iSIGN Media Solutions Inc. — Interim / Quarterly Report 2021

Apr 1, 2021

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iSIGN Media Solutions Inc.

Condensed Consolidated Interim Financial Statements For the Nine Months Ended January 31, 2021 and 2020 Expressed in Canadian Dollars

ATTRACT . TRANSACT . MEASURE .

iSIGN MEDIA SOLUTIONS INC.

CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS FOR THE NINE MONTHS ENDED JANUARY 31, 2021 and 2020

Contents

Notice to Shareholders	2
Consolidated Statements of Financial Position	3
Consolidated Statements of Changes in Shareholders’ Deficiency	4
Consolidated Statements of Loss and Comprehensive Loss	5
Consolidated Statements of Cash Flows	6
Notes to Consolidated Financial Statements	7 - 26

iSIGN MEDIA SOLUTIONS INC.

Notice of no auditor review of the condensed consolidated interim financial statements

Under National Instrument 51-102, Part 4, subsection 4.3(3)(a), if an auditor has not performed a review of the interim financial statements, they must be accompanied by a notice indicating that the financial statements have not been reviewed by an auditor.

The accompanying unaudited condensed consolidated interim financial statements of iSIGN Media Solutions Inc. (the “Company”) have been prepared by and are the responsibility of the Company’s management and approved by the Board of Directors.

The Company’s independent auditor has not performed a review of these condensed consolidated interim financial statements in accordance with the standards established by The Canadian Institute of Chartered Accountants, for a review of interim financial statements by an entity’s auditor.

March 31 2021

iSIGN Media Solutions Inc. Condensed Consolidated Interim Statements of Financial Position (Unaudited) Expressed in Canadian Dollars

	[Notes]	January 31, 2021	April 30, 2020
Assets
Current assets
Cash		$ 23,353	$ 14,390
Restricted cash		10,000	10,000
Accounts receivable (net of allowance of $77,157, 2020 - $77,157)		-	1,800
Sales taxes recoverable		4,680	29,483
Inventories		9,574	-
Prepaid expenses and deposits		11,487	11,403
Total current assets		59,094	67,076
Non-current assets
Property and equipment	[4]	3,747	9,622
Intangible assets	[5]	46,749	49,521
Total non-current assets		50,496	59,143
Total assets		$ 109,590	$ 126,219
Liabilities
Current liabilities
Bank indebtedness		$ -	$ 21,700
Accounts payable of and accrued liabilities	[13]	917,108	1,212,437
Government of Canada COVID funding	[6]	80,000	-
Advances	[7,13.xiii, xv, xviii, xix]	328,000	308,000
Notes payable	[8, 13.iii, x]	619,819	660,700
Convertible notes payable	[9, 13.iv, vii, viii, ix, xi, xii, xiv]	2,010,639	2,010,639
Total current liabilities		3,955,566	4,213,476
Non-current liabilities
Other liabilities	[10]	302,337	302,337
Total liabilities		4,257,903	4,515,813
Shareholders’ deficiency
Share capital	[11.a]	16,448,619	15,770,936
Warrants	[11.d]	198,542	90,145
Contributed surplus	[12]	10,911,748	10,755,603
Convertible debenture conversion option		162,359	162,359
Deficit		(31,869,581)	(31,168,637)
Total shareholders’ deficiency		(4,148,313)	(4,389,594)
Total liabilities and shareholders’ deficiency		$ 109,590	$ 126,219
Going Concern [Note 2]
Subsequent Events [Note 16]
Commitments and Contingencies [Note 17]
Approved by the Board
_"B. MacBean"______	_"B. Reilly"_______
Director	Director

3

The accompanying notes form an integral part of these consolidated financial statements.

iSIGN Media Solutions Inc. Condensed Consolidated Interim Statements of Changes in Shareholders’ Equity (Deficiency) For the Nine Months Ended January 31, 2021 and 2020 (Unaudited) Expressed in Canadian Dollars

[Notes]	Share Capital Warrants Number Amount Number Amount Contributed Surplus Deficit $ $ $ $	Convertible Debenture Conversion Option Total Shareholders’ Equity (Deficiency) $ $
Balance at April 30, 2019 Issuance of common shares in exchange for debt [11.a] Warrants exercised [11.d] Transfer to/from contributed surplus: Ascribed value of exercised warrants [11.d] Ascribed value of expired warrants [11.d, 12] Share-based compensation [11.c] Net loss Balance at January 31, 2020 Balance at April 30, 2020 Issuance of common shares with warrants [11.a] Issuance of common shares in exchange for debt [11.a] Transfer to/from contributed surplus: Ascribed value of expired warrants [11.d, 12] Ascribed value of warrant bonus [11.d] Share-based compensation [11.c] Net loss and comprehensive loss Balance at January 31, 2021	122,387,616 14,665,807 17,250,871 1,714,708 9,125,247 (29,975,197) 11,674,465 696,466 - - - - 2,560,000 256,000 - - - - - 73,624 (2,560,000) (73,624) - - - - (14,013,094) (1,550,939) 1,550,939 - - - - 79,417 - - - - - - (885,122)	162,359 (4,307,076) - 696,466 - 256,000 - - - 79,417 - (885,122)
	136,622,081 15,691,897 677,777 90,145 10,755,603 (30,860,319)	162,359 (4,160,315)
	137,954,385 15,770,936 677,777 90,145 10,755,603 (31,168,637) 3,414,000 108,158 3,414,000 59,538 - - 11,457,788 569,525 - - - - - - (677,777) (90,145) 90,145 - - - 12,014,000 139,004 - - - - - - 66,000 - - - - - - (700,944)	162,359 (4,389,594) - 167,696 - 569,525 - - - 139,004 - 66,000 - (700,944)
	152,826,173 16,448,619 15,428,000 198,542 10,911,748 (31,869,581)	162,359 (4,148,313)

4

The accompanying notes form an integral part of these consolidated financial statements.

iSIGN Media Solutions Inc. Condensed Consolidated Interim Statements of Loss and Comprehensive Loss For the Nine Months Ended January 31, 2021 and 2020 (Unaudited) Expressed in Canadian Dollars

	(Unaudited) Expressed in Canadian Dollars
[Notes]	For the three Months Ended For the Nine Months Ended January 31, 2021 January 31, 2020 January 31, 2021 January 31, 2020
Revenues Sales Service Cost of sales Gross Profit (Loss) Expenses Amortization - intangible assets [5] Depreciation – property and equipment [4] General and administration [21] Selling and Marketing [20] Research and development Interest Accretion interest Loss on disposal of fixed assets Net Loss from operations COVID-19 funding [6] Net loss and comprehensive loss Loss and comprehensive loss per share (basic and diluted) [14] Weighted average number common shares outstanding (basic and diluted) [14]	$ - $ 839 $ 1,136 $ 11,413 - - - -
	- 839 1,136 11,413 4,096 5,420 12,555 14,104
	(4,096) (4,581) (11,419) (2,691)
	924 924 2,772 2.774 133 384 1,096 1,152 192,749 238,694 472,934 581,627 - 2,749 621 2,819 - - - 26,000 56,206 56,396 174,621 169,102 24,531 2,951 73,593 98,957 - - 3,888 -
	274,543 302,098 729,525 882,431
	$ (278,639) $(306,679) $ (740,944) $ (885,122) (20,000) - (40,000) -
	$ (258,639) $ (306,679) $ (700,944) $ (885,122)
	(0.002) (0.002) (0.005) (0.007) 147,388,442 135,197,833 151,546,273 126,326,605

5

The accompanying notes form an integral part of these consolidated financial statements.

