CBD Global Sciences Inc. — Management Reports 2021

Sep 17, 2021

CBD Global Sciences Inc. Management Discussion and Analysis For the three months ended March 31, 2021 and 2020 (expressed in United States Dollars)

September 16, 2021

The following discussion and analysis of the Company's financial condition and results of operations for the three months ended March 31, 2021 should be read in conjunction with the condensed interim consolidated financial statements and related notes. The requisite financial data presented for the relevant periods has been prepared in accordance with International Accounting Standard (“IAS”) 34, “Interim Financial Reporting”, following the same accounting principles and methods of computation as outlined in the Company’s consolidated financial statements for the year ended December 31, 2020.

CBD Global Sciences Inc. is classified as a “venture issuer” for the purposes of National Instrument 51‐102.

Forward‐looking statements

Certain statements in this Management Discussion and Analysis (“MD&A”) are forward‐looking statements which reflect management’s expectations regarding future growth, results of operations, performance, business prospects and opportunities, the Company's ability to meet financial commitments and its ability to raise funds when required. Forward‐looking statements consist of statements that are not purely historical, including any statements regarding beliefs, plans, expectations or intentions regarding the future. Such statements are subject to risks and uncertainties that may cause actual results, performance or developments to differ materially from those contained in the statements. No assurance can be given that any of the events anticipated by the forward‐looking statements will occur or, if they do occur, what benefits the Company will obtain from them. These forward‐looking statements reflect management’s current views and are based on certain assumptions and speak only as of the date of this report. These assumptions, which include management’s current expectations, the global economic environment, and the Company’s ability to manage its operating costs, may prove to be incorrect.

A number of risks and uncertainties could cause actual results to differ materially from those expressed or implied by the forward‐looking statements, including but not limited to:

• the Company has a limited history of operations and has incurred losses since inception;

• there is no certainty that the Company will continue as a going concern;

• the Company may not be able to service its debt or meet other cash requirements;

• the need for additional financing;

• the outcome of ongoing bankruptcy proceedings and the resulting impact upon ongoing business relationships are uncertain;

• Federal laws concerning cannabis currently conflict with state laws in states that have legalized cannabis or possession of cannabis;

• State cannabis laws are not uniform from state to state and can, and do, change constantly;

• there remain several considerations and uncertainties regarding the cultivation, sourcing, production and distribution of Industrial Hemp and products containing hemp derivatives, and applicable laws remain subject to change as there are different interpretations among federal, state and local regulatory agencies;

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• significant economic disruptions caused by global health risks (such as COVID‐19);

• changes in product costs and supply channels, including disruption of the Company’s supply chain resulting from COVID‐19;

• heightened competition, whether from current competitors or new entrants, to the marketplace;

• failure to realize anticipated results, including revenue growth, anticipated cost savings or operating efficiencies associated with the Company’s major initiatives;

• claims by others that the Company has infringed upon intellectual property rights that could increase the Company’s expenses and delay the development of the Company’s business;

• the Company’s operations are subject to environmental regulation, including the maintenance of air and water quality standards and land reclamation; and

• the Company relies heavily on key personnel and advisors.

Refer to the Company’s Final Prospectus dated October 17, 2019 for a comprehensive discussion of the Company’s risk factors.

This is not an exhaustive list of the factors that may affect the Company’s forward‐looking statements. Other risks and uncertainties not presently known to the Company or that the Company presently believes are not material could also cause actual results or events to differ materially from those expressed in its forward‐looking statements. Additional risks and uncertainties are discussed in the Company’s materials filed with the Canadian securities regulatory authorities from time to time. The reader should not place undue reliance on any forward‐looking statements included herein. There is a significant risk that such forward‐looking statements will not prove to be accurate. Investors are cautioned not to place undue reliance on these forward‐looking statements. No forward‐looking statement is a guarantee of future results. The Company disclaims any intention or obligation to update or revise any forward‐looking statements, whether as a result of new information, future events or otherwise, except as required by law.

Nature of business

CBD Global Sciences Inc. (the "Company”) is in the business of producing and selling industrial hemp derived cannabidiol (“CBD”) infused consumable and topical products, including but not limited to CBD oil tincture drops, CBD hydration beverages, and CBD topicals.

