Mobio Technologies Inc. — Interim / Quarterly Report 2022

Dec 29, 2021

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Mobio Technologies Inc.

Condensed Consolidated Interim Financial Statements (Unaudited)

(EXPRESSED IN CANADIAN DOLLARS)

For the Three Months Ended October 31, 2021 and 2020

Index

Condensed Consolidated Interim Statements of Financial Position Condensed Consolidated Interim Statements of Comprehensive Loss Condensed Consolidated Interim Statements of Changes in Shareholders’ Equity (Deficit)

Condensed Consolidated Interim Statements of Cash Flows Notes to Condensed Consolidated Interim Financial Statements

NOTICE OF NO AUDITOR REVIEW OF CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

The Company’s auditors have not reviewed or been involved in the preparation of these 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 condensed consolidated interim financial statements, they must be accompanied by a notice indicating that the financial statements have not been reviewed by an auditor.

In accordance with National Instrument 51-102 Section 4.3(3)(a) released by the Canadian Securities Administrators, the Company discloses that its auditors have not reviewed the unaudited condensed consolidated interim financial statements in accordance with the standards established by the Chartered Professional Accountants Canada for a review of condensed consolidated interim financial statements by an entity’s auditor, for the three-month periods ended October 31,2021 and 2020.

The accompanying condensed consolidated interim financial statements of the Company have been prepared by and are the responsibility of the Company’s management.

MOBIO TECHNOLOGIES INC.

CONDENSED CONSOLIDATED INTERIM STATEMENTS OF FINANCIAL POSITION (Unaudited - Expressed in Canadian dollars)

As at	Notes	October 31, 2021	October 31, 2021		July 31, 2021
ASSETS
Current Assets
Cash		$	17,778	$	17,708
Accounts receivable	3		11,926		41,888
Deposits andprepaid expenses			7,686		13,713
			37,390		73,309
Non-Current Assets
Equipment	4		-		248
TOTAL ASSETS		$	37,390	$	73,557
LIABILITIES
Current Liabilities
Accounts payable and accrued liabilities	5	$	164,219	$	162,007
Relatedpartyloanspayable	6		389,002		379,748
			553,221		541,755
Non-Current Liabilities
Term loanpayable	7		26,280		25,064
TOTAL LIABILITIES			579,501		566,819
EQUITY (DEFICIT)
Share capital	8		26,531,970		26,094,077
Warrant reserves	8		112,116		550,009
Equity portion of debt	6		72,738		72,738
Share-based payment reserve			17,401		72,091
Deficit			(27,276,336)		(27,282,177)
TOTAL EQUITY (DEFICIT)			(542,111)		(493,262)
TOTAL LIABILITIES AND EQUITY		$	37,390	$	73,557
Nature of operations and going concern uncertainty	1

Approved on behalf of the board

"Brian O'Neill"	"Laurie Baggio"
Brian O'Neill, Director	Laurie Baggio, Chief Executive Officer

See accompanying notes to the condensed consolidated interim financial statements.

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MOBIO TECHNOLOGIES INC.

CONDENSED CONSOLIDATED INTERIM STATEMENTS OF COMPREHENSIVE LOSS (Unaudited - Expressed in Canadian dollars)

	Three	months ended	months ended	October 31,
	Notes	2021		2020
REVENUE
Sales	$	2,686	$	-
EXPENSES
Amortization		401		62
Personnel	10	19,155		60,015
Professional fees		11,765		13,155
Office and administration		7,362		4,727
Regulatory and filing costs		1,851		-
Website and IT		849		-
Share-based payments		-		36
Foreign exchange		945		3,922
		42,328		81,917
OTHER ITEMS
Interest expense	6,7,10	10,469		9,200
Other income		(1,262)		-
Loss on deconsolidation of Plank Ventures Ltd.		-		1,209,217
Loss on disposal of investment		-		205
Net loss and comprehensive loss for the year	9 $	9,207 (48,849)	$	1,218,622 (1,300,539)
Basic and diluted lossper share	9 $	(0.00)	$	(0.03)
Weighted average number of common shares outstanding,
basic and diluted	9	38,297,546		38,147,546

See accompanying notes to the condensed consolidated interim financial statements.

