Nuran Wireless Inc. — Interim / Quarterly Report 2021

Jun 30, 2021

Nuran Wireless inc.

Condensed Interim Financial Statements April 30, 2021 and April 30, 2020

Financial Statements
Condensed Interim Statements of
Comprehensive Income	2
Condensed Interim Statements of Changes
in Deficiency	3
Condensed Interim Statements of Cash
Flows	4
Condensed Interim Statements of Financial
Position	5
Notes to Condensed Interim Financial
Statements	6 - 19

The condensed interim financial statements of Nuran Wireless inc. for the second quarter ended April 30, 2021 as well as the corresponding comparative data were not subject to a review by the Company’s auditor.

2

Nuran Wireless Inc. Condensed Interim Consolidated Statements of Comprehensive Income

Periods ended April 30, 2021 and April 30, 2020

(In Canadian dollars)

(Unaudited)

Revenue Cost of sales Gross profit Selling expenses Administrative expenses Financial expenses Research and development costs, net of $0 in tax credits for the three-month period ended April 30, 2021, $0 for the six-month period ended April 30, 2021 ($70,135 for the three-month period ended April 30, 2020, $119,788 for the six-month period ended April 30, 2020) Loss before other elements Other elements: Gain (Loss) debt settlement share Loss on debt settlement Loss on disposal of assets Loss before income taxes Net loss and total comprehensive income Loss per share (Note 12) Basic and diluted loss per share Weighted average number of outstanding common shares	3 months ended	3 months ended	6 months ended	6 months ended
	2021-04-30 $ 410 488 238 970 171 518 136 993 919 457 115 134 122 478 1 294 063 (1 122 545) 6 000 6 000 (1 116 545) (1 116 545) (0,06) 19 631 680	2020-04-30 $ 1 432 841 1 169 036 263 805 316 508 382 544 275 183 180 577 1 154 812 (891 007) 69 740 (267 888) (198 148) (1 089 155) (1 089 155) (0,01) 172 977	2020-04-30 $ 880 895 618 438 262 457 329 440 1 297 487 203 548 217 193 2 047 669 (1 785 212) (285 269) (140 695) (269 559) (695 522) (2 480 734) (2 480 734) (0,17) 14 847 610	2019-04-30
				$ 3 478 053 2 452 670
				1 025 383 609 418 683 096 433 094 384 144
				2 109 752
				(1 084 369)
				69 740 (267 888)
				(198 148)
				(1 282 517)
				(1 282 517)
				(0,01)
				172 977 913

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

3

Nuran Wireless Inc. Condensed Interim Consolidated Statements of Changes in Deficiency

Periods ended April 30, 2021 and April 30, 2020

(In Canadian dollars)

(Unaudited)

Balance as at November 1, 2020 Issue of Shares Net loss and total comprehensive income Amendment to the conversion option of the convertible debenture (Note 8) Debenture conversion in share capital (Note 9) Exercise of Warrants (Note 10) Exercise of Stock Options (Note 11) Warrants (Notes 9 and 10) Non-Employee share-based compensation (Note 11) Employee share-based compensation (Note 11) Balance as at April 30, 2021 Balance as at November 1, 2019 Net loss and total comprehensive income Amendment to the conversion option of the convertible debenture (Note 9) Forbearance to the convertible debentures default (Note 9) Employee shared-based compensation (Note 12) Non-employee shared-based compensation (Note 13) Warrants (Notes 10 and 11) Balance as at April 30, 2020 _Notes refer to April 30, 2019 financial statements_	Number $ 7 123 117 25 362 587 8 268 552 400 231 (1 169 615) 5 142 428 6 287 048 194 780 339 265 59 800 89 700 20 788 677 31 309 215 Number $ 6 919 117 25 064 583 6 919 117 25 064 583 Share capital Share capital	Contributed Surplus	Fair value of the conversion option	2020-04-30 Deficit Total deficiency $ $ (28 895 688) (1 964 629) 400 231 (2 480 734) (2 480 734) 300 151 5 219 070 339 265 89 700 4 387 23 850 5 372 (31 376 422) 1 936 662 2019-04-30	2020-04-30 Deficit Total deficiency $ $ (28 895 688) (1 964 629) 400 231 (2 480 734) (2 480 734) 300 151 5 219 070 339 265 89 700 4 387 23 850 5 372 (31 376 422) 1 936 662 2019-04-30
		$ 1 568 472 4 387 23 850 5 372 1 602 081 Contributed Surplus $ 1 505 585 1 218 10 500 7 000 80 766 1 605 069	$ 1 469 766 (1 067 978) 401 788 Fair value of the conversion option 1 218 (70 958) 316 708 246 968		$ (1 964 629) 400 231 (2 480 734) 300 151 5 219 070 339 265 89 700 4 387 23 850 5 372
					1 936 662
					2019-04-30
				Deficit $ (27 001 435) (1 282 517) (28 283 952)	Total deficiency
	Number 6 919 117 6 919 117				$ (430 049) (1 282 517) (69 740) 316 708 10 500 7 000 80 766
					(1 367 332)

