DataMetrex AI Limited — Management Reports 2023

Nov 10, 2023

AMENDED AND RESTATED

Datametrex AI Limited

Management’s Discussion and Analysis December 31, 2022 (Canadian dollars)

Management’s Discussion and Analysis for the year ended December 31, 2022 (Canadian dollars, except share and unit information)

AMENDED AND RESTATED

Datametrex AI Limited

The following management discussion and analysis, prepared as of August 18, 2023, provides information that management believes is relevant to an assessment and understanding of the results of operations and the consolidated financial position of Datametrex AI Limited (the “Company”). The Management’s Discussion and Analysis (“MD&A”) should be read in conjunction with the consolidated financial statements for the year ended December 31, 2022. Unless otherwise noted, all financial information in the MD&A has been prepared in accordance with International Financial Reporting Standards (“IFRS”). All amounts are expressed in Canadian dollars unless otherwise indicated.

The Company is amending this MD&A for the year ended December 31, 2022 to (1) enhance disclosure about the Company’s current business operations, (2) provide updates on prior news releases, (3) provide additional discussion on revenues and direct costs, (4) discuss factors that have caused variations over the quarters, (5) include an analysis of the Company’s liquidity, and (6) include an analysis of the Company’s capital resources.

Forward-Looking Statements

This MD&A contains or incorporates forward-looking statements within the meaning of Canadian Securities legislation (collectively, “forward-looking statements”). These forward-looking statements relate to, among other things, revenue, earnings, changes in cost and expenses, capital expenditures and other objectives, strategic plans and business development goals, and may also include other statements that are predictive in nature or that depend upon or refer to future events or conditions, and can generally be identified by words such as “may”, “will”, “expects”, “anticipates”, “intends”, “plans”, “believes”, “estimates” or similar expressions. In addition, any statements that refer to expectations, projections, or other characterizations of future events or circumstances are forward-looking statements. These statements are not historical facts but instead represent only the Company’s expectations, estimates, and projections regarding future events.

Although the Company believes the expectations reflected in such forward-looking statements are reasonable, such statements are not guarantees of future performance and involve certain risks and uncertainties that are difficult to predict. Undue reliance should not be placed on such statements. Certain material assumptions are applied in making forwardlooking statements and actual results may differ materially from those expressed or implied in such statements.

The forward-looking statements contained in this MD&A are made as of the date of this MD&A and, accordingly, are subject to change after such date. Except as required by law, the Company does not undertake any obligation to update or revise any forward-looking statements made or incorporated in this MD&A, whether as a result of new information, future events or otherwise.

Business Overview

Datametrex AI Limited is a technology-focused Company with exposure to artificial intelligence, GPT technology, machine learning, and telehealth and has recently entered the electric vehicle (EV) market. Datametrex’s mission is to develop innovative tools and solutions that facilitate the adoption of new standards of protocols using artificial intelligence and health diagnostics. Leveraging these technologies enables companies to proactively address issues related to supply chain management and enhance their overall operational efficiency with predictive and preventive technologies. In addition to the Company’s existing portfolio of technologies, the Company recently ventured into the electric vehicle (EV) market, reflecting its commitment to sustainability and clean energy.

Datametrex prides itself on its forward-thinking approach and the ability to develop progressive solutions that address the most pressing challenges facing businesses today. Datametrex is committed to supporting clients in achieving their goals and helping them stay ahead of the curve in an ever-changing business landscape.

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Management’s Discussion and Analysis for the year ended December 31, 2022 (Canadian dollars, except share and unit information)

AMENDED AND RESTATED

Datametrex AI Limited

The Company is a publicly traded corporation, incorporated in the province of Ontario and its head office is located at 2300 Yonge Street, Suite 2802, Toronto, Ontario, M4P 1E4, Canada. The Company’s common shares are listed on the TSX Venture Exchange (“TSXV”) under the trading symbol “DM”, on the OTCQB under the trading symbol “DTMXF” and on the Frankfurt Stock Exchange under the trading symbol “D4G”.

Description of Business

Nexalogy Environics Inc. (“Nexalogy”)

For over a decade, Nexalogy has combined cutting-edge academic, statistical, and AI research with in-house know-how to build advanced products for social and traditional media research. Nexalogy brings a wealth of experience in AI, NLP, Deep Learning, and big data analysis to produce world-class software for investigative experts to perform data exploration and monitoring. Nexalogy also holds several patents in the field of NLP and text analytics.

Nexalogy has collaborated with the Canadian (DRDC, OSINT) and American armed forces (ONR, USAF) for over seven years, contributing to committees and scientific achievement awards at the NATO level. On the private side, Nexalogy has worked with companies like Samsung, Lotte, Ford and 7-11 to improve brand recognition, audience discovery, and internal narrative monitoring.

Operational Details

Nexalogy’s software, NexaIntelligence and NexaSMART, are available both as stand-alone products and as plug-ins to existing business intelligence and ETL pipelines. Nexalogy offers its software as an enterprise B2B offering with pricing commensurate with the amount of data processed. Nexalogy also participates in request for proposal (RFP) processes both in the public and private sectors, adapting its software solutions to specific customer needs on occasion. A typical enterprise engagement for Nexalogy ranges from hundreds of thousands to millions of dollars.

In addition to the enterprise offerings and RFP activities, Nexalogy offers custom services to businesses. These services include detailed research reports based on social and traditional media, market research and identification, and brand representation. Reporting and services start at $25,000 CAD. Prices increase with the amount of data processed.

Key Agreements and Partnerships

Nexalogy, as a subsidiary of Datametrex is currently recognized as a preferred solution provider for Lotte Corporation. This key strategic agreement has allowed Nexalogy to expand its footprint in the Korean market.

Strategic Direction

In Q1 2023, Nexalogy announced its next-generation software, AnalyticsGPT. This platform integrates Nexalogy’s proprietary GPT technology with its existing analytics engines, broadening its application. It aims to cater not only to large enterprises but also to SMEs, diversifying Nexalogy's potential market. The release of AnalyticsGPT is slated for fall 2023. Nexalogy will also continue to serve and expand its current clientele and continue to actively participate in both public and private RFPs.

Risk Factors

Nexalogy's business model is subject to various risks. As privacy laws evolve, access to primary data sources, especially from social media, may become restricted. Nexalogy adheres to these laws across all operational jurisdictions, including Canada, the US, and Korea. Some data types, like medical and legal information, come with added regulations. Additionally, should some data platforms choose to voluntarily restrict access to their data, Nexalogy would be adversely affected.

A significant portion of Nexalogy's revenue stems from public and private sector RFPs. A lack of suitable RFPs or unsuccessful bids could adversely affect the company's financial health. It's worth noting that certain public sector RFPs contain clauses that allow termination without prior notice. Nexalogy also works in the realm of AI. It’s also worth noting that as this nascent technology matures, currently unknown risk factors may emerge such as government regulations and public backlash.

