed Interim Consolidated Financial Statements As at and for the three months ended June 30, 2020

Stated in United States dollars (Unaudited)

Notice of No Auditor Review of Condensed Interim Consolidated Financial Statements

In accordance with National Instrument 51-102 released by the Canadian Securities Administrators, the Company discloses that its auditors have not reviewed these unaudited condensed interim consolidated financial statements as at and for the three months ended June 30, 2020.

Boardwalktech Software Corp. Condensed Interim Consolidated Statements of Financial Position

(United States dollars)

(Unaudited)

	As at		June 30 2020	March 31 2020
	ASSETS
	Current assets
	Cash		597,316	794,706
	Trade and other receivables (Note 3)		1,335,679	312,691
	Prepaid expenses and deposits		107,120	103,431
	Total current assets		2,040,115	1,210,828
	Non-current assets
	Property and equipment		12,792	11,650
	Right-of-use asset(Note 4)		149,657	213,800
	Total assets		2,202,564	1,436,278
	LIABILITIES and SHAREHOLDERS’ DEFICIENCY
	Current liabilities
	Accounts payable and accrued liabilities (Note 5)		1,143,043	945,378
	Deferred revenue (Note 6)		1,757,469	1,381,614
	Deferred compensation		766,617	766,617
	Current portion of term loan (Note 7)		960,156	1,545,650
	Lease liability (Note 8)		181,375	254,702
	Total current liabilities		4,808,660	4,893,961
	Non-current liabilities
	Term loan (Note 7)		2,569,801	2,613,407
	Forgivable loan(Note 9)		700,100	–
	Total liabilities		8,078,561	7,507,368
	Shareholders’ deficiency
	Share capital (Note 13)		25,660,331	25,098,962
	Contributed surplus		7,286,668	7,061,637
	Accumulated other comprehensive (loss) income		(1,614)	(168)
	Deficit		(38,820,903)	(38,231,042)
	Total deficiency attributed to shareholders		(5,875,518)	(6,070,611)
	Non-controllinginterest		(479)	(479)
	Total shareholders’ deficiency		(5,875,997)	(6,071,090)
	**Total liabilities and shareholders’ deficiency **		2,202,564	1,436,278

Going concern (Note 1)

Approved by the Board of Directors:

(signed) “Andrew T. Duncan” (signed) “ Steve Bennet”

The accompanying notes are an integral part of these unaudited condensed interim consolidated financial statements. 1

Boardwalktech Software Corp. Condensed Interim Consolidated Statements of Loss and Comprehensive Loss

(United States dollars)

(Unaudited)

For the three months ended June 30	2020	2019
Revenue(Note 10)	1,205,744	1,100,988
Cost of sales	156,474	141,681
Gross margin	1,049,270	959,307
Expenses
Salaries, wages and benefits	1,159,281	1,185,677
Share-based payments (Note 15)	200,431	456,721
General and administration (Note 11)	77,487	173,277
Professional fees	69,044	101,461
Depreciation	65,833	65,697
Consulting	43,333	195,671
Deferred compensation	–	114,725
Bad debt(Note 3)	4,500	–
Total expenses	1,619,909	2,293,229
Operating loss before other expenses	(570,639)	(1,333,922)
Other expenses
Interest and financingcosts(Note 12)	19,222	574,332
Loss for the period	(589,861)	(1,908,254)
Other comprehensive income
Items that may be reclassified to profit or loss
Exchange differences on translation of subsidiarycompanies	(1,446)	(1,782)
Loss and comprehensive loss for theperiod	(591,307)	(1,910,036)
Loss per share(Note 16)
Basic and diluted	(0.03)	(0.16)

The accompanying notes are an integral part of these unaudited condensed interim consolidated financial statements.

