Jasper Commerce Inc. — Interim / Quarterly Report 2021

Nov 19, 2021

SAASQUATCH CAPITAL CORP. MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2021

Dated: November 19, 2021

MANAGEMENT’S RESPONSIBILITY FOR FINANCIAL REPORTING

This management’s discussion and analysis (“MD&A”) reports on the consolidated operating results and consolidated financial condition of SaaSquatch Capital Corp. (the “Company” or “SAASQUATCH”) and its subsidiary for the three months ended September 30, 2021 and is prepared as at November 19, 2021. Throughout this MD&A, unless otherwise specified, “SAASQUATCH”, “Company”, “we”, “us” and “our” refer to SaaSquatch Capital Corp. and its subsidiary. This MD&A should be read in conjunction with the audited consolidated financial statements as at and for the three months ended September 30, 2021 and the period from incorporation on March 22, 2021 to June 30, 2021, which were prepared in accordance with International Financial Reporting Standards (“IFRS”) (collectively referred to as the “Financial Statements”). Other information contained in these documents has also been prepared by management and is consistent with the data contained in the Financial Statements. All dollar amounts referred to in this MD&A are expressed in Canadian dollars except where indicated otherwise.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING INFORMATION

This MD&A includes "forward‐looking statements", within the meaning of applicable securities legislation, which are based on the opinions and estimates of management and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward‐looking statements. While these forward‐looking statements, and any assumptions upon which they are based, are made in good faith, and reflect our current judgment regarding the direction of our business, actual results will likely vary, sometimes materially, from any estimates, predictions, projections, assumptions, or other future performance suggested herein.

Forward‐looking statements are often, but not always, identified by the use of words such as "seek", "anticipate", "budget", "plan", "continue", "estimate", "expect", "forecast", "may", "will", "project", "predict", "potential", "targeting", "intend", "could", "might", "should", "believe" and similar words suggesting future outcomes or statements regarding an outlook. These statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward‐looking statements. These forward‐looking statements include but are not limited to statements concerning:

• The Company’s ability to identify, successful negotiate and/or finance an acquisition of a new business opportunity

• The Company’s success at completing future financings

• The Company’s strategies and objectives

• General business and economic conditions

• The Company’s ability to meet its financial obligations as they become due

• The positive cash flows and financial viability of new business opportunities

• The Company’s ability to manage growth with respect to a new business opportunity

• The Company’s tax position, anticipated tax refunds and the tax rates applicable to the Company

SAASQUATCH CAPITAL CORP. MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2021

Readers are cautioned that the preceding list of risks, uncertainties, assumptions, and other factors are not exhaustive. Events or circumstances could cause actual results to differ materially from those estimated or projected and expressed in, or implied by these forward looking statements. Due to the risks, uncertainties, and assumptions inherent in forward‐looking statements, investors in securities of the Company should not place undue reliance on these forward‐looking statements.

CORPORATE OVERVIEW AND OUTLOOK

SAASQUATCH was incorporated on March 22, 2021 under the laws of British Columbia and is classified as a Capital Pool Company (“CPC”) as defined in the TSX Venture Exchange (“TSX‐V” or “Exchange”) Policy 2.4. The Company’s registered office is located at Suite 1500 – 1055 West Georgia Street, Vancouver, BC V6E 4N7.

Since incorporation on March 22, 2021, the Company has had no active business operations. As a CPC, the Company’s business objective is to identify and evaluate assets or businesses with a view to potential acquisition or participation by completing a Qualifying Transaction (“QT”), as defined in Exchange Policy 2.4 subject, in certain cases, to shareholder approval and acceptance by the TSX‐V. The Company has an accumulated deficit of $119,728 as at September 30, 2021. The Company currently has sufficient liquidity to meet its operational requirements for the next fiscal year. However, the Company’s continued operations are dependent upon its ability to identify, evaluate and successfully negotiate an agreement to acquire an interest in a sustainable/viable business operation. There is no assurance that the Company will identify a business or asset that warrants acquisition or participation, and/or will be able to obtain the financing necessary to support a new business acquisition. All the preceding indicates the existence of a material uncertainty that may cast substantial doubt about the Company’s ability to continue as a going concern. The Financial Statements do not give effect to any adjustments which would be necessary should the Company be unable to continue as a going concern and therefore be required to realize its assets and discharge its liabilities in other than the normal course of business and at amounts different from those reflected in the Financial Statements.