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MOBIO TECHNOLOGIES INC.

CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CHANGES IN EQUITY (DEFICIT) (Unaudited - Expressed in Canadian dollars)

Notes	Share capital Number of shares Amount	Reserves Warrant reserves Equity portion of debt Share- based payments reserves Non-controlling interest Deficit Total
Balance atJuly 31, 2020	38,147,546 25,787,321 $	841,765 $ 238,722 $ 84,722 $ 1,143,029 $ (25,995,776) $ 2,099,783 $
Deconsolidation of equity attributable to Plank Ventures Ltd. Loss for theperiod	- - - -	- (165,984) (12,631) (1,143,029) 178,615 (1,143,029) - - - - (1,300,539) (1,300,539)
Balance at October 31, 2020	38,147,546 25,787,321 $	841,765 $ 72,738 $ 72,091 $ - $ (27,117,700) $ (343,785) $
Balance at July 31, 2021	38,297,546 26,094,077	550,009 72,738 72,091 - (27,282,177) (493,262)
Expiry of options 8	- -	- - (54,690) - 54,690 -
Expiry of warrants 8 Loss for theyear	- 437,893 - -	(437,893) - - - - - - - - - (48,849) (48,849)
Balance at October 31, 2021	38,297,546 26,531,970 $	112,116 $ 72,738 $ 17,401 $ - $ (27,276,336) $ (542,111) $

See accompanying notes to the condensed consolidated interim financial statements.

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MOBIO TECHNOLOGIES INC.

CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CASH FLOWS (Unaudited - Expressed in Canadian dollars)

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Three months ended October 31, 2021 2020
OPERATING ACTIVITIES
Net loss from continuing operations $ (48,849) $ (1,300,539)
Items not affecting cash:
Amortization 401 62
Accrued interest expense 10,471 9,200
Loss on disposal of Plank Ventures Ltd. - 1,209,217
Net changes in non-cash working capital:
Accounts receivable 29,961 (875)
Deposits and prepaid expenses 6,027 4,835
Accounts payable and accrued liabilities 2,211 (25,087)
Net cash used in operating activities 223 (103,187)
INVESTING ACTIVITIES
Purchase of equipment (1,671) -
Disposal of equipment 1,518 -
Sale of investment - 211,427
Net cash provided by investing activities (153) 211,427
NET CHANGE IN CASH 70 108,239
CASH, BEGINNING OF THE YEAR 17,708 51,070
CASH, END OF THE YEAR $ 17,778 $ 159,309
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See accompanying notes to the condensed consolidated interim financial statements.

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MOBIO TECHNOLOGIES INC. NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (Unaudited - Expressed in Canadian Dollars) Three Months Ended October 31, 2021 and 2020

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1. NATURE OF OPERATIONS AND GOING CONCERN UNCERTAINTY

Mobio Technologies Inc. (“Mobio” or the “Company”) was incorporated pursuant to the provisions of the Business Corporations Act (Alberta) on November 19, 1998. The Company’s registered and records office is located at 1080 – 789 West Pender Street, Vancouver, BC, V6C 1H2. Mobio is a public company whose shares are listed on the TSX Venture Exchange under the symbol “MBO”. The Company’s primary line of business is Strutta.com Media Inc. (“Strutta”), a social promotions platform that allows brands to run contests and sweepstakes across multiple social web channels. In addition, the Company invests in start-up technology companies.

These condensed consolidated interim financial statements have been prepared using the going concern assumption, which assumes that the Company will continue in operation for the foreseeable future and be able to realize its assets and discharge its liabilities in the normal course of business. During the period ended October 31, 2021, the Company generated a net loss of $48,849 and has an accumulated deficit of $27,276,336 as at October 31, 2021. These conditions raise significant doubt about the Company’s ability to continue as a going concern.

