UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
Report of Foreign Private Issuer Pursuant to Rule 13a-16 or 15d-16 of the Securities Exchange Act of 1934
For the month of | September 2023 |
Commission File Number | 001-41460 |
Bruush Oral Care Inc.
(Translation of registrant’s name into English)
128 West Hastings Street, Unit 210
Vancouver, British Columbia V6B 1G8
Canada
(844) 427-8774
(Address of principal executive offices)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:
Form 20-F | ☒ | Form 40-F | ☐ |
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):
INFORMATION CONTAINED IN THIS FORM 6-K REPORT
On September 14, 2023, Bruush Oral Care Inc. (the “Company”) issued its unaudited condensed financial statements and the related management discussion and analysis as of and for the six months ended April 30, 2023 and April 30, 2022. The financial statements and related management discussion and analysis are attached hereto as Exhibit 99.1 and 99.2, respectively, and are incorporated herein by reference.
EXHIBIT INDEX
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Bruush Oral Care Inc. | ||||
(Registrant) | ||||
Date: | September 14, 2023 | By: | /s/ Aneil Singh Manhas | |
Name: | Aneil Singh Manhas | |||
Title: | Chief Executive Officer |
Exhibit 99.1
BRUUSH ORAL CARE INC.
CONDENSED INTERIM FINANCIAL STATEMENTS
FOR THE THREE AND SIX MONTHS ENDED APRIL 30, 2023
(Expressed in U.S. dollars)
BRUUSH ORAL CARE INC.
CONDENSED INTERIM STATEMENTS OF FINANCIAL POSITION
(Unaudited - Expressed in U.S. dollars)
As at | Note | April 30, 2023 | October 31, 2022 | ||||||||
ASSETS | |||||||||||
Current | |||||||||||
Cash | $ | 194,321 | $ | 72,921 | |||||||
Term deposit | - | 18,506 | |||||||||
Accounts and other receivables | 3 | 152,604 | 175,256 | ||||||||
Inventory | 4 | 142,950 | 241,341 | ||||||||
Prepaid expenses and deposits | 5 | 395,976 | 677,474 | ||||||||
885,851 | 1,185,498 | ||||||||||
Non-current | |||||||||||
Equipment | 4,914 | 5,619 | |||||||||
Total assets | $ | 890,765 | $ | 1,191,117 | |||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | |||||||||||
Current | |||||||||||
Accounts payable and accrued liabilities | 6,8 | $ | 2,308,607 | $ | 1,345,288 | ||||||
Due to related party | 8 | 311,774 | - | ||||||||
Loan payable | 7 | 2,336,222 | - | ||||||||
Deferred revenue | 2,009 | 6,045 | |||||||||
Warrant derivative | 10 | 1,107,775 | 1,242,580 | ||||||||
Total liabilities | 6,066,387 | 2,593,913 | |||||||||
SHAREHOLDERS’ EQUITY | |||||||||||
Share capital | 9 | 24,889,414 | 23,845,704 | ||||||||
Obigation to issue securities | 9 | 283 | - | ||||||||
Reserves | 9 | 1,905,507 | 1,137,814 | ||||||||
Accumulated deficit | (31,970,826 | ) | (26,386,314 | ) | |||||||
Total shareholders’ equity | (5,175,622 | ) | (1,402,796 | ) | |||||||
Total liabilities and shareholders’ deficiency | $ | 890,765 | $ | 1,191,117 |
Nature of operations and going concern (Note 1)
Contingencies (Note 14)
Subsequent events (Notes 7, 9 and 14)
Approved and authorized for issue by the Board of Directors on September 13, 2023.
The accompanying notes are an integral part of these condensed interim financial statements.
BRUUSH ORAL CARE INC.
CONDENSED INTERIM STATEMENTS OF COMPREHENSIVE LOSS
(Unaudited - Expressed in U.S. dollars, except for the number of shares)
Three months ended | Six months ended | ||||||||||||||||||
Note | April 30, 2023 | April 30, 2022 | April 30, 2023 | April 30, 2022 | |||||||||||||||
Revenues | $ | 325,532 | $ | 301,978 | $ | 1,401,624 | $ | 1,111,808 | |||||||||||
Cost of goods sold | 4 | 79,336 | 97,825 | 436,086 | 376,088 | ||||||||||||||
Gross Profit | 246,196 | 204,153 | 965,538 | 735,720 | |||||||||||||||
Expenses | |||||||||||||||||||
Advertising and marketing | 620,203 | 425,903 | 4,483,815 | 2,567,496 | |||||||||||||||
Amortization and depreciation expense | 1,062 | 2,787 | 2,110 | 5,640 | |||||||||||||||
Commission | 12,899 | 9,954 | 62,447 | 29,841 | |||||||||||||||
Consulting | 8 | 273,202 | 142,384 | 559,177 | 482,991 | ||||||||||||||
Interest and bank charges | 220,179 | 231,122 | 224,344 | 358,445 | |||||||||||||||
Inventory management | 6,549 | 4,459 | 18,143 | 12,896 | |||||||||||||||
Merchant fees | 9,221 | 27,393 | 47,923 | 56,460 | |||||||||||||||
Office and administrative expenses | 116,982 | 48,882 | 260,122 | 123,782 | |||||||||||||||
Professional fees | 8 | 43,429 | 27,034 | 260,802 | 73,519 | ||||||||||||||
Research and development | 1,500 | - | 1,680 | - | |||||||||||||||
Salaries and wages | 8 | 358,465 | 254,790 | 757,208 | 436,575 | ||||||||||||||
Share-based compensation | 8,9 | 202,884 | - | 406,154 | 7,861 | ||||||||||||||
Shipping and delivery | 152,205 | 135,935 | 450,147 | 350,096 | |||||||||||||||
Travel and entertainment | 38,090 | 52,853 | 68,884 | 127,359 | |||||||||||||||
(2,056,870 | ) | (1,363,496 | ) | (7,602,956 | ) | (4,632,961 | ) | ||||||||||||
Other items | |||||||||||||||||||
Financing costs | 10 | - | (1,650,000 | ) | (417,794 | ) | (3,150,000 | ) | |||||||||||
Foreign exchange | 14,179 | 7,591 | (31,745 | ) | 19,737 | ||||||||||||||
Gain on revaluation of warrant derivative | 10 | 1,292,230 | 68,779 | 1,473,271 | 181,078 | ||||||||||||||
Other income | 11 | 159,324 | - | 159,324 | - | ||||||||||||||
Write down of prepaid inventory | 5 | (130,150 | ) | - | (130,150 | ) | - | ||||||||||||
1,335,583 | (1,573,630 | ) | 1,052,906 | (2,949,185 | ) | ||||||||||||||
Net and comprehensive loss | $ | (475,091 | ) | $ | (2,732,973 | ) | $ | (5,584,512 | ) | $ | (6,846,426 | ) | |||||||
Loss per share - Basic and diluted | $ | (0.95 | ) | $ | (17.39 | ) | $ | (12.79 | ) | $ | (43.56 | ) | |||||||
Weighted average number of common shares outstanding - basic and diluted | 498,721 | 157,154 | 436,525 | 157,154 |
The accompanying notes are an integral part of these condensed interim financial statements.