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Datametrex AI Limited Management’s Discussion and Analysis for the year ended December 31, 2022 (Canadian dollars, except share and unit information)

AMENDED AND RESTATED

This business line holds medical insurance for its employees. Beyond this, no additional insurance is deemed necessary for the regular conduct of its operations.

Imagine Health Centres (“Imagine Health”) and Medi-Call Inc. (“Medi-Call”)

The Healthcare Vertical includes Imagine Health Centres, a multidisciplinary healthcare facility with locations currently in Calgary and Edmonton, Alberta, and Medi-Call, a telehealth platform for iOS and Android devices currently serving British Columbia and Alberta. Both Imagine Health Centres and Medi-Call aim to converge to offer a seamless, integrated healthcare model.

Operational Details

Imagine Health Centres offer an extensive range of services, particularly focusing on their three primary lines: Medical, Pharmacy, and Physiotherapy. Their wide spectrum of services comprises Primary Care, Emergency Care, Pharmacy, Physiotherapy, Massage Therapy, Acupuncture, Cosmetic Services, Allergy Consultations, and Virtual Consults, provided by both employed healthcare professionals and independent consultants. Imagine Health does not own the locations of its medical clinics. Instead, the Company leases its clinic spaces. Imagine Health holds ownership of the pharmacies. However, the operations and management of these pharmacies are entrusted to and executed by licensed pharmacists in adherence to regulatory standards and best practices.

For the operation of our various services, the following licensing structures are in place:

• Medical Clinic:

• Physicians must be registered and licensed with the College of Physicians & Surgeons of Alberta (CPSA).

• ● Pharmacy:

• Pharmacists must be registered and licensed through the Alberta College of Pharmacy (ACP).

• Pharmacy License: The pharmacy itself also has a license, in order to operate, that is under the name of a Imagine Health pharmacist.

• Physiotherapy:

• Physiotherapists need to be registered and licensed with the Physiotherapy Alberta College + Association.

Imagine Health primarily derives its revenue through the following channels:

• Physician Consultations: Revenue is primarily generated when physicians consult with patients on a fee-for-service basis. The fees associated with these consultations are typically billable to entities such as Alberta Health, Workers Compensation Board, and Occupational Injury Service. Depending on the nature of the consultation and the coverage of the patient, either the patient directly pays for these services or the cost is covered by Alberta Health or private insurance.

• Revenue Sharing: Medical professionals charge a fee for the services they render. This fee is then shared between the professional and Imagine Health based on pre-agreed terms.

• Pharmacy Operations: On the pharmacy side of the business, revenue is generated from the sales of prescription drugs and over-the-counter (OTC) products. Moreover, licensed pharmacists have the capability to bill for additional services such as vaccinations and consultative sessions.

Imagine Health receives payments through various channels, including directly from Alberta’s health care insurance plan, private insurance providers, and direct payments from clients.

Medi-Call, is an internally developed telehealth platform, with its technology maintained and updated through in-house resources and occasionally through external contractors as necessary.

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Management’s Discussion and Analysis for the year ended December 31, 2022 (Canadian dollars, except share and unit information)

AMENDED AND RESTATED

Datametrex AI Limited

The primary revenue sources for Imagine Health Centres are derived from patient consultations in the medical clinic, pharmacy prescription and OTC sales, and physiotherapy services. Meanwhile, Medi-Call's main revenue stream originates from billable telehealth services.

Medi-Call's billable telehealth services encompass a wide range of virtual consultation offerings. These services are specifically those not reserved or exclusively provided by Health Canada and the respective provincial Governmental Health Care providers. To be precise, our telehealth platform facilitates:

• Remote medical consultations with healthcare professionals, including general practitioners and specialists.

• Electronic prescriptions, including medication renewals and new prescriptions based on the outcome of the virtual consultation.

• Follow-up care, medication reviews, and monitoring for patients with chronic illnesses or those requiring continuous care.

• Referrals to specialists or additional healthcare resources as required.

Key Agreements and Partnerships

Imagine Health Centres is in the process of integrating the Medi-Call platform into its operations. This initiative will offer patients a unified virtual and physical healthcare experience, enhancing the services under a shared brand and nurturing a cohesive healthcare environment. Concurrently, Medi-Call has fostered strategic partnerships with numerous international student agencies, expanding its exposure, user base and reach.

Strategic Direction

Capitalizing on the traction Medi-Call has achieved in British Columbia, the Company envisions unveiling a fully integrated healthcare model. This model intends to combine the in-person consultations facilitated by Imagine Health Centres with Medi-Call's telehealth services.

Risk Factors

Datametrex’s Healthcare division faces several risk factors including ongoing regulatory shifts in telehealth governance as laws catch up to the technology. Expansion into new provinces also runs risks, as new levels of healthcare compliance have to be factored into the business’ expansion plans.

Datametrex’s Healthcare division is also subject to all risk factors common to the healthcare industry such as federal and provincial laws and regulations, data privacy policies, malpractice, healthcare incidents at physical clinics, and escalating competition in both telehealth and conventional healthcare sectors. Additionally, the international student flows for MediCall may be subject to changing immigration policies in Canada and abroad.

The physicians and nurses associated with these entities have their own individual insurance coverages. They are licensed and regulated by their respective colleges – the College of Physicians & Surgeons of Alberta (CPSA) for those based in Alberta and the College of Physicians & Surgeons of British Columbia (CPSBC) for those in British Columbia.

Upcoming Developments

Imagine Health Centres is set to progressively embed Medi-Call into its offerings, providing patients with a merged virtual and tangible healthcare experience. In tandem, Medi-Call plans a comprehensive expansion in Alberta by year-end, banking on the existing presence of Imagine Health Centres in the region. While a potential move into Ontario is under consideration, a definitive timeline is yet to be set.

In line with its goals, a proposal to spin off the healthcare division is underway. This strategic move aims to unite MediCall and Imagine Health Centres into a distinct entity. The overarching vision revolves around presenting a potent, interlinked healthcare solution that addresses the diverse needs of patients.

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Management’s Discussion and Analysis for the year ended December 31, 2022 (Canadian dollars, except share and unit information)

AMENDED AND RESTATED

Datametrex AI Limited

Datametrex Electric Vehicle Solutions (“dmEVS”)

Offering residential and commercial electric vehicle charging solutions, dmEVS emphasizes safety and reliability. In addition to assisting clients with product selection, installation, and network management, we guide them in identifying grants and benefits for comprehensive charging needs. Our offerings include stand-alone and robotic chargers for both residential and commercial spaces as well as mobile charging vehicles suitable for roadside assistance, event support, and on-demand activities.

Key Agreements and Partnerships

dmEVS has secured pivotal contracts with EVAR Korea and CyberSwitching Technologies from the US to provide its charging solutions. While EVAR Korea is our main supplier for these solutions, CyberSwitching complements our product range by filling specific gaps. Management deems these contracts pivotal because they form the backbone of our business operations in the electric vehicle (EV) charging sector. Without these agreements, our capacity to participate and deliver services within this domain would be severely constrained.