The accompanying notes are an integral part of the condensed interim consolidated financial statements.

4

Nuran Wireless Inc. Condensed Interim Statements of Cash Flows

Periods ended April 30, 2021 and April 30, 2020

(In Canadian dollars)

(Unaudited)

OPERATING ACTIVITIES Net loss Non-cash flow adjustments Depreciation of property, plant and equipment Depreciation of intangible assets Depreciation of Right-of-use assets Gain/loss extinguishment of debt Gain (loss) on disposal of assets Gain (loss) on debt settlement Non-employee share-based transaction Employee share-based transaction Accretion of convertible debentures Change in fair value of derivative liability Net change in working capital items Trade and other receivables Scientific research and experimental development tax credits receivable Work in progress Inventories Prepaid expenses Security deposits and deposits on purchase of goods Trade and other payables Deferred revenue Net cash from operating activities INVESTING ACTIVITIES Purchase of property, plant and equipment Purchase of intangible assets Placement in subsidiary Right-of-use assets Net cash used in investing activities FINANCING ACTIVITIES Net change in loan payable to Shareholder Long-term debt Repayment of long-term debt Lease liabilities Repayment of Lease liabilities Interest paid on lease liabilities Convertible debentures and derivative liability Convertible debenture conversion Forbearance of the convertible debenture Issue of class “A” shares Net cash used in financing activities Net increase in cash Cash, beginning of period Cash, end of period Supplementary information Interest paid included in operating activities	2021-04-30 (6 months) $ (2 480 734) 23 191 31 278 387 024 425 964 23 850 5 372 (57 096) (93 494) (165 005) (365 082) (29 536) (14 403) (476 134) (450 552) (3 235 357) (13 614) (41 448) (1 459) (56 521) 1 145 943 (1 287 421) 1 990 695 1 067 978 (767 826) 1 575 993 3 725 361 433 483 64 254 497 738 317 258	2020-04-30 (6 months)
		$ (1 282 517) 44 533 32 340 71 557 267 888 7 000 10 500 111 322 (69 740) (147 848) 326 708 (45 590) 680 535 65 979 329 960 640 792 (315 692)
		727 727 (24 680) (780 801) (429 341)
		(1 234 822) 646 215 (347 121) 429 341 (88 848) 20 342
		659 929
		152 834 510 832
		663 666
		154 149

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

5

Nuran Wireless Inc. Condensed Interim Statements of Financial Position

Periods ended April 30, 2021 and April 30, 2020

(In Canadian dollars)

(Unaudited)