The Company completed its IPO on August 11, 2021 (the “IPO”), issuing 2,000,000 common shares in the capital of the Company at a price of $0.10 per common share for gross proceeds of $200,000 pursuant to the final prospectus dated August 3, 2021. Following closing of the IPO, a total of 13,000,000 common shares are issued and outstanding, of which 2,000,000 are currently held in escrow pursuant to the policies of the TSX‐V. The net proceeds of the IPO, together with the proceeds from prior sales of common shares will be used by the Company to identify and evaluate assets or businesses for acquisition with a view to completing a QT under the TSX‐V’s capital pool company program. In connection with the IPO, the Company granted to the agent, options to acquire up to an aggregate of 200,000 common shares at a price of $0.10 per common share until August 11, 2026.

In March 2020, the World Health Organization declared coronavirus COVID‐19 a global pandemic. 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. To date, COVID‐19 has not had an adverse impact on the Company in its efforts to raise capital. Pandemic‐related restrictions on trans‐national travel are not expected to adversely impact the Company’s ability to complete a Qualifying Transaction.

SAASQUATCH CAPITAL CORP. MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2021

SELECTED ANNUAL INFORMATION

The Company was incorporated on March 22, 2021 and has been in existence for less than a fiscal year. Thus, there is no applicable annual information available.

SUMMARY OF QUARTERLY RESULTS

	For the three months ended September 30, 2021	For the period from incorporation on March 22, 2021 to June 30, 2021
Revenue	‐	‐
Loss for theperiod	$(59,978)	$(59,750)
Basic/diluted lossper share	(0.00)	(0.01)

RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2021 AND FOR THE PERIOD FROM INCORPORATION ON MARCH 22, 2021 TO JUNE 30, 2021

Office and miscellaneous expenditures for the three months ended September 30, 2021 were $502, and for the period from incorporation on March 22, 2021 to June 30, 2021 were $129. These charges were incurred for the maintenance of the Company’s bank account and administrative costs.

Professional fees for the three months ended September 30, 2021 were $48,098, and for the period from incorporation on March 22, 2021 to June 30, 2021 were $46,636. These fees were for accounting, audit and legal services.

Filing fees for the three months ended September 30, 2021 were $11,378, and for the period from incorporation on March 22, 2021 to June 30, 2021 were $12,985. These fees include expenses associated with the Company’s prospectus and IPO.

Loss and comprehensive loss for the period as a result of the activities discussed above, the Company experienced a loss and comprehensive loss for the three months ended September 30, 2021 of $59,978, and for the period from incorporation on March 22, 2021 to June 30, 2021 a loss and comprehensive loss of $59,750.

SHARE CAPITAL

Authorized

Unlimited number of common shares without par value.

Issued and outstanding

As at September 30, 2021 the Company has 13,000,000 common shares issued and outstanding.

SAASQUATCH CAPITAL CORP. MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2021

On March 22, 2021, the Company completed a private placement financing and issued 2,000,000 common shares of the Company at a price of $0.05 per share for total proceeds of $100,000.

On April 30, 2021, the Company completed a private placement financing and issued 9,000,000 common shares of the Company at a price of $0.10 per share for total proceeds of $900,000.

On August 11, 2021, the Company completed its IPO of 2,000,000 common shares at a price of $0.10 per share for gross proceeds of $200,000. The Company incurred cash share issuance costs of $60,166 in connection with the IPO.

connection with the IPO.
	Number of Shares	Amount
		$
Balance, (incorporation)March 22,2021	‐	‐
March 22,2021 – share issuance	2,000,000	100,000
April 30,2021 – share issuance	9,000,000	900,000
August 11,2021 – share issuance	2,000,000	200,000
Share issuance costs – cash	‐	(60,166)
Share issuance costs – agent options	‐	(14,000)
Balance,September 30,2021,and the date of this MD&A	13,000,000	1,125,834

Warrants

The Company has not issued warrants during the period from incorporation on March 22, 2021 to September 30, 2021.

Stock options

As part of the IPO on August 11, 2021, the Company granted to its agent 200,000 options to acquire the Company’s common shares at a price of $0.10 per common share until August 11, 2026. These options vested immediately. The fair value of these agent options calculated using the Black‐Scholes option‐ pricing model was $14,000. This amount was recorded as part of the share issuance costs and netted against reserves on the statement of financial position. The weighted average fair value of these stock options granted to the agent was $0.07 per option. The risk‐free interest rate was 1.73%, with an expected life of 5 years, dividend yield of 0%, and an annualized volatility of 100%.