iSIGN Media Solutions Inc. Condensed Consolidated Interim Statements of Cash Flows For the Nine Months Ended January 31, 2021 and 2020 (Unaudited) Expressed in Canadian Dollars [Notes] 2021 2020	iSIGN Media Solutions Inc. Condensed Consolidated Interim Statements of Cash Flows For the Nine Months Ended January 31, 2021 and 2020 (Unaudited) Expressed in Canadian Dollars [Notes] 2021 2020
Net (outflow) inflow of cash related to the following activities: Operating Net loss Adjustments for non-cash items: Depreciation – property and equipment [4] Amortization – intangible assets [5] Share-based compensation [11.c] Disposal of property and equipment Accretion interest [8,9] Net change in non-cash working capital [19] Net cash used in operating activities Financing Issuance of common shares with warrants [11.a,d] Exercise of warrants [11.d] Advances [13.xviii, xix] Government of Canada COVID funding [6] Net cash provided by financing activities Change in cash Cash (bank indebtedness) – beginning of period Cash (Bank Indebtedness) – end of period Cash positions consist of: Cash (defined as unrestricted bank balance) Bank indebtedness Supplemental Information: Warrants ‘issued’ in lieu of cash interest Shares issued in settlement of debt	$ (700,944) $ (885,122) 1,096 1,152 2,772 2,774 66,000 79,417 4,779 - 73,593 98,957
	(552,704) (702,822) 315,671 344,408
	$ (237,033) $ (358,414)
	$ 167,696 $ - - 256,000 20,000 - 80,000 -
	$267,696 $256,000
	$ 30,663 $ (102,414) (7,310) 93,305
	$ 23,353 $(9,109)
	$ 23,353 $ 3,991 - (13,100)
	$ 23,353 $(9,109)
	$ 139,004 $ - 572,889 700,468

6

The accompanying notes form an integral part of these consolidated financial statements.

iSIGN Media Solutions Inc. Notes to the Condensed Consolidated Interim Financial Statements For the Nine Months Ended January 31, 2021 and 2020 Expressed in Canadian Dollars

1. Description of Business

iSIGN Media Solutions Inc. (“iSIGN” or the “Company”) was incorporated under the laws of Ontario on May 15, 2007. The Corporation's head office is located at 45A West Wilmot Street, Unit 3 in Richmond Hill, Ontario, L4B 2P2.

iSIGN is a data focused Software-as-a-Service (“SaaS”) company in the areas of location-based security alert messaging and proximity messaging utilizing Bluetooth® and Wi-Fi connectivity. Creators of the Smart Suite of products, a patented interactive proximity messaging technology, iSIGN enables the delivery of messages to mobile devices, with real-time reporting and analytics.

2. Going Concern

While these consolidated financial statements have been prepared on the basis of accounting principles applicable to a going concern, certain material uncertainties and events cast significant doubt upon the validity of this assumption. As at the nine-month period ended January 31, 2021, the Company has incurred significant losses since its inception in the amount of $31,869,581 (April 30, 2020 - $31,168,637). As at the nine-month period ended January 31, 2021, the Company reported a working capital deficiency of $3,896,472 (April 30, 2020 - $4,146,400) and certain of its notes payable and convertible notes are past due.

The Company’s ability to continue as a going concern will depend on management’s ability to successfully execute its business plan and to raise capital through equity or debt financing until such time as the Company can support its activities through its own cash flow. It is not possible to predict whether financing efforts will be successful or if the Company will attain profitable levels of operation.

If the going concern assumption were not appropriate for these consolidated financial statements, adjustments would be necessary to the carrying values of assets and liabilities, the reported loss and comprehensive loss and the statement of financial position classifications used. The financial statement items most likely to be subject to adjustment would be property and equipment and intangible assets.

Novel Coronavirus (“COVID-19”)

The Company’s operations could be significantly adversely affected by the effects of a widespread global outbreak of a contagious disease, including the recent outbreak of respiratory illness caused by COVID-19. The Company cannot accurately predict the impact COVID-19 will have on its operations and the ability of others to meet their obligations with the Company, including uncertainties relating to the ultimate geographic spread of the virus, the severity of the disease, the duration of the outbreak, and the length of travel and quarantine restrictions imposed by governments of affected countries. In addition, a significant outbreak of contagious diseases in the human population could result in a widespread health crisis that could adversely affect the economies and financial markets of many countries, resulting in an economic downturn that could further affect the Company’s operations and ability to finance its operations.

3. Basis of Preparation

Statement of Compliance

These unaudited condensed interim consolidated financial statements have been prepared in accordance with International Accounting Standard 34, Interim Financial Reporting (“IAS 34”), as issued by the International Accounting Standards Board (“IASB”). They do not include all the information and footnotes required by the International Financial Reporting Standards (“IFRS”) as issued by the IASB for full annual financial statements and should be read in Conjunction with the Company’s annual financial statements for the years ended April 30, 2020 and 2019.

7

iSIGN Media Solutions Inc. Notes to the Condensed Consolidated Interim Financial Statements For the Nine Months Ended January 31, 2021 and 2020 Expressed in Canadian Dollars

3. Basis of Preparation - continued

These unaudited condensed interim consolidated financial statements have been prepared on a historical basis using the accrual basis of accounting except for available-for-sale financial assets. The policies applied in these condensed consolidated financial statements are based on IFRS and IFRIC policies issued and effective as of January 31 2021.

The accounting policies and methods adopted are consistent with those disclosed in Note 4 to the Company’s consolidated financial statements for the years ended April 30, 2020 and 2019.

These unaudited condensed consolidated interim financial statements of the Company for the nine months ended January 31, 2021 and 2020, were approved and authorized for issue by the Audit Committee and the Board of Directors on March 31 2021.

Basis of Measurement

These unaudited condensed consolidated interim financial statements have been prepared on the basis of historical costs. In addition, these consolidated financial statements have been prepared using the accrual basis of accounting except for cash flow information.

Functional and Presentation Currency

These unaudited condensed consolidated interim financial statements are presented in Canadian dollars, which is the functional currency of the Company and its subsidiaries.

Principles of Consolidation

The unaudited condensed consolidated interim financial statements include the accounts of the Company and its wholly owned subsidiaries, iSIGN Media Corp., iSIGN Media Network Corp. and Pinpoint Commerce Inc.

Subsidiaries consist of entities over which the Company is exposed to, or has rights to, variable returns as well as the ability to affect those returns through the power to direct the relevant activities of the entity. Subsidiaries are fully consolidated from the date control is transferred to the Company and are de-consolidated from the date control ceases.

Intra-group balances and transactions, and any unrealized gains and losses or income and expenses arising from intra-group transactions, are eliminated in preparing the consolidated financial statements.

Use of Estimates and Judgments

The preparation of these unaudited condensed consolidated interim financial statements in conformity with IFRS requires management to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses during the reporting periods. Although these estimates are based on management's best knowledge of the amount, event or actions, actual results ultimately may differ from those estimates and these differences could be material.

Intangible assets – The Company has capitalized certain costs to internally generated intangible assets related to intellectual property development; for costs incurred for a US patent that the Company has been awarded, as well as for patents in other jurisdictions that the Company is pursuing; and to the cost of obtaining certain contracts through a deferred share-based payment. Judgment is required in identifying whether a particular project can be properly classified as being in the development phase or not. In addition, judgment is required in order to identify and reliably measure the expenditures attributable to these development initiatives.

8

iSIGN Media Solutions Inc. Notes to the Condensed Consolidated Interim Financial Statements For the Nine Months Ended January 31, 2021 and 2020 Expressed in Canadian Dollars

3. Basis of Preparation – continued

Use of Estimates and Judgments – continued

Inventories – The Company carries inventory on its accounts at the lower of cost and net realizable value. Judgment is required to evaluate when a write-down of inventory might be necessary and is required in the evaluation of available data to determine net realizable value.

