Jasper Commerce Inc. — Interim / Quarterly Report 2022

Jun 28, 2022

Jasper Commerce Inc.

(formerly SaaSquatch Capital Corp.)

Unaudited Condensed Consolidated Interim Financial Statements

For the three and nine months ended April 30, 2022 and 2021

(Expressed in Canadian Dollars)

No Auditor Review of Interim Condensed Financial Statements

Under Part 4, subsection 4.3(3)(a) of National Instrument 51-102 – Continuous Disclosure Obligations, if an auditor has not performed a review of the condensed interim financial statements, they must be accompanied by a notice indicating that the interim financial statements have not been reviewed by an auditor. The accompanying unaudited condensed interim financial statements of Jasper Interactive Studios Inc. (the “Company”) have been prepared by and are the responsibility of the Company’s management. The Company’s independent auditor has not performed a review of these condensed interim financial statements in accordance with standards established by the Canadian Institute of Chartered Accountants for a review of interim financial statements by an entity’s auditor.

Jasper Commerce Inc. Condensed Consolidated Interim Statements of Financial Position As at April 30, 2022 and July 31, 2021 (Unaudited)(in Canadian Dollars)

	Note	April 30, 2022	July 31, 2021
Assets
Current assets:
Cash and cash equivalents		$3,949,688	$ 1,289,325
Accounts receivable		246,602	127,513
Government tax and subsidy receivable	12	-	383,672
Contract assets		26,138	62,030
Prepaid expenses and deposits		250,823	37,762
		4,473,251	1,900,302
Non-current assets:
Contract assets		2,883	16,619
Furniture and equipment		16,516	15,048
		$ 4,492,650	$ 1,931,969
Liabilities
Current liabilities:
Accounts payable and accrued liabilities		$ 590,442	$ 531,974
Contract liabilities		65,753	172,168
Loans	5	136,340	92,180
Debentures	6	-	307,786
		792,535	1,104,108
Non-current liabilities:
Contract liabilities		38,281	42,252
Loans	5,12	202,330	313,425
Debentures	6	-	2,001,957
Conversion warrants	6	-	540,279
Conversion feature	6	-	904,359
		1,033,146	4,906,380
Shareholders' deficiency:
Share capital	7	15,388,817	4,220,507
Options reserve	8	608,335	342,458
Warrants reserve	8	2,754,415	778,488
Accumulated deficit		(15,292,063)	(8,315,864)
		3,459,504	(2,974,411)
		$ 4,492,650	$ 1,931,969

Nature of operations and going concern (see Note 1) Subsequent events (see Note 14) Approved by: Approved by: “Jon Marsella” “Jeffrey Klam” Jon Marsella, Director Jeffrey Klam, Director

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

1

Jasper Commerce Inc. Condensed Consolidated Interim Statements of Loss and Comprehensive Loss For the three and nine months ended April 30, 2022 and 2021 (Unaudited)(in Canadian Dollars)

		Three months	ended Apr 30,	Nine months	ended Apr 30,
	Note	2022	2021	2022	2021
Revenues		$ 383,297	$ 335,661	$ 1,306,291	$ 1,007,331
Expenses
General and administrative		709,958	340,231	1,689,567	767,818
Research and development		360,765	304,569	896,847	885,412
Selling and marketing		344,731	46,439	830,042	112,306
Hosting		86,428	33,698	221,596	94,854
Customer support		314,820	55,095	664,682	156,182
Stock-based compensation	8	148,297	22,914	289,262	48,331
Loss on settlement		-	-	19,426	-
Depreciation		2,700	2,421	9,419	7,343
Foreign exchange loss (gain)		4,867	1,802	3,731	4,462
Finance costs	11	3,210,371	212,463	3,681,303	353,644
		5,182,937	1,019,632	8,305,875	2,430,352
Net loss and comprehensive loss		$(4,799,640)	$(683,971)	$(6,999,584)	$(1,423,021)
Basic and diluted loss per share		$ (0.09)	$ (0.03)	$ (0.20)	$ (0.05)
Weighted average number of common
shares - basic and diluted		52,519,220	27,069,259	35,366,133	27,064,004

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

2

Jasper Commerce Inc. Condensed Consolidated Interim Statements of Changes in Shareholder’s Equity (Deficiency) For the three and nine months ended April 30, 2022 and 2021 (Unaudited)(in Canadian Dollars)