The Company markets and sells its own brand of CBD oil and byproducts under the Aethics and CannaOil brands (collectively “Products”). More information about the Aethics brand can be found at https://aethics.com/. The Company plans to continue to expand its range of CBD oil and byproducts; refer to “Outlook” below.

All Industrial Hemp produced and sold by the Company constitutes Industrial Hemp under the 2018 and 2014 Farm Bills, as well as the laws of the states in which it produces and sells such Industrial Hemp and its Products.

The Products will be legal as a matter of federal law because they will constitute hemp as defined in the Agriculture Improvement Act of 2018 (“2018 Farm Bill”). As a result, the Products may be legally shipped and transported in interstate commerce as a matter of federal law. The Products will be legal as a matter of the laws of Colorado for the same reason and may be legally offered for retail sale in Colorado.

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It is noted, however, that topical and ingestible products containing CBD fall within the regulatory jurisdiction of the U.S. Food and Drug Administration (“FDA”) under the federal Food, Drug, and Cosmetic Act (21 U.S.C. 301 et seq.) (“Food and Drug Act”). Accordingly, because they will contain CBD, certain of the Products, including the Company’s nutraceuticals and food and body care Products, may be subject to enhanced scrutiny or enforcement action by FDA.

Refer to the Company’s Final Prospectus dated October 17, 2019 for a comprehensive discussion of the Company’s regulatory environment in the United States with respect to hemp and CBD.

Outlook

During the three months ended March 31, 2021, two of the Company’s subsidiaries, Global NV Corp. (“Global NV”) and Strasburg Pharms, LLC, filed for protection under the Bankruptcy Code as a result of claims against Global NV by a former landlord during the year ended December 31, 2020. Prior to filing for bankruptcy, the Company’s position was to defend these claims; however the landlord became an aggressive creditor. In connection with the bankruptcy, a trustee has been appointed on behalf of the Company to liquidate assets and discharge the outstanding liabilities of Global NV and Strasburg Pharms LLC. This liquidation process is ongoing.

The bankruptcy process will potentially allow the Company to implement operational and commercial plans to re‐position the Company for future growth. These plans include the incorporation of the following wholly‐owned subsidiaries during fiscal 2021: Global Sciences Holdings Inc., Dog Unleashed CBD, LLC, Legacy Distribution Group LLC, and Energy Unleashed LLC. Through these new subsidiaries, the Company is expanding its distribution and adding new CBD and non‐CBD products to enhance diversity of product offerings.

In conjunction with the bankruptcy liquidation process, the Company purchased certain assets of Aethics and CannaOil from the courts securing brand names, trademarks, websites and all product lines and formulations.

As at March 31, 2021, total assets presented in the consolidated statement of financial position do not include amounts for Global NV or Strasburg Pharms on the basis that the entities did not maintain the rights to or control of assets as a result of commencing bankruptcy proceedings on March 23, 2021.

In connection with the bankruptcy proceedings, the Company identified liabilities subject to compromise as at March 31, 2021 which totaled $4,061,735 and comprised accounts payable and accrued liabilities, amounts due to related parties, lease liabilities, notes payable and customer deposits of Global NV and Strasburg Pharms, LLC. Liabilities that are not subject to the bankruptcy proceedings are excluded from the liabilities subject to compromise. Liabilities incurred after the start of the bankruptcy proceedings are not subject to compromise.

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Harvesting summary

During the year ended December 31, 2020, the Company abandoned its 2020 crops due to the cost to harvest versus the impaired value of biomass as the price of CBD continued to decrease due to large scale farming of industrial hemp in the United States. Because of this the Company decided to scale back farming and extraction operations and focus on expanding the distribution of its CBD infused finished products.

Summary of Quarterly Results

Historical quarterly results of operations and loss per share data do not reflect any recurring expenditure patterns or predictable trends. The Company’s expenditures are driven by availability of financing to fund continued operations.

The table below sets forth selected results of operations for the Company’s eight most recently completed quarters. All figures are in accordance with IFRS.