DM EVS has a comprehensive partnership with EVAR Korea wherein we act in the capacity of a distributor. Specifically:

1. We purchase charging stations directly from EVAR Korea and subsequently resell them to the end-user. It's essential to note that our relationship is not merely facilitative; we do not simply introduce the supplier to the enduser.

2. Our involvement extends beyond the point of sale. DM EVS is responsible for the installation, maintenance, and other requisite services associated with the charging stations.

3. Furthermore, DM EVS furnishes the critical support infrastructure necessary for seamless operation within the North American market, which includes:

4. Provisioning a dedicated mobile phone application tailored for North American users.

5. Establishing and maintaining a robust payment infrastructure, encompassing our website, online payment portals, server support, and essential software back-end.

6. Ensuring prompt and efficient installation of the charging stations.

7. Offering consistent maintenance and support for all DM EVS products within North America.

8. Coordinating scheduling and being available for on-call activities.

Our suppliers, including EVAR Korea, provide warranties on their products. These warranties generally cover manufacturing defects and the operational integrity of the products for a specified period.

As for DM EVS' liability towards the end-user in cases of product defects:

• DM EVS is responsible for facilitating the warranty claims between the end-user and the supplier.

• In the event of a product defect, we undertake the task of diagnosing the issue and, if the defect falls under the supplier's warranty terms, we liaise with the supplier to ensure the product is repaired or replaced as stipulated by the warranty provisions.

• Additionally, DM EVS may offer auxiliary support and services to the end-user, particularly in areas concerning installation and operational guidance, to minimize any disruptions caused by potential product defects.

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Management’s Discussion and Analysis for the year ended December 31, 2022 (Canadian dollars, except share and unit information)

AMENDED AND RESTATED

Datametrex AI Limited

Operational Details

dmEVS collaborates with clients to develop solutions that meet mutual requirements. We assist in sizing, ordering, delivery, and logistical support. Typically, electrical installation and maintenance and construction are outsourced to certified thirdparty contractors.

For chargers and charging robots, dmEVS generally sells the unit(s) to the client. In these cases, dmEVS does not recognize revenue past the sales of the unit(s). dmEVS can provide ongoing maintenance and upkeep for a fee. For mobile charging solutions, dmEVS generally provides its own mobile charging units to clients on a case-by-case basis. Specifically, our tailored approach evaluates the specific requirements and circumstances of each client individually, determining the most suitable solution for them based on their needs. Historically, DM EVS has only rented out its mobile charging units to clients. However, this does not preclude the possibility of other arrangements, including sales, in the future.

dmEVS may, on occasion, enter into contracts that allow a split revenue recognition arrangement with the client. In such cases, ongoing revenue recognition and costs may be shared between dmEVS and the client. This includes revenue from the use of the chargers themselves in addition to revenue generated from operations and carbon tax credits. Additionally, in this model, ongoing costs, such as maintenance, will be negotiated on a case-by-case basis. This model is generally used when the client has an already established system that they would like to leverage i.e. an established hotel chain that is adding electric vehicle charging capabilities to their properties with existing maintenance contracts that must be honoured.

Key Agreements and Partnerships

dmEVS and EVAR Korea have collaboratively formed a partnership to enhance technical collaboration and streamline the supply of specialized electric charging equipment. This includes exclusive access to the complete range of company products and services, including smart electric vehicle chargers, automated robotic electric vehicle chargers, mobile charging units suitable for vehicles such as vans and trucks, and indoor self-driving infrastructure (SLAM).

A “smart electric vehicle charger” is a stationary installation, typically designed for fixed locations like homes, offices, or public charging stations. Its key differentiating feature is its ability to incorporate intelligent charging capabilities. Such capabilities encompass features like error and maintenance detection, load balancing to facilitate simultaneous charging of multiple vehicles from a single charging source, and often, real-time communication with grid operators or users.

In contrast, “mobile charging units” are adaptable charging systems specifically designed to be integrated into mobile platforms, like vans or trucks. These units enable the said vehicles to become mobile EV charging stations, thus offering flexibility in terms of location and rapid response to on-demand charging needs.

Our partnership agreements with EVAR Korea encompass licenses and provisions that enable DM EVS to operate within various geographical regions of North America, including the US. However, while our contractual permissions extend beyond Canada, our operational focus and endeavours have, to date, been singularly concentrated on the Canadian market.

Additionally, dmEVS has contracts to supply it with chargers and charging equipment with CyberSwitching. This partnership is aimed at filling product gap lines and expediting dmEVS’ market presence.

dmEVS has partnered with Rewatt Power to deal in carbon tax credits. This collaboration allows dmEVS to accrue federal Clean Fuel Regulation (CFR) credits, a Canada-wide government incentive credit and the Low-Carbon Fuel Standard (LCFS) credit, which is British Columbia based only.

dmEVS recently signed a contract to provide the Holiday Inn Vancouver with electric vehicle chargers. The Holiday Inn agreement grants dmEVS the full entitlement to revenue generated from EV charging operations and carbon credits.

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Management’s Discussion and Analysis for the year ended December 31, 2022 (Canadian dollars, except share and unit information)

AMENDED AND RESTATED

Datametrex AI Limited

Risk Factors

dmEVS is subject to any and all disruptions to its suppliers, namely EVAR and CyberSwitching. As electric charging demand increases, so will demand on these supply chains. Should dmEVS’ current suppliers become unable to provide their products for any reason, dmEVS will have to look for additional suppliers to continue its business.

The electric charging industry is rapidly evolving. Unforeseen changes in government regulations and policies and industry agreements may negatively impact the ability of dmEVS to operate in certain jurisdictions. As global demand for charging solutions increases, pressure on manufacturers will increase, possibly negatively impacting dmEVS’ ability to procure products.

Certain environmental conditions may also prohibit the ability of dmEVS to provide solutions to clients. For instance, dmEVS cannot provide chargers capable of charging in certain inclement weather conditions.

Carbon tax credits and their regulation by governments and industry is an ongoing process. dmEVS’ revenue could be negatively affected by any regulations that restrict its ability to monetize carbon tax credits.

This segment possesses motor vehicle liability insurance that covers any potential liabilities related to the operation of its vehicles. Additionally, medical insurance is provided for its employees. When it comes to the installation and maintenance aspects of the business, the professionals contracted for these tasks are responsible for their own insurance coverage.

Strategic Direction

dmEVS currently operates in British Columbia, Canada, and recently announced the opening of operations in Ontario, Canada. dmEVS intends to expand its operations across Canada on a province-by-province basis, opening operations in new geographies as soon as operationally feasible.