2

Boardwalktech Software Corp. Condensed Interim Consolidated Statements of Changes in Shareholders’ Deficiency

(United States dollars)

(Unaudited)

For the three months ended June 30	2020	2019
Share capital
Balance, beginning of period	25,098,962	22,174,957
Unit private placement (Note 13)	646,818	482,923
Share issue costs(Note 13)	(85,449)	(19,649)
Balance,end ofperiod	25,660,331	22,638,231
Contributed surplus
Balance, beginning of period	7,061,637	5,610,633
Finders’ options (Note 13)	24,600	–
Share-basedpayments(Note 15)	200,431	456,721
Balance,end ofperiod	7,286,668	6,067,354
Accumulated other comprehensive income
Balance, beginning of period	(168)	1,088
Exchange differences on translation of subsidiarycompanies	(1,446)	(1,782)
Balance,end ofperiod	(1,614)	(694)
Deficit
Balance, beginning of period	(38,231,042)	(32,412,152)
Loss for theperiod	(589,861)	(1,908,254)
Balance,end ofperiod	(38,820,903)	(34,320,406)
Non-controlling interest
Balance,beginningand end ofperiod	(479)	(479)
Total shareholders’ deficiency	(5,875,997)	(5,615,994)

The accompanying notes are an integral part of these unaudited condensed interim consolidated financial statements.

3

Boardwalktech Software Corp. Condensed Interim Consolidated Statements of Cash Flows

(United States dollars)

(Unaudited)

For the three months ended June 30 2020	2019
Cash provided by (used in) the following activities: Operating activities Loss for the period (589,861) Depreciation 65,833 Share-based payments (Note 15) 200,431 Interest and financing costs (Note 12) 19,222 Unrealized foreign exchange (1,445) Changes in non-cash working capital: Trade and other receivables (1,022,988) Prepaid expenses and deposits (3,689) Accounts payable and accrued liabilities 56,717 Deferred revenue 375,855 Deferred compensation –	(1,908,254) 65,697 456,721 574,332 (1,859)
	(522,277)
	30,195
	(343,680)
	560,530
	99,725
Cash flows used in operating activities (899,925)	(988,870)
Financing activities Proceeds from term loan – Repayment of term loan (Note 7) (500,000) Term loan financing fees (Note 7) (1,148) Interest paid (Note 7) – Lease payments (Note 8) (79,553) Forgivable loan proceeds 700,100 Common shareproceeds,net of issue costs(Note 13) 585,969	1,000,000 – (75,035) (181,545) (77,236) – 463,274
Cash flowsprovided by financing activities 705,368	1,129,458
Investing activities Purchase ofpropertyand equipment (2,839)	(3,352)
Cash flows used in investing activities (2,839)	(3,352)
Change in cash (197,396) Foreign exchange effect on cash held in foreign currencies 6 Cash, beginning of theperiod 794,706
	137,236
	191
	195,464
Cash, end of theperiod 597,316	332,891
Taxespaid –
	–

The accompanying notes are an integral part of these unaudited condensed interim consolidated financial statements.

4

Boardwalktech Software Corp. Notes to Condensed Interim Consolidated Financial Statements

For the three months ended June 30, 2020 (United States dollars unless otherwise disclosed) (Unaudited)

1. Description of Business

Boardwalktech Software Corp. (“Boardwalk” or the “Company”) was incorporated pursuant to the Business Corporations Act of British Columbia. The Company operates from locations in the United States and India and provides enterprise softwareas-a-service (SaaS) to global customers. Boardwalk is a publicly-traded company whose shares are listed on the TSX Venture Exchange under the symbol BWLK.V and on the OTCQB under the symbol BWLKF.

The Company designs and sells collaborative enterprise digital ledger data management technology offered as either a cloud-based platform service that runs industry, or customer specific applications, Boardwalk Application Engine (“BAE”) or Boardwalk Enterprise Blockchain (“BEB”) platforms.

The address of the Company’s corporate headquarters, Boardwalktech, Inc., and registered office is 10050 N Wolfe Road, Cupertino, CA, 95014 USA.