ASSETS Current Cash Trade and other receivables Scientific research and experimental development tax credits receivable Work in progress Inventories (Note 4) Prepaid expenses Security deposits and deposits on purchase of goods Current assets Non-current Property, plant and equipment (Note 5) Intangible assets (Note 6) Placement in subsidiary Non-current assets Total assets LIABILITIES Current Trade and other payables Deferred revenue Loans payable (Note 7) Convertible debentures and derivative liability (Note 8) Deferred Tax liabilities Current portion of long-term debt Current liabilities Non-current Long-term debt Deferred Tax liabilities Total liabilities DEFICIENCY Share capital (Note 9) Contributed Surplus Fair value of conversion option Deficit Total deficiency Total deficiency and liabilities	2020-04-30 $ 497 738 399 671 165 005 1 669 794 32 122 195 971 2 960 301 256 963 5 437 237 1 459 5 695 660 8 655 961 1 639 709 1 727 992 1 142 607 717 904 361 342 5 589 554 1 129 745 6 719 299 31 309 215 1 602 081 401 788 (31 376 422) 1 936 662 8 655 961	2020-10-31
		$ 64 254 306 177 1 625 483 2 586 181 568
		2 180 068
		314 414 5 445 448
		5 759 862
		7 939 930
		2 112 507 2 178 544 2 835 000 361 342 183 444
		7 670 837 1 103 977 1 129 745
		9 904 559
		25 362 587 1 568 472 (28 895 688)
		(1 964 629)
		7 939 930

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

6

NuRAN Wireless Inc. Notes to Condensed Interim Consolidated Financial Statements

As at April 30, 2021 and April 30, 2020

(In Canadian dollars) (Unaudited)

1 - GOVERNING STATUTES AND NATURE OF OPERATIONS

Nuran Wireless Inc. is incorporated under the Business Corporations Act (B.C.). Nuran Wireless Inc. and its subsidiaries (together, the “Company”) operate in the research, development, manufacturing and marketing of digital electronic circuits and wireless telecommunication products.

2 - GENERAL INFORMATION, STATEMENT OF COMPLIANCE WITH IFRSs AND GOING CONCERN ASSUMPTION

The Company's registered office is at 2150 Cyrille-Duquet Street, suite 100, Québec, Quebec G1N 2G3.

These condensed interim consolidated financial statements have been prepared in accordance with IAS 34, Interim Financial Reporting . Accordingly, they do not include all the disclosures required under IFRS for annual financial statements. These condensed interim consolidated financial statements should be read in conjunction with the 2020 audited annual financial statements. They are based on the assumption that the Company is a going concern, meaning it will be able to realize its assets and discharge its liabilities in the normal course of its operations.

During the six-month period ended April 30, 2021, the Company incurred a net loss of $2,480,734 and has a deficit of $31,376,422 as at April 30, 2021. Consequently, there is material uncertainty that may cast significant doubts as to whether the Company will have the ability to continue as a going concern. The Company's ability to continue as a going concern is dependent upon its capacity to adequately restructure its operations, to continue the refinancing of its Convertible Debentures for which a forbearance agreement has been reached and to obtain additional financing to deliver on the NaaS contracts signed in September 2020 and February 2021. As at the date of these financial statements, 74% of the principal amount of the Convertible Debentures and 100% of other secured debt outstanding at the end of October 2020 have been converted to common shares. In addition, the Company has made expenditures towards the rollout of the NaaS contract in Cameroon and planning is progresing for the contract in DRC announced in February 2021. Together these contracts will generate significant projected gross revenues and operating profit which will be transformative for the Company. In addition the Company announced a non-brokered private placement generating gross proceeds of up to $11,000,000 (Note 14) to be used for expenses associated with the buildout of sites under its NAAS contracts with Orange SA, product development and general working capital purposes. This capital provides the Company with much needed resources to achieve its objectives and will be used to further leverage other funding sources. There are however operational risks resulting in uncertainties that this plan

7

NuRAN Wireless Inc. Notes to Condensed Interim Consolidated Financial Statements

As at April 30, 2021 and April 30, 2020 (In Canadian dollars) (Unaudited)

will be implemented successfully. If the Company is unable to continue to successfully implement the above, there is a possibility that the Company may be unable to continue to realize on its assets and to discharge its liabilities in the normal course of operations.

The carrying amounts of assets, liabilities, revenues and expenses presented in the condensed interim consolidated financial statements and the condensed interim consolidated statements of financial position's classification have not been adjusted as would be required if the going concern assumption were not appropriate.