Accounts receivable – The Company carries trade accounts receivable at cost net of an allowance for expected credit losses which provides for any uncertainty of collection. Judgment is required on the evaluation of future probable events that might impact a customer’s ability or intention to make full payment of these accounts.

Provisions – Provisions necessarily involve extensive judgment about the impact that a past event may have on future outlays and what amount would be required to be recorded in the current period to adequately reflect the obligation at the end of the reporting period.

Depreciation - Depreciation is calculated to amortize the cost, less estimated residual value, of property and equipment on a declining balance or a straight-line basis over their expected useful lives. Estimates of residual value and useful lives are based on data and information from various sources including vendors, industry practice, and company-specific history (Note 4).

Amortization - Amortization is calculated to amortize the cost of intangible assets on a straight-line basis over their expected useful lives. Useful lives are based on data and information from industry practice and company-specific history (Note 5).

Impairment - The determination of whether indicators of impairment exist and the aggregation of assets into cash generating units ("CGUs") based on their ability to generate independent cash flows is subject to management’s judgment. The recoverable amounts used for impairment calculations require estimates of future cash flows related to the assets or CGUs and estimates of discount rates applied to these cash flows.

The Company reviews impairment based on the following:

Property and equipment (Note 4) - Whenever there are indicators of impairment Intangible assets (Note 5) - Whenever there are indicators of impairment

Share-based payments - Management is required to make certain estimates when determining the fair value of stock option awards, the number of awards that are expected to vest, and warrants related to deferred stock-based payments. These estimates affect the amount recognized as share-based payments in the consolidated statements of loss, and the amounts ascribed to warrants in the statements of financial position (Note 11).

Income, value added, withholding and other taxes – The Company is subject to income, value added, withholding and other taxes. Significant judgment is required in determining the Company’s provisions for taxes. There are many transactions and calculations for which the ultimate tax determination is uncertain during the ordinary course of business. The Company recognizes liabilities for anticipated tax audit issues based on estimates of whether additional taxes will be due. The determination of the Company’s income, valued added, withholding and other tax liabilities requires interpretation of complex laws and regulations. The Company’s interpretation of taxation law as applied to transactions and activities may not coincide with

9

iSIGN Media Solutions Inc. Notes to the Condensed Consolidated Interim Financial Statements For the Nine Months Ended January 31, 2021 and 2020 Expressed in Canadian Dollars

3. Basis of Preparation – continued

Use of Estimates and Judgments – continued

the interpretation of the tax authorities. All tax related filings are subject to government audit and potential reassessment subsequent to the reporting period. Where the final tax outcome of these matters is different from the amounts that were initially recorded, such difference will impact the tax related accruals and deferred income tax provisions in the period in which such determination is made.

Compound financial instruments – The Company has entered into convertible notes payable as described in Note 9. The fair value of the conversion option is estimated at the date of the transaction as the value of a similar liability that does not have an equity conversion option. Assumptions are made, and judgments are used in applying valuation techniques. Such judgement is inherently uncertain. Changes in the valuation assumptions could materially affect the fair value estimates of the liability and equity components of the convertible debentures.

Going concern assumption – Refer to Note 2

Contingencies – Refer to Note 17

4. Property and Equipment

	Furniture and Fixtures Computer Equipment Leasehold Improvements Total $ $ $ $
Balance April 30, 2019 and 2020 Disposals Balance January 31, 2021 Balance April 30, 2019 Depreciation Balance April 30, 2020 Disposals Depreciation Balance January 31, 2021 Balance April 30, 2020 Balance January 31, 2021	22,599 43,557 8,733 74,889 (11,069) - - (11,069)
	11,530 43,557 8,733 63,820
	13,529 41,473 8,733 63,735 907 625 - 1,532
	14,436 42,098 8,733 65,267 (6,290) - - (6,290) 486 610 - 1,096
	8,632 42,708 8,733 60,073
	8,163 1,459 - 9,622
	2,898 849 - 3,747

10

iSIGN Media Solutions Inc. Notes to the Condensed Consolidated Interim Financial Statements For the Nine Months Ended January 31, 2021 and 2020 Expressed in Canadian Dollars

5. Intangible Assets

Cost Balance April 30, 2019 and 2020 Additions Balance January 31, 2021 Accumulated amortization Balance April 30, 2019 Amortization Balance April 30, 2020 Amortization Balance January 31, 2021 Net book value	Internally generated Patents Total $ $ 73,960 73,960
	- - 73,960 73,960
	20,741 20,741 3,698 3,698
	24,439 24,439 2,772 2,772
	27,211 27,211
	49,521 49,521
Balance April 30,2020
Balance January 31, 2021	46,749 46,749

Remaining amortization period (in months) 89 to 182

6. Government of Canada COVID Funding

Canada Emergency Business Account (“CEBA”) funding provides interest free loans to support businesses during the Novel Coronavirus (”COVID-19”) pandemic. Under the terms of this financing, repayment of the loans on or before December 31, 2022 will result in loan forgiveness of 25% ($40,000).

Balance April 30, 2020 COVID-19 funding COVID-19 forgiveness Balance January 31, 2021	Amount $ - 120,000 (40,000)
	$ 80,000

11

iSIGN Media Solutions Inc. Notes to the Condensed Consolidated Interim Financial Statements For the Nine Months Ended January 31, 2021 and 2020 Expressed in Canadian Dollars

7. Advances

The Company classifies funds received with no agreed upon rate of interest and terms of repayment as advances.

[Notes] Balance April 30, 2019 Additions 13.xv Balance, April 30, 2020 Transfer to share capital 11.a, 13xix Additions 13.xviii, xix Balance, January 31, 2021	Amount
	$ 150,000 158,000
	$ 308,000 (42,672) 62,672
	$ 328,000

8. Notes Payable

• i) On March 13, 2015, the Company entered into a secured $100,000 note with Korona Group Ltd., a company controlled by the Company’s former Chief Executive Officer, at an interest rate of 8% compounded monthly, due and payable July 30, 2015. On June 29, 2015, the Company repaid $40,000 against the outstanding $100,000. The Company and the note holder have agreed to further extend the due date of the remaining $60,000 to December 31, 2018 at 8% interest compounded monthly. The note is past due at January 31, 2021 and April 30, 2020 (Note 13.iii).

• ii) On August 8, 2017, the Company entered into a secured $600,700 note with Korona Group Ltd., a company controlled by the Company’s former Chief Executive Officer, of which $198,700 was received during the year ended April 30, 2017 and was recorded under Advances. The note included the issuance of a 15% bonus paid in common shares of the Company, based upon the value of the note and utilizing a share price of $0.08 in lieu of cash interest payments (Note 13.x).

On January 21, 2019, the Company and Note Holder extended the due date of the note to January 31, 2020, by the issuance of a warrant bonus of 6,007,000 warrants in lieu of future interest payments. The exercise price of the warrants was $0.10 and the expiry date was January 31, 2020 (Note 13.x).

On June 15, 2020, the Company and Note holder extended the due date of the note to June 30, 2021 by the issuance of a warrant bonus of 12,014,000 warrants in lieu of future interest payments. The exercise price of the warrants is $0.05 and the expiry date is June 30, 2021. These warrants cannot be extended (Note 11.d.iii and 13.x).

