Current report of foreign issuer pursuant to Rules 13a-16 and 15d-16 Amendments

Share Capital and Reserves

v3.23.2
Share Capital and Reserves
6 Months Ended
Jun. 30, 2023
Share Capital and Reserves [Abstract]  
SHARE CAPITAL AND RESERVES
13. SHARE CAPITAL AND RESERVES

 

a) Authorized share capital

 

We are authorized to issue an unlimited number of Class A Shares. The Class A Shares do not have any special rights or restrictions attached. As of June 30, 2023, there were 338 Class A Shares issued and outstanding.

 

b) Issued share capital


During the six month period ended June 30, 2023, the Company:

 

i) Issued 2,500,000 shares at a price of $0.90 per share for total proceeds of $2,250,000 in a registered direct offering. In connection with the offering, the Company incurred $226,544 in issuance costs as part of the transaction.

 

ii) Issued 4,042,000 common shares pursuant to exercise of 4,042,000 warrants at a price of $1.10 per share for total proceeds of $4,446,200.

 

Escrow

 

At June 30, 2023, 21 common shares (December 31, 2022 – 21) of the Company are held in escrow due to misplaced share certificates originally issued to three individual shareholders.

 

During the year ended December 31, 2022, the Company:

 

i) Issued 291,667 units at a price of $24.00 per unit for total proceeds of $7,000,000. Each unit consisted of one common share and one warrant, to purchase one common share at $28.80 per share until February 28, 2027. In connection with the offering, the Company incurred $900,720 in issuance costs as part of the transaction.

 

ii) Issued 11,441 shares, which were converted from Versus Holdco shares.

 

iii) Issued 39,375 shares at a price of $22.20 per unit for total proceeds of $874,125 as a result of the underwriter exercising the overallotment.

 

iv) Issued 4,196 shares related to the Xcite acquisition and the vesting of key employee shares.

 

v) Issued 276,334 units at a price of $7.80 per unit for total proceeds of $2,155,195. The offering consisted of 140,000 common shares and 136,334 pre-funded warrants. In connection with the offering, the Company incurred $313,482 in issuance costs as part of the transaction.

 

vi) Issued 412,293 shares at $2.72 per share in a private placement offering for total proceeds of $1,119,373.

 

vii) Issued 2,100,000 units at a price of $1.00 per unit for total proceeds of $2,099,866. The offering consisted of 300,000 common shares and 1,800,000 pre-funded warrants. In connection with the offering, the Company incurred $522,460 in issuance costs as part of the transaction.

 

c) Stock options

 

The Company may grant incentive stock options to its officers, directors, employees, and consultants. The Company has implemented a rolling Stock Option Plan (the “Plan”) whereby the Company can issue up to 10% of the issued and outstanding common shares of the Company. Options have a maximum term of ten years and vesting is determined by the Board of Directors.

A continuity schedule of outstanding stock options is as follows:

 

    Number Outstanding     Weighted Average
Exercise Price
 
          ($)  
Balance –December 31, 2021     129,451       63.60  
Granted     104,520       6.19  
Exercised    
-
     
-
 
Forfeited     (6,183 )     92.81  
Balance –December 31, 2022     227,788       37.13  
Granted     400,000       0.90  
Exercised    
-
     
-
 
Forfeited     (133,705 )     29.63  
Balance – June 30, 2023     494,083       9.83  

 

During the six months ended June 30, 2023, 400,000 stock options were granted by the Company. During the six months ended June 30, 2023, the Company recorded a share-based compensation adjustment of ($1,156,217) (June 30, 2022 - $884,322) relating to options forfeited as a result of the Company’s corporate restructuring in January 2023.

 

During the year ended December 31, 2022, 104,520 stock options were granted by the Company. During the year ended December 31, 2022, the Company recorded share-based compensation of $1,567,583 relating to options vested during the period.