The condensed interim consolidated financial statements were approved and authorized for issue by the Board of Directors on June 29, 2021.

8

NuRAN Wireless Inc. Notes to Condensed Interim Consolidated Financial Statements

As at April 30, 2021 and April 30, 2020

(In Canadian dollars) (Unaudited)

3 - SUMMARY OF ACCOUNTING POLICIES

Overall considerations

The accounting policies are in accordance with those used in the preparation of the 2020 annual financial statements.

Significant management judgement in applying accounting policies and estimation uncertainty

When preparing the condensed interim financial statements, management makes a number of judgements, estimates and assumptions about the recognition and measurement of assets, liabilities, income and expenses. The actual results may differ from the judgments, estimates and assumptions made by management and will seldom equal the estimated results.

The judgments, estimates and assumptions applied in the condensed interim financial statements, including the key sources of estimation uncertainty, were the same as those applied in the Company's last annual financial statements for the year ended October 31, 2020.

4 - INVENTORIES

Raw materials Finished goods	2021-04-30 $ 982 977 686 817 1 669 794	2020-10-31
		$ 986 941 638 542
		1 625 483

For the six-month period ended April 30, 2021, $0 and $0 for the three-month period ended April 30, 2021 ($11,207 for the six-month period ended April 30, 2020 and $0 for the threemonth period ended April 30, 2020) of inventories was included in profit or loss as an expense resulting from the write-down of inventories.

9

NuRAN Wireless Inc. Notes to Condensed Interim Consolidated Financial Statements

As at April 30, 2021 and April 30, 2020

(In Canadian dollars) (Unaudited)

5 - PROPERTY, PLANT AND EQUIPMENT

The Company's property, plant and equipment and their carrying amounts are detailed as follows:

2021-04-30

			2021-04-30
Gross carrying amount Balance as at November 1, 2020 Additions Disposal Balance as at April 30, 2021 Depreciation Balance as at November 1, 2020 Disposal Depreciation Balance as at April 30, 2021 Carrying amount as at April 30, 2021	Equipment and furniture, tele- communication system, furniture and fixtures $ 787,808 (194,185) 593,623 533,818 (150,231) 15,448 399,035 194,588	Computer equipment $ 355,664 13,614 (11,091) 358,187 295,240 (7,172) 7,743 295,811 62,376	Total
			$ 1,143,472 13,614 (205,277)
			951,809
			829,058 (157,403) 23,191
			694,846
			256,963

10

NuRAN Wireless Inc. Notes to Condensed Interim Consolidated Financial Statements

As at April 30, 2021 and April 30, 2020

(In Canadian dollars) (Unaudited)

6 – INTANGIBLE ASSETS

The Company’s intangible assets and their carrying amounts are detailed as follows:

Gross carrying amount Balance as at November 1, 2020 Additions Disposal Balance as at April 30, 2021 Amortization Balance as at November 1, 2020 Amortization Balance as at April 30, 2021 Carrying amount as at April 30, 2021				2021-04-30
		Acquisition software $ 5,925,085 41,448 5,966,533 540,089 31,279 571,368 5,395,165	Trademarks $ 60,452 (18,380) 42,072 42,072	Total
				$ 5,985,537 41,448 (18,380)
				6,008,605
				540,089 31,279
				571,368
				5,437,237

7 - LOANS PAYABLE

2021-04-30 2020-10-31 $ $ Shareholders 1,142,607

Given their short-term maturity, the carrying amount of loans payable is considered a reasonable approximation of their fair value.