In addition to pursuing large fleet contracts, dmEVS also believes there is significant revenue potential in the SMB marketplace. It is the belief of dmEVS that electric charging will become ubiquitous across Canada. To that end, dmEVS is also targeting these types of businesses for electric charging solutions.

DM EVS offers flexibility in the approach to the installation, maintenance, and construction of charging stations.

DM EVS has, on several occasions, undertaken the responsibility of providing support for the installation, maintenance, and construction of the charging stations, leveraging our network of trusted professionals and expertise in the domain.

Conversely, end-users or third parties are also afforded the choice to engage their preferred professionals for the installation, maintenance, and construction tasks related to their charging stations. Should they opt for this route, the responsibility for securing any necessary permits, licenses, and insurance pertinent to the installation and operation of the charging stations typically resides with these third parties, contingent on the specifics of each individual case.

In essence, while DM EVS is equipped and willing to provide comprehensive support, end-users or third parties retain the freedom to manage these aspects independently, should they deem it more suitable to their requirements.

Summary of Recent Developments

The Company announced the Normal Course Issuer Bid program to increase value for shareholders. For the year ending December 31, 2022, the Company has purchased a total of 21,594,000 shares in 2022 through the NCIB share buyback program.

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Management’s Discussion and Analysis for the year ended December 31, 2022 (Canadian dollars, except share and unit information)

AMENDED AND RESTATED

Datametrex AI Limited

Nexalogy

Nexalogy announced it has started the second phase of the $40 million AI project with the Canadian Government, aimed at aiding Canadian cyber security initiatives.

The Company received several large contracts for its technology services. The Company continues to expand into new markets, including the United States.

The Company appointed a new Chief Technology Officer, Maxime Martineau, and a new president of Nexalogy, Mr. Charles Park, CFA.

The Company launched Smart Factory AI technology.

Nexalogy announced the development of its artificial intelligence and machine learning tool to detect depression and anxiety online.

Medi-Call

This past year, Medi-Call launched its mobile telehealth application for iOS and Android devices.

Medi-Call announced three distribution agreements last November with international student agencies.

Imagine Health

In 2023, the Company is expanding its footprint in the healthcare industry with its acquisition of Imagine Health Centres, a fully operational and turnkey healthcare business with two clinics currently operating in Calgary and Edmonton offering an abundance of multidisciplinary healthcare services staffed with skilled physicians, pharmacists, and other allied healthcare professionals. The Share Purchase Agreement under which the Company is acquiring all of the issued and outstanding shares of Imagine Health was signed in November 2022. As at December 31, 2022, the Company had not obtained control over the operations in both locations, and, as such, the acquisition is not completed, but is expected to be in 2023.

dmEVS

dmEVS launched its mobile roadside charging service.

dmEVS is partnering with commercial landlords and developers in Canada to install EV charging stations across British Columbia.

dmEVS has applied for three EV trademarks to protect its intellectual property in the EV space.

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Datametrex AI Limited Management’s Discussion and Analysis for the year ended December 31, 2022 (Canadian dollars, except share and unit information)

AMENDED AND RESTATED

Other updates on the Company’s news releases

The Company is also providing updates on the following items described in the Company’s prior news releases:

From the Issuer’s news releases:	Company’s update:
the deployment of 20 Van Mounted Mobile Chargers by the first half of 2023 and the launch of Mobile Charging Vehicles (news releases dated July 28, 2022 and November 14, 2022)	Our initial forward-looking statement in the July 28, 2022 news release projected the deployment of 20 Van Mounted Mobile Chargers by the end of the first half of 2023. However, by that time, only six chargers were deployed. The deviation from our projection arose from unexpected operational challenges and external factors that were not anticipated at the time of the initial announcement.
the anticipated initial release of Smart Factory AI technology in the United States, with possible subsequent international release (news releases dated September 16, 2022 and January 1, 2023)	The Company completed the initial release of the technology in December 2022 at a location in the state of Michigan, USA. This initial technology release was not and is not considered by the Company to be a material change, however, a broader release of the technology in the future may be deemed to be material.
the development of Nexalogy’s AI and machine-learning tool to detect depression and anxiety (news release dated October 27, 2022)	The research and development of the Company’s AI and machine learning tool is continuous and ongoing. This research has been moved to the new AnalyticsGPT platform as described in the Company’s February 9, 2023 press release. There have been no other material events in the development of the tool to date. For clarity, the AnalyticsGPT platform is the newest version of NexaSmart software.
DM EVS’ plan to install approximately 500 EV chargers across B.C. in 2023 (news release dated January 18, 2023)	Currently, the Company has installed 5 chargers in BC and 2 in Ontario. The principal reason for the delay, as mentioned in our subsequent press releases on March 23, 2023, and July 20, 2023, was pending permit approval from the City of Vancouver. The backlog from the City of Vancouver led to these unforeseen delays, making it challenging to meet our original target.
the Issuer’s plans to improve the software and user interface and experience of its NexaSmart technology (news release dated February 1, 2023)	The Company continues with plans to improve software and user interface with the development of AnalyticsGPT. The improved interface and workflow will be included in the release. The Company anticipates more UI and UX improvements will follow based on feedback from the user base once released. These new interfaces will be shown in the coming months as they are released with the marketing plan described below. The Company does not have any material information to disclose at this time regarding Nexa smart technology, but does anticipate an announcement in the near future.

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Management’s Discussion and Analysis for the year ended December 31, 2022 (Canadian dollars, except share and unit information)

AMENDED AND RESTATED

Datametrex AI Limited

From the Issuer’s news releases:	Company’s update:
Nexalogy’s planned launch of AnalyticsGPT to the general public and SMEs (news releases dated February 7, 2023, May 1, 2023 and May 30, 2023 and Q1 2023 MD&A)	The commercialization of AnalyticsGPT is currently underway. Barring any complications, the Company expects AnalyticsGPT will be released to SMEs this September with a limited public release to follow shortly. The Company will then expand the scope of the release as it adjusts for volume, capacity, etc. The Company will review technical reports before making any public announcements about AnalyticsGPT.
the Issuer’s plan to expand Nexalogy’s user base “as aggressively as possible” and the Issuer’s “aggressive strategy to elevate the Medi-Call platform” (news release dated March 23, 2023)	The Company is currently engaged in an internet marketing campaign, including twitter, LinkedIn and Facebook to highlight and grow the visibility of the upcoming software release AnalyticsGPT. The marketing efforts include producing videos to be broadcast on cable networks, satellite TV and web platforms and interviews on Bloomberg ON show “Advancements” to expand Nexalogy user base and Medi-Call platform. The Company has also participated in trade shows with booths at AI Expo Korea 2023 and FIC Europe 2023, and has also attended trade shows as participant at Cyber Eco 2023 (Montreal) and Collission 2023 (Toronto). The Company is also currently in production of a short form interviews for The Market Herald Canada, a market news publication, Agoracom IR, an online forum, and Stockhouse. Additionally, the Company is internally testing the market expansion qualities of the software and its application to Nexalogy. The Company plans to use this market intelligence to further the reach and visibility of the product closer to and following the launch. These same technologies and techniques will be used to market Datametrex’s other platforms. Additionally, MediCall is moving into a new physical services market (Vancouver) and actively considering Ontario for the same type of expansion.
the expansion of DM EVS charging locations pending permit approval from the City of Vancouver (news release dated March 23, 2023)	As discussed above, the backlog from the City of Vancouver led to these unforeseen delays, making it challenging to meet our original target.