The continuing operations of the Company are dependent upon its ability to develop profitable operations in the future and to raise adequate financing, if necessary. The Company has generated operating losses since inception. The application of the going concern concept is dependent on the Company’s ability to achieve profitable operations and obtain necessary financing.

There can be no assurance that the Company will be successful in achieving profitability or raising additional cash to finance operations. These conditions indicate the existence of a material uncertainty that may raise doubt about the Company’s ability to continue as a going concern. The condensed consolidated interim financial statements do not include any adjustments relating to the recoverability of assets and liabilities that might be necessary should the Company be unable to continue as a going concern and such adjustments could be material.

Since March 2020, several measures have been implemented in Canada and the rest of the world in response to the increased impact from novel coronavirus (“COVID-19”). The Company continues to operate its business at this time. While the impact of COVID-19 is expected to be temporary, the current circumstances are dynamic and the impacts of COVID-19 on business operations, cannot be reasonably estimated at this time. The Company anticipates this could have an adverse impact on its business, results of operations, financial position and cash flows in future periods.

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MOBIO TECHNOLOGIES INC. NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (Unaudited - Expressed in Canadian Dollars) Three Months Ended October 31, 2021 and 2020

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2. BASIS OF PRESENTATION

These condensed consolidated interim financial statements were authorized for issue on December 29, 2021, by the Board of Directors of the Company.

Statement of Compliance

These condensed consolidated interim financial statements have been prepared in accordance with IAS 34, Interim Financial Reporting, using accounting policies consistent with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (IASB). These condensed consolidated interim financial statements do not include all of the information required for full annual audited consolidated financial statements and should be read in conjunction with the annual audited consolidated financial statements of the Company for the years ended July 31, 2021, and 2020.

Functional and Presentation Currency

The consolidated financial statements are presented in Canadian dollars, which is the functional currency of Mobio Technologies Inc.

Basis of Measurement

These consolidated financial statements have been prepared on a historical cost basis except for financial instruments classified as fair value through profit or loss, which are stated at their fair values. In addition, these consolidated financial statements have been prepared using the accrual basis of accounting.

Use of estimates and judgments

The preparation of the 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. Actual results could differ from those estimates.

Management has applied judgments in the assessment of the Company’s ability to continue as a going concern when preparing its condensed consolidated financial statements for the three months ended October 31, 2021. Management prepares the consolidated financial statements on a going concern basis unless management either intends to liquidate the entity or to cease trading or has no realistic alternative but to do so. In assessing whether the going concern assumption is appropriate, management takes into account all available information about the future, which is at least, but is not limited to, twelve months from the end of the reporting period. Management considered a wide range of factors relating to current and expected profitability, current working capital levels, and potential sources of replacement financing.

As a result of the assessment and as described in Note 1 – Nature of Operations and Going Concern Uncertainty, management concluded the going concern basis of accounting is appropriate based on its cash flow forecast and expectations with respect to access to financing for the next twelve months.

Significant estimates and assumptions were used with respect to the impairment of financial and non-financial assets and the fair value of investments. Estimates and assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimates are revised and in any future periods affected.

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MOBIO TECHNOLOGIES INC. NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (Unaudited - Expressed in Canadian Dollars) Three Months Ended October 31, 2021 and 2020

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2. BASIS OF PRESENTATION (CONT’D)

Basis of Consolidation

These condensed consolidated interim financial statements consist of Mobio Technologies Inc. and Strutta.Com Media Inc., a subsidiary wholly owned by the Company.

The condensed consolidated financial statements at October 31, 2021 and 2020 include the assets, liabilities, revenues and expenses of the Company’s controlled and wholly owned subsidiaries. All inter-company balances and transactions, including unrealized income and expenses arising from inter-company transactions are eliminated on consolidation.

Certain comparative figures have been reclassified to conform to the current period's presentation.