[Notes] Balance April 30, 2019 Accretion interest 8.(ii) Balance April 30, 2020 Accretion interest 8.(ii) Warrants issued for interest 8.(ii) Balance January 31, 2021	Amount
	$ 561,743 98,957
	$ 660,700 57,239 (98,120)
	$ 619,819

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iSIGN Media Solutions Inc. Notes to the Condensed Consolidated Interim Financial Statements For the Nine Months Ended January 31, 2021 and 2020 Expressed in Canadian Dollars

9. Convertible Notes Payable

• i) On May 7, 2015, the Company entered into a secured convertible promissory note in the amount of $360,000 due May 7, 2016 and bearing an interest rate of 10% per annum to 1454602 Ontario Inc., a company controlled by two shareholders, one being the Company’s former Chief Executive Officer and the other being a person formerly considered to be an insider of the Company due to diluted ownership in excess of 10% of the common shares of the Company (Note 13.iv).

On May 7, 2016, the $360,000 note was replaced with a new convertible promissory note for the same amount and interest rate, due May 7, 2019, with conversion into common shares of the Company at $0.11 per share, with a warrant exercisable at $0.17 per share for a period of two years (Note 13.iv).

• ii) On September 22, 2016, the Company entered into two secured convertible promissory notes in the total amount of $204,000 due September 22, 2017 and bearing an interest rate of 10% per annum, due upon maturity. One of the note holders, 1454602 Ontario Inc., is a company controlled by two shareholders, one being the Company’s former Chief Executive Officer and the other being a person formerly considered to be an insider of the Company due to diluted ownership in excess of 10% of the common shares of the Company. Both notes are convertible into common shares of the Company at $0.095, with a warrant exercisable at $0.15 per share for a period of two years (Note 13.vii).

• iii) On October 13, 2016, the Company entered into two secured convertible promissory notes in the total amount of $139,000 due October 13, 2017 and bearing an interest rate of 10% per annum, due upon maturity. One of the note holders, 1454602 Ontario Inc., is a company controlled by two shareholders, one being the Company’s former Chief Executive Officer and the other being a person formerly considered to be an insider of the Company due to diluted ownership in excess of 10% of the common shares of the Company. The other note holder, Unicare Inc., is a company partially controlled by the Company’s former Chief Executive Officer. Both notes are convertible into common shares of the Company at $0.10, with a warrant exercisable at $0.15 per share for a period of two years (Note 13.viii).

• iv) On October 24, 2016, the Company entered into three secured convertible promissory notes in the total amount of $225,000 due October 24, 2017 and bearing an interest rate of 10% per annum, due upon maturity. One of the note holders, Cancore Enterprise, is a company controlled by a shareholder, who was formerly considered to be an insider of the Company due to diluted ownership in excess of 10% of the common shares of the Company. These notes are convertible into common shares of the Company at $0.12, with a warrant exercisable at $0.18 per share for a period of two years (Note 13.ix).

• v) On February 28, 2018, the Company entered into a secured convertible promissory note with Korona Group Ltd., a company controlled by the Company’s former Chief Executive Officer in the amount of $285,000 due February 26, 2019 and bearing an interest rate of 10% per annum, due upon maturity. The note is convertible into common shares of the Company at $0.07, with a warrant exercisable at $0.105 per share for a period of two years (Note 13.xi).

• vi) On June 27, 2018, the Company entered into a secured convertible promissory note with Korona Group Ltd., a company controlled by the Company’s former Chief Executive Officer in the amount of $297,639 due June 27, 2019 and bearing an interest rate of 10% per annum, due upon maturity. The note is convertible into common shares of the Company at $0.08, with a warrant exercisable at $0.12 per share for a period of two years (Note 13.xii).

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iSIGN Media Solutions Inc. Notes to the Condensed Consolidated Interim Financial Statements For the Nine Months Ended January 31, 2021 and 2020 Expressed in Canadian Dollars

9. Convertible Notes Payable - continued

• vii) On September 14, 2018, the Company entered into secured convertible promissory notes in the aggregate amount of $500,000 due September 14, 2019 and bearing an interest rate of 10% per annum, due upon maturity. One of the note holders, Cancore Enterprises, is a company controlled by a shareholder, who was formerly considered to be an insider of the Company due to diluted ownership in excess of 10% of the common shares of the Company. The notes are convertible into common shares of the Company at $0.10, with a warrant exercisable at $0.15 per share for a period of two years (Note 13.xiv).

[Notes] Balance April 30, 2019 Accretion interest Balance April 30 and January 31, 2021	Amount
	$ 1,987,004 23,635
	$ 2,010,639

The convertible notes payable are past due at January 31, 2021 and April 30, 2020 and their convertibility into iSIGN shares and warrants have expired.

10. Other Liabilities

During fiscal 2019, the Company transferred $302,337 of accounts payable and provisions (the “Statute-Barred Claims”) to non-current liabilities on the basis that any claims in respect of the Statute-Barred Claims were statute barred under the Limitations Act (Ontario). For accounting purposes under IFRS, a debt can only be removed from the Company’s Statement of Financial Position when it is extinguished, meaning only when the contract is discharged, cancelled or expires. The effect of the Limitations Act is to prevent a creditor from enforcing an obligation, but it does not formally extinguish the debt for accounting purposes. It is the position of the Company’s management that the Stature-Barred Claims cannot be enforced by the creditors, do not create any obligation for the Company to pay out any cash and do not affect the financial or working capital position of the Company. The Stature-Barred Claims are required to be reflected on the Company’s Statement of Financial Position as a result of the current interpretation of IFRS, but they are classified as long-term liabilities since the Company has no intention to pay these Stature-Barred Claims and the creditors cannot enforce their payment. While inclusion of these items is intended solely to comply with the IFRS requirements, the Company in no way acknowledges any of the Stature-Barred Claims.

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iSIGN Media Solutions Inc. Notes to the Condensed Consolidated Interim Financial Statements For the Nine Months Ended January 31, 2021 and 2020 Expressed in Canadian Dollars

11. Share Capital

• a. Common Shares

Common shares issued

ommon shares issued
[Notes] Balance April 30, 2019 Issuance in exchange for debt 11.a.(i) Exercise of warrants 11.a.(ii) Issuance in exchange for debt 11.a.(iii) Cost of share issuances Balance April 30 and July 31, 2020 Issuance in exchange for debt 11.a(iv) Issuance in exchange for shares 11.a(v) Issuance in exchange for shares 11.a(vi) Cost of share issuance Balance January 31, 2021	Number Amount
	122,387,616 $ 14,665,807 11,674,465 700,468 2,560,000 329,624 1,332,304 79,939 - (4,902)
	137,954,385 $ 15,770,936 11,457,788 572,890 1,280,000 41,906 2,134,000 69,256 - (6,369)
	152,826,173 $16,448,619

• i. On October 11, 2019, the Company completed a shares for debt transaction by issuing 11,674,465 shares at a price of $0.06 per share in settlement of monies owed, totaling $700,468, less the cost of issuance of $4,002. As the debts were owed to shareholders of the Company, the shares were valued at the amount of the debt that was settled (Note 13.xvi).

• ii. On October 18, 2019 and January 24, 2020, the Company completed warrant exercises by issuing 2,560,000 shares at a price of $0.10, for proceeds of $256,000 (Note 13.x).

• iii. On April 21, 2020, the Company completed a share for debt transaction by issuing 1,332,304 shares at a price of $0.06 per share in settlement of monies owed, totaling $79,939, less the cost of issuance of $900. As the debts were owed to shareholders of the Company, the shares were valued at the amount of the debt that was settled (Note 13.xvii).

• iv. On August 6, 2020, the Company completed a shares for debt transaction by issuing 11,457,788 shares at a price of $0.05 in settlement of interest charges, totaling $572,890, with the shares valued at the amount of the debt that was settled (Note 13.xx).

• v. On November 30, 2020, the Company completed a private placement with the Company’s former Chief Executive Officer of 1,280,000 shares and 1,280,000 warrants at a price of $0.05, for proceeds of $64,000 (common share fair value of $41,906 and warrant fair value of $22,094) less the cost of issuance for a net cash flow of $62,930 (Note 13.xix).