COVID-19

In early March 2020, the World Health Organization declared the coronavirus outbreak ("COVID-19") to be a pandemic. Responses to the spread of COVID-19 have resulted in a significant disruption to business operations and a significant increase in economic uncertainty in North America, India and elsewhere, with more volatile currency exchange rates, higher lending rates and a marked decline in long-term interest rates. These events have resulted in a volatile and challenging economic climate which may adversely affect the Company's operational results and financial position. The current economic climate is having and may continue to have significant adverse impacts on the Company, which may include, but are not limited to:

• a delay in business activity that could result in material reductions in future revenue and cash flows;

• inability to access equity and/or debt financing;

• increased risk of non-performance by the Company’s customers which could materially increase collection risk of accounts receivable and the risk of customer defaults on contracts; and

• increased risk of non-renewals of future subscription license, or cancelation of pending projects contracts.

While the Company does not believe there has been an impact to existing business, the current situation is dynamic and the ultimate duration and magnitude of the impact on the economy and the financial effect on the Company is not known at this time. Estimates and judgments made by management in the preparation of these consolidated financial statements are increasingly difficult and subject to a higher degree of measurement uncertainty during this volatile period.

Going concern

These consolidated financial statements have been prepared on a going concern basis, which implies the Company will continue to realize its assets and discharge its liabilities in the normal course of business. During the three months ended June 30, 2020, the Company generated a loss of $589,861 and negative cash flows from operating activities of $899,925. As at June 30, 2020, the Company has an accumulated deficit of $38,820,903 and a working capital deficit of $2,768,545. As such, there is a material uncertainty related to these events and conditions that may cast significant doubt on the Company’s ability to continue as a going concern and therefore, it may be unable to realize its assets and discharge its liabilities in the normal course of business. The continuation of the Company as a going concern is dependent on the ability of the Company to achieve positive cash flow from operations and/or obtain necessary equity or other financing to increase the number of licensed customers and continue with expansion in the digital ledger market.

The ability of the Company to be successful in obtaining additional future financing, if required, cannot be predicted at this present time. 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. Basis of Presentation

Statement of compliance

These unaudited condensed interim consolidated financial statements of the Company and its subsidiaries have been prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board, applicable to the preparation of interim financial statements as set out in International Accounting Standard 34 Interim Financial Reporting.

The Company has consistently applied the same accounting policies throughout all periods presented. These unaudited condensed interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto for the year ended March 31, 2020.

5

Boardwalktech Software Corp. Notes to Condensed Interim Consolidated Financial Statements

For the three months ended June 30, 2020 (United States dollars unless otherwise disclosed) (Unaudited)

Authorization

These unaudited interim consolidated financial statements were authorized for issue in accordance with a resolution of the Board of Directors on August 27, 2020.

Consolidation

These consolidated financial statements include the accounts of the following entities:

		Place of business	Legal
Name of entity	Principle activity	and operations	ownership
Boardwalk	Legal parent	Canada	–
	Accounting parent and
Boardwalktech Inc.	operating company	United States	100% owned by Boardwalk
Boardwalktech Solutions Private	Research and development
Limited(“BWSPL”)	company	India	98% owned byBoardwalktech

Functional and presentation currency

The functional currency of Boardwalk is the Canadian dollar (“CAD”), the functional currency of Boardwalktech Inc. is the United States dollar (“USD”) and the functional currency of BWSPL is the Indian Rupee (“INR”). The presentation currency of the Company is the USD.

3. Trade and Other Receivables

The Company’s trade and other receivables consist of:

3. Trade and Other Receivables The Company’s trade and other receivables consist of:
As at	June 30 2020	March 31 2020
Trade receivables	206,700	191,950
Receivables from contracts with customers	1,120,400	112,500
Other	8,579	8,241
	1,335,679	312,691

As at June 30, 2020, two customers accounted for 86% of trade receivables (March 31, 2020 – four customers; 83%), each with balances greater than 10%.