Period ending	Quarter	Sales ($)	Income (loss) ($)	Earnings/(loss) per share ($)
March 31, 2021	Q1	15,385	(1,231,263)	Basic and diluted: (0.04)
December 31, 2020	Q4	(157,114)	(5,157,358)	Basic and diluted: (0.15)
September 30, 2020	Q3	17,870	(1,775,696)	Basic and diluted: (0.06)
June 30, 2020	Q2	296,550	(1,292,813)	Basic and diluted: (0.04)
March 31, 2020	Q1	148,094	(701,835)	Basic and diluted: (0.02)
December 31, 2019	Q4	(2,588,021)	(11,165,327)	Basic and diluted: (0.74)
September 30, 2019	Q3	1,799,572	(2,341,819)	Basic and diluted: (0.21)
June 30, 2019	Q2	1,842,227	5,912,586	Basic: 0.55 Diluted: 0.42

Sales

The fluctuations in sales can be explained by the changes in composition of sales and hemp pricing. Prices per pound of raw hemp varies depending on the CBD potency of the product and the market price of hemp. In addition, sales since the first quarter of fiscal 2020 reflect the negative impact of the global pandemic on the US economy, retailers and the Company. Due to the global pandemic and economic shutdown, the Company experienced a cancelation of a $2.4M purchase order for its CBD infused finished

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products that was set to go into production in the second quarter of fiscal 2020. Its largest and fastest growing retailer in airports saw the loss of 96% of its foot traffic due to the travel restrictions enforced at all major US airports. Most stores remained closed throughout the duration of the year ceasing all orders for new product in fiscal 2020. During the year ended December 31, 2019, the Company completed sales of biomass as well as secured processing contracts which did not occur during the year ended December 31, 2020 or quarter ended March 31, 2021.

Income (loss)

The fluctuations in income (loss) result from non‐cash items, including unrealized gains and losses on the change in fair value of biological assets (June 30, 2019 and September 30, 2019) and derivative liability (March 31, 2021), listing expense related to a reverse takeover transaction (December 31, 2019), impairment of inventory (December 31, 2019 and 2020), impairment of property and equipment (December 31, 2020), and share‐based payments (June 30, 2020 to March 31, 2021).

Discussion of operations

For the three months ended March 31, 2021

Revenue for the three months ended March 31, 2021 was $15,385 compared to $148,094 for the three months ended March 31, 2020. The decrease in sales is explained by the economic disruptions in the CBD market caused by the COVID‐19 pandemic.

The Company incurred cost of sales of $44,163 (March 31, 2020 ‐ $96,638) which decreased by $52,475 compared to the same period of the prior year as a result of changes in the amount and composition of sales, and scaling back farming and extraction operations.

General and administrative costs for the three months ended March 31, 2021 and 2020 can be summarized as follows:

For the three months ended	March 31, 2021	March 31, 2020	Change $	Change %
Investor relations	$ 100,895	$ 986	$ 99,909	10,133%
Office expenses	75,478	47,965	27,513	57%
Professional fees	57,313	90,464	(33,151)	‐37%
Rent	3,855	50,075	(46,220)	‐92%
Salaries	124,201	62,471	61,730	99%
Small tools and equipment	‐	850	(850)	‐100%
Travel	989	14,084	(13,095)	‐93%
Total G&A	$ 362,731	$ 266,895	$ 95,836	36%

• Investor relations increased by $99,909 due to service contracts entered into during the second half of fiscal 2020 with service periods which continued into fiscal 2021.

• Office expenses increased by $27,513 due to non‐recurring expenses incurred during the current period.

• Professional fees decreased by $33,151 due to the nature and timing of corporate transactions.

• Rent expense decreased by $46,220 from the prior period due to office closures and related decreases in operating costs.

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• Salaries increased by $61,730 as a result of amendments to executive management compensation.

• Travel expenses decreased by $13,095 due to travel restrictions related to the COVID‐19 pandemic.

The Company recorded accretion expense of $171,012 for the three months ended March 31, 2021 (March 31, 2020 ‐ $138,094) related to the carrying value of outstanding convertible debt and notes payable. Accretion expense increased from the prior period due to the modification of terms of convertible notes. The Company also recorded interest expense of $78,080 (March 31, 2020 ‐ $189,477) in interest expense related to convertible debt and notes payable.

During the three months ended March 31, 2021, the Company recorded an unrealized loss of $133,032 (March 31, 2020 ‐ $Nil) related to the change in fair value of a derivative liability.

The Company incurred consulting fees during the three months ended March 31, 2021 of $137,359 (March 31, 2020 ‐ $51,246), representing an increase of $86,113. The increase in consulting fees for the three months ended March 31, 2021 is explained by service contracts entered into during the second half of fiscal 2020 with service periods which continued into fiscal 2021.