A summary of the Company’s stock option activity is as follows:

	Number of Stock Options	Weighted Average Exercise Price
Balance,as of March 22,2021	‐	$‐
Granted	200,000	$0.10
Balance, September 30, 2021, and the date of this MD&A	200,000	$0.10

SAASQUATCH CAPITAL CORP. MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2021

As at September 30, 2021, and the date of this MD&A, outstanding stock options were as follows:

Grant Date	Number of options Outstanding and Exercisable	Exercise Price	Expiry date	Remaining contractual life(years)
August 11,2021	200,000	$0.10	August 11,2026	4.87

Escrowed shares

As at September 30, 2021, 2,000,000 common shares were held in escrow (June 30, 2021 – 2,000,000).

LIQUIDITY AND CAPITAL RESOURCES

Capital is comprised of the Company’s shareholders’ equity. As at September 30, 2021, the Company’s shareholders’ equity was $1,020,106 and there was no long‐term debt outstanding. The Company manages its capital structure to maximize its financial flexibility making adjustments to it in response to changes in economic conditions and the risk characteristics of its underlying assets and business opportunities. The Company does not presently utilize any quantitative measures to monitor its capital. There were no changes to the Company’s approach to capital management during the period ended September 30, 2021.

The proceeds raised from the issuance of common shares may only be used to identify and evaluate assets or businesses for future investment, with the exception that up to $3,000 per month may be used for reasonable general and administrative expenses of the Company. These restrictions apply until completion of a Qualifying Transaction by the Company as defined under the Exchange Policy 2.4. The Company currently is not subject to other externally imposed capital requirements.

A summary of the Company’s cash flows is as follows:

	For the three months ended September 30, 2021	For the period from incorporation on March 22 to June 30, 2021
Cash flows used in operatingactivities	($17,920)	($23,114)
Cash flowsprovided byfinancingactivities	$139,834	$1,000,000
Increase in cash for theperiod	$121,914	$976,886
Cash,beginningof theperiod	$976,886	‐
Cash,end of theperiod	$1,098,800	$976,886

Cash flows used in operating activities were $17,920 during the three‐month period ended September 30, 2021 and $23,114 during period from incorporation on March 22, 2021 to June 30, 2021. The cash was used to pay for administrative expenditures associated with the establishment and maintenance of the Company.

SAASQUATCH CAPITAL CORP. MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2021

Cash flow provided by financing activities was $139,834 during the three‐month period ended September 30, 2021 and $1,000,000 during the period from incorporation on March 22, 2021 to June 30, 2021. The funds were provided through the issuance of common shares.

As a result of the above activities, at September 30, 2021, the Company has $1,098,800 of cash to settle current liabilities of $78,694. As such, management feels the Company has sufficient cash to fund corporate overhead costs and the repayment of the Company’s debt obligations for the next year.

The Financial Statements have been prepared in accordance with IFRS applicable to a going concern, which assumes that the Company will be able to meet its obligations and continue its operations for its next fiscal year. The accompanying financial statements do not reflect adjustments that may be necessary if the going concern assumption were not appropriate. If the going concern basis were not appropriate, adjustments may be necessary to the carrying amounts and/or classification of assets and/or liabilities and the reported expenses in these financial statements. Such adjustments could be material.

RELATED PARTY TRANSACTIONS

Parties are considered to be related if one party has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operating decisions. Related parties may be individuals or corporate entities. A transaction is considered to be a related party transaction when there is a transfer of resources or obligations between related parties.

There were no related party transactions during the period from incorporation on March 22, 2021 to September 30, 2021

RISKS AND UNCERTAINTIES

Strategic Risk

There is also no guarantee that the Company will be able to complete the acquisition of or participation in a new business opportunity. If an acquisition of or the participation in corporations, properties, assets, or businesses is identified, the Company may find that, even if the terms of an acquisition or participation are economic, it may not be able to finance such acquisition or participation and additional funds will be required to enable the Company to pursue such an initiative. There is no guarantee that additional financing will be available or that it will be available on terms acceptable to management of the Company. The Company will be competing with other companies, many of which will have far greater resources and experience than the Company. No assurance can be given that the Company will be successful in raising the funds required for an acquisition.

Possible Dilution to Present and Prospective Shareholders

The Company’s plan of operation, in part, contemplates the acquisition of an operating business by the issuance of cash, securities of the Company, or a combination of the two. Any transaction involving the issuance of previously authorized but unissued common shares would result in dilution, possibly substantial, to present and prospective holders of common shares.