The Company’s trade and other receivables are aged as follows:

with balances greater than 10%. The Company’s trade and other receivables are aged as follows:
As at	June 30 2020	March 31 2020
Current	1,269,100	251,950
31 – 60 days past due	10,000	–
61 – 90 days past due	–	–
Past due forgreater than 90 days	56,579	60,741
	1,335,679	312,691

At June 30, 2020, the Company evaluated the collectability of trade and other receivables and lifetime expected credit losses and recognized $4,500 (March 31, 2020 – $nil) of bad debt expense. The assessment of expected credit losses due to doubts of collectability did not warrant the recognition of an additional allowance for credit losses.

4. Right-Of-Use Asset

The Company has recognized a right-of-use (“ROU”) asset and corresponding lease liability (Note 4) related to office premises. The ROU asset is depreciated on a straight-line basis over the term of the related lease.

Carrying amount, March 31, 2020	213,800
Depreciation	(64,143)
Carryingamount,June 30,2020	149,657

6

Boardwalktech Software Corp. Notes to Condensed Interim Consolidated Financial Statements

For the three months ended June 30, 2020 (United States dollars unless otherwise disclosed) (Unaudited)

5. Accounts Payable and Accrued Liabilities

5. Accounts Payable and Accrued Liabilities
As at	June 30 2020	March 31 2020
Accounts payable	1,134,818	885,219
Accrued liabilities	8,225	60,159
	1,143,043	945,378

6. Deferred Revenue

A continuity of deferred revenue is as follows:

6. Deferred Revenue A continuity of deferred revenue is as follows:	6. Deferred Revenue A continuity of deferred revenue is as follows:
Balance, March 31, 2020 1,381,614 Invoiced in the period, excluding amount recognized as revenue 1,141,730
Invoiced in the period, excluding amount recognized as revenue
Amount recognized as revenue	(765,875)
Balance,June 30,2020	1,757,469

7. Term Loan

A continuity of the Company’s term loan is as follows:

7. Term Loan A continuity of the Company’s term loan is as follows:
Balance, March 31, 2020		4,159,057
Financing fees		(1,148)
Principal repayments		(500,000)
Gain on de-recognition of term loan		(143,765)
Accretion of financingfees and de-recognition charges		15,813
Balance, June 30, 2020		3,529,957
Current portion		(960,156)
Long-termportion		2,569,801

As at March 31, 2020, the Company had a term loan for a principal amount of $4,988,090 bearing interest at 12.5% per annum due to SQN Venture Income Fund LP (“SQN”) subject to the terms of an Amended and Restated Loan and Security Agreement (the “June 2019 Agreement”). Pursuant to the June 2019 Agreement, the Company was required to make interest-only payments until May 31, 2020 followed by monthly blended principal and interest payments of $212,319 from June 1, 2020 until the maturity date of June 7, 2020 plus a $299,404 final payment fee on June 7, 2020.

On April 4, 2020, the Company made a $500,000 prepayment of the term loan.

On June 30, 2020, the Company executed an Amended and Restated Loan and Security Agreement (the “June 2020 Agreement”) in relation to the term loan. Key amendments in the June 2020 Agreements are as follows:

• An extension of the loan’s maturity to August 1, 2022;

• An extension of the interest-only period to August 31, 2020;

• The Company shall use its best efforts to make a $250,000 principal repayment on or before August 31, 2020 as long as such payment would not result in the Company’s forecasted cash balance to fall below $250,000; and

• $20,000 shall be added to the final payment fee, increasing it to $319,904.

On June 30, 2020, the Company recognized a $143,765 gain on de-recognition for the difference between the then carrying amount of the $4,488,090 principal amount of term loan and the present value of cash flows based on the terms of the June 2020 Agreement. The Company incurred $1,148 of financing fees related to the June 2020 Agreement.

Loan covenants

The Company must maintain the following covenants:

• A minimum trailing three-month revenues of not less than $1,200,000; and

• A minimum cash balance of $250,000 in bank accounts.

As at June 30, 2020, the Company was in compliance with the term loan covenants.