		Number of
		Common		Options	Warrants
	Note	Shares	Share capital	Reserve	Reserve	Deficit	Total
Balance, August 1, 2021		27,069,258	$ 4,220,507	$ 342,458	$ 778,488	$ (8,315,864)	$ (2,974,411)
Surrender of shares		(34,870)	(15,000)	-	-	-	(15,000)
Reverse takeover	4	7,940,784	3,181,567	-	34,676	-	3,216,243
Debenture conversion	6	11,104,447	3,862,708	-	-	-	3,862,708
Warrant liability	8	-	-	-	701,432	-	701,432
Private placement		12,000,000	4,139,035	-	1,239,819	-	5,378,854
Stock based compensation		-	-	289,262	-	-	289,262
Stock options expired unexercised		-	-	(23,385)	-	23,385	-
Comprehensive loss for theperiod		-	-	-	-	(6,999,584)	(6,999,584)
Balance, April 30, 2022		58,079,619	$ 15,388,817	$ 608,335	$ 2,754,415	$ (15,292,063)	$ 3,459,504
		Number of
		Common		Options	Warrants
	Note	Shares	Share capital	Reserve	Reserve	Deficit	Total
Balance, August 1, 2020		27,034,387	$ 4,193,151	$ 503,877	$ 691,457	$ (6,877,320)	$ (1,488,835)
Stock options exercised		34,871	27,356	(11,731)	-	-	15,625
Stock based compensation		-	-	48,331	-	-	48,331
Comprehensive loss for theperiod		-	-	-	-	(1,423,021)	(1,423,021)
Balance,April 30,2021		27,069,258	$4,220,507	$540,477	$691,457	$ (8,300,341)	$ (2,847,900)

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

3

Jasper Commerce Inc. Condensed Consolidated Interim Statements of Cash Flows For the nine months ended April 30, 2022 and 2021 (Unaudited)(in Canadian Dollars)

Nine months ended April 30,	Note	2022	2021
Cash flows used in operating activities:
Loss for the year		$ (6,999,584)	$ (1,318,685)
Adjustments for items not affecting cash:
Stock-based compensation	8	289,262	48,331
Depreciation		9,419	7,343
Finance costs	11	3,681,303	353,644
Changes in non-cash working capital balances:
Accounts receivable		(119,090)	(121,779)
Government tax and subsidy receivable		383,672	438,766
Contract assets		49,629	71,769
Prepaid expenses and deposits		(213,062)	(72,436)
Accounts payable and other liabilities		(13,307)	253,187
Contract liabilities		(110,386)	(220,492)
		(3,042,144)	(560,352)
Cash flows from financing activities:
Common share financing, net of issue costs		5,378,854	-
Debenture financing, net of issue costs		-	2,492,650
Share buyback		(15,000)	-
Exercise of stock options		-	15,625
Proceeds from loans		100,000	140,000
Interest paid		(288,796)	(59,546)
Debenture repayments		(290,000)	-
Loan repayments		(166,935)	(339,530)
		4,718,123	2,249,199
Cash flows used in investing activities:
Cash from reverse takeover		995,270	-
Purchase of furniture and equipment		(10,886)	(1,324)
		984,384	(1,324)
Net increase in cash and cash equivalents		2,660,363	1,687,523
Cash and cash equivalents,beginningofperiod		1,289,325	127,268
Cash and cash equivalents, end ofperiod		$ 3,949,688	$ 1,814,791

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

4

Jasper Commerce Inc. Notes to the Condensed Consolidated Interim Financial Statements For the three and nine months ended April 30, 2022 and 2021 (Unaudited)(in Canadian Dollars)

1. Nature of operations and going concern

Jasper Commerce Inc. (formerly SaaSquatch Capital Corp.)(together with its subsidiary, the “Company” or “Jasper”) was incorporated on March 22, 2021 under the Business Corporations Act (British Columbia). The Company is domiciled in Canada and its head office, principal address and records office are located at 44 Victoria Street, Suite 820, Toronto, Ontario M5C 1Y2.

On February 16, 2022, SaaSquatch Capital Corp. (“SCC”), a Capital Pool Company as defined in Policy 2.4 of the TSX Venture Exchange, acquired Jasper Interactive Studios Inc. in a reverse takeover transaction (“RTO”)(see Note 4) and began trading its common shares on the TSX Venture Exchange under the symbol JPIM.

