Venzee Technologies Inc. — Interim / Quarterly Report 2020

Jun 18, 2020

Condensed Interim Consolidated Financial Statements (Expressed in U.S. dollars - unaudited)

VENZEE TECHNOLOGIES INC.

For the three months ended March 31, 2020

MANAGEMENT’S RESPONSIBILITY FOR FINANCIAL REPORTING

CONDENSED INTERIM CONSOLIDATED FINANCIAL REPORTING

The accompanying condensed interim consolidated financial statements of Venzee Technologies Inc. (“the Company”) have been prepared by management in accordance with International Financial Reporting Standards (“IFRS”). Management acknowledges responsibility for the preparation and presentation of the condensed consolidated interim financial statements, including responsibility for significant accounting estimates and the choice of accounting principles and methods that are appropriate to the Company‘s circumstances.

NOTICE OF NO AUDITOR REVIEW OF INTERIM FINANCIAL STATEMENTS

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

VENZEE TECHNOLOGIES INC.

Condensed Interim Consolidated Statements of Loss and Comprehensive Loss (expressed in U.S. dollars - unaudited)

	Note	For the Three Months Ended March 31,
		2020 2019 25,787 $ 54,560 $ 25,392 77,389 395 (22,829) 159,778 198,080 156,776 593,074 100,889 226,615 4,202 8,875 24,954 - 1,604 999 (448,203) (1,027,643) (447,808) (1,050,472) (9,252) 25,758 (457,060) $ (1,024,714) $ (0.00) $ (0.01) $ 133,418,234 82,333,412
Revenues Cost of revenues Expenses Selling and marketing General and administrative Research and development Depreciation Loss on disposal of assets Interest expense Net loss for the period Translation adjustment Total loss and comprehensive loss Basic and diluted loss per common share Weighted average number of common shares outstanding - basic and diluted	11 12 4 4 6

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

VENZEE TECHNOLOGIES INC.

Condensed Interim Consolidated Statements of Financial Position (expressed in U.S. dollars - unaudited)

ASSETS Current assets Cash Accounts receivable Prepaid expenses Total current assets Equipment Total assets LIABILITIES AND SHAREHOLDERS'DEFICIENCY Current liabilities Accounts payable and accrued liabilities Deferred revenue Loans payable Total liabilities Shareholders' deficiency Share capital Subscriptions received in advance Reserves Accumulated other comprehensive loss Deficit Total shareholders' deficiency Total liabilities and shareholders' deficiency	Note 4 5 6 7 8	As at March 31, As at December31, 2020 2019 $ 129,698 $ 53,204 43,620 44,225 20,748 24,462 194,066 121,891 18,211 48,252 $ 212,277 $170,143 $ 158,199 $ 241,116 796 20,291 86,764 88,497 245,759 349,904 13,858,800 13,246,902 - 64,600 1,774,273 1,718,232 (31,797) (22,545) (15,634,758) (15,186,950) (33,482) (179,761) $ 212,277 $170,143

Nature and continuance of operations (Note 1) Subsequent event (Note 13)

Approved and authorized for issue on behalf of the Board on June 17, 2020.

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

VENZEE TECHNOLOGIES INC. Condensed Interim Consolidated Statements of Changes in Shareholders’ Deficiency (expressed in U.S. dollars - unaudited)

Note	Common Shares Outstanding Share capital Subscriptions received in advance Reserves Accumulated other comprehensive loss Deficit Total
Balance – December 31, 2018 Share-based compensation 8 Transaction costs in connection with private placements Translation adjustment Net loss for the period Balance – March 31, 2019 Balance – December 31, 2019 Share-based compensation 8 Broker warrants in connection with private placements 7,8 Private placements 7 Transaction costs in connection with private placements Translation adjustment Net loss for the period Balance – March 31, 2020	82,333,412 11,536,952 $ - $ 1,345,822 $ (66,428) $ (11,876,132) $ 940,214 $ - - - 142,900 - - 142,900 - (6,742) - - - - (6,742) - - - - 25,758 - 25,758 - - - - - (1,050,472) (1,050,472)
	82,333,412 11,530,210 $ - $ 1,488,722 $ (40,670) $ (12,926,604) $ 51,658 $
	121,151,201 13,246,902 $ 64,600 $ 1,718,232 $ (22,545) $ (15,186,950) $ (179,761) $ - - - 13,495 - - 13,495 - (42,546) - 42,546 - - - 18,300,000 692,457 (64,600) - - - 627,857 - (38,013) - - - - (38,013) - - - - (9,252) - (9,252) - - - - - (447,808) (447,808)
	139,451,201 13,858,800 $ - $ 1,774,273 $ (31,797) $ (15,634,758) $ (33,482) $