7

Boardwalktech Software Corp. Notes to Condensed Interim Consolidated Financial Statements

For the three months ended June 30, 2020 (United States dollars unless otherwise disclosed) (Unaudited)

The carrying amount of the term loan is comprised of the following:

	As at	June 30 2020	March 31 2020
	Principal amount of term loan	4,488,089	4,988,089
	Unamortized balance of financingfees and de-recognitioncharges	(958,132)	(829,032)
		3,529,957	4,159,057
	Currentportion	(960,156)	(1,545,650)
	Long-termportion	2,569,801	2,613,407

During the three months ended June 30, 2020, the Company was charged $140,948 of interest on the term loan, none of which was paid in the period (three months ended June 30, 2019 – $181,545 of interest, all of which was paid in the period). As at June 30, 2020, accounts payable and accrued liabilities included $198,539 (March 31, 2020 – $57,592) of accrued interest and prepayment fees due to SQN.

8. Lease Liability

The Company incurs lease payments related to office premises.

8. Lease Liability The Company incurs lease payments related to office premises.
Balance, March 31, 2020	254,702
Imputed interest	6,226
Payments	(79,553)
Balance,June 30,2020	181,375

Total expected payments under the Company’s office lease agreement are as follows:

		Monthly	Total
July 1, 2020 to October 31, 2020		26,518	106,072
November 1, 2020 to January 31, 2021		27,313	81,939

9. Forgivable Loan

On April 18, 2020, the Company obtained a forgivable $700,100 loan under the U.S. Small Business Administration’s Payroll Protection Program (“PPP”) designed to assist companies in maintaining operations through the COVID-19 pandemic. The PPP loan has a term of two years, is unsecured, and is guaranteed by the U.S. Small Business Administration. The loan bears a fixed interest rate of 1% per annum with the first six months of interest deferred. The loan will be forgiven if the proceeds are used by the Company to cover payroll costs (including benefits), with up to twenty-five percent (25%) allowed for rent and utilities, during the eight-week period following the loan origination date. The Company believes it has met those criteria and, as such, expects to meet the requirements for full loan forgiveness.

10. Revenue

The following table presents the Company’s revenue disaggregated by type:

For the three months ended June 30	2020	2019
Software subscriptions and services	738,875	681,693
Professionalservices	466,869	419,295
Total revenue	1,205,744	1,100,988

The Company’s revenue is generated in the United States. For the three months ended June 30, 2020, 47.4% of the Company’s revenue was earned through sales to one major customer (three months ended June 30, 2019 – 35.1% of revenue to one major customer). As at June 30, 2020, trade and other receivables (Note 3) included $1,120,400 of receivables from software subscriptions and services customers (March 31, 2020 – $112,500) and $206,700 of receivables from professional services customers (March 31, 2020 – $191,950).

8

Boardwalktech Software Corp. Notes to Condensed Interim Consolidated Financial Statements

For the three months ended June 30, 2020 (United States dollars unless otherwise disclosed) (Unaudited)

11. Nature of Expenses

The nature of the Company’s general and administrative expenses is as follows:

11. Nature of Expenses The nature of the Company’s general and administrative expenses is as follows:
For the three months ended June 30	2020	2019
Rent and utilities	28,741	26,710
Office	26,109	24,124
Marketing	15,966	69,814
Shareholder, regulatory and other	6,310	5,633
Travel and lodging	361	46,996
	77,487	173,277

12. Interest and Financing Costs

12. Interest and Financing Costs
For the three months ended June 30	2020	2019
Term loan interest (Note 7)	140,948	181,545
Lease liability imputed interest (Note 8)	6,226	13,586
Accretion of term loan (Note 7)	15,813	217,572
(Gain)loss on de-recognition of term loan(Note 7)	(143,765)	161,629
	19,222	574,332

13. Share Capital

13. Share Capital
Issued common shares:		Number of Shares	Amount ($)
Common shares
Balance, March 31, 2020		19,323,097	25,098,962
Unit private placement		1,768,389	646,818
Share issue costs		–	(85,449)
Balance,June 30,2020		21,091,486	25,660,331