Jasper is a Software-as-a-service (“SaaS”) Product Information Management (“PIM“) solution empowering eCommerce retailers, wholesalers or distributors to: centralize, organize and richly merchandise their products from a single central repository.

Jasper’s ability to continue as a going concern is dependent upon its ability to become profitable to obtain additional financing to support operations for the foreseeable future. It is not possible to predict whether financing efforts will be successful in the future. Failure to obtain such financing could result in delay or indefinite postponement of the Company’s strategic goals. These material uncertainties may cast significant doubt upon the Company’s ability to continue as a going concern.

These financial statements have been prepared on the basis that Jasper will continue as a going concern, and do not reflect the adjustments to the carrying values of assets and liabilities and the reported revenues and expenses, and classifications of statements of financial position that would be necessary if it were unable to realize its assets and settle its liabilities as a going concern in the normal course of operations. Such adjustments could be material.

2. Basis of presentation

These unaudited condensed consolidated interim financial statements have been prepared in accordance with International Financial Reporting Standards (“IFRS”) as set out in the Handbook of Chartered Professional Accountants Canada and are presented in accordance with International Accounting Standard (“IAS”) 34, Interim Financial Reporting. The disclosures contained in these financial statements do not contain all requirements of IFRS for annual financial statements and should be read in conjunction with the annual financial statements for the year ended July 31, 2021.

The unaudited condensed consolidated interim financial statements were authorized for issue by the Board of Directors on June 21, 2022.

Principles of consolidation

The consolidated financial statements include the accounts of Jasper Commerce Inc. and its wholly owned subsidiary Jasper Interactive Studios Inc. All intercompany transactions and balances have been eliminated on consolidation.

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Jasper Commerce Inc. Notes to the Condensed Consolidated Interim Financial Statements For the three and nine months ended April 30, 2022 and 2021 (Unaudited)(in Canadian Dollars)

COVID-19

The outbreak of the novel strain of the coronavirus, specifically identified as the COVID-19 pandemic, has caused governments worldwide to enact emergency measures to combat the spread of the virus. Jasper applied for and received certain government funding (see Note 12) which was integral to the Company’s financial condition.

3. Significant accounting policies

The accounting policies applied in these financial statements are consistent with those disclosed in Note 2 to the annual financial statements for the year ended July 31, 2021.

4. Reverse takeover

On February 16, 2022, Jasper completed an RTO transaction pursuant to an agreement between Jasper Interactive Studios Inc. (“JISI”) and SaaSquatch Capital Corp. (“SCC”) whereby JISI amalgamated with a subsidiary of SCC. The amalgamation constituted a reverse acquisition of SCC by JISI (the subsidiary for legal purposes and the acquirer for accounting purposes). SCC then changed its name to Jasper Commerce Inc. The historical operations, assets and liabilities of JISI, which is deemed to be the continuing entity for financial reporting purposes, are included as the comparative figures as at and for the period ended April 30, 2021.

Immediately prior to the completion of the transaction: (i) SCC consolidated its issued and outstanding SCC common shares on the basis of one post-consolidation SCC common share for every 2 pre-consolidation SCC common shares and (ii) JISI shares were exchanged for shares of Jasper Commerce Inc. on a 13.95 for one basis.

For accounting purposes, JISI is deemed to be the accounting acquiror and is deemed to split its common shares on a 13.95 for every 1 common share outstanding immediately prior to the transaction and to issue 6.5M shares to the shareholders of SCC to acquire SCC. The effect of the deemed stock split has been applied retrospectively through these consolidated financial statements.

On closing, Jasper: (iii) is deemed to have issued 6,500,000 common shares valued at $2,604,300 and 100,000 common share warrants valued at $34,676 in exchange for all the issued and outstanding common shares of SCC, (iv) issued 1,440,784 common shares valued at 577,267 as a finders’ fee for the RTO transaction, (v) converted $3,483,000 principal amount of debentures plus $125,942 accrued interest into 11,104,447 common shares (see Note 6), and (vi) issued 12,000,000 common shares and 6,000,000 common share warrants for gross proceeds of $6,000,000 in a concurrent financing (see Note 7).