• vi. On January 14 and 26, 2021, the Company completed a private placement of 2,134,000 shares and 2,134,000 warrants at a price of $0.05, for proceeds of $106,700 (common share fair value of $69,256 and warrant fair value of 37,444) less the cost of issuance for a net cash flow of $104,766.

b. Compensation Based Options

On January 18, 2019, the shareholders of the Company ratified a Stock Option Plan (the “Plan”) which is administered by the directors of the Company. Under the Plan, the Company may grant to directors, officers, employees and consultants’ options to purchase shares of the Company. The Plan provides for the issuance of stock options to

15

iSIGN Media Solutions Inc. Notes to the Condensed Consolidated Interim Financial Statements For the Nine Months Ended January 31, 2021 and 2020 Expressed in Canadian Dollars

11. Share Capital - continued

b. Compensation Based Options - continued

acquire up to 10% of the Company’s issued and outstanding common shares. The Plan is a rolling plan such that the number of shares reserved for issuance will increase as the Company’s issued and outstanding common shares increases. Options granted under the Plan are exercisable for a period up to five years, as determined by the Board, from the date of the grant. The exercise price of the options shall be determined by the Board at the time of the grant but shall not be less than the Discounted Market Price as set by the TSX Venture Exchange Policy 1.1 as amended from time to time. The options are subject to several vesting periods as outlined in the Plan.

The granting of options is subject to the following conditions: (a) not more than 10% of the outstanding issue of the shares may be reserved for the granting of options to insiders; (b) not more than 10% of the outstanding issue of the shares may be reserved for the granting of options to insiders or issued to insiders within any one year period; (c) not more than 5% of the issued and outstanding common shares may be granted to any one individual in a one year period; (d) not more than 2% of the issued and outstanding common shares may be granted to any one consultant in any one-year period; and (e) not more than an aggregate 2% of the issued and outstanding common shares may be granted to an employee conducting investor relations activities in any one-year period.

c. Stock Options

A summary of the stock options outstanding and exercisable under the plan as of January 31, 2021 and April 30, 2020 and changes during the nine and twelve-month periods are as follows:

Options outstanding at April 30, 2019 Granted Cancelled Options outstanding at April 30, 2020 Cancelled Options outstanding at January 31, 2021 Options exercisable at April 30, 2019 Vested during the year Cancelled during the year Options exercisable at April 30, 2020 Vested during the year Cancelled Options exercisable at January 31, 2021		Options		Weighted Price
		1,800,000 2,700,000 (200,000)		$ 0.20 0.10 0.10
		4,300,000 (1,000,000)		$ 0.14
				0.26
		3,300,000		$ 0.10
		Options		Weighted Price
		1,475,001 1,125,001
				$ 0.24
				0.10
		(133,334)		0.10
		2,466,668		$ 0.18
		933,332		0.10
		(1,000,000)		0.26
		2,400,000		$ 0.12

16

iSIGN Media Solutions Inc. Notes to the Condensed Consolidated Interim Financial Statements For the Nine Months Ended January 31, 2021 and 2020 Expressed in Canadian Dollars

11. Share Capital - continued

c. Stock Options - continued

The following table summarizes additional disclosures on the stock options outstanding at January 31, 2021:

Exercise Price	Options Outstanding	Options Outstanding	Options Exercisable Number Remaining Average Fair Value at Time of Issue Expensed to Outstanding Life(Mths) Notyet Expired 31-Jan-21	Options Exercisable Number Remaining Average Fair Value at Time of Issue Expensed to Outstanding Life(Mths) Notyet Expired 31-Jan-21	Not Expensed at 31-Jan-21
	Number Outstanding	Remaining Average Life(Mths)	Number Outstanding
$ 0.15 0.10 0.10 0.10	250,000 350,000 400,000 2,300,000	19.5	250,000 350,000 266,666 1,533,334	19.5 $ 6,250 $ 6,250 35.5 24,500 24,500 44.5 30,000 20,000 46.0 161,000 107,334	$ - - 10,000 53,666
		35.5
		44.5
		46.0
	3,300,000		2,400,000	$221,750 $158,084	$63,666

During the nine months ended January 31, 2021, the Company recognized $66,000 (January 31, 2020 - $79,417) in stock-based compensation expense to directors, employees and consultants under general and administrative expenses. The fair value of each option granted has been estimated at the date of grant using the Black-Scholes option pricing model with the following weighted average assumptions: risk free interest rate of 1.66% (January 31, 2020 – 1.66%); expected dividend yield of $Nil (January 31, 2020 - $Nil); estimated volatility of 112.8% (January 31, 2020 – 112.8%) and an expected option life of 5 years (January 31, 2020 – 5 years).

The 2,700,000 options granted in the year ended April 30, 2020 vest one-third on the date of grant; one-third on the first anniversary of their grant and one-third on the second anniversary of their grant.

The Company has an additional 500,000 options owing to officers to be issued at a later date (April 30, 2020 – 1,000,000).

d. Warrants

[Notes] Balance April 30, 2019 Exercise of warrants 11.d.(i) Expiry of warrants 11.d (ii) Balance April 30, 2020 Issuance of warrants as a bonus 11.d(iii) Issuance of warrants in private placements 11.a(v, vi) Expiry of warrants 11.d.(iv) Balance January 31, 2021	Warrants Number Amount
	17,250,871 $ 1,714,708 (2,560,000) (73,624) (14,013,094) (1,550,939)
	677,777 $ 90,145 12,014,000 139,004 3,414,000 59,538 (677,777) (90,145)
	15,428,000 $ 198,542

17

iSIGN Media Solutions Inc. Notes to the Condensed Consolidated Interim Financial Statements For the Nine Months Ended January 31, 2021 and 2020 Expressed in Canadian Dollars

11. Share Capital – continued

d. Warrants - continued

• i. During the year ended April 30, 2020, 2,560,000 warrants valued at $73,624 were exercised and their value was transferred to share capital (Note 13.x).

• ii. During the year ended April 30, 2020, 14,013,094 warrants valued at $1,550,939 expired without being exercised and their value was transferred to contributed surplus.

• iii. On June 15, 2020, the Company entered into an agreement with Korona Group Inc., a company controlled by the Company’s former Chief Executive Officer, to extend the due date of a $600,700 loan to June 30, 2021 and issued a warrant bonus of 12,014,000 warrants in lieu of future interest payments. The exercise price of the warrants is $0.05 and the expiry date is June 30, 2021. These warrants cannot be extended (Note 8.ii and 13.x).

• iv. On May 11, 2020, 677,777 warrants valued at $90,145 expired without being exercised and their value was transferred to contributed surplus.

The following table summarizes information about stock warrants outstanding at January 31, 2021:

Issue Date	Number of		Expiry Date	Weighted Average
	Warrants	Weighted Average Exercise		Remaining Life
	Outstanding	Price		(months)
15-June-20	12,014,000	$ 0.050	30-June-21	5.0
30-Nov-20	1,280,000	0.075	30-Nov-22	22.0
14-Jan-21	1,734,000	0.075	14-Jan-23	23.5
26-Jan-21	400,000	0.075	26-Jan-23	24.0
	15,428,000	$ 0.056

12. Contributed Surplus

Contributed surplus resulted from the following:

ontributed surplus resulted from the following:
[Notes] Balance at April 30, 2019 Amounts resulting from share-based compensation 11.c. Ascribed value of expired warrants 11.d.(ii) Balance at April 30, 2020 Amount resulting from share-based compensation 11.c. Ascribed value of expired warrants 11.d.(iv) Balance at January 31, 2021	Amount
	$ 9,125,247 79,417
	1,550,939
	$ 10,755,603 66,000 90,145
	$ 10,911,748

13. Related Party Transactions and Balances

During the fiscal years 2021 and 2020, the Company entered into the following related party transactions. The outstanding amounts included in accounts payable and accrued liabilities are unsecured, non-interest bearing with no fixed terms of repayment.