 

The Company used the following assumptions in calculating the fair value of stock options for the period ended:

 

    June 30,
2023
    December 31,
2022
 
Risk-free interest rate     3.93 %     2.14% – 4.03%  
Expected life of options     5.0 years       5.0 years  
Expected dividend yield     Nil       Nil  
Volatility     132.65 %     96.90% – 112.40%  

 

 

At June 30, 2023, the Company had incentive stock options outstanding as follows:

 

Expiry Date  

Options

Outstanding

   

Exercise

Price 

    Weighted Average
Remaining Life
 
        ($)     (years)  
September 4, 2023     521       44.55       0.17  
April 2, 2024     6,877       37.80       0.75  
June 27, 2024     417       38.40       1.00  
September 27, 2024     15,418       67.95       1.25  
October 22, 2024     834       60.45       1.33  
July 24, 2025     8,873       44.70       2.08  
July 31, 2025     8,761       44.70       2.08  
August 10, 2025     833       44.70       2.17  
June 1, 2026     3,788       105.60       2.92  
June 29, 2026     700       84.75       3.00  
August 19, 2026     24,071       63.00       3.17  
May 10, 2027     300       11.85       3.92  
August 17, 2027     52,387       6.00       4.17  
September 20, 2027     2,240       3.45       4.25  
February 13, 2028     368,063       0.90       4.75  
      494,083       9.83       4.31  

 

d) Share purchase warrants

 

A continuity schedule of outstanding share purchase warrants is as follows:

 

    Number
Outstanding
    Weighted Average
Exercise Price
 
          ($)  
Balance – December 31, 2021     299,077       102.45  
Exercised    
-
     
-
 
Expired     (186,586 )     96.30  
Issued     5,166,044       3.42  
Balance – December 31, 2022     5,278,535       5.74  
Exercised     (4,042,000 )     1.10  
Expired    
-
     
-
 
Issued     175,000       0.90  
Balance – June 30, 2023(1)     1,411,535       18.44  

 

(1) Unit A warrant balance is 1,687,341 as of June 30, 2023; however, table above reflects 15:1 post-consolidated common shares to be issued and exercise price upon the exercise of the warrants.

 

During the six month period ended June 30, 2023, the Company:

 

i) Issued 175,000 placement agent warrants in conjunction with a registered direct offering on February 2, 2023, with an exercise price of $0.90 per share.

 

During the year ended December 31, 2022, the Company:

 

ii) Completed a public offering on February 28, 2022, and issued 291,669 units at a price of $24.00 per unit for total proceeds of $7,000,000. Each unit consisted of one common share and one warrant, to purchase one common share at $28.80 per share until February 28, 2027.

 

iii) Issued 39,375 units on March 24, 2022, at a price of $22.20 per unit for total proceeds of $874,125 because the underwriter exercised its overallotment option. Each unit consisted of one common share and one warrant, to purchase one common share at $28.80 per share until February 28, 2027.

 

iv) Issued 414,500 warrants on July 18, 2022, to purchase common shares, each exercisable for one common share at an exercise price of $7.80 per share in an offer to an investor.

 

v) Completed a public offering on December 9, 2022 and issued 2,100,000 units for total proceeds of $2,099,866. Each unit consists of (1) either (a) one common share or (b) one pre-funded warrant to purchase one common share and (2) two warrants to purchase one common share each, at a public offering price of $1.00 per unit. The unit will have an exercise price of $1.10 per share, are exercisable immediately upon issuance, and will expire five years following the date of issuance. An additional 220,500 warrants were provided to placement agents with an exercise price of $1.25 per share.

 

The Company used the following assumptions in calculating the fair value of the warrants for the period ended:

    June 30, 2023  
Risk-free interest rate     4.13% - 4.49%  
Expected life of warrants     2.58 – 4.67 years  
Expected dividend yield     Nil  
Volatility     132.78 %
Weighted average fair value per warrant   $ 0.21  

 

At June 30, 2023, the Company had share purchase warrants outstanding as follows:

Expiry Date  

Warrants

Outstanding

   

Exercise

Price

    Weighted Average
Remaining Life
 
          ($)     (years)  
January 20, 2026(1)     112,491       112.50       2.58  
February 28, 2027     331,044       28.80       3.67  
December 6, 2027     220,500       1.25       4.42  
December 9, 2027     158,000       1.10       4.42  
January 18, 2028     414,500       7.80       4.58  
February 2, 2028     175,000       0.90       4.67  
      1,411,535       18.44       4.17  

 

(1) Unit A warrant balance is 1,687,341 as of June 30, 2023; however, the table above reflects 15:1 post-consolidated common shares to be issued and exercise price upon the exercise of the warrants.