The RTO transaction did not constitute a business combination as SCC did not meet the definition of a business under IFRS 3, Business Combinations. As a result, the transaction is accounted for as an asset acquisition, JISI is identified as the acquirer and the equity consideration is accounted for in accordance with IFRS 2, Share-based payments, and measured at fair value. Accordingly, there is no goodwill recognized, and the difference between

6

Jasper Commerce Inc. Notes to the Condensed Consolidated Interim Financial Statements For the three and nine months ended April 30, 2022 and 2021 (Unaudited)(in Canadian Dollars)

the consideration and fair value of the net assets acquired results in an RTO listing expense of $2,292,750 (see Note 11). The non-cash listing expense was determined as follows:

the consideration and fair value of the net assets acquired results in an Note 11). The non-cash listing expense was determined as follows:	RTO listing expense of $2,292,750 (see
Consideration:
Fair value of 6,500,000 common shares	$ 2,604,300
Fair value of 100,000 common share warrants	34,676
Fair value of 1,440,784 finder’s shares	577,267
Total consideration	$ 3,216,243
**Net assets acquired(liabilities assumed): **
Cash	$ 995,269
Accountspayable and accrued liabilities	(71,776)
Total net assets acquired	$ 923,493
Listing expense	$ 2,292,750

5. Loans payable
	Rate of Interest	Maturity	Apr 30, 2022	Jul 31, 2021
BDC Term Loan -02	Floating+2%	Sep 2021	-	$ 4,160
BDC Term Loan -03	Floating+2.5%	Apr 2024	$ 66,000	85,800
BDC Term Loan -06	Floating+2%	Mar 2024	20,470	28,480
BDC Term Loan -07	Floating+2%	May 2024	67,000	91,120
BDC Term Loan -08	Floating+1.75%	Apr 2023	47,180	56,045
BDC Term Loan -09	Floating+2%	Mar 2026	78,020	80,000
CEBA Loan		Dec 2023	60,000	60,000
			338,670	405,605
Currentportion			(136,340)	(92,180)
Non-current			$ 202,330	$ 313,425

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Jasper Commerce Inc. Notes to the Condensed Consolidated Interim Financial Statements For the three and nine months ended April 30, 2022 and 2021 (Unaudited)(in Canadian Dollars)

6.	Debentures
		Rate of	Principal Amount	Amortized Cost	Amortized Cost
		Interest	Jul 31, 2021	Apr 30, 2022	Jul 31, 2021
Series	I Debentures	10.0%	290,000	-	$ 307,786
Series	II Debentures	10.0%	3,483,000	-	2,001,957
			3,773,000	-	2,309,743
Currentportion				-	(307,786)
Non-currentportion				-	$ 2,001,957

The Series I Debentures were scheduled to mature on May 31, 2022 and bear interest at a rate of 10% per annum, payable on maturity. On September 27, 2021, Jasper paid $50,000 to fully extinguish 50 Series I Debentures with a carrying value of $55,896 and recorded the difference as a gain on settlement of liability in finance costs (see Note 11). On February 21, 2022, the Company paid $316,142 to fully extinguish the remaining 240 Series I Debentures consisting of $240,000 principal amount and $76,142 accrued interest.

The Series II Debentures were scheduled to mature on September 30, 2023 and bear interest at a rate of 10% per annum, payable semi-annually. The debentures included options for either Jasper or the debenture holders to convert outstanding principal and accrued interest into equity under various scenarios, including a forced conversion in the event of an RTO transaction (the “Conversion Feature” ).

On February 16, 2022, the $3,483,000 principal amount of Series II Debentures and $125,942 accrued interest automatically converted into equity as part of the RTO transaction (see Note 4) at a price equal to the price of new equity offered concurrently less a 35% discount. The concurrent financing was priced at $0.50 per unit, each unit consisting of one common share and one-half common share warrant (see Note 7), and therefore the Series II Debentures converted at a price of $0.325 per common share. Accordingly, debenture holders received 11,104,447 common shares on closing of the RTO transaction.

The Conversion Feature had a variable exercise price and was therefore recorded as a liability and categorized as FVTPL in accordance with IFRS 9. On closing of the RTO transaction, the exercise price was set at $0.325, the fair value of the Conversion Feature of $1,557,192 was added to the carrying value of the Series II Debentures of $2,179,574 and accrued interest of $125,942 and the total amount of $3,862,708 was transferred to share capital in equity.