On June 12, 2020, the Company closed a non-brokered Unit private placement for the placement of 1,768,389 Units, of which 1,629,500 Units were subscribed at CAD 0.50 per Unit and 138,889 Units were subscribed at $0.36 per Unit, for gross proceeds of $646,818. Each Unit is comprised of one common share and one-half of one common share purchase warrant of the Company. Each whole warrant is exercisable at a price of CAD 0.70 per share for a period of 24 months following the closing and will be subject to early redemption by the Company if the trading price of the Company’s common shares is greater than CAD 1.10 for 10 consecutive trading days. The Company paid aggregate finder's fees of CAD 53,533 ($39,374) and issued 107,065 finders’ options (categorized as common share warrants) with a term of two years and an exercise price of CAD 0.50 to compensate finders who introduced purchasers under the private placement and incurred $21,475 of other share issue costs.

The issue date aggregate fair value of the common share warrants and finders’ options was estimated to be $157,900 and $24,600, respectively, using the Black-Scholes pricing model based on the following assumptions:

Issue date share price	CAD 0.58	Expected dividend yield	0%
Exercise price	CAD 0.50 – CAD 0.70	Risk-free interest rate	0.19%
Expected volatility	96%	Forfeiture rate	0%
Expected life	2 years	Fair value per common share warrant	$0.19 – $0.23

9

Boardwalktech Software Corp. Notes to Condensed Interim Consolidated Financial Statements

For the three months ended June 30, 2020 (United States dollars unless otherwise disclosed) (Unaudited)

Non-voting and escrowed common shares:

The following common shares and non-voting common shares are escrowed and subject to release as follows:

		Common shares	Non-voting common shares(1)
Released 15% on each six-month anniversary date of June 7, 2018, with the final 15% released on June 7, 2021
Balance, March 31, 2020		515,060	1,530,281
Released		(171,687)	(510,093)
Balance, June 30, 2020		343,373	1,020,188
Released 15% on each six-month anniversary date of June 7, 2018, with the final 25% released on June 7, 2021		47,713 (13,013)	182,400 (49,745)
Balance, March 31, 2020
Released
Balance, June 30,2020		34,700	132,655
Total		562,773 378,073	1,712,681 1,152,843
March 31, 2020
June 30,2020

(1) Non-voting common shares have the same rights and privileges as other common shares, including the same dividend rights, except for the purpose of electing the Company’s directors, in which case they are not entitled to vote. These non-voting common shares obtain voting rights to elect the Company’s directors upon the Company’s receipt of written notice by the non-voting common shareholders to convert the share status to voting common shares following their release from escrow. As at June 30, 2020, no non-voting common shares had been converted to voting common shares.

14. Common Share Warrants

	Number of	Weighted Average
	Warrants	Exercise Price
Common share warrants
Balance, March 31, 2020	5,846,988	0.57
Issued (Note 13)	814,750	0.51(2)
Issued (Note 13)	107,065	0.37(2)
Balance,June 30,2020	6,768,803	0.57

Information about common share warrants outstanding and exercisable at June 30, 2020 is as follows:

ExpiryDate	Number Outstanding Number Exercisable Weighted Average Exercise Price Weighted Average Life Remaining (Years)
February 22, 2021	502,651 502,651 0.81(2) 0.65
April 9, 2021	316,315 316,315 0.81(2) 0.78
May 7, 2021	140,385 140,385 0.81(2) 0.85
May 10, 2021	43,809 43,809 0.81(2) 0.86
November 27, 2021	1,277,794 1,277,794 0.48(3) 1.41
November 27, 2021	49,250 49,250 0.33(4) 1.41
March 9, 2022	1,748,044 1,748,044 0.48(3) 1.69
March 9, 2022	99,200 99,200 0.33(4) 1.69
June 7, 2022	1,200,000 1,200,000 0.44(5) 1.94
June 12, 2022	814,750 814,750 0.51(6) 1.95
June 12,2022	107,065 107,065 0.37(7) 1.95
December 13, 2024	150,000 137,500 0.34(8) 4.46
December 21, 2027	319,540 319,540 1.67 7.48
	6,768,803 6,768,803 0.57 1.91