Depreciation recorded for the three months ended March 31, 2021 was $Nil on the basis that property and equipment were impaired to a net book value of $Nil as at December 31, 2020. During the three months ended March 31, 2020, the Company recorded depreciation of $51,132 prior to the capital assets becoming impaired.

The Company recorded finance fees for the three months ended March 31, 2021 totaling $15,753 (March 31, 2020 ‐ $Nil) which relate to costs incurred for amending financing terms. The amount and timing of finance fees fluctuates based on the fair value of equity instruments issued and the underlying vesting and maturity terms of the instruments.

Marketing, sales and distribution expenses for the three months ended March 31, 2021 amounted to $176,057 (March 31, 2020 ‐ $7,091). The increase of $168,966 is a result of service agreements in connection with the Company’s plans to re‐position itself subsequent to filing for bankruptcy.

Share‐based payments expense for the three months ended March 31, 2021 of $80,573 (March 31, 2020 ‐ $Nil) related to the fair value of stock options granted. There were no stock options issued or outstanding during the three months ended March 31, 2020.

Liquidity and capital resources

As at March 31, 2021, the Company had a working capital deficit of $5,250,866 as compared to $3,240,196 as at December 31, 2020, an increase in working capital deficit of $2,010,670. Working capital decreased due to decreases in prepaid expenses as services were received, reclassification of liabilities to short‐term in connection with the bankruptcy proceedings, an increase in the fair value of derivative liability, and increases to notes payable and obligation to issue shares related to proceeds received by the Company.

The Company’s ability to continue its operations is dependent upon its ability to raise financing and generate profits and positive cash flows from operations in order to cover its operating costs. From time to time, the Company generates working capital to fund its operations by raising additional capital through

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equity and/or debt financing. However, there is no assurance it will be able to continue to do so in the future.

As discussed above in “Outlook”, during the three months ended March 31, 2021, two of the Company’s subsidiaries, Global NV and Strasburg Pharms, LLC, filed for protection under the Bankruptcy Code as a result of claims against Global NV by a former landlord.

These factors, including the Company’s financial position, liquidity and the uncertain outcome of the matters arising from the bankruptcy proceedings, indicate the existence of a material uncertainty that may cast significant doubt about the Company’s ability to continue as a going concern.

Cash flows

A summary of cash flows for the three months ended March 31, 2021 and 2020 is summarized in the table below.

below.
For theperiod ended March 31,	2021 ($)	2020 ($)
Cash used in operatingactivities	(519,720)	(278,602)
Cashprovided byinvestingactivities	80,000	‐
Cashprovided byfinancingactivities	443,612	404,496
Change in cash duringtheperiod	3,892	125,894
Cash,beginningof theperiod	541	21,598
Cash,end of theperiod	4,433	147,492

Operating activities

Cash used in operating activities adjusts loss for the period for non‐cash items including, but not limited to accretion of loans and notes payable, change in fair value of derivative liability, depreciation of property and equipment, accrued interest and share‐based payments. Cash used in operating activities also reflects changes in working capital items, such as amounts receivable, prepaid expenses, inventory and amounts payable, which fluctuate in a manner that does not necessarily reflect predictable patterns for the overall use of cash, the generation of which depends almost entirely on sources of external financing to fund operations.

Investing activities

During the three months ended March 31, 2021, cash provided by investing activities consisted of proceeds received from the sale of assets under construction of $80,000.

The Company had no investing activities for the three months ended March 31, 2021.

Financing activities

During the three months ended March 31, 2021, the Company received net cash of $443,612 (March 31, 2020 ‐ $404,496) from financing activities which included proceeds from the issuance of debt of $325,000 (March 31, 2020 ‐ $395,274), proceeds from the issuance of shares or shares to be issued of $30,000 (March 31, 2020 ‐ $117,069 net of share issue costs) and government assistance received of $135,095

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(March 31, 2020 ‐ $nil). Proceeds received were partially offset by the repayment of notes payable of $34,317 (March 31, 2020 ‐ $100,000) and lease payments of $12,166 (March 31, 2020 ‐ $7,847).

Related party disclosures

Related parties and related party transactions impacting the accompanying condensed interim consolidated financial are summarized below.