11

NuRAN Wireless Inc. Notes to Condensed Interim Consolidated Financial Statements

As at April 30, 2021 and April 30, 2020

(In Canadian dollars) (Unaudited)

8 - CONVERTIBLE DEBENTURES AND DERIVATIVE LIABILITY

As at April 30, 2021, the convertible debentures and derivative liability consists of:

	Convertible
	debentures
	$
Opening Balance as at November 1,
2020	2,835,000
Issuance of convertible debenture	990,695
Conversion of convertible debenture	(3,050,695)
Accretion of convertible debenture	243,055
Forbearance of the debenture
default	(300,151)
Closing balance, as at April 30, 2021	717,904

The extinguishment and recognition of the debentures, including the fair value of the warrants issued as consideration (Note 10) and the fair value of the conversion option, resulted in an equity adjustment of $1,110,490 that has been recognized in the consolidated statement of changes in equity. This transaction had no impact on the consolidated statement of comprehensive income.

As at November 16, 2020, a debt holder of the Company agreed to convert $100,000 of debt into a secured convertible debenture (the “Debenture”) of the Company. The principal amount of the Debenture is $115,000 (the “Purchase Price”), representing the original $100,000 of debt (the “Debt”), inclusive of an original issue discount equal to 15% of the Purchase Price. The Debt was in default, and the issuance of the Debenture was to result in an extension of the maturity of the Debt until May 31, 2021. The Debenture was to bear interest at a rate of 10% per annum however was converted into common shares of the Company at a conversion price of $0.71 on the same date.

As at November 20, 2020, a debt holder of the Company agreed to convert an additional $250,000 of debt into a secured convertible debenture of the Company. The principal amount of the Debenture is $287,500 for the original $250,000 of debt (representing an original issue discount equal to 15% of the purchase price). The Debenture was to bear interest at a rate of 10% per annum however was converted into common shares of the Company at a conversion price of $0.60 on the same date.

As at November 30, 2020, a debt holder of the Company agreed to convert an additional $300,000 of debt into a secured convertible debenture of the Company. The principal amount of the Debenture is $352,900 for the original $300,000 of debt (representing an original issue discount equal to 15% of the purchase price). The Debenture was to bear interest at a rate of

12

NuRAN Wireless Inc. Notes to Condensed Interim Consolidated Financial Statements

As at April 30, 2021 and April 30, 2020

(In Canadian dollars) (Unaudited)

10% per annum however was converted into common shares of the Company at a conversion price of $0.49 on the same date.

As at December 29, 2020, a debt holder of the Company agreed to convert an additional $200,000 of debt into a secured convertible debenture of the Company. The principal amount of the Debenture is $235,294 representing an original issue discount equal to 15% of the purchase price of the original $200,000 owed to the debt holder. The convertible debenture bears interest at a rate of 10% per annum and was converted into common shares of the Company at a conversion price of $0.37.

As at January 12, 2021, all of the holders of the 12% senior secured convertible debentures of the Company issued on February 23, 2017 executed the Forbearance Agreement dated as of November 30, 2020 to forbear from enforcing their rights under the security agreements relating to the Debentures until December 31, 2021. Following the execution of the Forbearance Agreement by all Secured Creditors on January 12, 2021, effective as of such date the Debentures have been amended as follows:

• (i) The maturity date of the Debentures is amended to December 31, 2021;

• (ii) Subject to compliance with applicable securities laws, all accrued but unpaid interest and penalties on the Debentures in common shares of the Company up to and as at January 12, 2021 will be settled at a deemed price per common share equal to $0.28 (being last closing market price of the common shares on the CSE), discounted by the maximum discount permitted by Section 2.1 of Policy 6 of the CSE. As at January 12, 2021, the total amount of interest and penalties owed under the Debentures totaled approximately $875,000;

• (iii) Interest on the Debentures following January 12, 2021 will be payable on June 30, 2021 and December 31, 2021, payable at the option of the Company in cash or common shares, at a deemed price per common share equal to the volume weighted average trading price of the common shares on the CSE for the 10 day period prior to the interest payment date; and

• (iv) In the event that the Company elects to pay accrued interest in common shares, the effective interest rate is increased to 15% (from 12%).

As at March 23, 2021, debt holders of the Company agreed to convert an additional $1,000,000 of debt into a secured convertible debenture of the Company. The principal amount of the Debenture is $1,000,000 and was converted into common shares of the Company at a conversion price of $1.