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

VENZEE TECHNOLOGIES INC. Condensed Interim Consolidated Statements of Cash Flows (expressed in U.S. dollars - unaudited)

Cash flows from operating activities Net loss for the period Interest expense Depreciation Loss on disposal of assets Share-based compensation Changes in non-cash operating elements of working capital Accounts receivable Prepaid expenses Accounts payable and accrued liabilities Deferred revenue Net cash used in operating activities Cash flows from financing activities Interest paid on loans payable Proceeds from private placements Transaction costs in connection with private placements Net cash provided by financing activities Effect of foreign exchange on cash Change in cash during the year Cash – beginning of period Cash – end of period	For the Three Months Ended March 31,	For the Three Months Ended March 31,
	2020 (447,808) $ 1,604 4,202 24,954 13,495 (3,033) 1,646 (72,664) (19,495) (497,099) - 627,857 (38,013) 589,844 (16,251) 76,494 53,204 129,698 $	2019
		(1,050,472) $ 999 8,875 - 142,900 5,464 (52,412) 16,690 8,096
		(919,860)
		(999) (6,742) -
		(7,741)
		26,979 (900,622) 1,117,362
		216,740 $

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

VENZEE TECHNOLOGIES INC. Notes to Condensed Interim Consolidated Financial Statements For the three months ended March 31, 2020

(expressed in U.S. dollars - unaudited)

1. NATURE AND CONTINUANCE OF OPERATIONS

Venzee Technologies Inc. (the “Company” or “Venzee”) develops and markets a cloud-based platform that suppliers and manufacturers from multiple industries use to share product information and inventory updates, in real-time, with on-line retailers. The Company’s shares are listed on the TSX Venture Exchange under the symbol “VENZ”. The Company was incorporated under the laws of the province of British Columbia, Canada and its registered office is located at Suite 1700 - 1055 West Hastings Street, Vancouver, British Columbia, Canada.

These condensed interim consolidated financial statements have been prepared by management on a going concern basis which assumes that the Company will be able to realize its assets and discharge its liabilities in the normal course of business for the foreseeable future. The Company has incurred ongoing losses and expects to incur further losses in the development of its business. At March 31, 2020, the Company had a working capital deficit of $51,693, had not yet achieved profitable operations and has an accumulated deficit of $15,634,758 since its inception. The continuing operations of the Company are dependent upon its ability to continue to raise adequate financing, to commence profitable operations in the future and to repay its liabilities arising from normal business operations as they become due. While the Company has been successful in securing financings in the past, there is no assurance that it will be able to do so in the future. These circumstances comprise a material uncertainty which may lend significant doubt as to the ability of the Company to continue as a going concern.

The condensed interim consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue in existence.

On March 11, 2020, the World Health Organization categorized COVID-19 as a pandemic. The potential economic effects within the Company’s industry and in the global markets, including possible disruptions in the Company’s ability to provide services to its clients, and measures being introduced at various levels of government to curtail the spread of the virus (such as travel restrictions, closures of non-essential municipal and private operations, imposition of quarantines and social distancing) to date have not had a material impact on the Company’s operations and ability to access capital. The full extent of the impact of this outbreak and related containment measures on the Company’s operations cannot be reliably estimated at the date these financial statements were approved, which was on June 17, 2020.

2. BASIS OF PREPARATION

Statement of compliance

These condensed interim consolidated financial statements, including comparatives, have been prepared in accordance with International Financial Reporting Standards (“IFRS”) using accounting policies consistent with IFRS issued by the International Accounting Standards Board (“IASB”) and Interpretations of the International Financial Reporting Interpretations Committee (“IFRIC”).