3. ACCOUNTS RECEIVABLE

ACCOUNTS RECEIVABLE
		October 31,		July 31,
		2021		2021
Trade receivables	$	9,052	$	17,134
Government wage subsidy		2,637		18,742
GST recoverable		237		6,012
Total accounts receivable	$	11,926	$	41,888

4. EQUIPMENT

EQUIPMENT
		Computer
		Equipment
Cost
Balance, July 31, 2021	$	5,901
Acquire		1,671
Disposals		(7,572)
Balance, October 31, 2021	$	-
Accumulated depreciation
Balance, July 31, 2021	$	5,653
Amortization		401
Disposals		(6,054)
Balance, October 31, 2021	$	-
Net book value
As at July31, 2021	$	248
Balance, October 31, 2021	$	-

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MOBIO TECHNOLOGIES INC. NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (Unaudited - Expressed in Canadian Dollars) Three Months Ended October 31, 2021 and 2020

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5. TRADE PAYABLES AND ACCRUALS

		October 31,		July 31,
		2021		2021
Accounts payable	$	33,262	$	38,641
Accrued liabilities		130,957		123,366
Total Accountspayable and accrued liabilities	$	164,219	$	162,007

Included in accounts payable and accrued liabilities at October 31, 2021 is $97,100 (2021 - $97,000) owing to officers of the Company.

6. RELATED PARTY LOANS PAYABLE

On August 14, 2019, the Company received a loan in the amount of $25,000 from a company controlled by an officer. The loan is unsecured, due on demand and bears interest at 10% per annum. During the three months ended October 31, 2021, the Company recorded $753 (period ended October 31, 2020 - $630) (Note 10) in interest on the loan. The balance of the loan at October 31, 2021 is $30,913.

On August 29, 2019, the Company received a loan in the amount of $100,000 from a company controlled by a significant shareholder. The loan is unsecured, due on demand and bears interest at 10% per annum. During the three months ended October 31, 2021, the Company recorded $2,955 (period ended October 31, 2020 - $2,521) (Note 10) in interest on the loan. The balance of the loan at October 31, 2021 is $122,402.

On November 20, 2019, the Company received a loan in the amount of $50,000 from a company controlled by an officer. The loan is unsecured, due on demand and bears interest at 10% per annum. During the three months ended October 31, 2021, the Company recorded $1,386 (period ended October 31, 2020 - $1,260) (Note 10) in interest on the loan. The balance of the loan at October 31, 2021 is $59,159.

On January 30, 2020, the Company received a loan in the amount of $50,000 from a company controlled by an officer. The loan is unsecured, due on demand and bears interest at 10% per annum. During the three months ended October 31, 2021, the Company recorded $1,386 (period ended October 31, 2020 - $1,260) (Note 10) in interest on the loan. The balance of the loan at October 31, 2021 is $60,229.

On April 6, 2020, the Company received a loan in the amount of $100,000 from a company controlled by an officer. The loan is unsecured, due on demand and bears interest at 10% per annum. During the three months ended October 31, 2021, the Company recorded $2,773 (period ended October 31, 2020 - $2,521) (Note 10) in interest on the loan. The balance of the loan at October 31, 2021 is $116,299.

Loan transactions for the three months ended October 31,2021 are summarized as follows:

	Liability component	Equity component
Balance, July 31, 2021	$ 379,748	$ 72,738
Accrued interest and accretion	9,254	-
Balance, October 31, 2021	$ 389,002	$ 72,738

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MOBIO TECHNOLOGIES INC. NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (Unaudited - Expressed in Canadian Dollars) Three Months Ended October 31, 2021 and 2020

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7. TERM LOANS PAYABLE

On May 4, 2020 (“disbursement date”), the Company received a loan for gross proceeds of $40,000 under the Canada Emergency Business Account (“CEBA”) as part of the Canadian government funded COVID-19 financial assistance programs. The CEBA term loan is due on December 25, 2025. The loan is interest free until December 31, 2022 and bears interest at 5% per annum thereafter. If at least 75% of the loan principal is paid on or before December 31, 2022, the balance of the loan will be forgiven.