BRUUSH ORAL CARE INC.
CONDENSED INTERIM STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY
(Unaudited - Expressed in U.S. dollars, except for the number of shares)
Common Stock | Obligation | |||||||||||||||||||||||
Number | to issue | Accumulated | ||||||||||||||||||||||
of shares | Amount | securities | Reserves | Deficit | Total | |||||||||||||||||||
Balance, October 31, 2021 | 157,154 | $ | 13,276,909 | $ | - | $ | 400,936 | $ | (17,621,043 | ) | $ | (3,943,198 | ) | |||||||||||
Securities to be issued for financing costs | - | - | 3,150,000 | - | - | 3,150,000 | ||||||||||||||||||
Shares issued for services | - | - | - | 7,861 | - | 7,861 | ||||||||||||||||||
Net and comprehensive loss | - | - | - | - | (6,846,426 | ) | (6,846,426 | ) | ||||||||||||||||
Balance, April 30, 2022 | 157,154 | $ | 13,276,909 | $ | 3,150,000 | $ | 408,797 | $ | (24,467,469 | ) | $ | (7,631,763 | ) | |||||||||||
Balance, October 31, 2022 | 326,028 | $ | 23,845,704 | $ | - | $ | 1,137,814 | $ | (26,386,314 | ) | $ | (1,402,796 | ) | |||||||||||
Private placement units | 118,667 | 973,419 | - | - | - | 973,419 | ||||||||||||||||||
Exercise of warrants | 66,666 | 637,812 | 283 | - | - | 638,095 | ||||||||||||||||||
Shares issued for services | - | (361,539 | ) | - | 361,539 | - | - | |||||||||||||||||
Financing costs | - | (205,982 | ) | - | - | - | (205,982 | ) | ||||||||||||||||
Share-based compensation | - | - | - | 406,154 | - | 406,154 | ||||||||||||||||||
Net and comprehensive loss | - | - | - | - | (5,584,512 | ) | (5,584,512 | ) | ||||||||||||||||
Balance, April 30, 2023 | 511,361 | $ | 24,889,414 | $ | 283 | $ | 1,905,507 | $ | (31,970,826 | ) | $ | (5,175,622 | ) |
The accompanying notes are an integral part of these condensed interim financial statements.
BRUUSH ORAL CARE INC.
CONDENSED INTERIM STATEMENTS OF CASH FLOWS
(Unaudited - Expressed in U.S. dollars)
Six months ended | Six months ended | |||||||
April 30, 2023 | April 30, 2022 | |||||||
Cash flows from operating activities | ||||||||
Net loss | $ | (5,584,512 | ) | $ | (6,846,426 | ) | ||
Items not affecting cash: | ||||||||
Amortization and depreciation | 2,110 | 5,640 | ||||||
Share-based compensation | 406,154 | 7,861 | ||||||
Gain on revaluation of warrant derivative | (1,473,271 | ) | (181,078 | ) | ||||
Write down of prepaid inventory | 130,150 | - | ||||||
Accretion of promissory note | 206,968 | 247,261 | ||||||
Unrealized foreign exchange | (21 | ) | - | |||||
Gain on write-off of accounts payable | - | (1,005 | ) | |||||
Listing expense | - | (27 | ) | |||||
Financing costs | - | 3,150,000 | ||||||
Changes in non-cash working capital | ||||||||
Accounts and other receivables | 22,652 | 17,961 | ||||||
Inventory | 98,391 | 167,057 | ||||||
Term deposit | 18,506 | - | ||||||
Prepaid expenses and deposits | 151,348 | 40,015 | ||||||
Accounts payable and accrued liabilities | 1,279,135 | (192,550 | ) | |||||
Deferred revenue | (4,036 | ) | 224,850 | |||||
Net cash flows used in operating activities | (4,746,426 | ) | (3,360,441 | ) | ||||
Cash flows from investing activities | ||||||||
Purchase of property and equipment | (1,405 | ) | (2,042 | ) | ||||
Net cash flows used in investing activities | (1,405 | ) | (2,042 | ) | ||||
Cash flows from financing activities | ||||||||
Proceeds from private placement warrants | 2,742,069 | - | ||||||
Proceeds from convertible debentures | - | 3,760,725 | ||||||
Proceeds from promissory notes | 1,874,254 | - | ||||||
Proceeds from exercise of warrants | 1,667 | - | ||||||
Share subscriptions received in advance | 283 | - | ||||||
Proceeds from loans | 508,225 | - | ||||||
Repayment of loans | (257,267 | ) | - | |||||
Net cash flows provided by financing activities | 4,869,231 | 3,760,725 | ||||||
Change in cash | $ | 121,400 | $ | 398,242 | ||||
Cash | ||||||||
Beginning of period | $ | 72,921 | $ | 14,530 | ||||
End of period | $ | 194,321 | $ | 412,772 | ||||
Supplemental cash flow disclosure | ||||||||
Interest | $ | - | $ | - | ||||
Taxes paid | $ | - | $ | - | ||||
Non- cash investing and financing activities | ||||||||
Fair value of warrants exercised | $ | 636,160 | $ | - | ||||
Broker warrants | $ | 361,539 | $ | - |
The accompanying notes are an integral part of these condensed interim financial statements.
BRUUSH ORAL CARE INC.
NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS
(Unaudited - Expressed in U.S. dollars)
Three and six months ended April 30, 2023 and 2022
1. | NATURE OF OPERATIONS AND GOING CONCERN |
Bruush Oral Care Inc. (the “Company”) was incorporated in British Columbia under the Business Corporations Act on October 10, 2017. The Company is in the business of selling electric toothbrushes. The Company is located at 128 West Hastings Street, Unit 210, Vancouver, British Columbia V6B 1G8. The Company’s common shares are listed for trading on NASDAQ under the symbol “BRSH”.