18

iSIGN Media Solutions Inc.

Notes to the Condensed Consolidated Interim Financial Statements For the Nine Months Ended January 31, 2021 and 2020 Expressed in Canadian Dollars

13. Related Party Transactions and Balances - continued

• i. Recorded the fees of the Sales Consultant to a company owned by him. During the nine-month period ended January 31, 2021, the Company expensed fees totaling $52,189 (January 31, 2020 - $90,000) and fixed allowances of $740 (January 31, 2020 – $13,320). The amount outstanding in trade accounts payable at January 31, 2021 was $Nil (January 31, 2020 - $34,666).

• ii. Recorded the fees of the Chief Financial Officer to a company controlled by him. During the nine-month period ended January 31, 2021, the Company expensed fees totaling $27,000 (January 31, 2020 - $27,000). The amount outstanding in trade accounts payable at January 31, 2021 was $16,950 (January 31, 2020 - $3,390).

• iii. On March 13, 2015, the Company entered into a secured $100,000 note with Korona Group Ltd., a company controlled by the Company’s former Chief Executive Officer, at an interest rate of 8% compounded monthly, due and payable July 30, 2015. On June 15, 2015, the Company repaid $40,000 to the note holder. The Company and the note holder agreed to extend the $60,000 note to December 31, 2018. Total interest expense on the note for the nine-month period ended January 31, 2021 amounted to $4,206 (January 31, 2020 - $6,260) and the accrued interest payable included in accounts payable at January 31, 2021 was $2,976 (January 31, 2020 - $8,007) (Note 8.i).

• iv. On May 7, 2015, the Company issued a secured convertible promissory note in the amount of $360,000, due May 7, 2016 and bearing an interest rate of 10% to 1454602 Ontario Inc., a company controlled by two shareholders, one being the Company’s former Chief Executive Officer and the other being a person formerly considered to be an insider of the Company due to diluted ownership in excess of 10% of the common shares of the Company (Note 9.i).

Effective May 7, 2016, this note was replaced with a new convertible promissory note for the same amount and interest rate, due May 7, 2019. Total interest expense for these notes for the nine-month period ended January 31, 2021 amounted to $27,222 (January 31, 2020 - $27,222) and the accrued interest payable included in accounts payable at January 31, 2021 was $21,205 (January 31, 2020 – $134,630) (Note 9.i).

• v. During the nine-month period ended January 31, 2021, the Company recorded directors’ fees of 36,000 (January 31, 2020 – $56,842). Included in accounts payable and accrued liabilities are unpaid directors’ fees at January 31, 2021 of $96,892 (January 31, 2020 – $84,399). These fees are non-interest bearing, are unsecured and have no fixed term for repayment.

• vi. Contracted with QDAC Inc., a company in which the Company’s former Chief Executive Officer is a minority owner, to undertake the manufacture of the Company’s hardware. The amount outstanding in trade accounts payable at January 31, 2021 was $434,901 (January 31, 2020- $373,032). Included in trade accounts payable at January 31, 2021 are late payment fees of $434,901 (January 31, 2020 - $535,809), of which late payments charges of $59,115 (January 31, 2020 - $81,765) are recorded in Office costs under General and Administration. This debt is non-interest bearing, unsecured and has no fixed term for repayment.

• vii. On September 22, 2016, the Company entered into a $79,000 secured convertible promissory note, with 1454602 Ontario Inc., a company controlled by two shareholders, one being the Company’s former Chief Executive Officer and the other being a person formerly considered to be an insider of the Company due to diluted ownership in excess of 10% of the common shares of the Company. The note, due September 22, 2017, bears an interest rate of 10%, is convertible at $0.095 per share, with a warrant priced at $0.15 exercisable for a period of two years from date of conversion. Total interest expense on the Note for the

19

iSIGN Media Solutions Inc. Notes to the Condensed Consolidated Interim Financial Statements For the Nine Months Ended January 31, 2021 and 2020 Expressed in Canadian Dollars

13. Related Party Transactions and Balances - continued

nine-month period ended January 31, 2021 amounted to $5,974 (January 31, 2020 - $5,974) and the accrued interest payable included in accounts payable at January 31, 2021 was $4,635 (January 31, 2020 - $9,242) (Note 9.ii).

• viii. On October 13, 2016, the Company entered into 2 secured convertible promissory notes, totaling $139,000 due October 13, 2017 bearing an interest rate of 10%, is convertible at $0.10 per share, with a warrant priced at $0.15 exercisable for a period of two years from date of conversion. One of the note holders, 1454602 Ontario Inc., is a company controlled by two shareholders, one being the Company’s former Chief Executive Officer and the other being a person formerly considered to be an insider of the Company due to diluted ownership in excess of 10% of the common shares of the Company. The other note holder, Unicare Inc., is a company partially controlled by the Company’s former Chief Executive Officer. Total interest expense on these Notes for the nine-month period ended January 31, 2021 amounted to $10,511 (January 31, 2020 - $10,511) and the accrued interest payable included in accounts payable at January 31, 2021 was $8,188 (January 31, 2020 - $16,261) (Note 9.iii).

• ix. On October 24, 2016, the Company entered into a $75,000 secured convertible promissory note with Cancore Enterprise, a company controlled by a shareholder, who was formerly considered to be an insider of the Company due to diluted ownership in excess of 10% of the common shares of the Company. The note due October 31, 2017, bears an interest rate of 10% per annum, is convertible at $0.12 per share, with a warrant priced at $0.18 exercisable for a period of two years from date of conversion. Total interest expense on the Note for the nine-month period ended January 31, 2021 amounted to $5,671 (January 31, 2020 - $5,671) and the accrued interest payable included in accounts payable at January 31, 2021 was $4,418 (January 31, 2020 - $8,774) (Note 9.iv).

• x. On September 5, 2017, the Company converted advances received during the period of February to August 2017 into a promissory note with Korona Group Ltd., a company controlled by the Company’s former Chief Executive Officer, in the amount of $600,700. The note matured on August 31, 2018. A share bonus of 1,126,312 common shares was issued by the Company in lieu of interest payments in 2018. The bonus was calculated as being 15% of the note and convertible into shares at a conversion rate of $0.08 (Note 8.ii).

On January 21, 2019, the Company and Note holder agreed to extend this note to January 31, 2020. A warrant bonus of 6,007,000 warrants was issued by the Company in lieu of interest payments. The exercise price of the warrants was $0.10 and expired January 31, 2020 (Notes 8.ii).

On October 18, 2019 and January 24, 2020, 2,560,000 of these warrants were exercised. The remaining 3,447,000 warrants expired on January 31, 2020 (Notes 11.a.ii and 11.d.iii).

On June 15, 2020, the Company and Note holder agreed to extend this note to June 30, 2021. A warrant bonus of 12,014,000 warrants was issued by the Company in lieu of future interest payments. The exercise price of the warrants is $0.05, with an expiry date of June 30, 2021 and cannot be extended (Note 8.ii).

• xi. On February 28, 2018, the Company converted advances received during the period of August 2017 to January 2018 into a convertible promissory note with Korona Group Ltd., a company controlled by the Company’s former Chief Executive Officer, in the amount of $285,000. The note matured on February 26, 2019, is convertible at $0.07 a share, with a warrant priced at $0.105 for two years from the date of conversion. Total interest expense on the Note for the nine-month period ended January 31, 2021

20

iSIGN Media Solutions Inc. Notes to the Condensed Consolidated Interim Financial Statements For the Nine Months Ended January 31, 2021 and 2020 Expressed in Canadian Dollars

13. Related Party Transactions and Balances - continued

amounted to $21,551 (January 31, 2020 - $21,551) and the accrued interest payable included in accounts payable at January 31, 2021 was $16,7887 (January 31, 2020 - $65,718) (Note 9.v).