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Management’s Discussion and Analysis for the year ended December 31, 2022 (Canadian dollars, except share and unit information)

AMENDED AND RESTATED

Datametrex AI Limited

From the Issuer’s news releases:	Company’s update:
the Issuer’s plan to expand the scope of marketing activities for Medi-Call Inc. and to establish more partnerships with international language agencies, and the roll-out of Medi-Call’s AI-powered features to enhance the telehealth platform experience (news release dated May 1, 2023 and Q1 2023 MD&A)	The marketing activities for Medi-Call are ongoing and discussion with several international language agencies have taken place. AI development to enhance the Medi- Call features is also ongoing. The Company has commenced an email-based marketing including campaign, an internet-based advertising campaign, twitter posts, LinkedIn, and Facebook, participated in trade shows with booths at AI Expo Korea 2023 and International Education Fair Korea 2022. In addition, the Company has entered distribution agreements with 3 international student agencies (Medinet, Halifax Life, and JS Edu).
the potential opening of a fourth Imagine Health clinic in Ontario (news release dated May 3, 2023)	Several locations are currently under consideration.
the potential expansion of DM EVS’s EV charging network as a result of the collaboration with Rewatt Power (news release dated May 24, 2023)	As a result of collaboration with Rewatt, the Company is able to monetize carbon credits as this improves DM EVS’s ability to monetize its charging products by providing an additional possible revenue stream. The carbon credit monetization, as a result of collaboration with Rewatt makes DMEVS more attractive and competitive, and which results in higher visibility, marketability, and sales. See July 21,2023 press release regarding Ontario expansion and carbon credits.
the status of DM EVS’s discussions with three prominent hotels to install and operate EV chargers on-site (news releases dated May 1, 2023 and May 30, 2023)	The Company’s June 1, 2023 press release discloses the signing of a contract to service one hotel, Holliday Inn, Vancouver. The Company continues negotiations with two other hotels: Onni Group (Level Hotels) and Sunray Group. The Company is also engaged in negotiations with additional hotels.
the possible spin out of the Issuer’s healthcare division (news release dated July 6, 2023)	The Company is actively exploring the different possibilities for spinning out its healthcare entities. As these unfold, more information will be shared.

Selected Financial Information

	Years ended December 31,	Years ended December 31,
	2022	2021	2020
	$	$	$
Current assets	15,618,738	23,775,212	3,873,566
Total assets	35,999,997	42,640,643	9,998,329
Total current liabilities	9,403,193	9,437,061	6,053,667
Total liabilities	13,231,352	10,151,618	6,751,972
Revenue	30,488,939	49,029,040	12,378,024
Net income (loss)	(17,258,809)	9,090,124	(5,006,276)

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Datametrex AI Limited Management’s Discussion and Analysis for the year ended December 31, 2022 (Canadian dollars, except share and unit information)

AMENDED AND RESTATED

EBITDA and Adjusted EBITDA

Management believes that EBITDA and Adjusted EBITDA are effective measures for analyzing the performance of the Company. The term “EBITDA” refers to earnings before deducting interest, taxes, depreciation and amortization. The Company calculates Adjusted EBITDA as earnings before deducting interest and accretion, taxes, depreciation and amortization, impairment charges, acquisition related costs, and share based compensation. “EBITDA”, “EBITDA per share”, “Adjusted EBITDA”, and “Adjusted EBITDA per share” are non-GAAP measures. The Company believes that EBITDA and Adjusted EBITDA are useful additional information to management, the Board and investors as it provides an indIcation of the operational results generated by its business activities prior to taking into consideration how those activities are financed and taxed and also prior to taking into consideration asset depreciation and amortization and it excludes items that could affect the comparability of our operational results and could potentially alter the trends analysis in business performance. Excluding these items does not necessarily imply they are non-recurring, infrequent or unusual. EBITDA and Adjusted EBITDA are also used by some investors and analysts for the purpose of valuing a company. Investors are cautioned that EBITDA and Adjusted EBITDA should not be construed as an alternative to operating earnings or net earnings determined in accordance with IFRS as an indicator of the Company’s financial performance or as a measure of the Company’s liquidity and cash flows. EBITDA and Adjusted EBITDA do not take into account the impact of working capital changes, capital expenditures, debt principal reductions and other sources and uses of cash, which are disclosed in the consolidated statements of cash flows.

The following table reconciles net loss to EBITDA and Adjusted EBITDA for the year ended December 31, 2022, and 2021:

Net income (loss) Income taxes Depreciation and amortization Interest and accretion EBITDA Share based compensation Consideration paid in excess of asset acquired Loss on impairment of intangible assets Adjusted EBITDA	2022 $ (17,258,809) 988,592 2,791,878 18,423 (13,459,916) - 5,061,333 6,745,317 (1,653,266)	Year ended December 31, 2021 $ 9,090,124 2,675,670 1,511,704 2,558 13,280,056 1,709,940 - - 14,989,996

Refer to the Summary of Operations section in this MD&A for further details.

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Datametrex AI Limited Management’s Discussion and Analysis for the year ended December 31, 2022 (Canadian dollars, except share and unit information)

AMENDED AND RESTATED

Summary of Operations

Revenue

For the year ended December 31, 2022, revenue was $30,488,939 (2021: $49,029,040). Certain significant revenue results were as follows:

• $4,578,717 from IT services and licensing revenue earned from big data and Artificial Intelligence solutions (2021: $4,051,805). Nexalogy has a contract with the Canadian government which is recognized over the contract term and based on milestones. Datametrex Korea has contracts with numerous customers, including global conglomerates such as LOTTE Group, which added approximately $2,176,565 IT hardware and servicing revenue. Gross profit from Datametrex Korea was approximately $630,000, or roughly 29% gross margin. In comparison, for 2021, Datametrex Korea provided approximately $3,496,467 revenue, $1.2 million gross profit and roughly 34% gross margin. The fluctuation in the results from Korea is largely due to and based on the shortterm contracts that the Company wins from its significant customers.

• $25,910,222 from health care revenue (2021: $44,977,235) which is entirely from COVID-19 related businesses. Direct costs related to this business was approximately $16 million, for a gross profit of $9.9 million, or roughly 38% gross margin. Revenue decreased significant due to the COVID-19 related businesses have been reduced significant during fiscal 2022 and virtually ended in the first half of 2023. Gross margin for 2022 of 38% was lower than 2021 gross margin of roughly 42.8% due to the decreasing costs of COVID-19 testing services.