Along with the Series II Debentures, Jasper issued 2,331,946 common share warrants to the debenture holders. The warrants had a term of approximately 5 years and a conversion price equal to 150% of the Series II Debentures’ conversion price, net of any discounts (the “Conversion Warrants” ). On closing of the RTO transaction, the debentures’ conversion price was set at $0.325 and therefore the warrant’s exercise price was set at $0.4875.

The Conversion Warrants had a variable exercise price and were therefore recorded as a liability and categorized as FVTPL in accordance with IFRS 9. On closing of the RTO transaction, the exercise price was set at $0.4875 and the fair value of the Conversion Warrants of $706,541 was transferred to warrant reserve in equity.

8

Jasper Commerce Inc. Notes to the Condensed Consolidated Interim Financial Statements For the three and nine months ended April 30, 2022 and 2021 (Unaudited)(in Canadian Dollars)

The fair values for the Conversion Feature and Conversion Warrants were determined using a probability weighted scenario model and the following assumptions:

• Share price: $0.40

• Life of Warrants: 3.9 years

• Annualized volatility: 120%

• Dividend yield: 0%

• Risk free rate: 1.80%

• Probability of liquidity event for 35% discount: 100%

Changes in the fair values of the Conversion Feature and Conversion Warrants were recorded in finance costs (see Note 11).

7. Share capital

• a) Authorized

Unlimited common shares without par value

• b) Issued and outstanding common shares

• i) On February 16, 2022, immediately prior to an RTO transaction (see Note 4), Jasper Interactive Studios Inc. shares were exchanged for shares of Jasper Commerce Inc. on a 13.95 for one basis. The issued and outstanding common shares shown in these financial statements have been retroactively restated to reflect the exchange.

• ii) On February 16, 2022, concurrent with the RTO transaction, Jasper completed a brokered private placement for aggregate gross proceeds of $6,000,000 at a price of $0.50 per unit. Each unit consisted of one common share and one-half common share purchase warrant, with each whole warrant exercisable for 2 years at a price of $0.70.

The fair value of the common share of $0.40 and the one-half warrant of $0.10 was determined using the Black-Scholes option pricing model and the following assumptions:

• Resulting unit price: $0.50

• Exercise price: $0.70

• Expected life: 2 years

• Volatility: 120%

• Dividend yield: 0%

• Risk free rate: 1.53%

In connection with the brokered private placement, Jasper incurred share issue costs totaling $834,600. Jasper paid a cash commission of $471,080 to the broker, paid legal costs and disbursements totaling $150,066 and issued 942,160 broker warrants valued at $213,454. The net proceeds from the financing,

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Jasper Commerce Inc. Notes to the Condensed Consolidated Interim Financial Statements For the three and nine months ended April 30, 2022 and 2021 (Unaudited)(in Canadian Dollars)

totaling $5,165,400, was split between $4,139,035 common shares and $1,026,365 common share purchase warrants based on the relative fair value of the two equity instruments.

iii) On March 25, 2022, Jasper paid $15,000 to repurchase 34,870 common shares from a former shareholder.

8. Reserves

Reserves represents the value attributable to all unexercised and outstanding stock options and warrants classified within equity.

• a) Issued and outstanding common share purchase warrants

		Weighted
		Average Exercise
	Note	Price($)	Number
Outstanding, July 31, 2021	(i)	0.47	7,341,773
Issued on RTO	(ii)	0.20	100,000
Issued on concurrent financing	(iii)	0.70	6,000,000
Broker warrants issued on concurrent financing	(iii)	0.50	942,160
Outstanding, April 30, 2022		0.53	14,383,933

• i) On February 16, 2022, immediately prior to an RTO transaction (see Note 4), Jasper Interactive Studios Inc. shares were exchanged for shares of Jasper Commerce Inc. on a 13.95 for one basis. The issued and outstanding common share purchase warrants and warrant exercise prices shown in these financial statements have been retroactively restated to reflect the exchange.

• ii) On February 16, 2022, in connection with the RTO transaction Jasper issued 100,000 warrants to shareholders of SaaSquatch Capital Corp. with each warrant exercisable for approximately 5 years at a price of $0.20.

• iii) On February 16, 2022, concurrent with the RTO transaction, Jasper completed a brokered private placement for aggregate gross proceeds of $6,000,000 at a price of $0.50 per unit. Each unit consisted of one common share and one-half common share purchase warrant, with each whole warrant exercisable for 2 years at a price of $0.70.