These condensed interim consolidated financial statements were approved for issuance by the Board of Directors on June 17, 2020.

VENZEE TECHNOLOGIES INC. Notes to Condensed Interim Consolidated Financial Statements For the three months ended March 31, 2020

(expressed in U.S. dollars - unaudited)

2. BASIS OF PREPARATION (continued)

Basis of measurement

These condensed interim consolidated financial statements have been prepared on a historical cost basis except for certain financial assets that are measured at fair value. In addition, these consolidated financial statements have been prepared using the accrual basis of accounting except for cash flow information.

These condensed interim consolidated financial statements are presented in U.S. dollars (“USD”). The functional currency of the Company and its 100% owned Canadian subsidiary is the Canadian Dollar (“CAD” or “CAD $”). The functional currency of the Company’s 100% owned U.S. subsidiary is the USD. Unless otherwise indicated, all dollar (“$”) and “USD” amounts and references in these condensed interim consolidated financial statements are to U.S. dollars, and references to “CAD” are to Canadian dollars.

Basis of consolidation

The condensed interim consolidated financial statements include the accounts of the Company, its wholly-owned U.S. subsidiary, Venzee Inc. and its wholly owned Canadian subsidiary, Venzee Technologies Canada Inc. All intercompany balances, transactions, income and expenses, and profits or losses have been eliminated on consolidation.

Critical accounting estimates and judgments

The preparation of these condensed interim consolidated financial statements in accordance with IFRS requires management to make estimates and assumptions that can have a significant effect on the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting period.

Estimates and judgments are significant when:

• the outcome is highly uncertain at the time the estimates are made; or

• different estimates or judgments could reasonably have been used that would have had a material impact on the consolidated financial statements.

The condensed interim consolidated financial statements include estimates based on currently available information and management’s judgment as to the outcome of future conditions and circumstances. Management uses historical experience, general economic conditions and trends, and assumptions regarding probable future outcomes as the basis for determining estimates.

Estimates and their underlying assumptions are reviewed on a regular basis and the effects of any changes are recognized immediately. Changes in the status of certain facts or circumstances could result in material changes to the estimates used in the preparation of the condensed interim consolidated financial statements and actual results could differ from the estimates and assumptions.

VENZEE TECHNOLOGIES INC. Notes to Condensed Interim Consolidated Financial Statements For the three months ended March 31, 2020 (expressed in U.S. dollars - unaudited)

2. BASIS OF PREPARATION (continued)

Set forth below are descriptions of items that management believes require its most critical estimates and judgments:

Key sources of estimation uncertainty

Recoverability of receivables

The Company evaluates specific accounts where it has information that a customer may be unable to meet its financial obligations. In these cases, judgment is used based on the best available information to determine actual amounts that will be collected. The Company continually reviews and adjusts such amounts as better information becomes available.

Judgments

Functional currency

The functional currency of the Company and its subsidiaries are the currencies that reflect the economic environment in which the Company and its subsidiaries performs their operations. Functional currencies are reevaluated if there is a change in events and conditions which determines the primary economic environment.

Going concern

The condensed interim consolidated financial statements have been prepared on a going concern basis, which assumes that the Company will be able to realize its assets and discharge its liabilities in the normal course of business for the foreseeable future. The assessment of the Company’s ability to source future operations and continue as a going concern involves judgement. Estimates and assumptions are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. If the going concern assumption is not appropriate, then adjustments would be necessary to the carrying value of assets and liabilities, the reported revenue and expenses and the statement of financial position classifications used.

Income taxes

In assessing the probability of realizing deferred tax assets, management makes estimates related to the expectation of future taxable income, applicable tax opportunities, expected timing of reversals of existing temporary differences and the likelihood that the tax position taken will be sustained upon examination by applicable tax authorities. In making its assessments, management gives additional weight to positive and negative evidence that can be objectively verified.