SAASQUATCH CAPITAL CORP. MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2021

FINANCIAL INSTRUMENTS

Fair value

Financial instruments measured at fair value are classified into one of three levels in the fair value hierarchy according to the relative reliability of the inputs used to estimate the fair values. The three levels of the fair value hierarchy are:

Level 1 – Unadjusted quoted prices in active markets for identical assets or liabilities;

Level 2 – Inputs other than quoted prices that are observable for the asset or liability either directly or indirectly; and

Level 3 – Inputs that are not based on observable market data.

Cash is carried at fair value using Level 1 inputs. The carrying value of accounts payable and accrued liabilities approximates fair value due to its short‐term nature.

Financial risk management

The Company’s risk exposures and the impact on the Company’s financial instruments are summarized below.

Credit risk

Credit risk is the risk of an unexpected loss if a customer or third party to a financial instrument fails to meet its contractual obligations. The Company limits its exposure to credit risk by placing its cash with a major financial institution. The Company’s credit risk with respect to its financial assets is remote.

Interest rate risk

The Company is exposed to interest rate risk to the extent that its cash maintained in a financial institution is subject to a floating rate of interest. The interest rate risk on cash is not considered significant.

Liquidity risk

The Company’s financial liabilities are classified as current and are anticipated to mature within the next twelve months. The Company intends to settle these with funds from its positive working capital position.

Foreign currency risk

Currency risk is the risk that the fair value or future cash flows from a financial instrument will fluctuate due to changes in foreign exchange rates. As at September 30, 2021, the Company did not have any financial instruments denominated in foreign currencies and considers foreign currency risk insignificant.

SAASQUATCH CAPITAL CORP. MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2021

Price risk

The Company has no exposure to price risk with respect to equity prices. Equity price risk is defined as the potential adverse impact on the Company’s profit or loss due to movements in individual equity prices or general movements in the level of the stock market.

CRITICAL ACCOUNTING ESTIMATES AND JUDGMENTS

The preparation of the Financial Statements requires management to make certain estimates, judgments and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported expenses during the period. Actual results could differ from these estimates. The preparation of the Financial Statements requires management to make judgments regarding the going concern of the Company, as discussed in Note 1 of the Financial Statements.

Significant assumptions about the future and other sources of estimation uncertainty that management has made at the end of the reporting period, that could result in a material adjustment to the carrying amounts of assets and liabilities in the event that actual results differ from assumptions made, relate to, but are not limited to, the following:

Deferred tax assets and liabilities

The measurement of deferred income tax provision is subject to uncertainty associated with the timing of future events and changes in legislation, tax rates and interpretations by tax authorities. The estimation of taxes includes evaluating the recoverability of deferred tax assets based on an assessment of the Company’s ability to utilize the underlying future tax deductions against future taxable income prior to expiry of those deductions. Management assesses whether it is probable that some or all of the deferred income tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income, which in turn is dependent upon the successful operations of the Company. To the extent that management’s assessment of the Company’s ability to utilize future tax deductions changes, the Company would be required to recognize more or fewer deferred tax assets, and deferred tax provisions or recoveries could be affected.

Share-based payments

The Company uses the Black‐Scholes option pricing model to determine the fair value of options in order to calculate share‐based payment expense and the fair value of agent options. The Black‐Scholes model involves six key inputs to determine fair value of an option: risk‐free interest rate, exercise price, market price at date of issue, expected dividend yield, expected life, and expected volatility. Certain of the inputs are estimates that involve considerable judgment and are or could be affected by significant factors that are out of the Company’s control. The Company is also required to estimate the future forfeiture rate of options based on historical information in its calculation of share‐based payment expense.

PROPOSED QUALIFYING TRANSACTION

The Company entered into a combination agreement (the “Combination Agreement”) dated October 7, 2021 with Jasper Interactive Studios Inc. (“Jasper”) in respect of a proposed business combination (the

SAASQUATCH CAPITAL CORP. MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2021

“Proposed Transaction”). It is anticipated that the proposed business combination will constitute the Company’s “Qualifying Transaction” in accordance with Policy 2.4 – Capital Pool Companies of the Exchange.

Pursuant to the Combination Agreement, the Company will consolidate its common shares on the basis of one new share for two old shares (the “Consolidation”) and the Company will then acquire all of the issued and outstanding Jasper common shares (“Jasper Shares”) in exchange for post‐Consolidation SaaSquatch Shares on the basis of 13.94835 post‐Consolidation SaaSquatch Shares for each Jasper Share.

Completion of the Proposed Transaction is subject to several conditions, including acceptance by the Exchange. There can be no assurance that the Proposed Transaction will be completed as proposed, or at all.

OFF-BALANCE SHEET ARRANGEMENT

The Company currently has no off‐balance sheet arrangement.