During the six-month period ended April 30, 2021, the debenture holders requested the conversion of debentures totalling a par value of $3,050,695 in common shares of the Company. Taking into account the book value of the debentures converted, as well as the value of the conversion option, the carrying value recorded for these shares was $5,118,673.

13

NuRAN Wireless Inc. Notes to Condensed Interim Consolidated Financial Statements

As at April 30, 2021 and April 30, 2020

(In Canadian dollars) (Unaudited)

9- SHARE CAPITAL

2021-04-30 2020-10-31 $ $ Common Shares 31,309,215 25,362,587

• a) The number of issued common shares totals 20,788,667 as at April 30, 2021 (7,123,117 as at October 31, 2020)

As at November 9, 2020, Nuran Wireless Cameroon Ltd issued 10 shares representing 100% of its share capital to Nuran Wireless inc.

As at December 3, 2020, a majority of the holders of the senior secured convertible debentures of the Company issued on February 23, 2017 have executed the Forbearance Agreement effective December 3, 2020 to forbear from enforcing their rights under the security agreements relating to the Debentures until December 31, 2021. Prior to the forbearance the Company was in material default under the terms of the Debentures. In consideration of the foregoing forbearance, the Company has agreed to adjust the conversion price of the Debentures to $0.33 per common share.

As at December 15, 2020, the Company completed a non-brokered private placement of units of the Company at a price of $0.40 per unit for total gross proceeds of $400,000. Each Unit consists of one common share in the capital of the Company and one Common Share purchase warrant, with each Warrant entitling the holder to acquire one Common Share at a price of $0.50 per Common Share for a period of 18 months from the date of issuance. The Company issued an aggregate of 1,000,000 units pursuant to the offering.

As at March 23, 2021, debt holders of the Company agreed to convert $1,000,000 of debt into a secured convertible debenture of the Company. The principal amount of the Debenture is $1,000,000 and was converted into common shares of the Company at a conversion price of $1.

During the six-month period ended April 30, 2021, the Company converted unpaid interest and penalties on the debenture totalling a par value of $887,495 in common shares of the Company. Taking into account the book value of the debt converted, the carrying value recorded for these shares was $1,172,762.

During the six-month period ended April 30, 2021, 194,780 shares were issued following the exercise of warrants (Note 10) and 59,800 shares were issued following the exercise of stock options (Note 11).

. As stated in Note 7, the debenture holders requested the conversion of debentures totalling a par value of $3,050,695 in common shares of the Company. Taking into account the book

14

NuRAN Wireless Inc. Notes to Condensed Interim Consolidated Financial Statements

As at April 30, 2021 and April 30, 2020

(In Canadian dollars) (Unaudited)

value of the debentures converted, as well as the value of the conversion option, the carrying value recorded for these shares was $5,118,673.

10 – WARRANTS

The following is a summary of the activity of warrants:

The following is a summary of the activity of warrants:
	Six months ended April 30, 2021
	Number of warrants Weighted average exercise price
Opening balance, as at November 1, 2020 Granted during the period Exercised during the period Expired during the period	1,341,109 $ 4.22 1,000,000 $ 0.50 (194,780) $ 1.74 (520,840) $ 8.13
Closing balance, as atApril30,2021	1,625,489 $ 0.98

15

NuRAN Wireless Inc. Notes to Condensed Interim Consolidated Financial Statements

As at April 30, 2021 and April 30, 2020

(In Canadian dollars) (Unaudited)

The following is a summary of warrants outstanding and exercisable, as at April 30, 2021

April 30, 2021 Exercise price $0.05 $1.25 $1.50 $1.75 $2.50	Warrants outstanding Number Weighted average contractual life (years) 1,000,000 1.13 168,400 1.83 12,000 0.31 339,889 1.31 105,200 0.32 1,625,489	Warrants exercisable Number Weighted average contractual life (years) 1,000,000 1.13 168,400 1.83 12,000 0.31 339,889 1.31 105,200 0.32 1,625,489

As stated in Note 9, on December 15, 2020, the Company completed a non-brokered private placement of units of the Company at a price of $0.40 per unit for total gross proceeds of $400,000. Each Unit consists of one common share in the capital of the Company and one Common Share purchase warrant, with each Warrant entitling the holder to acquire one Common Share at a price of $0.50 per Common Share for a period of 18 months from the date of issuance. The Company issued an aggregate of 1,000,000 units pursuant to the offering.