In connection with the brokered private placement, Jasper issued 942,160 broker warrants with each warrant exercisable for 2 years at a price of $0.50

10

Jasper Commerce Inc. Notes to the Condensed Consolidated Interim Financial Statements For the three and nine months ended April 30, 2022 and 2021 (Unaudited)(in Canadian Dollars)

Warrants outstanding as of April 30, 2022 are as follows:

	Weighted Average Remaining
Exercise Price ($)	Contractual Life in Years	Outstanding
0.20	1.8	100,000
0.31	1.1	1,063,142
0.33	1.4	571,692
0.49	3.5	2,350,036
0.50	1.8	942,160
0.51	2.8	802,029
0.54	2.9	2,554,874
0.70	1.8	6,000,000

b) Issued and outstanding convertible debt warrants

On April 30, 2021, Jasper issued 186 convertible debt warrants to brokers in a private placement. Each warrant entitles the holder to acquire the number of common shares as is equal to $1,000 divided by the conversion price of the Series II Debentures (see Note 6). On closing of the RTO transaction, the debentures’ conversion price was set at $0.325 and the number of broker warrants was set at 571,692, plus an additional 18,090 broker warrants exercisable at $0.4875 for approximately 4 years. These broker warrants have been added to the number of warrants outstanding at July 31, 2021 in part (a) above.

c) Options

Under Jasper’s current Stock Option Plan (the “Plan”), its directors may approve the issuance of stock options to directors, officers, employees and consultants of the Company and its affiliates. The aggregate number of shares reserved for issuance under the Plan is up to 10% of the number of outstanding common shares. As at April 30, 2022, 3,321,218 stock options remain outstanding at exercise prices ranging from $0.45 to $0.50 per share. Options for the Company’s directors vest immediately, while options for employees generally vest ratably over a period of three years. All options have a life of five years and have expiry dates ranging from September 2023 to March 2027.

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Jasper Commerce Inc. Notes to the Condensed Consolidated Interim Financial Statements For the three and nine months ended April 30, 2022 and 2021 (Unaudited)(in Canadian Dollars)

Jasper measures compensation costs associated with stock-based compensation using the fair value method and the cost is recognized over the vesting period of the underlying security. Expected volatilities are based on market data of public companies in a similar industry and of a similar size as Jasper. The fair value of each option is determined at the grant date using the Black-Scholes option valuation model with the following weighted average assumptions:

assumptions:
	2022
Share price	$ 0.32
Exercise price	$ 0.50
Life	5 years
Annualized volatility	120%
Dividend yield	0%
Risk-free rate	1.55%
Fair value (per option)	$ 0.25

For the nine months ended April 30, 2022, $289,262 (2021 – $48,331) was recognized as stock-based compensation in profit and loss. This expense includes a reversal of $23,385 (2021 – $nil) of expenses recognized in a previous period for which the award did not ultimately vest.

At April 30, 2022, the remaining unvested value of the Company’s stock options is $411,903 which will be recognized through March 2025.

The following table sets out information concerning stock options issued to employees, consultants, directors and officers that were outstanding at April 30, 2022:

officers that were outstanding at April 30, 2022:
	Weighted Average	Number of
	Exercise Price ($)	Options
Outstanding, July 31, 2021	0.46	1,185,610
Granted	0.50	2,484,317
Forfeited	0.45	(174,355)
Forfeited	0.50	(139,483)
Outstanding, April 30, 2022	0.49	3,321,218

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Jasper Commerce Inc. Notes to the Condensed Consolidated Interim Financial Statements For the three and nine months ended April 30, 2022 and 2021 (Unaudited)(in Canadian Dollars)

The following table summarizes information about the stock options outstanding at April 30, 2022:

	Weighted Average
Exercise Prices per Share	Remaining Contractual	Number of Options	Number of Options
($)	Life in Years	Outstanding	Vested/Exercisable
0.45	2.1	627,676	627,676
0.50	4.3	2,693,542	371,956
	3.9	3,321,218	999,632

9. Related party transactions

One director owns approximately 1% of Jasper’s issued common shares and has a controlling interest in a business that provided consulting services. For the nine months ended April 30, 2022, amounts billed, excluding disbursements, totaled $nil (2021 – $94,125).