As of April 30, 2023, the Company had a working capital deficit of $5,180,536, an accumulated deficit totaling $31,970,826. The ability of the Company to carry out its business objectives is dependent on its ability to secure continued financial support from related parties, to obtain equity financing, or to ultimately attain profitable operations in the future. The Company will need to raise additional capital during the next twelve months and beyond to support current operations and planned development. Whether and when the Company can attain profitability and positive cash flows is uncertain. While the Company has been successful in securing financing in the past, there is no assurance that financing will be available in the future on terms acceptable to the Company.
These factors form a material uncertainty that may cast significant doubt upon the Company’s ability to continue as a going concern. These financial statements do not give effect to adjustments to the carrying value and classification of assets and liabilities and related expense that would be necessary should the Company be unable to continue as a going concern. If the going concern assumption is not appropriate, material adjustments to the statements could be required.
On July 7, 2023, the Company completed a 1-for-25 reverse split of its common shares (“the Consolidation”). The Consolidation is effective as of the close of business on July 31, 2023. Except where otherwise indicated, all historical share numbers and per share amounts have been adjusted on a retroactive basis to reflect following the Consolidation.
2. | BASIS OF PRESENTATION |
Statement of compliance
These unaudited condensed interim financial statements have been prepared in accordance with IAS 34 – Interim Financial Reporting as issued by the International Accounting Standards Board (“IASB”). Accordingly, certain disclosures included in annual financial statements prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the IASB have been condensed or omitted and these unaudited condensed interim consolidated financial statements should be read in conjunction with the Company’s audited financial statements for the year ended October 31, 2022.
The Company’s management makes judgments in its process of applying the Company’s accounting policies in the preparation of its unaudited condensed interim financial statements. In addition, the preparation of the financial data requires that the Company’s management make assumptions and estimates of the effects of uncertain future events on the carrying amounts of the Company’s assets and liabilities at the end of the reporting period and the reported amounts of revenues and expenses during the reporting period. Actual results may differ from those estimates as the estimation process is inherently uncertain. Estimates are reviewed on an ongoing basis based on historical experience and other factors that are considered to be relevant under the circumstances. Revisions to estimates and the resulting effects on the carrying amounts of the Company’s assets and liabilities are accounted for prospectively. The critical judgments and estimates applied in the preparation of the Company’s unaudited condensed interim financial statements are consistent with those applied and disclosed in the Company’s financial statements for the year ended October 31, 2022. In addition, other than noted below, the accounting policies applied in these unaudited condensed interim financial statements are consistent with those applied and disclosed in the Company’s audited financial statements for the year ended October 31, 2022.
These unaudited condensed interim financial statements were approved by the Board of Directors on September 13, 2023.
BRUUSH ORAL CARE INC.
NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS
(Unaudited - Expressed in U.S. dollars)
Three and six months ended April 30, 2023 and 2022
Basis of presentation
These condensed interim financial statements have been prepared on a historical cost basis and presented in U.S. dollars which is the functional currency of the Company. The financial statements of the Company have been prepared on an accrual basis, except for cash flow information. The condensed interim financial statements have been prepared on a historical cost basis except for warrants and options, which are measured at fair value.
3. | ACCOUNTS AND OTHER RECEIVABLES |
April 30, 2023 | October 31, 2022 | |||||||
Trade receivables | $ | 52,879 | $ | 103,471 | ||||
Sales taxes receivable | 99,725 | 71,785 | ||||||
$ | 152,604 | $ | 175,256 |
4. | INVENTORY |
Inventory consisted entirely of finished goods.
During the six months ended April 30, 2023, $434,994 (six months ended April 30, 2022 - $332,657) of inventory was sold and recognized in cost of goods sold, and $17,473 (six months ended April 30, 2022 - $89,646) of inventory was used for promotional purposes and recognized in other expense categories, such as selling and marketing and investor relations.
5. | PREPAID EXPENSES AND DEPOSITS |
April 30, 2023 | October 31, 2022 | |||||||
Prepaid expenses | $ | 67,418 | $ | 191,322 | ||||
Deposits on inventory | 317,864 | 475,458 | ||||||
Deposits | 10,694 | 10,694 | ||||||
$ | 395,976 | $ | 677,474 |
Deposits on inventory relate to payment for inventory that is still to be received. During the six months ended April 30, 2023, the Company impaired deposits on inventory of $130,150 (October 31, 2022 – $Nil).
6. | ACCOUNTS PAYABLE AND ACCRUED LIABILITIES |
April 30, 2023 | October 31, 2022 | |||||||
Accounts payable | $ | 1,661,284 | $ | 909,438 | ||||
Accrued liabilities | 647,323 | 435,850 | ||||||
$ | 2,308,607 | $ | 1,345,288 |
7. | PROMISSORY NOTE |
On March 6, 2023, the Company issued an unsecured promissory note (“the Promissory note”) in a principal amount of $2,749,412. The Promissory note was issued at discount of 15% with a maturity date of July 18, 2023. The principal amount outstanding shall bear no interest during the period up until July 18, 2023. The Promissory note will only bear simple interest at the rate of 20% per annum in the event of default from the date of such non-payment until such amount is paid in full.
BRUUSH ORAL CARE INC.
NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS
(Unaudited - Expressed in U.S. dollars)
Three and six months ended April 30, 2023 and 2022
A continuity of the Promissory note is shown below:
Balance October 31, 2022 | $ | - | ||
Additions | 2,749,412 | |||
Discount | (412,412 | ) | ||
Transaction costs | (207,746 | ) | ||
Accretion | 206,968 | |||
Balance April 30, 2023 | $ | 2,336,222 |
Subsequent to the period ended, the Company and the Promissory note holder (“the Holder”) entered into an agreement in which the Holder subscribed for convertible notes (Note 14) in lieu of repayment and Promissory note was cancelled in its entirety.
8. | RELATED PARTY TRANSACTIONS |
Key Management Compensation
Key management personnel are those persons having authority and responsibility for planning, directing and controlling the activities of the Company, directly or indirectly. Key management personnel include the Company’s executive officers and Board of Director members.
All related party transactions are in the normal course of operations. All amounts either due from or due to related parties other than specifically disclosed are non-interest bearing, unsecured and have no fixed terms of repayments.