• xii. On June 27, 2018, the Company entered into a secured convertible promissory note with Korona Group Ltd., a company controlled by the Company’s former Chief Executive Officer in the amount of $297,639 that matured June 27, 2019, bearing an interest rate of 10% per annum, due upon maturity. Included in this note were advances received during March 2018. The note is convertible into common shares of the Company at $0.08, with a warrant exercisable at $0.12 per share for a period of two years. Total interest expense on the Note for the nine-month period ended January 31, 2021 amounted to $22,506 (January 31, 2020 - $22,506) and the accrued interest payable included in accounts payable at January 31, 2021 was $17,532 (January 31, 2020 - $50,152) (Note 9.vi).

• xiii. During July 2018, the Company received advances of $150,000 from Korona Group Ltd., a company controlled by the Company’s former Chief Executive Officer. Total interest expense on the advance for the nine-month period ended January 31, 2021 amounted to $11,342 (January 31, 2020 - $11,342) and the accrued interest payable included in accounts payable at January 31, 2021 was $8,836 (January 31, 2020 - $23,465) (Note 7).

• xiv. On September 14, 2018, the Company entered into a $300,000 secured convertible promissory note with Cancore Enterprises, a company controlled by a shareholder, who was formerly considered to be an insider of the Company due to diluted ownership in excess of 10% of the common shares of the Company. The note matured September 14, 2019 and bears an interest rate of 10% per annum, due upon maturity. The note is convertible into common shares of the Company at $0.10, with a warrant exercisable at $0.15 per share for a period of two years. Total interest expense on the note for the nine-month period ended January 31, 2021 amounted to $22,685 (January 31, 2020 - $22,685) and the accrued interest payable included in accounts payable at January 31, 2021 was $17,671 (January 31, 2020 - $42,329) (Note 9.vii).

• xv. During the year ended April 30, 2020, the Company received advances of $158,000 from 1454602 Ontario Inc., a company controlled by two shareholders, one being the Company’s former Chief Executive Officer and the other being a person formerly considered to be an insider of the Company due to diluted ownership in excess of 10% of the common shares of the Company. Total interest expense on the advances for the nine -month period ended January 31, 2021 amounted to $8,167 (January 31, 2020 - $Nil) and the accrued interest payable included in accounts payable at January 31, 2021 was $6,362 (January 31, 2020 - $Nil) (Note 7).

• xvi. On October 11, 2019, the Company completed a shares for debt transaction by issuing 11,674,465 common shares at a price of $0.06 to Officers and Directors of the Company and to a company in which the Company’s former Chief Executive Office holds a minority position totaling $688,468 (Note 11.a.i).

• xvii. On April 21, 2020, the Company completed a shares for debt transaction by issuing 1,332,304 common shares at a price of $0.06 to Directors and Officers of the Company in payment of fees totaling $79,939 (Note 11.a.iii).

• xviii. On July 7, 2020, the Company received an advance of $20,000 from its former Chief Executive Officer. Total interest expense on the advance for the nine-month period ended January 31, 2021 amounted to $1,145 (January 31, 2020 - $Nil) and the accrued interest payable included in accounts payable at January 31, 2021 was $1,145 (January 31, 2020 - $Nil) (Note 7).

21

iSIGN Media Solutions Inc. Notes to the Condensed Consolidated Interim Financial Statements For the Nine Months Ended January 31, 2021 and 2020 Expressed in Canadian Dollars

13. Related Party Transactions and Balances – continued

• xix. During August 2020, the Company received advances of $42,672 from its former Chief Executive Officer. Total interest expense on the advance for the nine-month period ended January 31, 2021 amounted to $778 (January 31, 2020 - $Nil) and the accrued interest payable included in accounts payable at January 31, 2021was $Nil (January 31, 2020 - $Nil) (Note 7).

On November 30, 2020, these advances were converted into a $64,000 private placement with the Company’s former Chief Executive Officer. This placement was completed by the Company issuing 1,280,000 shares and 1,280,000 warrants at a price of $0.05, with a warrant exercise price of $0.075 (Note 11.a.v).

• xx. On August 5 and 10, 2020, the Company completed a shares for debt transaction by issuing 8,683,758 common shares at a price of $0.05 to various companies that are either wholly or partially owned and controlled by the Company’s former Chief Executive Officer and another shareholder, who was formerly considered to be an insider of the Company due to diluted ownership in excess of 10% of the common shares of the Company (Note 11.a.iv).

xxi. Compensation of key management personnel and board of directors:

Wages and director fees Benefits	As at January 31, 2021 2020
	$ 115,189 $ 173,842 740 13,320
	$115,929 $187,162

14. Loss per Share

Basic loss per share is calculated on the basis of the weighted average number of common shares outstanding for the period, which, for the nine-month period ended January 31, 2021, amounted to 151,546,273 (January 31, 2020 – 126,326,605). For the periods presented, all stock options, warrants and convertible notes payables are antidilutive, therefore diluted loss per share is equal to the basic loss per share.

The following instruments have been excluded from the diluted earnings per share as these instruments are antidilutive:

Issued stock options Issued warrants Convertible notes – potential share issuance Convertible notes – potential warrant issuance	For the years ended January 31, 2021 2020
	3,300,000 4,500,000 15,428,000 677,777 - 22,727,012 - 22,727,012
	18,728,000 50,631,801

22

iSIGN Media Solutions Inc. Notes to the Condensed Consolidated Interim Financial Statements For the Nine Months Ended January 31, 2021 and 2020 Expressed in Canadian Dollars

15. Financial Instruments and Risk Management

The fair value of a financial instrument is the amount of consideration that would be agreed upon in an arm's length transaction between knowledgeable and willing parties who are under no compulsion to act. When the independent prices are not available, fair values are determined using valuation techniques that refer to observable market data.

These techniques include comparisons with similar instruments where market observable prices exist, discounted cash flow analysis, and other valuation techniques commonly used by market participants.

Fair value

The Company uses the following methods and assumptions to estimate the fair value of each class of financial instruments:

The carrying amounts of cash, restricted cash, accounts receivable, other receivables, bank and government indebtedness, accounts payable and accrued liabilities, notes payable, convertible note payable and advances approximate fair value due to the short-term maturity of these financial instruments.

The Company had no financial instruments to classify within the fair value hierarchy as at January 31, 2021 and 2020.

Interest rate risk

The Company has cash and restricted cash balances with rates that fluctuate with the prevailing market rate. The Company’s current policy is to invest excess cash in cash accounts or short-term interest-bearing securities issued by Canadian chartered banks. The Company periodically monitors the investments it makes and is satisfied with the credit ratings of its banks. The Company’s notes payable and convertible notes payable bear interest at fixed interest rates.

Credit risk

Credit risk is the risk of financial loss associated with the counterparty’s inability to fulfill its payment obligations in accordance with the terms and conditions of its contract with the Company. Credit risk arises from cash and deposits with banks as well as credit exposure to outstanding receivables.

The Company’s credit risk arises primarily from the Company’s trade receivable. The carrying amount of financial assets represents the maximum credit exposure to the Company. The Company’s exposure to trade credit risk as at January 31, 2021 was $Nil (April 30, 2020 - $1,800) net of allowances.

The Company may also have credit risk relating to cash and restricted cash, of $23,353 and $10,000 (April 30, 2020 - $14,390 and $10,000), respectively, which it manages by dealing with highly rated financial institutions.