Key management personnel include those persons having authority and responsibility for planning, directing and controlling the activities of the Company as a whole. Key management personnel comprise officers and directors of the Company.

Remuneration attributed to key management personnel for the three months ended March 31, 2021 and 2020 are summarized as follows:

2020 are summarized as follows:
For the three months ended March 31,	2021 ($)	2020 ($)
Salaries	75,000	75,897
Share‐basedpayments	53,009	‐
Total remuneration	128,009	75,897

Other related party transactions and balances

• a) As at March 31, 2021, a revolving promissory note due to Mac5 Mortgage, a company jointly controlled by the President of the Company, Brad Wyatt, and the Chief Operating Officer of the Company, Glenn Dooley, had a carrying value of $534,663 (December 31, 2020 ‐ $509,321), principal balance of $873,685 (December 31, 2020 ‐ $873,685) and accrued interest balance of $67,897 (December 31, 2020 ‐ $57,125). As at March 31, 2021, the carrying value and accrued interest balance were reclassified to liabilities subject to compromise from due to related parties.

The Company recorded the promissory note at amortized cost using an effective interest rate of 20% which caused the carrying amount to be lower than the principal and accrued interest with the difference recognized as a related party contribution in capital reserve. During the period ended March 31, 2021, the Company recognized an additional $Nil (December 31, 2020 ‐ $41,067) as related party contributions pursuant to proceeds received during the period and recorded accretion expense of $25,460.

The note is unsecured and, bears interest at 5% per annum. The interest was due monthly with the principal balance due on demand. On January 1, 2019, the Company entered into a modification agreement to amend the maturity date of the principal balance to December 31, 2024.

• b) On September 1, 2018, Mac5 Mortgage, a company jointly controlled by the President of the Company, Brad Wyatt and the Chief Operating Officer of the Company, Glenn Dooley, advanced $7,500 to the Company in exchange for a promissory note. The note is unsecured and bears interest at 6% per annum. Payments of interest only are due monthly on the first day of every calendar month starting January 1, 2018 with payment in full at maturity on December 31, 2019. Should the Company default on an interest payment, the interest rate shall increase to 12% per annum. On January 1, 2019, the Company entered into an agreement amending the maturity date of the note to December 31, 2021.

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As of March 31, 2021, the balance due on this note was $8,260 (December 31, 2020 ‐ $8,177), including principal balance of $7,500 and accrued interest of $760 (December 31, 2020 ‐ $677). As at March 31, 2021, the principal and accrued interest balances were reclassified to liabilities subject to compromise from due to related parties.

• c) On April 1, 2019, the Company entered into an unsecured promissory note with Mac5 Mortgage, a company jointly controlled by the President of the Company, Brad Wyatt, and the Chief Operating Officer of the Company, Glenn Dooley, whereby Mac5 Mortgage loaned a balance up to $500,000 to the Company. As at March 31, 2021, the promissory note had a carrying value of $905,863 (December 31, 2020 ‐ $623,560), principal balance of $1,064,505 (December 31, 2020 ‐ $749,505) and accrued interest balance of $40,808 (December 31, 2020 ‐ $21,580). As at March 31, 2021, the carrying value and accrued interest balance were reclassified to liabilities subject to compromise from due to related parties.

The note is unsecured, bears interest at 8% per annum, has payments of interest only due monthly with the principal balance due on June 30, 2022.

The Company recorded the promissory note at amortized cost using an effective interest rate of 20% which caused the carrying amount to be lower than the principal and accrued interest with the difference recognized as a related party contribution in capital reserve. During the period ended March 31, 2021, the Company recognized an additional $63,609 (December 31, 2020 ‐ $172,672) as related party contributions pursuant to proceeds received during the period and recorded accretion expense of $30,912 (2020 ‐ $70).

• d) On December 31, 2018, the Company entered into an unsecured promissory note with TargetPath, a company controlled by Scott Hix, a director whereby TargetPath loaned $33,736 to the Company. As at March 31, 2021, the promissory note had principal and accrued interest balances of $33,736 (December 31, 2020 ‐ $33,736) and $3,036 (December 31, 2020 ‐ $2,024), respectively. The note is unsecured and bears interest at 6% per annum. Interest and principal are due and payable on the maturity date of December 31, 2020. As at March 31, 2021, the loan was in default; and as a result of the default the outstanding principal balance accrues interest at a rate of 12% per annum effective January 1, 2021. As at March 31, 2021, principal and accrued interest balances were reclassified to liabilities subject to compromise from due to related parties and accounts payable and accrued liabilities, respectively.