Related party transactions with key management directors, subsequent and former directors and companies and entities over which they have significant influence over:
Three months ended | Six months ended | |||||||||||||||
April 30, 2023 | April 30, 2022 | April 30, 2023 | April 30, 2022 | |||||||||||||
Consulting fees | $ | 11,163 | $ | 35,790 | $ | 11,163 | $ | - | ||||||||
Director fees | 46,500 | - | 93,000 | 47,905 | ||||||||||||
Professional fees | - | 50,000 | - | 50,000 | ||||||||||||
Salaries | 224,949 | 70,880 | 321,234 | 110,354 | ||||||||||||
Share-based compensation | 203,268 | - | 405,419 | - | ||||||||||||
$ | 485,880 | $ | 156,670 | $ | 830,816 | $ | 208,259 |
Accounts payable and accrued liabilities – As of April 30, 2023, $11,163 (October 31, 2022 - $33,918) due to related parties was included in accounts payable and accrued liabilities.
As at June 30, 2023, included in loans payable is $311,774 (September 30, 2022 - $Nil) due to the Chief Executive Officer of the Company. This loan is non-interest bearing, unsecured and payable on demand.
9. | SHARE CAPITAL |
a) | Share capital |
Authorized share capital
Unlimited Common Shares without par value.
BRUUSH ORAL CARE INC.
NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS
(Unaudited - Expressed in U.S. dollars)
Three and six months ended April 30, 2023 and 2022
Shares outstanding
On July 29, 2022, the Company completed a share reorganization (the “Share Reorganization”) to redesignate all Class B shares to common shares and to convert the Class A shares to common shares. The Company also effected a share consolidation on the basis of 1 new share for each 3.86 shares outstanding (the “Consolidation”). Prior to the Share Reorganization and Consolidation, the Company had 6,824,127 Class A and 7,130,223 Class B common shares issued and outstanding. Immediately following the Share Reorganization and Consolidation, the Company had 3,615,116 common shares outstanding. Except where otherwise indicated, all historical share numbers and per share amounts have been adjusted on a retroactive basis to reflect the Share Reorganization and Consolidation.
The Company also completed another Share Reorganization on July 31, 2023 in which 1 new share was issued for each 25 outstanding shares. Prior to this Share Reorganization, a total of 12,784,209 common shares were outstanding and they were converted into 511,361 common shares. Except where otherwise indicated, all historical share numbers and per share amounts have been adjusted on a retroactive basis to also reflect this Share Reorganization.
Six months ended April 30, 2023:
On December 9, 2022, the Company closed a private placement pursuant (“the Private placement”) to a securities purchase agreement with institutional investors. The Company issued 118,667 units (“the units”) and 78,000 pre-funded units (“the pre-funded units”) at a purchase price of $15 per unit for gross proceeds of $2,948,050. The pre-funded units were sold at a purchase price of $14.98. Each of the units consists of one share of common stock and one non-tradable warrant (“the unit warrants”) exercisable for one share of common stock at a price of $15 for a period of 5.5 years from the closing date of the Private placement. The pre-funded Unit consist of one pre-funded common share purchase warrant of the Company (a “pre-funded warrant”) and one unit warrant. As at April 30, 2023, $283 had been received in advance as subscriptions for warrants still to be exercised.
In connection with the Private placement, the Company paid share issuance costs of $623,776 consisting of $295,000 in underwriting fees, $132,500 in legal fees and $196,276 in other related expenses. Total transaction costs of $623,776 were incurred relating to the Private placement and $205,982 was allocated to equity.
During the six months ended April 30, 2023, the Company issued 66,667 common shares as a result of the exercise of 66,667 warrants for total proceeds of $1,667. The weighted average market price of the Company’s common shares at the period of the exercise was $9.56 per share.
Six months ended April 30, 2022:
There were no share issuances during the six months ended April 30, 2022.
a) | Options |
The Company has established a stock option plan for its directors, officers, employees, and consultants under which the Company may grant options (each, an “Option”) from time to time to acquire Shares. The exercise price of each Option shall be determined by the Board of Directors. Options may be granted for a maximum term of five years from the date of grant. Options are non-transferable and expire immediately upon termination of employment for cause, or within 30 days of termination of employment for cause, or within 30 days of termination of employment or holding office as director or officer of the Company or in the case of death. Unless otherwise provided in the applicable grant agreement, Options fully vest upon the grant thereof.
BRUUSH ORAL CARE INC.
NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS
(Unaudited - Expressed in U.S. dollars)
Three and six months ended April 30, 2023 and 2022
Six months ended April 30, 2023:
On April 3, 2023, the Company granted 40,800 stock options to its directors and officers. Each option is exercisable for one common share in the capital of the Company at an exercise price of $6.25 per share. These options vest over four years from the date of grant and expire on April 3, 2028. The fair value of the options was estimated to be $162,384 based on the Black-Scholes Option Pricing Model using the following assumptions: fair value of the underlying stock – $6.48, exercise price $6.50, expected dividend yield - 0%, expected volatility - 72%, risk-free interest rate – 2.94% and an expected remaining life – 5 years.
Six months ended April 30, 2022:
There were no option grants during the six months ended April 30, 2022.
During the six months ended April 30, 2023, the Company recognized share-based compensation expense of $6,245 for the vesting of options (six months ended April 30, 2022 - $7,862).
As at April 30, 2023, the following options were outstanding and vested, entitling the holders thereof the right to purchase one common share for each option held as follows:
Outstanding | Exercise Price | Expiry Date | Vested | ||||||||
3,207 | CAD$172.50 | November 9, 2025 | 3,207 | ||||||||
40,800 | $ | 6.25 | April 3, 2028 | - | |||||||
44,007 | 3,207 |
b) | Warrants |
During August 2022, the Company’s volume weighted average stock price was less than the exercise floor of $52 as per the agreements for the warrants issued as part of the units offered in the Company’s initial public offering (“IPO”) as a result, the following occurred:
● | Effective after the closing of trading on November 3, 2022 (the 90th calendar day immediately following the issuance date of the Warrants), the exercise price of all IPO warrants was reset from $104 to $52 (“reset price”). The other terms of the IPO warrants remained unchanged. | |
● | On November 3, 2022, the Company also issued to an aggregate amount of 266,420 additional warrants (“the additional warrants”) to purchase 266,420 shares of common stock. The Additional Warrants expire November 3, 2027 and are exercisable at a price of $52. |
Continuity of the warrants issued and outstanding as follows:
Number of warrants | Weighted average exercise price | |||||||
Outstanding, October 31, 2021 | 29,210 | $ | 196.75 | |||||
Granted | 174,078 | 105.50 | ||||||
Outstanding, October 31, 2022 | 203,288 | $ | 118.75 | |||||
Granted | 553,019 | 5.25 | ||||||
Exercised | (66,667 | ) | 0.025 | |||||
Outstanding, April 30, 2023 | 689,640 | $ | 46.00 |
BRUUSH ORAL CARE INC.
NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS
(Unaudited - Expressed in U.S. dollars)
Three and six months ended April 30, 2023 and 2022
The following table discloses the number of warrants outstanding as at April 30, 2023:
Number of warrants | Price | Expiry date | |||||
10,736 | CAD$86.75 | August 3, 2024 | |||||
18,474 | CAD$260.50 | August 3, 2024 | |||||
163,565 | $ | 52 | August 4, 2027 | ||||
10,514 | $ | 130 | August 4, 2027 | ||||
11,931 | $ | 0.025 | August 4, 2027 | ||||
266,420 | $ | 52 | November 3, 2027 | ||||
118,667 | $ | 15 | June 9, 2028 | ||||
78,000 | $ | 15 | June 9, 2028 | ||||
11,333 | $ | 0.025 | No expiry | ||||
689,640 |
As at April 30, 2023, the weighted average life remaining of warrants outstanding is 4.36 years.
c) | Restricted Share Awards |
On June 30, 2022, the Company issued 19,689 Restricted Share Awards (“RSU” or “RSU’s”) to directors of the Company. The RSU’s vest over a period of three years, in three equal tranches on the first, second, and third anniversaries of the grant date. At October 31, 2022, none of the RSU’s had vested. The Company recognizes the share-based payment expense over the vesting terms. The share-based compensation costs for the RSU’s are based on the share price at the date of grant at a price of $71.25 per RSU.
During the six months ended April 30, 2023, the Company recognized share-based compensation expense of $399,909 for the vesting of RSUs (Six months ended April 30, 2022 - $nil).
As at April 30, 2023 and October 31, 2022, 19,689 RSU’s were outstanding.
10. | WARRANT DERIVATIVE LIABILITY |
In July and August 2020, in connection with a private placement, the Company issued 10,710 warrants with an exercise price of CAD$86.75 ($66.50) per warrant with an expiry date of twenty-four months from the time the Company completes a bone-fide public offering of common shares under a prospectus or registration statement filed with the securities regulatory authorities in Canada or the United States (the “Liquidity Event”). As the warrants have an exercise price denominated in a currency other than the Company’s functional currency, they are derivative financial instrument measured at fair value at the end of each reporting period. On July 29, 2022, the Company amended the exercise price of 3,461 of the warrants to $66.50. As a result, the derivative liability associated with these warrants at the time of $136,047 was derecognized and recorded to equity. The fair value at the time of derecognition was based on the Black-Scholes Option Pricing Model using the following assumptions: fair value of the underlying stock - $71.25, expected dividend yield – 0%, expected volatility – 100%, risk-free interest rate – 2.92% and an expected remaining life – 2.01 years. As at April 30, 2023, the fair value of the remaining 7,248 warrants which were not repriced (and therefore continue to be recognized as derivative financial instruments) was determined to be $122 based on the Black-Scholes Option Pricing Model using the following assumptions: fair value of the underlying stock – CAD$8.75, expected dividend yield – 0%, expected volatility – 74%, risk-free interest rate – 3.72% and an expected remaining life – 1.26 years (2022 - $30,469 based on the Black-Scholes Option Pricing Model using the following assumptions: fair value of the underlying stock – CAD$37.25, expected dividend yield – 0%, expected volatility – 72%, risk-free interest rate – 3.90% and an expected remaining life – 1.76 years).
BRUUSH ORAL CARE INC.
NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS
(Unaudited - Expressed in U.S. dollars)
Three and six months ended April 30, 2023 and 2022
In August and September 2020, in connection with a private placement, the Company issued 15,290 warrants with an exercise price of CAD$260.50 ($195) per warrant with an expiry date of twenty-four months from the Liquidity Event. As the warrants have an exercise price denominated in a currency other than the Company’s functional currency, they are derivative financial instrument measured at fair value at the end of each reporting period. As at April 30, 2023, the fair value of the warrants was determined to be $3 and was estimated using the Black-Scholes Options Pricing Model using the following assumptions: fair value of the underlying stock – CAD$8.75, expected dividend yield – 0%, expected volatility – 74%, risk-free interest rate – 3.72% and an expected remaining life – 1.26 years. (2022 - $8,655 based on the Black-Scholes Option Pricing Model using the following assumptions: fair value of the underlying stock – CAD$37.25, expected dividend yield – 0%, expected volatility – 72%, risk-free interest rate – 3.90% and an expected remaining life – 1.76 years).
In August 2022, in connection with the units issued as part of the Company’s IPO, the Company issued 149,142 warrants with an exercise price of $104 per warrant with an expiry date of five years from the date of issuance. The warrants contain a cashless exercise provision which enables the holder to receive common shares equal to the fair value of the warrants based on the number of warrants to be exercise multiplied by the fair value of the common shares less the exercise price with the difference divided by the fair value of the share. If a warrant holder exercises this option, there will be variability in the number of shares issued, therefore they are a derivative financial instrument measured at fair value at the end of each reporting period. On November 3, 2022 ,the exercise price of these warrants was reset from $104 to $52 the other terms of the IPO warrants remained unchanged (Note 9(b)).
As at April 30, 2023, the fair value of the warrants was determined to be $152,713 and was estimated using the Black-Scholes Options Pricing Model using the following assumptions: fair value of the underlying stock – $6.50, expected dividend yield – 0%, expected volatility – 74%, risk-free interest rate – 3.04% and an expected remaining life – 4.27 years. (2022 – $1,097,323 based on the Black-Scholes Options Pricing Model using the following assumptions: fair value of the underlying stock – $27.25, expected dividend yield – 0%, expected volatility – 67%, risk-free interest rate – 3.43% and an expected remaining life – 4.76 years).
Also in connection with the IPO, on November 3, 2022, the Company issued to an aggregate amount of 266,420 additional warrants to purchase 266,420 shares of common stock (Note 9(b)). The Additional Warrants expire November 3, 2027 and are exercisable at a price of $2.08. These warrants also contain a cashless exercise provision which enables the holder to receive common shares equal to the fair value of the warrants based on the number of warrants to be exercise multiplied by the fair value of the common shares less the exercise price with the difference divided by the fair value of the share. . If a warrant holder exercises this option, there will be variability in the number of shares issued, therefore they are a derivative financial instrument measured at fair value at the end of each reporting period. At issuance, the fair value of the warrants was determined to be $2,736,592 and was estimated using the Black-Scholes Options Pricing Model using the following assumptions: fair value of the underlying stock – $24.50, expected dividend yield – 0%, expected volatility – 68%, risk-free interest rate – 3.67% and an expected remaining life – 5 years. As at April 30, 2023, the fair value of the warrants was determined to be $291,303 and was estimated using the Black-Scholes Options Pricing Model using the following assumptions: fair value of the underlying stock – $6.50, expected dividend yield – 0%, expected volatility – 73%, risk-free interest rate – 3.04% and an expected remaining life – 4.52 years.