• The Company experienced an increase in IT services revenue. The Company continues to work with several companies to build on its AI and Technology segment.

Revenue for the fourth quarter ended December 31, 2022 was $2,944,601 (2021: $8,713,152). The significant decrease in revenue is mainly due to the decrease in COVID-19 testing in recent months. The COVID-19 testing virtually ended during the first half of 2023 and, as a result, it will have a significant impact on the Company’s future revenue and cash flows. The Company is committed to a long-term strategy to strengthen its core businesses and capitalize on several investments made over the past few years.

As part of the Company’s growth strategy, management made a strategic decision to reinvest the profits made in the acquisition of Imagine Health Centres. This acquisition and the Company exercising its share buyback program have contributed to a decrease in cash. The Company believes that the acquisition of Imagine Health Centres, once completed, will enhance its position in the market and drive future growth and profits.

The Company also spent a total of $2,368,397 to repurchase 21,594,000 common shares of the Company through the NCIB in 2022 which contributes to the decrease in cash.

The Company notes that the recent loss reported in the Profit and Loss report is not a result of operations, but rather attributed to the expenses related to the amortization and depreciation of various intangible assets, the excess purchase consideration paid for EVS, impairment losses of Medi-Call and EVS intangible assets, as well as a decrease in the share price of the invested companies.

The Company remains committed to strengthening its position in these companies as well as mitigating any potential financial impact.

Despite the expected end of the COVID-19 pandemic, which fueled significant profits for the Company, management remains committed to a long-term strategy of prioritizing its core AI technology and integrating it to its healthcare businesses to drive sustained growth and profitability.

Operating Expenses & Other Items

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Datametrex AI Limited

Management’s Discussion and Analysis for the year ended December 31, 2022 (Canadian dollars, except share and unit information)

AMENDED AND RESTATED

For the year ended December 31, 2022, the Company incurred $12,596,099 of operating expenses (2021: $10,026,880). Certain significant items are noted below:

• Depreciation and amortization of $2,791,878 (2021: $1,511,704) relating to the Company’s property and equipment, intangible assets, and right-of-use assets. The increase is due to the increase in finite live intangible assets from Medi-Call and DM EVS.

• Share based compensation of $Nil (2021: $1,709,940) as the Company’s stock option plan lapsed on January 21, 2022, and therefore the Company was unable to grant any stock options during the year, until the plan was renewed.

• Salaries, benefits, and consulting fees of $3,928,731 (2021: $4,250,675) decreased due to decrease in health care revenue and reducing the number of employees as a result.

• Professional fees of $3,232,037 (2021: $1,300,053) due to various acquisitions and consulting services related to EVS. As EVS is a new business line for the Company, the Company engages various consultants and professionals, in the early stage of its business. As discussed above, the Company is reducing the number of employees in the health care division, due to the expected end of the COVID-19 pandemic but will see an increase in AI and technology employees going forward.

• Office and general of $1,871,097 (2021: $1,148,983) includes office supplies, office maintenance, insurance, travel expenses and marketing costs. Office and general costs increase slightly in 2022 due to additional costs incurred by EVS as well as increased marketing and travel costs due to the acquisition of EVS (Vancouver based) and Imagine Health (Alberta based).

• The Company holds marketable securities in ScreenPro and Graph Blockchain. The investments are measured at fair value, with the change recognized in profit or loss. During the year ended December 31, 2022, the Company recorded an unrealized loss on its marketable securities of $2,456,839 (2021: loss of $11,398,575).

• The Company also sold 400,200 shares of ScreenPro for proceeds of $79,100 resulting in a loss of $940.

• The Company recorded an impairment loss $6,745,317 on its Medi-Call and dmEVS intangible assets acquired in 2021 and 2022. The impairment charges were deemed appropriate given the delays in launching the products. The Company’s remaining intangible assets largely related to Medi-Call, approximately $7.9 million, and dmEVS, approximately $1.7 million, and there can be further impairments in the future if there are unavoidable delays in product launches, including government permits at all levels and Google/Apple approvals of the Company’s apps.

Operating expenses for the fourth quarter ended December 31, 2022 was $3,119,363 (2021: $2,124,811). The increase is mainly due to increased depreciation and amortization from $146,929 in Q4-2021 to $992,676 in Q4-2022. Office and general increased from $185,371 in Q4-2021 to $400,312 in Q4-2022. Salaries, benefits and consulting fees for the quarter ended December 31, 2022 was $569,272 compared to $2,384,597 due to the decrease in health care revenue as discussed above.

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Management’s Discussion and Analysis for the year ended December 31, 2022 (Canadian dollars, except share and unit information)

AMENDED AND RESTATED

Datametrex AI Limited

Summary of Quarterly Results

The following is a summary of the Company’s eight most recently completed quarters:

	Q4 – 22	Q3 – 22	Q2 – 22	Q1 – 22	Q4 – 21	Q3 – 21	Q2 – 21	Q1 – 21
	$	$	$	$	$	$	$	$
Total revenue	2,944,601	9,202,894	7,627,303	10,714,141	8,713,152	10,821,697	10,448,303	19,045,888
Net income (loss)	(20,071,827)	961,922	(621,193)	2,450,782	(1,490,655)	170,294	850,134	9,560,351
Net income (loss)	(0.046)	0.002	(0.002)	0.006	(0.004)	0.001	0.003	0.03
per share – basic
EBITDA	(13,459,916)	2,699,239	99,482	3,166,424	(390,334)	1,420,179	1,565,957	10,684,254
Adjusted EBITDA	(1,653,266)	2,699,239	99,482	3,166,424	(1,950,834)	1,420,179	1,567,993	13,952,658

The Company witnessed a significant uptrend in its revenue starting 2020 and peaked at $19 million during Q1-2021, which was largely due to COVID-19 test kits, equipment sales, and testing services. Then, revenue leveled out at approximately $10 million per quarter from Q2-2021 to Q3-2022 (6 quarters). During Q4-2022, the Company only generated $3 million revenue as COVID-19 testing services significant dropped in recent months and will virtually end in 2023.

Net income (loss) over the past 8 quarters were fluctuating significantly which is due to the timing of recognition of expense items, including share-based compensation expense, impairment losses on intangible assets, losses from business acquisitions, and unrealized losses on marketable securities. As a result, the Company experienced significant losses during Q4 of both 2022 and 2021. The Company reported positive EBITDA and Adjusted EBITDA except for those two Q4 quarters due to the annual adjustments, as described above.