The warrants were assigned a value of $4,387 using the Black Scholes option pricing model using the following assumptions: risk free interest rate of; expected volatility of 64%; expected dividend yield of 0%; expected life of one year and a half and exercise price of $0.50. Expected volatility was based on the historical volatility of other comparable listed companies. The share price upon issuance was $0.350.

16

NuRAN Wireless Inc. Notes to Condensed Interim Consolidated Financial Statements

As at April 30, 2021 and April 30, 2020

(In Canadian dollars) (Unaudited)

11 - OPTIONS

The following is a summary of the activity of stock options:

The following is a summary of the activity of stock options:
	Six months ended April 30, 2021
	Number of options Weighted average exercise price
Opening balance, as at November 1, 2020 Granted during the period Exercised during the period Forfeited	320,200 $ 2.96 1,225,000 $ 2.35 (59,800) $ 1.50 (56,000) $ 2.86
Closing balance, as atApril30,2021	1,429,400 $2.50

The following is a summary of stock options outstanding and exercisable as at April 30, 2021:

April 30, 2021 Exercise price $1.50 $2.35 $2.50 $5.00 $7.50	Options outstanding Number Weighted average contractual life (years) 40,200 2.64 1,225,000 4.66 74,000 0.79 89,200 0.20 1,000 0.95 1,429,400	Options exercisable
		Number Weighted average contractual life (years)
		40,200 2.64 950,000 4.78 74,000 0.79 89,200 0.20 1,000 0.95 1,154,400

17

NuRAN Wireless Inc. Notes to Condensed Interim Consolidated Financial Statements

As at April 30, 2021 and April 30, 2020 (In Canadian dollars) (Unaudited)

On February 8, 2021, NuRAN Wireless inc. granted stock options pursuant to its incentive stock option plan to employees, consultants, directors and officers of the Company, to purchase an aggregate of 1,225,000 common shares of the Company at an exercise price of $2.35 per share. Pursuant to the terms of the grant, 950,000 options will vest immediately, 137,500 options will vest over a period of 6 months from the date of grant and the remaining 137,500 options will vest over a period of 12 months from the date of grant. 1,150,000 of the options expire five years from the date of grant and the remaining 75,000 options will expire three years from the date of grant.

The options with a three-year lifespan were assigned a value of $14,325 using the BlackScholes option pricing model using the following assumptions: risk free interest rate 0.18%; expected volatility 65%; expected dividend yield of 0%; expected life of five years and an exercise price of $2.35. Expected volatility was based on the historical volatility of other comparable listed companies.

The options with a five-year lifespan were assigned a value of $365,700 using the BlackScholes option pricing model using the following assumptions: risk free interest rate 0.18%; expected volatility 65%; expected dividend yield of 0%; expected life of three years and an exercise price of $2.35. Expected volatility was based on the historical volatility of other comparable listed companies.

For the six-month period ended April 30, 2021, $29,222 and $0 for the three-month period ended April 30, 2021 ($10,500 for the six-month and $3,500 the three-month period ended April 30, 2020) employee remuneration expense has been included in profit or loss and credited to contributed surplus.

18

NuRAN Wireless Inc. Notes to Condensed Interim Consolidated Financial Statements

As at April 30, 2021 and April 30, 2020

(In Canadian dollars) (Unaudited)

12 - LOSS PER SHARE

Basic and diluted losses per share have been calculated based on the net loss available for common shareholders by the weighted average number of common shares outstanding during the period. There were no adjustments to the numerator and denominator of basic earnings used in calculating diluted earnings.

Details of share options and warrants issued that could potentially dilute earnings per share in the future are given in Notes 10 and 11.