In August 2022, in connection with the units issued as part of its December Senior Secured Promissory Notes, the Company issued 14,423 warrants with an exercise price of $104 per warrant with an expiry date of five years from the date of issuance. The warrants contain a cashless exercise provision which enables the holder to receive common shares equal to the fair value of the warrants based on the number of warrants to be exercise multiplied by the fair value of the common shares less the exercise price with the difference divided by the fair value of the share. If a warrant holder exercises this option, there will be variability in the number of shares issued, therefore they are a derivative financial instrument measured at fair value at the end of each reporting period. At issuance, the fair value of the warrants was determined to be $488,147 and was estimated using the Black-Scholes Options Pricing Model using the following assumptions: fair value of the underlying stock – $70.25, expected dividend yield – 0%, expected volatility – 66%, risk-free interest rate – 2.79% and an expected remaining life – 5 years. As at April 30, 2023, the fair value of the warrants was determined to be $36,917 and was estimated using the Black-Scholes Options Pricing Model using the following assumptions: fair value of the underlying stock – $6.50, expected dividend yield – 0%, expected volatility – 74%, risk-free interest rate – 3.04% and an expected remaining life – 4.27 years. (2022 – $106,119 based on the Black-Scholes Options Pricing Model using the following assumptions: fair value of the underlying stock – $27.25, expected dividend yield – 0%, expected volatility – 67%, risk-free interest rate – 3.43% and an expected remaining life – 4.76 years).
BRUUSH ORAL CARE INC.
NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS
(Unaudited - Expressed in U.S. dollars)
Three and six months ended April 30, 2023 and 2022
During December 2022, in connection with the units issued as part of the private placement (Note 9), the Company issued 118,667 unit warrants with an exercise price of $15 with an expiry date of 5.5 years from the date of issuance. The warrants contain a cashless exercise provision which enables the holder to receive common shares equal to the fair value of the warrants based on the number of warrants to be exercise multiplied by the fair value of the common shares less the exercise price with the difference divided by the fair value of the share. If a warrant holder exercises this option, there will be variability in the number of shares issued, therefore they are a derivative financial instrument measured at fair value at the end of each reporting period. At issuance, the fair value of the warrants was determined to be $806,581 and was estimated using the Black-Scholes Options Pricing Model using the following assumptions: fair value of the underlying stock – $10.25, expected dividend yield – 0%, expected volatility – 67%, risk-free interest rate – 3.07% and an expected remaining life – 5.5 years. As at April 30, 2023, the fair value of the warrants was determined to be $333,875 and was estimated using the Black-Scholes Options Pricing Model using the following assumptions: fair value of the underlying stock – $6.50, expected dividend yield – 0%, expected volatility – 71%, risk-free interest rate – 3.04% and an expected remaining life – 5.11 years.
Also in connection with the private placement (Note 9), the Company issued 78,000 pre-funded warrants with an exercise price of $0.025 with no expiry date and another 78,000 unit warrants with an exercise price of $15 and with an expiry date of 5.5 years from the date of issuance for total proceeds of $1,168,051. These warrants also contain a cashless exercise provision which enables the holder to receive common shares equal to the fair value of the warrants based on the number of warrants to be exercise multiplied by the fair value of the common shares less the exercise price with the difference divided by the fair value of the share. If a warrant holder exercises this option, there will be variability in the number of shares issued, therefore they are a derivative financial instrument measured at fair value at the end of each reporting period. At issuance, the fair value of the prefunded warrants and unit warrants was $747,917 and $420,134 respectively, the fair value of the pre-funded warrants was determined with reference to the fair value of the Company’s common shares and the fair value of the unit warrants was estimated using the Black-Scholes Options Pricing Model using the following assumptions: fair value of the underlying stock – $12.13, expected dividend yield – 0%, expected volatility – 67%, risk-free interest rate – 3.07% and an expected remaining life – 5.5 years. As at April 30, 2023 the fair value of the unit warrants was $219,458 respectively and was estimated using the Black-Scholes Options Pricing Model based on the following assumptions: fair value of the underlying stock – $6.50, expected dividend yield – 0%, expected volatility – 71%, risk-free interest rate – 3.04% and an expected remaining life – 5.11 years.
During January 2023, 49,867 pre-funded warrants were exercised (Note 9) and a fair value loss of $39,565 was recognized from the fair valuation of these pre-funded warrants on the dates of exercise and their total fair value was $517,720.
A further 16,800 pre- funded warrants were exercised during April 2023 (Note 9) and a fair value gain of $53,340 was recognized from the fair valuation of these pre-funded warrants on the dates of exercise and their total fair value was $118,440.
As at April 30, 2023 the fair value of the remaining pre-funded warrants was deterimined to be $73,384 and was estimated using the Black-Scholes Options Pricing Model using the following assumptions: fair value of the underlying stock – $6.50, expected dividend yield – 0%, expected volatility – 71%, risk-free interest rate – 3.04% and an expected remaining life – 5.11 years.
From the total transaction costs of $623,776 that were incurred relating to the Private placement (Note 9), $417,794 was allocated to the derivative liability.
BRUUSH ORAL CARE INC.
NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS
(Unaudited - Expressed in U.S. dollars)
Three and six months ended April 30, 2023 and 2022
The following is a continuity of the Company’s warrant derivative liability:
Balance, October 31, 2021 | $ | 1,582,977 | ||
Issued during the period | 5,535,852 | |||
Change in fair value of derivative | (5,740,202 | ) | ||
Derecognition of warrant derivative | (136,047 | ) | ||
Balance, October 31, 2022 | $ | 1,242,580 | ||
Issued during the period | 1,974,626 | |||
Change in fair value of derivative | (1,473,271 | ) | ||
Derecognition of warrant derivative | (636,160 | ) | ||
Balance, April 30, 2023 | $ | 1,107,775 |
11. | OTHER INCOME |
During the year ended October 31, 2022, the Company fell victim to a cyber-scam that resulted in the Company making an inappropriate payment of $166,150.
During the six months ended April 30, 2023, the Company has filed an insurance claim and received an indemnity of CAD$217,943 ($159,324) in relation to the cyber-scam.