VENZEE TECHNOLOGIES INC. Notes to Condensed Interim Consolidated Financial Statements For the three months ended March 31, 2020

(expressed in U.S. dollars - unaudited)

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Except as otherwise indicated hereunder, these condensed interim consolidated financial statements have been prepared using the same policies and methods as the consolidated financial statements of the Company for the year ended December 31, 2019. Refer to Note 3 of the Company’s consolidated financial statements for the year ended December 31, 2019 for more information on new accounting standards and amendments not yet effective.

4. EQUIPMENT

Net carrying amount – December 31, 2018 Depreciation Net carrying amount – March 31, 2019 Net carrying amount - December 31, 2019 Depreciation Disposals Foreign currency translation Net carrying amount - March 31, 2020	Furniture and Fixtures $ 42,191 (4,673) 37,518 $ 25,839 - (24,954) (885) - $	Software Total $ 39,223 $ 81,414 (4,202) (8,875) 35,021 $ 72,539 $ 22,413 48,252 (4,202) (4,202) - (24,954) - (885) 18,211 $ 18,211 $

5. DEFERRED REVENUE

The Company offers a variety of options for software licensing, prepayments for specific amounts of work for product submissions, and an access fee for the use of the partner platform. Deferred revenue represents the unearned portion of these software licensing options purchased by our customers. The Company amortizes the recognition of revenue of these contracts as per the specific contract term. The entire balance is current and expected to be earned within the next 12 months. As at March 31, 2020, $796 (2019 - $20,291) was outstanding in deferred revenue.

6. LOANS PAYABLE

On May 1, 2017, the Company entered into a loan agreement with the following terms and conditions:

• Face value of $50,000, accruing interest at a rate of 8% per annum; and

• Monthly interest payments of $333, due on the last day of each calendar month.

Subsequent to March 31, 2020, the Company repaid the loan by way of a cash payment of $13,500 and conversion of the remainder of the loan for 1,152,400 common shares of the Company.

On December 23, 2019, the Company received a $38,497 (CAD $50,000) unsecured loan by way of a promissory note bearing interest at 15% per annum. Subsequent to March 31, 2020, the Company repaid the loan and accrued interest.

During the three month period ended March 31, 2020, the Company incurred interest expense of $1,604 (2019 – $999).

VENZEE TECHNOLOGIES INC. Notes to Condensed Interim Consolidated Financial Statements For the three months ended March 31, 2020 (expressed in U.S. dollars - unaudited)

7. SHARE CAPITAL

The authorized share capital of the Company consists of unlimited common shares, with no par value.

Equity Financing

On January 31, 2020, the Company closed a non-brokered private placement for total proceeds of CAD $915,000 resulting in the issuance of 18,300,000 units. Each unit is comprised of one share and one warrant. Each warrant is exercisable until January 31, 2023 (subject to an acceleration clause) at a price of CAD $0.10 per warrant to acquire one common share. In connection with the private placement, the Company paid CAD $45,850 and issued 1,181,000 agent warrants as finders’ fees, exercisable for one common share at CAD $0.10 expiring January 31, 2023.

8. RESERVES

Stock Options

The Company has a stock option plan (the "Plan") that is administered by the Board of Directors of the Company, who establish exercise prices and vesting periods.

Options under the Plan remain exercisable for ten years from the date of grant. The maximum number of common shares reserved for issuance for options that may be granted under the Plan as at March 31, 2020 was 13,945,200 (December 31, 2019 – 12,115,120), being 10% of the issued and outstanding common shares of the Company.

A summary of the Company’s stock option transactions during the period is as follows:

Beginning balance Transactions during the period: Granted Cancelled Ending balance	Number of options Weighted average exercise price CAD$ 5,062,875 0.27 $ - - (990,375) 0.19 4,072,500 0.29 $ As at March 31, 2020	As at December 31, 2019
	Number of options 5,062,875 - (990,375) 4,072,500	Number of options Weighted average exercise price CAD$ 2,437,500 0.74 $ 4,700,000 0.10 (2,074,625) 0.43 5,062,875 0.27 $

VENZEE TECHNOLOGIES INC. Notes to Condensed Interim Consolidated Financial Statements For the three months ended March 31, 2020

(expressed in U.S. dollars - unaudited)

8. RESERVES (continued)

The following incentive stock options were outstanding as at March 31, 2020:

Number of Options Outstanding 247,500 275,000 400,000 150,000 1,800,000 1,200,000 4,072,500	Exercise Price (CAD $) 0.25 $ 0.25 $ 1.32 $ 1.44 $ 0.10 $ 0.10 $ 0.29 $	Expiry Date June 8, 2027 September 1, 2027 January 5, 2023 January 15, 2023 January 17, 2024 June 25,2024	Number of Options Exercisable Exercise Price (CAD $) 170,155 0.25 575,000 0.25 400,000 1.32 82,135 1.44 320,832 0.10 300,000 0.10 1,848,122 0.48

During the three months ended March 31, 2020, the Company granted nil (2019 – 4,700,000) stock options with a weighted average fair value of $nil (2019 - $0.10) per option. During the three months ended March 31, 2020, the Company recognized $13,495 (2019 - $142,900) as share-based compensation expense. The fair value of the stock options granted during the three months ended March 31, 2020 was estimated on the date of grant using the BlackScholes Option Pricing Model with the following weighted average assumptions:

Expected volatility Expected life Risk-free interest rate Dividend yield Weighted average fair value of options at grant date	2019 2018 127% 100% 3.75 years 3.45 years 1.75% 1.82% 0% 0% CAD$0.07 CAD$0.74

Warrants

A summary of the Company’s warrant transactions during the year is as follows:

Balance, December 31, 2018 Balance, March 31, 2019 Balance, December 31, 2019 Issued Balance, March 31, 2020	Number of warrants Weighted average exercise priceCAD$ 28,271,142 0.28 28,271,142 0.28 62,381,656 0.14 19,481,000 0.10 81,862,656 0.13

VENZEE TECHNOLOGIES INC. Notes to Condensed Interim Consolidated Financial Statements For the three months ended March 31, 2020

(expressed in U.S. dollars - unaudited)

8. RESERVES (continued)

The following warrants were outstanding as at March 31, 2020:

Number of warrants outstanding 21,135,235 30,150,221 3,291,000 7,805,200 19,481,000 81,862,656	Weighted average exercise price CAD $ Expiry date 0.15 December 28, 2020 0.15 April 26, 2022 0.10 November 22, 2022 0.10 December 2, 2022 0.10 January31,2023 0.13

The weighted average remaining life of the warrants is 1.99 years.

During the period ended March 31, 2020, the Company granted 18,300,000 warrants to investors pursuant to nonbrokered private placements as well as 1,181,000 broker warrants pursuant to non-brokered private placements. The fair value of broker warrants granted are estimated on the date of grant using the Black-Scholes Option Pricing Model with the following weighted average assumptions:

Expected volatility Expected life Risk-free interest rate Dividend yield Weighted average fair value of warrants at grant date	2020 2019 160% 127% 3 years 3.75 years 1.44% 1.75% 0% 0% CAD$ 0.08 CAD$ 0.07

9. FINANCIAL INSTRUMENTS AND RISK MANAGEMENT

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

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

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

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

The fair value of the Company’s accounts receivable, accounts payable and accrued liabilities and loans payable approximate their carrying values due to their short-term nature. The Company’s cash is measured at fair value using Level 1 inputs.

VENZEE TECHNOLOGIES INC. Notes to Condensed Interim Consolidated Financial Statements For the three months ended March 31, 2020 (expressed in U.S. dollars - unaudited)

9. FINANCIAL INSTRUMENTS AND RISK MANAGEMENT (continued)

The Company is exposed to various financial instrument related risks:

Foreign Exchange Risk

Foreign exchange risk is the risk that the fair value of future cash flows will fluctuate as a result of changes in foreign exchange rates. As at March 30, 2019, the Company’s significant foreign exchange currency exposure on its financial instruments by currency was as follows (in U.S. dollar equivalents):

Cash Accounts receivable Accounts payable and accrued liabilities	$CAD
	107,000 43,000 (152,000)

The table below details the effect on earnings before tax of a 10% strengthening or weakening of the USD exchange rate at the balance sheet date for balance sheet items denominated in CAD:

	(Increase) Decrease in
	Loss and Comprehensive
Currency	loss
CAD	(600) $

Credit Risk

Credit risk is the risk that one party to a financial instrument will cause a financial loss for the other party by failing to discharge an obligation. The Company’s cash and accounts receivable are exposed to credit risk. The Company reduces its credit risk on cash by placing these instruments with institutions of high credit worthiness. The accounts receivable is comprised of sales tax receivable from the Government of Canada. As at March 30, 2019, the Company is not exposed to any significant credit risk.