13 - RELATED PARTY TRANSACTIONS

The Company's related parties include companies under common control as well as key management personnel.

Unless otherwise stated, none of the transactions incorporate special terms and conditions and no guarantees were given or received.

Other related party transactions

During the period, the Company entered into the following transactions with related parties:

Shareholders Interest expenses	2021-04-30 (3 months) $	2020-04-30 (3 months) $ 3,279	2021-04-30 (6 months) $	2020-04-30 (6 months)
				$ 6,632

14 – POST-REPORTING DATE EVENTS

On May 27, 2021, the debenture holders requested the conversion of debentures totalling a par value of $29,500 in common shares of the Company.

On June 29, 2021 the Company announced a non-brokered private placement of up to 7,189,542 units (“Units”) of the Company at a price of $1.53 per Unit for gross proceeds of up to $11,000,000 (the “Offering”). Each Unit is comprised of one common share in the capital of the Company (“Common Share”) and one Common Share purchase warrant (“Warrant”), with each Warrant entitling the holder to acquire one Common Share at a price of $2.40 per Common Share for a period of 24 months from the date of issuance, subject to an acceleration

19

NuRAN Wireless Inc. Notes to Condensed Interim Consolidated Financial Statements

As at April 30, 2021 and April 30, 2020

(In Canadian dollars) (Unaudited)

provision. In connection with the Offering, the Company received a lead order to subscribe for 2,614,379 Units for gross proceeds of $4,000,000 from Space-Communication Ltd. (TASE: SCC) ("Spacecom"), an international satellite communication provider. Following closing of the Offering, Spacecom is expected to hold an approximately 9.3% equity stake in the Company on an undiluted basis, assuming total gross proceeds of $11,000,000. The order from Spacecom is subject to certain closing conditions, including the following:

• i. Spacecom and NuRAN having entered into mutually acceptable commercial agreements for the engagement of Spacecom as an exclusive satellite capacity provider, including: (i) a signed and binding Master Service Agreement (“MSA”) for the supply of satellite capacity, including an exclusivity commitment from NuRAN in favour of Spacecom for the provision of satellite capacity in connection with all future projects of the Company, (ii) a signed and binding Service Order pursuant to the MSA for the supply of managed services for 120 sites of the Company's Network as a Service (NAAS) contract with Orange Cameroon SA in Cameroon; and (iii) a signed and binding Service Order pursuant to the MSA for the supply of satellite capacity to 2,000 sites of the Company's NAAS contract with Orange DRC SA located in the Democratic Republic of the Congo (the “DRC Contract”);

• ii. the parties having entered into a mutually acceptable lock-box arrangement pursuant to which Spacecom shall be assured that the sum of $4,000,000 will be applied by the Company toward the fulfilment by NuRAN of its obligations under the DRC Contract;

• iii. the parties having entered into a mutually acceptable participation agreement with respect to any subsidiaries of the Company in Africa pursuant to which Spacecom will be entitled to participate, on the same terms and conditions as any third-party investor (the “Investor”), in the event of any sale by the Company of all or any part of its operations to any Investor, whether through the sale of assets or shares or through any other means;

• iv. the parties having entered into a mutually acceptable right of first refusal agreement pursuant to which Spacecom will be entitled to match any offer received by the Company from time to time for the financing of all or any part of its operations in Africa.

• v. the appointment of a board observer in favour of Spacecom for as long as it holds at least 5% of the issued and outstanding shares of NuRAN;

• vi. the parties adding such restrictions as may be necessary to all convertible securities issuable to Spacecom in connection with the Offering to prevent Spacecom from becoming a "related party" of NuRAN, as such term is defined in Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions adopted by the Canadian Securities Administrators (“MI 61-101”) and/or beneficially owning more than 9.9% of the issued and outstanding Common Shares (the "Ownership Limitation"); and

• vii. other customary closing conditions, including completion of the respective parties due diligence and receipt of all required regulatory approvals and consents for the Offering and appointment of the board nominee.