10

Boardwalktech Software Corp. Notes to Condensed Interim Consolidated Financial Statements

For the three months ended June 30, 2020 (United States dollars unless otherwise disclosed) (Unaudited)

(2) CAD 1.10 at the June 30, 2020 CAD to USD exchange rate. (6) CAD 0.70 at the June 30, 2020 CAD to USD exchange rate. (3) CAD 0.65 at the June 30, 2020 to USD exchange rate. (7) CAD 0.50 at the June 30, 2020 CAD to USD exchange rate. (4) CAD 0.45 at the June 30, 2020 CAD to USD exchange rate. (8) CAD 0.46 at the June 30, 2020 CAD to USD exchange rate. (5) CAD 0.60 at the June 30, 2020 CAD to USD exchange rate.

15. Share-Based Payments

Stock options:

As at March 31, 2020 and June 30, 2020, the Company had 828,915 stock options outstanding and exercisable. Information about the Company’s stock options as at June 30, 2020 is summarized in the following table:

ExpiryDate	Number Weighted Average Exercise Price Weighted Average Life Remaining (Years)
December 3, 2023	183,915 0.44 3.43
December 3, 2025	10,000 0.44 5.46
January 28, 2026	40,000 0.44 5.58
April 26, 2026	7,500 0.44 5.82
February 10, 2028	587,500 2.00 7.62
	828,915 1.55 6.55

RSUs:

As at March 31, 2020 and June 30, 2020, the Company had 853,333 RSUs outstanding of which 290,007 RSUs vested on June 4, 2019 and 281,674 RSUs vested on June 4, 2020 and 281,652 RSUs will vest on June 4, 2021.

RSUs entitle participants the conditional right to receive one common share of the Company for each share unit. RSUs typically vest in three equal tranches on the first, second and third anniversaries of the grant date. RSUs automatically convert to common shares on the vesting date, with the exception of the first and second vested tranches which will be converted to common shares following approval by the Company’s Board of Directors.

During the three months ended June 30, 2020, the Company recognized $196,681 (three months ended June 30, 2019 – $$456,721) of share-based payment expense. As at June 30, 2020, the remaining unvested balance of share-based payments was $353,797.

16. Per Share Amounts

16. Per Share Amounts
For the three months ended June 30		2020 2019
Loss for theperiod		(589,861) (1,908,254)
Basic and diluted weighted average number of shares		19,672,889 11,667,291
Basic and diluted lossper share (0.03) (0.16)

For the three months ended June 30, 2020 and 2019, all common share warrants, stock options and RSUs were excluded from the diluted per share amounts as their effect is anti-dilutive.

11

Boardwalktech Software Corp. Notes to Condensed Interim Consolidated Financial Statements

For the three months ended June 30, 2020 (United States dollars unless otherwise disclosed) (Unaudited)

17. Liquidity Risk

Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they fall due. The Company generally relies on funds generated from operations, acquisitions and/or equity financing to provide sufficient liquidity to meet budgeted operating requirements. Maturities of the Company’s financial liabilities are as follows:

	Carrying	Contractual	March 31	March 31	March 31
As at June 30,2020	Amount	cash flows	2021	2022	2023
Accounts payable and accrued liabilities	1,143,043	1,143,043	1,143,043	–	–
Deferred compensation	766,617	766,617	766,617	–	–
Term loan (Note 7)	3,529,957	4,488,089	1,195,833	2,263,044	1,029,212
Term loan interest	–	701,079	383,905	284,789	32,385
Lease liability (Note 8)	181,375	188,011	188,011	–	–
Forgivable loan (Note 9)	700,100	700,100	–	–	700,100
Forgivable loan interest	–	10,847	3,501	7,001	345
	6,321,092	7,997,786	3,680,910	2,554,834	1,762,042

The Company has current assets of $2,040,115 to satisfy its financial liabilities and therefore will have to generate sources of cash through positive operating cash flows, acquisitions and/or equity financing to satisfy liabilities as they come due.

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