Segment information

Geographical information is summarized as follows:

	Canada	Korea	Total
	$	$	$
For the year ended December 31, 2022
Revenue from external customers	28,312,374	2,176,565	30,488,939
Non-current assets	20,125,413	255,846	20,381,259
	Canada	Korea	Total
	$	$	$
For the year ended December 31, 2021
Revenue from external customers	45,532,573	3,496,467	49,029,040
Non-current assets	18,608,380	257,051	18,865,431

Liquidity, Capital Resources, and Cash Flow

The Company has historically primarily financed its operations through the issuance of common shares and warrants, but operations were profitable in recent periods. Also, the management focused on improving sales and reducing operating costs. The consolidated financial statements have been prepared on a going concern basis which assumes that the Company will be able to realize its assets and discharge its liabilities in the normal course of business for the foreseeable future.

For the year ended December 31, 2022 , net cash provided by (used in) operating activities was ($249,093) (2021: $11,453,126), net cash used in investing activities was $3,791,975 (2021: $234,409), and net cash provided by (used in) financing activities was ($2,402,657) (2021: $2,192,314).

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Datametrex AI Limited Management’s Discussion and Analysis for the year ended December 31, 2022 (Canadian dollars, except share and unit information)

AMENDED AND RESTATED

At December 31, 2022, the Company has an accumulated deficit of $40,849,941 (December 31, 2021: $23,591,132) and a working capital of $6,215,545 (2021: $14,338,151). On December 31, 2022, the Company had cash and cash equivalents of $8,934,913. Management believes that it has sufficient cash to fund its planned operations for the next twelve months. However, as noted above, the Company’s cash flows from operations decreased significantly. In 2021, the Company generated over $11 million in cash from operations. In 2022, the cash flows from operations were non-existent due to declining COVID-19 related sales and declining margin as a result of lower testing fees. However, the Company has close to $8 million in cash that can be used to implement its core business strategy.

Nexalogy’s contract with the Canadian government will continue to provide cash in 2023 and the Company continues to obtain IT related contracts both in Canada and in Korea.

The acquisitions of dmEVS and Imagine Health are complete and Imagine Health will start to add revenues and cash flows almost immediately without any significant additional capital expenditures. In connection with the purchase of Imagine Health, the Company issued a secured vendor take-back note with a principal amount of $800,000 payable in installments of 6, 12 and 18 months from the date of issuance. At December 31, 2022, the Company recorded the debt at its present value of $715,273 of which $520,189 was classified as current debt. $266,667 was paid subsequent to December 31, 2022 and $533,333 remain outstanding as of the date of this amended MD&A.

dmEVS division has already incurred significant start-up cost, including development of mobile charging vans, that can be deployed upon further testing. There will be further capital expenditures in building additional fleet of mobile charging vans and installing charging stations, but spending will be based on a contract-by-contract basis and will only occur when the Company starts to see revenues.

Related Party Transactions

a) Accounts payable and accrued liabilities

Included in accounts payable and accrued liabilities at December 31, 2022 was $Nil (December 31, 2021 - $16,600) due to an officer and a director of the Company.

b) Loan receivables

As at December 31, 2022, the Company has a loan receivable from Graph in an amount of $10,000 (December 31, 2021 - $56,706). The loan is unsecured, non-interest bearing and repayable on demand.

c) Compensation of key management personnel

Related parties include key management personnel and others considered to have significant influence or control over the Company’s operations. The Company considers key management personnel to include members of the Board of Directors and executive officers of the Company. Compensation to key management personnel is listed below:

Cash based compensation Accrued bonus compensation Share based compensation	Year ended December 31, 2022 Amount $ Options vested 2,610,222 - - - - - 2,610,222 -	Year ended December 31, 2021	Year ended December 31, 2021
	Amount $ 2,610,222 - - 2,610,222	Amount $ 2,208,503 1,025,000 1,643,949 4,877,452	Options vested - - 11,200,000
			11,200,000

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Datametrex AI Limited

Management’s Discussion and Analysis for the year ended December 31, 2022 (Canadian dollars, except share and unit information)

AMENDED AND RESTATED

d) Settlement of contingent consideration

During the year ended December 31, 2021, the Company settled contingent consideration related to the acquisition of Nexalogy, and amounts due to the former president of Nexalogy for a cash payment of $725,000, which resulted in a loss on debt settlement of $374,327. No such transactions occurred during the year ended December 31, 2022.

Off Balance Sheet Arrangements

The Company has not entered into any off balance sheet arrangements, such as guarantee contracts, contingent interests in assets transferred to unconsolidated entities, derivative financial obligations, or with respect to any obligations under a variable interest equity arrangement.

Contingency

A former employee of the Company filed a claim for wrongful dismissal seeking damages aggregating $135,000. The Company filed a defence and counterclaim denying the claim and counterclaiming for certain losses incurred by the Company. The Company intends to defend the claim vigorously and the outcome of the claim cannot be reasonably estimated at this time.

Risk Factors

The Company is exposed to a number of risks and uncertainties that are common to other companies engaged in the same or similar business. Material risks that could significantly affect the financial condition, operating results or business of the Company are listed below:

Risks Associated with the Company’s Business

Coronavirus Global Pandemic Risk

In March 2020, the World Health Organization declared a global pandemic related to the virus known as COVID-19. This contagious disease outbreak, which has continued to spread, and any related adverse public health developments, has adversely affected workforces, economies, and financial markets globally, potentially leading to an economic downturn. It has also disrupted the normal operations of many businesses, including the Company’s. This outbreak could decrease spending, adversely affect demand for the Company’s products and harm the Company’s business and results of operations.

The Company entered into agreements securing the rights to import COVID-19 test kits from manufacturers in South Korea. The Company provides COVID-19 related services in the Canadian and international markets. COVID-19 has had a significant positive impact on the Company’s financial position, its results of operations and its cash flows for the years ended December 31, 2022, and 2021. However, the Company is unable to predict how COVID-19 will affect the Company’s ability to generate positive financial results and cash flows and its ability to raise capital in the future.

Risks Associated with the Company’s Limited Operating History and Evolving Business Model

The Company has a limited operating history, especially DM EVS and Medi-Call, and therefore is exposed to the risks, expenses and problems frequently encountered by companies in the early stage of their development. The Company’s business model is continuously evolving to adapt to the new and rapidly evolving industries that the Company operates. There are no assurances that the Company’s products will gain market acceptance. To date, the Company has not earned operating profits and significant further operating losses are possible. There can be no assurance that the Company will achieve profitability.

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Datametrex AI Limited Management’s Discussion and Analysis for the year ended December 31, 2022 (Canadian dollars, except share and unit information)

AMENDED AND RESTATED

Market Acceptance

The success of the Company’s products and any new services the Company may launch is dependent upon its ability to attract and retain a critical mass of customers in potentially diverse geographic locations. The sales cycle for a new merchant can be lengthy. Customers may not be willing to invest the time and resources necessary to achieve the necessary education and integration required to successfully deploy the Company’s technology.