The benefit of the government loan received at below market rate of interest is treated as a government grant. The loan was recognized at the fair value of $19,847, using the Company’s incremental borrowing rate of 20% per annum. The difference between the initial carrying amount and proceeds received of $20,152 is the value of the grant. During the three months ended October 31, 2021, the Company recorded interest of $1,216 on the loan (three months ended October 31, 2020$1,008). The balance of the loan at October 31, 2021 is $26,280 (July 31, 2021 - $25,064).

8. SHARE CAPITAL

Authorized:

• Unlimited number of common shares without par value.

• Unlimited number of preferred shares without par value, non-voting and entitled to such dividends as may be set by the Board of Directors of the Company.

Issued and Outstanding:

• 38,297,546 common shares (July 31, 2021 – 38,147,546)

Warrants

During the period ended October 31, 2021, 4,068,750 warrants expired unexercised. The fair value of the expired warrants of $437,893 was reclassified from warrants reserve to share capital.

As at October 31, 2021, the following warrants were issued and exercisable:

			Weighted
	Number of		Average
	Warrants	Exercise Price
Balance, July 31, 2021	5,735,420	$	0.30
Warrants expired	(4,068,750)		0.30
Balance,October 31,2021	1,666,670	$	0.30
Number of	Exercise		Expiry
Warrants	Price		Date
1,666,670	0.30 $	March 22, 2022

The weighted average life of the remaining warrants is 0.39 years.

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MOBIO TECHNOLOGIES INC.

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (Unaudited - Expressed in Canadian Dollars) Three Months Ended October 31, 2021 and 2020

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8. SHARE CAPITAL (CONT’D)

Stock Options

Under the Company’s stock option plan, options may be granted to directors, officers, employees and consultants of the Company. Options expire between two and five years after being issued or thirty days after an optionee ceases to be engaged in a bona fide manner with the Company. The Board of Directors has the discretion to extend the expiration period on cessation of engagement. The maximum number of common shares authorized for issuance by the Board of Directors under the plan is limited to 10% of the total issued and outstanding common shares of the Company and the aggregate number of common shares to be delivered upon exercise of the options to any one individual granted under the plan may not exceed 5% of the common shares issued and outstanding.

During the period ended October 31, 2021, 275,000 options expired unexercised. The fair value of the expired options of $54,590 was reclassified from share-based payments reserve to deficit.

As at October 31, 2021 the following stock options were issued and exercisable:

				Weighted
		Number of		Average
		Options		Exercise Price
Balance, July 31, 2021		362,500		$ 0.22
Options expired		(275,000)		0.22
Balance,Balance at October 31,2021		87,500		$0.22
Outstanding		Exercisable	Exercise	Expiry
	(#)	(#)	Price($)	Date
	87,500	87,500	0.22	January19,2028

The weighted average life of the remaining options is 6.22 years.

9. LOSS PER SHARE

The basic loss per common share is calculated using the weighted average number of common shares outstanding during the period. Any warrants and stock options outstanding as at October 31, 2021 and 2020 have not been included in the calculation of diluted loss per common share as the effect of their inclusion would be anti-dilutive.

their inclusion would be anti-dilutive.
Loss Per Share Calculation	Weighted Average
	Shares Outstanding		Net Loss	Loss Per Share
Three months ended October 31, 2020	38,147,546	$	(1,300,539)	$	(0.03)
Three months ended October 31,2021	38,297,546	$	(48,849)	$	(0.00)

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MOBIO TECHNOLOGIES INC. NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (Unaudited - Expressed in Canadian Dollars) Three Months Ended October 31, 2021 and 2020

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10. RELATED PARTY TRANSACTIONS