Interest Rate Risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. As at March 30, 2019, the Company is not exposed to any significant interest rate risk. The loans payable are to a third parties have a fixed interest rate of 8% and 15% per annum (Note 6).

Liquidity Risk

Liquidity risk is the risk that the Company will encounter difficulty in meeting obligations associated with financial liabilities. The Company manages liquidity risk by maintaining sufficient cash balances to enable settlement of transactions on the due date. The Company addresses its liquidity through equity financing obtained through the sale of common shares. While the Company has been successful in securing financings in the past, there is no assurance that it will be able to do so in the future.

VENZEE TECHNOLOGIES INC. Notes to Condensed Interim Consolidated Financial Statements For the three months ended March 31, 2020 (expressed in U.S. dollars - unaudited)

10. RELATED PARTY TRANSACTIONS

Key management personnel are the persons responsible for the planning, directing and controlling the activities of the Company and includes certain executive directors, and entities controlled by such persons. The key management personnel of the Company are certain members of the Company’s executive management team and the Board of Directors.

The compensation of such key management for the three months ended March 31, 2020 and 2019 included the following:

Remuneration paid to the CEO Remuneration paid to CTO Remuneration paid to CFO Remuneration paid to directors Stock-based compensation	2020 2019 50,000 33,708 27,883 28,251 17,845 35,560 43,750 11,282 9,866 90,868 149,344 $ 199,669 $ For the Three Months Ended March 31,

As at March 31, 2020, included in accounts payable and accrued liabilities was $15,889 (2019 - nil) of fees owed to key management personnel.

11. SEGMENTED INFORMATION

The Company operates in one operating segment, being a cloud-based platform solution targeted to online retailers and vendors. This segment engages in business activities from which it earns license revenues and incurs expenses. The equipment held by the Company is held in Canada $nil (2019 – $37,518) and the United States $18,211 (2019 – $35,021).

Revenues from external customers are attributed to geographic areas based on the location of the contracting customers. The following table sets forth external revenue by geographic areas:

Geographic Area United States Other	For the Three Months Ended March 31,
	2020 2019 16,118 $ 49,336 $ 9,669 5,224 25,787 $ 54,560 $

VENZEE TECHNOLOGIES INC. Notes to Condensed Interim Consolidated Financial Statements For the three months ended March 31, 2020

(expressed in U.S. dollars - unaudited)

12. EXPENSES CLASSIFIED BY NATURE

The following table shows the breakdown of expenses by nature for each function on the consolidated statements of loss and comprehensive loss:

Employees and contractors Depreciation Loss on disposal of assets Interest expense Software and support tools Director fees Investor relations Legal and professional fees Administration Share-based compensation Travel and entertainment Advertising, promotion and marketing	For the Three Months Ended March 31,
	2020 2019 $ 258,754 $ 662,824 4,202 8,875 24,954 - 1,604 999 17,805 33,809 - 11,282 48,208 50,609 42,470 33,338 27,338 59,277 13,495 142,900 5,421 8,892 3,952 14,838 $ 448,203 $1,027,643

13. SUBSEQUENT EVENT

Subsequent to March 31, 2020, the Company completed a non-brokered private placement for total proceeds of CAD $1,402,000 resulting in the issuance of 28,040,000 units. Each unit is comprised of one share and one warrant. Each warrant is exercisable until May 22, 2023 (subject to an acceleration clause) at a price of CAD $0.10 per warrant to acquire one common share. The Company issued 1,808,800 agent warrants which are exercisable at CAD $0.06 expiring May 22, 2023. Each warrant entitles its holder to acquire one common share of the Company in accordance with its terms. This financing is subject to the approval of the TSX Venture Exchange;