A shareholder that owns approximately 6% of Jasper’s issued share capital also has a controlling interest in three of Jasper’s customers. During the nine months ended April 30, 2022 Jasper earned revenue of $181,228 (2021 – $338,556) from those customers. As of April 30, 2022 Jasper was owed $32,911 (July 31, 2021 – $10,170) from those customers.

All related party transactions are measured at the amounts agreed upon between the related parties.

Key management compensation	2022	2021
Salaries	$ 556,667	$ 397,500
Stock-based compensation	97,496	68,581
	$ 654,163	$ 466,081

Key management includes the senior officers of the Company and directors.

10. Segmented information

Jasper identified its operating segment based on the financial information that is reviewed and used by executive management (collectively, the Chief Operating Decision Maker, or “CODM”) in assessing performance and in determining the allocation of resources. The CODM considers the business from a single operating segment perspective and assess the performance of the segment-based measures of profit and loss as well as assets and liabilities.

As the operations are a single segment, all amounts disclosed in the financial statements represent segment amounts.

Product categorization information

13

Jasper Commerce Inc. Notes to the Condensed Consolidated Interim Financial Statements For the three and nine months ended April 30, 2022 and 2021 (Unaudited)(in Canadian Dollars)

For the nine months ended April 30, 2022, Jasper earned revenue attributed to the following product categories based on the main product or service sold to the customer:

	2022	2021
SaaS PIM subscriptions	$ 888,540	$ 591,570
Professional services	417,751	415,761
Total	$ 1,306,291	$1,007,331

For the nine months ended April 30, 2022, Jasper earned 14% of its revenue from a related shareholder (see Note 9). For the nine months ended April 30, 2021, the Company earned 34% of its revenue from a related shareholder (see Note 9).

Geographic information

Jasper earned revenue attributed to the following regions based on the geographical location of the customer:

	2022	2021
United States	$ 623,116	$ 563,594
Canada	231,275	358,287
Rest of world	451,900	85,450
Total	$ 1,306,291	$1,007,331

All of the Company’s non-current assets are located in Canada.

11. Finance costs

Finance costs comprise the following:

11. Finance costs Finance costs comprise the following:
	Note	2022	2021
Interest and accretion on debentures	5	243,207	141,830
Interest on loans	4	332,504	10,189
(Gain) Loss on settlement of debentures	5	(5,896)	-
Listing cost	4	2,292,750	-
Fair value of the conversion feature	6	652,833
Fair value of the warrant liability	8	161,155
Other financingcosts		4,750	201,625
		3,681,303	353,644

12. Government support

During the nine months ended April 30, 2022, the Canadian federal government made certain government support programs available to eligible entities as part of its COVID-19 economic response plan. The Company applied and

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Jasper Commerce Inc. Notes to the Condensed Consolidated Interim Financial Statements For the three and nine months ended April 30, 2022 and 2021 (Unaudited)(in Canadian Dollars)

received support under the Canada Emergency Wage Subsidy (“CEWS”) and Canada Emergency Business Account (“CEBA”) programs. Each applicant’s eligibility for these programs is subject to validation and detailed verification by the federal government. Due to nature of the eligibility requirements and related calculations, it is possible that the eligibility requirements may not be considered to be met upon validation, and as such the benefits received may be repayable.

During the nine months ended April 30, 2022, the Company received $36,474 of wage subsidies in connection with the CEWS program (2021 – $203,373). These amounts are included in salaries that are related to general and administrative, research and development and sales and marketing.

During the year ended July 31, 2021, the Company received $60,000 of loan proceeds in connection with the CEBA program. This loan amount is included in Loans under non-current liabilities.

13. Contingencies

A former employee commenced proceedings against Jasper by way of Notice of Action issued December 17, 2021 and subsequent Statement of Claim filed January 14, 2022. The claim against Jasper seeks $1,000,000 in damages for wrongful dismissal, breach of contract, tortious conduct and/or negligent misrepresentation, a declaration pursuant to section 248 of the OBCA and an order compelling Jasper to purchase the employee’s shares in Jasper. Jasper is contesting the action and believes the case is without merit. A reliable estimate of the amount of any payment required by the Company cannot be made at this time and therefore the Company has not recorded a provision for this amount.

14. Subsequent events

Management is not aware of a subsequent event that merit disclosure in these financial statements.

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