12. | FINANCIAL INSTRUMENT RISK MANAGEMENT |
Classification of financial instruments
Financial assets included in the statement of financial position are as follows:
Level in fair value hierarchy | April 30, 2023 | October 31, 2022 | ||||||||||
Amortized cost: | ||||||||||||
Cash | $ | 194,321 | $ | 72,921 | ||||||||
Term deposit | - | 18,506 | ||||||||||
Accounts receivable | 152,604 | 175,256 | ||||||||||
$ | 346,925 | $ | 266,683 |
Financial liabilities included in the statement of financial position are as follows:
Level
in fair value hierarchy | April 30, 2023 | October 31, 2022 | ||||||||||
Amortized cost: | ||||||||||||
Accounts payable and accrued expenses | $ | 2,308,607 | $ | 1,345,288 | ||||||||
Loans payable | 2,336,222 | - | ||||||||||
Due to related party | 311,774 | - | ||||||||||
FVTPL: | ||||||||||||
Warrant derivative liability | Level 3 | 1,107,775 | 1,242,580 | |||||||||
$ | 6,064,378 | $ | 2,587,868 |
BRUUSH ORAL CARE INC.
NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS
(Unaudited - Expressed in U.S. dollars)
Three and six months ended April 30, 2023 and 2022
Fair value
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 carrying value of the Company’s cash, term deposits, accounts receivable and accounts payable and accrued liabilities as at approximate their fair value due to their short terms to maturity.
The following table shows the valuation techniques used in measuring Level 3 fair values for the derivative liability as well as the significant unobservable inputs used.
Type | Valuation technique | Key inputs | Inter-relationship between significant inputs and fair value measurement | |||
Warrant derivative liability | The fair value of the warrant derivative liability at initial recognition and at period-end has been calculated using the Black Scholes option pricing model. | Key observable inputs ● Share price ● Risk free interest rate ● Dividend yield Key unobservable inputs ● Expected volatility
|
The estimated fair value would increase (decrease) if: ● The share price was higher (lower) ● The risk-free interest rate was higher (lower) ● The dividend yield was lower (higher) ● The expected volatility was higher (lower) |
For the fair values of the derivative liability, reasonably possible changes to the expected volatility, the most significant unobservable input would have the following effects:
Unobservable Inputs | Change | Impact on comprehensive loss | ||||||||||
Six months ended April 30, 2023 | Six months ended April 30, 2022 | |||||||||||
Volatility | 20 | % | $ | 435,415 | $ | 261,511 |
The Company is exposed in varying degrees to a variety of financial instrument related risks. The Board of Directors approves and monitors the risk management processes, inclusive of documented investment policies, counterparty limits, and controlling and reporting structures.
Credit risk
The Company’s principal financial assets are cash and trade accounts receivable. The Company’s credit risk is primarily concentrated in its cash which is held with institutions with a high credit worthiness. Credit risk is not concentrated with any particular customer. The Company’s accounts receivable consists primarily of GST receivable.
The Company’s maximum credit risk exposure is $152,604.
Liquidity risk
Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they fall due. The Company has a planning and budgeting process in place to help determine the funds required to support the Company’s normal operating requirements on an ongoing basis.
BRUUSH ORAL CARE INC.
NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS
(Unaudited - Expressed in U.S. dollars)
Three and six months ended April 30, 2023 and 2022
Historically, the Company’s primary source of funding has been the issuance of equity securities for cash, primarily through the issuance of preferred shares. The Company’s access to financing is always uncertain. There can be no assurance of continued access to significant equity funding.
The following is an analysis of the contractual maturities of the Company’s financial liabilities as at April 30, 2023:
Within one year | Between one and five years | More than five years | ||||||||||
Accounts payable and accrued expenses | $ | 2,308,607 | $ | - | $ | - |
Foreign exchange risk
Foreign currency risk arises from fluctuations in foreign currencies versus the United States dollar that could adversely affect reported balances and transactions denominated in those currencies. As at April 30, 2023, a portion of the Company’s financial assets are held in Canadian dollars. The Company’s objective in managing its foreign currency risk is to minimize its net exposure to foreign currency cash flows by transacting, to the greatest extent possible, with third parties in United States dollars. The Company does not currently use foreign exchange contracts to hedge its exposure of its foreign currency cash flows as management has determined that this risk is not significant at this point in time. The Company is not exposed to any material foreign currency risk.
Interest rate risk
Interest rate risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company is not exposed to any material interest rate risk.
Capital Management
In the management of capital, the Company includes components of shareholders’ equity. The Company aims to manage its capital resources to ensure financial strength and to maximize its financial flexibility by maintaining strong liquidity and by utilizing alternative sources of capital including equity, debt and bank loans or lines of credit to fund continued growth. The Company sets the amount of capital in proportion to risk and based on the availability of funding sources. 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. Issuance of equity has been the primary source of capital to date. Additional debt and/or equity financing may be pursued in future as deemed appropriate to balance debt and equity. To maintain or adjust the capital structure, the Company may issue new shares, take on additional debt or sell assets to reduce debt.
13. | SEGMENTED INFORMATION |
The Company’s breakdown of sales by geographical region is as follows:
Six
months ended April 30, 2023 | Six
months ended April 30, 2022 | |||||||
United States of America | $ | 1,319,868 | $ | 1,079,617 | ||||
Canada | 81,756 | 32,191 | ||||||
$ | 1,401,624 | $ | 1,111,808 |
Three
months ended April 30, 2023 | Three
months ended April 30, 2022 | |||||||
United States of America | $ | 295,627 | $ | 289,670 | ||||
Canada | 29,905 | 12,308 | ||||||
$ | 325,532 | $ | 301,978 |
BRUUSH ORAL CARE INC.
NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS
(Unaudited - Expressed in U.S. dollars)
Three and six months ended April 30, 2023 and 2022
The Company’s breakdown of sales by product segment is as follows:
Six
months ended April 30, 2023 | Six
months ended April 30, 2022 | |||||||
Devices | $ | 1,088,876 | $ | 665,475 | ||||
Consumables | 312,748 | 446,333 | ||||||
$ | 1,401,624 | $ | 1,111,808 |
Three
months ended April 30, 2023 | Three
months ended April 30, 2022 | |||||||
Devices | $ | 280,450 | $ | 62,683 | ||||
Consumables | 45,082 | 238,295 | ||||||
$ | 325,532 | $ | 1,111,808 |
14. | SUBSEQUENT EVENTS |
Litigation
During the subsequent period, litigation was brought against the Company by the Toronto Dominion Bank (“TD Bank”) in which TD Bank made a claim for an amount of $1,721,345 (the “Principal Amount”) relating to a bank overdraft. TD Bank and the Company reached a settlement agreement in which the Company agreed to repay the Principal Amount plus interest and additional costs. The Settlement was guaranteed by a letter of credit issued to TD Bank by the Royal Bank of Canada of $2,000,000.