Payments to key management and directors during the periods ended October 31, 2021 and 2020 were as follows:

were as follows:
Three months ended October 31,		2021		2020
Management fees paid to current and former directors and/or officers,
or to companies controlled by directors and/or officers	$	5,000	$	12,250
Total compensation	$	5,000	$	12,250

Interest and accretion recorded on related party loans is as follows:

Three months ended October 31,	2021	2020
Interest and accretion on loans payable to companies with a
common director and officer or to companies controlled by
directors and/or officers or by significant shareholders	$ 9,254	$ 8,192

11. FINANCIAL INSTRUMENTS

The Company’s financial instruments consist of cash, accounts receivable, investments, related party loans payable, and accounts payable and accrued liabilities. As at October 31, 2021, there were no significant differences between the carrying amounts of these items and their estimated fair values.

Fair Value

Financial instruments measured at fair value are classified into one of three levels in the fair value hierarchy based on the degree to which the inputs used to determine the fair value are observable.

The three levels of the fair value hierarchy are:

• Level 1 – quoted prices (unadjusted) in active markets for identical assets or liabilities;

• Level 2 – inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly; and

• Level 3 – inputs for the asset or liability that are not based on observable market data (unobservable inputs).

As of October 31, 2021, cash and restricted cash are classified as Level 1 and investments are classified as Level 3. The fair value of investments was determined based on the cash received on the subsequent disposition of the investments.

The Board of Directors approves and monitors the risk management processes. The Company has exposure to the following risks from its use of financial instruments:

• Interest rate risk

• Credit risk

• Liquidity risk

• Market risk

• Currency risk

Interest Rate Risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate due to changes in market interest rates. The Company manages its financial instruments with the objective of minimizing potential interest rate risk, which generally means avoiding interest-

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NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (Unaudited - Expressed in Canadian Dollars) Three Months Ended October 31, 2021 and 2020

MOBIO TECHNOLOGIES INC.

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11. FINANCIAL INSTRUMENTS (CONT’D)

bearing obligations other than in unusual circumstances. The Company is not exposed to significant interest rate risk.

Credit Risk

Credit risk is the risk of potential loss to the Company if the counter party to a financial instrument fails to meet its contractual obligations. The credit risk of the Company is associated with cash, restricted cash, and accounts receivable. Management believes that the credit risk with respect to cash and restricted cash is minimal as balances are held with a high-credit quality financial institution. Accounts receivable have historically been subject to very few bad debts.

Liquidity Risk

The Company’s exposure to liquidity risk is dependent on the collection of accounts receivable, purchasing commitments and obligations or raising funds to sustain operations. The Company controls liquidity risk by management of working capital and cash flows. The Company’s ability to meet its future obligations may depend in significant part on the extent to which the Company can raise sufficient funds or implement successfully its business growth and cost reduction strategies. The Company cannot provide any assurance that it will be able to implement its strategy fully or that the anticipated results of its strategy will be realized.

Market Risk

The Company’s exposure to financial market risk is limited, as it presently does not have any investments where value fluctuates as a result of changes in prices quoted in open markets.

Currency risk

Currency risk is the risk that the fair values of future cash flows of a financial instrument will fluctuate because they are denominated in currencies that differ from the respective functional currency. The Company’s reporting currency is Canadian dollars and has not entered into any derivative instruments to manage foreign exchange fluctuations.

12. CAPITAL MANAGEMENT

The Company defines capital as an aggregate of cash, common shares, warrants and stock options. The Company manages the capital structure and makes adjustments to it in light of changes in economic conditions and the risk characteristics of the underlying assets. The Company targets to meet this objective by managing working capital to provide for the possibility that cash flows from assets will not be sufficient to meet future cash flow requirements in the near term. The Board of Directors does not establish quantitative return on capital criteria for management. In recent years, the Company has relied on funds generated through the issuance of common shares and loans to supplement funds generated from operations. There were no changes in the Company’s approach to capital management during the year. The Company is not subject to any externally imposed capital requirements.

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