Liquidity risk

Liquidity risk is the risk that the Company will experience difficulty in meeting its obligations that are associated with financial liabilities. The Company’s approach to managing liquidity risk is to ensure that it will have sufficient liquidity to meet financial obligations when they fall due, from its funding sources, such as equity and debt issuances. The Company continues to actively pursue new equity financing to ensure that it will have funds available to meet liabilities when they fall due.

23

iSIGN Media Solutions Inc. Notes to the Condensed Consolidated Interim Financial Statements For the Nine Months Ended January 31, 2021 and 2020 Expressed in Canadian Dollars

15. Financial Instruments and Risk Management – continued

Liquidity risk - continued

The following table represents the Company’s financial liabilities identified by type and future contractual dates of payment:

t:
Trade accounts payable and accrued liabilities Government of Canada COVID funding Advances Notes payable Convertible notes payable	Under 1 – 3 Total 1 Year Years	After 3 Years
	$ 917,108 $ 917,108 $ - 80,000 - 80,000 328,000 328,000 - 660,700 660,700 - 2,010,639 2,010,639 -	$ - - - - -
	$ 3,996,447 $ 3,916,447 $ 80,000	$ -

16. Subsequent Events

On February 1, 2021, the Company announced its intention to complete a private placement of up-to $6.9 million. This placement, when completed, would result in the issuance of up to 138 million Units at a price of $0.05 per Unit. Each Unit consists of one Common Share of the Company (each a “Common Share” and collectively, the “Common Shares”) and one common share purchase warrant (each warrant referred to herein as a “Warrant” and collectively, the “Warrants”). Each Warrant will entitle the holder to purchase one Common Share at a price of $0.075 for a period of 24 months from the date of closing. All securities would be subject to a four month hold period.

On February 16, 2021, the Company announced it completed the final tranche of its $236,700 private placement by issuing 2,600,200 Units at a price of $0.05 per Unit. Each Unit consists of one Common Share of the Company (each a “Common Share” and collectively, the “Common Shares”) and one common share purchase warrant (each warrant referred to herein as a “Warrant” and collectively, the “Warrants”). Each Warrant will entitle the holder to purchase one Common Share at a price of $0.075 for a period of 24 months from the date of closing. All securities are subject to a four month hold period.

On February 23, 2021, the Company announced that its Chief Executive Officer, Joe Kozar had resigned effective February 22, 2021.

On March 23, 2021, the Company announced that it hadn’t completed the required documentation required by the TSX-V Exchange to allow for the up to $6.9 million placement to close in trust and that it would reapply at a later date, with pricing based on the prevailing market price.

17. Commitments and Contingencies

Rental and operating leases

The Company is party to certain contracts which contain minimum commitments of approximately $40,200 payable in fiscal 2021.

24

iSIGN Media Solutions Inc. Notes to the Condensed Consolidated Interim Financial Statements For the Nine Months Ended January 31, 2021 and 2020 Expressed in Canadian Dollars

17. Commitments and Contingencies - continued

Contingencies and provisions

From time to time, the Company enters into software licensing agreements with a client/business partners whereby the Company has agreed to indemnify the counterparties for liabilities that may arise during the terms of the agreements. The maximum amount of any potential future payment cannot be reasonably estimated and it is not practicable to estimate the financial effects on its consolidated financial statements.

In the ordinary course of business, the Company and its subsidiaries are involved in legal claims and counter claims, as defendants or plaintiffs. The Company has evaluated its legal actions and has estimated potential settlements and legal costs based on the current information and have accrued a provision based on management's estimate of potential outcomes. It is management's opinion that any additional liability to the Company that may arise from these matters will not have a material effect upon the operating results, financial position, or cash flows of the Company.

18. Capital Management

The Company considers that its capital is synonymous with the value of convertible notes payable, bank indebtedness and shareholders’ (deficiency).

The total of these items was as follows:

Convertible note payables Bank indebtedness Shareholders’ (deficiency)	January 31, 2021 April 30. 2020
	$ 2,010,639 $ 2,010,639 - (21,700) (4,148,313) (4,365,959)
	$ (2,137,674) $ (2,377,020)

The Company manages its capital structure and makes adjustments to it in light of general economic conditions and the risk characteristics of the underlying assets and the Company’s working capital requirements. In order to maintain or adjust the capital structure, the Company, upon approval from its Board of Directors, may issue longterm debt, convertible notes, issue shares or repurchase shares through a normal course issuer bid. The Board of Directors reviews and approves any material transactions not in the ordinary course of business which may include various acquisition proposals, as well as capital and operating budgets. The Company is not subject to any externally imposed capital requirements. There were no significant changes in the Company’s approach to capital management during the nine-month period ended January 31, 2021 or the fiscal year ended April 30, 2020.

The Company is not subject to any capital requirements imposed by a lending institution or regulatory body, other than of the TSX Venture (“TSX-V”) which requires adequate working capital or financial resources of the greater of (i) $50,000 and (ii) an amount required to maintain operations and cover general and administrative expenses for a period of six months. As of January 31 2021, the Company may not be compliant with the policies of the TSX-V. The impact of this violation is not known and is ultimately dependent on the discretion of the TSX-V.

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iSIGN Media Solutions Inc. Notes to the Condensed Consolidated Interim Financial Statements For the Nine Months Ended January 31, 2021 and 2020 Expressed in Canadian Dollars

19. Net Change in Non-Cash Working Capital

Net change in non-cash working capital balances: Accounts receivables Other receivables Sales taxes recoverable Inventories Prepaid expenses and deposits Accounts payable and accrued liabilities Deferred revenue	For the nine months ended January 31, 2021 2020
	$ 1,800 $ - - 1,417 24,803 (3,970) (9,574) - (84) (32,303) 298,726 364,393 14,871
	$ 315,671 $ 344,408

20. Selling and Marketing

Travel, tradeshows and promotional Other Total - Selling and marketing	For the nine months ended January 31, 2021 2020	For the nine months ended January 31, 2021 2020
	$ - -% $ 2,819 621 100.0% -	100.0% -%
	$ 621 100.0% $ 2,819	100.0%

21. General and Administration

Salaries Benefits Contractual services Share-based compensation Travel and auto Office costs Occupancy and operating costs Professional Consulting Directors' fees Other (income) Total - General and administration	For the nine months ended January 31, 2021 2020 $ 39,657 8.4% $ 52,470 9.1% 2,185 0.5% 1,934 0.3% 115,307 24.4% 161,911 27.8% 66,000 13.9% 79,417 13.7% 1,031 0.2% 14,187 2.4% 135,912 28.7% 111,830 19.2% 27,886 5.9% 49,995 8.6% 85,042 18.0% 55,182 9.5% 1,900 0.4% 11,310 1.9% 36,000 7.6% 56,842 9.8% (37,986) (8.0%) (13,451) (2.3%) $ 472,934 100.0% $ 581,627 100.0%	For the nine months ended January 31, 2021 2020 $ 39,657 8.4% $ 52,470 9.1% 2,185 0.5% 1,934 0.3% 115,307 24.4% 161,911 27.8% 66,000 13.9% 79,417 13.7% 1,031 0.2% 14,187 2.4% 135,912 28.7% 111,830 19.2% 27,886 5.9% 49,995 8.6% 85,042 18.0% 55,182 9.5% 1,900 0.4% 11,310 1.9% 36,000 7.6% 56,842 9.8% (37,986) (8.0%) (13,451) (2.3%) $ 472,934 100.0% $ 581,627 100.0%
		9.1% 0.3% 27.8% 13.7% 2.4% 19.2% 8.6% 9.5% 1.9% 9.8% (2.3%)
		100.0%

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