Key Management Personnel

The Company depends on the services of its key technical, management, sales and marketing personnel. The loss of the services of any of these persons could have a material adverse effect on the Company’s business, results of operations and financial condition. The Company’s success is also highly dependent on its continuing ability to identify, hire, train, motivate and retain highly qualified management, technical, sales and marketing personnel. Competition for such personnel can be intense, and the Company cannot provide assurance that it will be able to attract, engage, hire or retain technical, managerial, sales and marketing personnel in the future with the right qualifications, at the times needed, and/or at competitive costs. The Company’s inability to attract and retain the necessary management, technical, sales and marketing personnel may adversely affect its future growth and profitability.

Ability to Manage Growth

The Company continuously seeks opportunities to grow its current business by pursuing existing and potential market opportunities, including acquisitions. Such growth may place significant demands on existing management and operational resources. It also creates the need for proper onboarding procedures to ensure smooth integration of the acquired business with existing business and products. In order to manage expected growth effectively, the Company must concurrently develop more sophisticated operational systems, procedures and controls. If the Company fails to develop these systems, procedures or controls on a timely basis, its business, financial condition and operating results could be materially affected in an adverse manner.

Technology and Development Risk

The Company’s approach utilizes technology principally architected and developed by the Company. The Company has also contracted with or identified a number of key suppliers for the various components that comprise the Company’s solutions. There can be no assurances that the Company will meet its targeted development or integration timelines such that it will be able to offer solutions at competitive pricing, or that the Company can continue to enhance and improve the responsiveness, functionality and features of its technology and enable the solutions to scale at a reasonable cost. In addition, there is a risk that third parties may have applied for or been granted patents for certain processes or technology which the Company has already deployed or intends to deploy, in which case the Company may incur additional costs or be prohibited from using or implementing certain product features or processes in one or more countries. The Company’s solutions incorporate complex technology and software. Accordingly, they may contain errors, or "bugs", that could be detected at any point. Such errors could materially and adversely affect the Company’s reputation, resulting in claims and/or significant costs to the Company, and/or cause consumers, merchants, licensees and other parties to abandon the Company’s solutions and impair the Company’s ability to market and sell solutions and services in the future. The costs incurred in correcting any errors and satisfying any such claims may be substantial and could adversely affect the Company’s operating margins. While the Company plans to continually test its solutions for errors and work with customers and merchants through its maintenance support services to identify and correct bugs, errors may be found in the future.

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Datametrex AI Limited Management’s Discussion and Analysis for the year ended December 31, 2022 (Canadian dollars, except share and unit information)

AMENDED AND RESTATED

Protection of Intellectual Property

The Company depends on its ability to develop and maintain proprietary aspects of its technology and business methods. It seeks to protect its software, documentation and other written materials under trade secret and copyright law, as well as with confidentiality provisions in contracts with its customers, suppliers, contractors and employees, all of which afford limited protection. It is also seeking to protect its proprietary technology and business methods under patent laws in selected jurisdictions. The Company intends to apply for several trademark registrations.

Despite the measures the Company has taken to protect its intellectual property, there can be no assurance that these steps will be adequate, that the Company will be able to secure patents for all its inventions or trademark registrations for or the rights to use its trademarks, respectively, in Canada, the U.S. or other countries, that third parties will not breach the confidentiality provisions in the Company’s contracts or infringe or misappropriate its copyrights, patents, trademarks and other proprietary rights, or that third parties have not already obtained prior rights in one or more jurisdictions to the same or similar trademarks to those of the Company or any other intellectual property sought to be protected by the Company.

Global Financial Developments

Stress in the global financial system may adversely affect the Company's finances and operations in ways that may be hard to predict or to defend against. Financial developments seemingly unrelated to the Company or to its industry may adversely affect the Company over the course of time. For example, material increases in any applicable interest rate benchmarks may increase the debt payment costs for any credit facilities. Credit contraction in financial markets may hurt its ability to access credit in the event that the Company identifies an acquisition opportunity or requires significant access to credit for other reasons. A reduction in credit, combined with reduced economic activity, may adversely affect business. Any of these events may have a material adverse effect on the Company business, operating results, and financial condition.

Compliance with Complex Domestic and Foreign Laws

The Company is subject to a variety of laws and regulations in Canada and South Korea that involve matters central to its business, including user privacy, data protection, intellectual property, distribution, contracts and other communications, consumer protection, and taxation. Korean laws and regulations may be more restrictive than those in Canada. In addition, the application and interpretation of these laws and regulations are often uncertain, particularly in the new and rapidly evolving industry that the Company operates in. Existing and proposed laws and regulations can be and may be costly to comply with and can delay or impede the development of new products, result in negative publicity, increased operating costs, additional time and attention required from management, and subject the Company to claims or other remedies, including fines or demands that the Company modify or cease existing business practices.

The Company may in the future enter into agreements or conduct activities outside of Canada and South Korea, which expansion may present additional complexities in terms of the Company’s legal compliance, and adversely affect the results of operations and/or financial condition of the Company.

20

Datametrex AI Limited Management’s Discussion and Analysis for the year ended December 31, 2022 (Canadian dollars, except share and unit information)

AMENDED AND RESTATED

Litigation

Within the Company’s normal course of operation, the Company may become involved in various legal proceedings. Such matter can be time-consuming, divert management’s attention and resources and cause the Company to incur significant expenses. Furthermore, because litigation is inherently unpredictable, the results of any such actions may have a material adverse effect on the Company’s business, operating results and financial condition. In particular, the Company may face claims relating to the Company’s products as the nature of the Company’s business exposes it to claims related to intellectual property rights and rights of privacy.

Risks Associated with Additional Financing

The Company may need to raise additional financing. There can be no assurance that the Company will be successful in raising sufficient capital on acceptable terms, if at all. If it is unable to raise capital, it may not be able to execute its business plan or respond to competitive pressures. If the Company is able to raise additional capital, it may be on terms and conditions which result in significant dilution to existing shareholders.

Currency Risk

While the Company is headquartered in Canada and its shares are traded on the TSX Venture Exchange, certain operations may be conducted in Asia, the United States and Europe. As such, the Company’s results of operations are subject to fluctuations in currency exchange rates, which may adversely affect the financial position and operating results of the Company.

Disruption of its Information Technology Systems

The Company relies on information technology in virtually all aspects of its business. A significant disruption or failure of its information technology systems could result in service interruptions, security violations, regulatory compliance failures, an inability to protect information and assets against intruders, and other operational difficulties. Attacks perpetrated against its information systems could result in loss of assets and critical information and exposes it to remediation costs and reputational damage. A significant disruption or cyber intrusion could lead to misappropriation of assets or data corruption and could adversely affect its results of operations, financial condition, and liquidity. Additionally, if the Company is unable to acquire or implement new technology, it may suffer a competitive disadvantage, which could also have an adverse effect on its results of operations, financial condition, and liquidity. Cyber-attacks could further adversely affect the Company’s ability to operate information technology and business systems or compromise confidential customer and employee information.

Other Information

Additional information regarding the Company is available on SEDAR at www.sedar.com

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