• e) During the period ended March 31, 2021, the Company incurred $7,157 (March 31, 2020 ‐ $13,096) in professional fees to ACM Management Inc. controlled by Alex McAulay, Chief Financial Officer of the Company recorded in general and administrative expenses.

• f) During the period ended March 31, 2021, the Company incurred $3,167 (March 31, 2020 ‐ $18,733) in professional fees to Tingle Merrett LLP controlled by Scott Reeves, director of the Company recorded in general and administrative expenses.

• g) As at March 31, 2021, the Company owed $39,332 (December 31, 2020 ‐ $41,923) to W2D Holdings, a company jointly controlled by Brad Wyatt, President and Glenn Dooley, Chief Operating Officer of the Company for rental fees and expense reimbursement. As at March 31, 2021, the amount was reclassified to liabilities subject to compromise from accounts payable and accrued liabilities.

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• h) As at March 31, 2021, the Company owed $39,852 (December 31, 2020 ‐ $46,452) to Brad Wyatt, President of the Company for salaries and wages. As at March 31, 2021, the amount was reclassified to liabilities subject to compromise from accounts payable and accrued liabilities.

• i) As at March 31, 2021, the Company owed $128,305 (December 31, 2020 ‐ $126,029) to ACM Management Inc. controlled by Alex McAulay, Chief Financial Officer for professional fees. As at March 31, 2021, $124,893 of the amount outstanding was reclassified to liabilities subject to compromise from accounts payable and accrued liabilities.

• j) As at March 31, 2021, the Company owed $173,737 (December 31, 2020 ‐ $170,478) for professional fees to Tingle Merrett LLP, a company controlled by Scott Reeves, director of the Company. As at March 31, 2021, $17,397 of the amount outstanding was reclassified to liabilities subject to compromise from accounts payable and accrued liabilities.

• k) As at March 31, 2021, the Company owed $413,955 (December 31, 2020 ‐ $412,943) for consulting fees to TargetPath, a company controlled by Scott Hix, a director of the Company. As at March 31, 2021, the amount was reclassified to liabilities subject to compromise from accounts payable and accrued liabilities.

• l) As at March 31, 2021, the Company owed $11,776 (December 31, 2020 ‐ $1,776) to Mac5 Mortgage, a company jointly controlled by the President of the Company, Brad Wyatt, and the Chief Operating Officer of the Company, Glenn Dooley, related to advances included in due to related parties.

All transactions with related parties were intended to be carried on the same basis as they would have occurred if the transaction was with an arm’s length party.

Subsequent Events

The Company entered into debt settlement agreements related to convertible debentures with total principal balances of $4,287,412 and accrued interest balances of $65,872 which are to be converted to 310,928 preferred shares of the Company.

The Company received share subscriptions of $25,000 for 83,333 units at a price of $0.30 per unit. Each unit will consist of one common share of the Company and one‐half of one warrant. Each whole warrant shall entitle the holder to acquire one common share of the Company at a price of $0.60 for a period of 24 months.

Outstanding share data

The Company is authorized to issue an unlimited number of shares of common stock and preferred shares without par value.

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The Company has securities outstanding as follows:

The Company has securities outstanding as follows:
Security Description	March 31, 2021	Date of Report
Common shares	34,525,758	34,525,758
Preferred shares	316,784	316,784
Stock options	5,700,000	5,700,000
Cashless options	250,000	250,000
Warrants	16,871,384	13,832,004
Debt – convertible to common shares	6,599,403	398,377
Debt – convertible topreferred shares	1,000	311,928
Fully diluted shares	64,264,329	55,334,851

As at March 31, 2021, the Company had 3,635,484 common shares and 101,344 preferred shares held in escrow. Of the total remaining securities, 908,871 common shares and 25,341 preferred shares will be released every six months until April 7, 2022.

Company documents

The Company files annual and interim reports, information circulars and other information with certain Canadian securities regulatory authorities. The documents filed with the Canadian securities regulatory authorities are available at http://www.sedar.com and the Company’s website https://www.cbdglobalsciences.com.

Approval

The Board of Directors of the Company has approved the disclosure contained in this MD&A.

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