Convertible debentures
On June 26, 2023, the Company completed its issuance of an unsecured convertible note with a principal aggregate amount of $3,341,176 (the “June 2023 Note”) to the Selling Securityholder with a maturity date of June 26, 2024. The conversion price in effect on any Conversion Date shall be equal to (i) for the first seven months following the date hereof, shall be $0.25, and (ii) following the seven month anniversary of the date hereof, 90% of the lowest closing price of the Company’s shares for the previous three Trading Days prior to the conversion date provided, however, that such price shall in no event be less than $0.15. A maximum of 22,274,507 shares of Common Stock are issuable by the Company upon conversion of the June 2023 note.
In connection with the issuance of the June 2023 Note, the Company entered into a securities purchase agreement with the Selling Securityholder and issued a common stock purchase warrant to purchase 10,023,530 shares of Common Stock (the “Purchase Warrant”), with an Exercise Price of $0.001 or on a cashless basis, to the Selling Securityholder. The Purchase Warrants will be classified as financial liabilities since the terms allows for a cashless net share settlement at the option of the holder.
Share capital
On August 25, 2023, the company offered warrant holders the option to exercise their existing warrants at $3.33 per share, resulting in 633,026 Warrant Shares being issued. Holders were also given new warrants (New Warrants) allowing them to purchase up to 250% of the exercised Warrant Shares at the same price, with an expiration date of June 9, 2028. The exercise of Existing Warrants led to the issuance of New Warrants for a total of 1,582,566 New Warrant Shares.
From August 1 to August 25, 2023, a total of 883,131 shares were issued from warrants being exercised for proceeds of $2,855,979. On August 10 and 14th, the company issued 50,000 and 150,000 common shares as compensation for consulting services.
Exhibit 99.2
BRUUSH ORAL CARE INC.
MANAGEMENT’s DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
September 13, 2023
You should read the following management’s discussion and analysis of financial condition and results of operations together with our unaudited condensed interim financial statements as of and for the three and six months ended April 30, 2023 and April 30, 2022, of Bruush Oral Care Inc. (herein after referred to as “the Company”) which were prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board, or IASB.
The statements in this discussion regarding industry outlook, our expectations regarding our future performance, liquidity and capital resources and other non-historical statements are forward-looking statements. These forward-looking statements are subject to numerous risks and uncertainties, including the risks and uncertainties described in the section titled “Risk Factors”. Our actual results may differ materially from those contained in the following discussion and analysis, as well as the section titled “Cautionary Note Regarding Forward-Looking Statements”.
Basis of Presentation
Our unaudited condensed interim financial statements as of and for the three and six months ended April 30, 2023 and April 30, 2022 are presented in U.S. dollars and have been prepared in accordance with IFRS which may differ in material respects from generally accepted accounting principles accounting principles in the United States, or U.S. GAAP. Our presentation and functional currency is the U.S. dollar and, accordingly, all the amounts in this discussion and analysis are in U.S. dollars unless otherwise indicated. See “Results of Operations – April 30, 2023 compared to April 30, 2022”.
Non-IFRS Financial Measures
This discussion may refer to certain non-IFRS measures. These measures are not recognized measures under IFRS, do not have a standardized meaning prescribed by IFRS and therefore may not be comparable to similar measures presented by other companies. Rather, these measures are provided as additional information to complement those IFRS measures by providing further understanding of our results of operations from management’s perspective. Accordingly, these measures should not be considered in isolation or as a substitute for analysis of our financial information reported under IFRS.
Going Concern
As of and for the six months ended April 30, 2023, the Company has recurring losses, a working capital deficit of $5,180,536 (October 31, 2022 – working capital deficit of $1,408,415), an accumulated deficit totaling $31,970,826 (October 31, 2022 – accumulated deficit of $26,386,314) and negative cash flows used in operating activities of $4,746,426 (April 30, 2022 – negative cash flows used in operating activities of $3,360,441). The ability of the Company to carry out its business objectives is dependent on its ability to secure continued financial support from related parties, to obtain equity financing or to ultimately attain profitable operations in the future. The Company will need to raise additional capital during the next twelve months and beyond to support current operations and planned development. Whether and when the Company can attain profitability and positive cash flows is uncertain. While the Company has been successful in securing financing in the past, there is no assurance that we will be able to obtain financing in the future on terms acceptable to us.
Company Overview
The Company is on a mission to inspire confidence through brighter smiles and better oral health. Founded in 2018 by Chief Executive Officer Aneil Manhas, a former investment banker and private equity investor turned entrepreneur, we are an oral care company that is disrupting the space by reducing the barriers between consumers and access to premium oral care products because it is our belief that high-quality oral care products should be more accessible. We are an e-commerce business with a product portfolio that currently consists of a sonic-powered electric toothbrush kit and brush head refills. Through our website, consumers can purchase a Brüush starter kit (the “Brüush Kit”), which includes: (i) the Brüush electric toothbrush (the “Brüush Toothbrush”); (ii) three brush heads; (iii) a magnetic charging stand and USB power adapter; and (iv) a travel case. We also sell the brush heads separately which come in a three-pack (the “Brüush Refill”) and can be purchased on a subscription basis, where the customer will automatically receive a Brüush Refill every six months (the “Subscription”). We consider a Subscription to be active (an “Active Subscription”) until it is either cancelled by the customer or terminated due to payment failure (for example, a lost or expired credit card). In 2024, we plan to expand our portfolio with the launch of several new subscription-based consumable oral care products, including toothpaste, mouthwash, dental floss, a whitening pen, as well as an electric toothbrush designed for kids.
Financial Operations Overview
Revenues
Revenues are comprised of sales of Brüush Kits and of Brüush Refills net of changes in the provision for payment discounts and product return allowances.
Cost of goods sold
Cost of goods sold consists of: (i) the costs of finished goods sold; and (ii) the freight expense of transporting the finished goods from the manufacturer to our third-party distribution facility in Salt Lake City, Utah.
Operating expenses
Operating expenses consist primarily of advertising and marketing expenses, salaries and wages, consulting services, professional fees, interest charges, and shipping and delivery expense. We offer free regular shipping on all of our website orders. All of these expenses have increased year-over-year and are expected to keep rising as we continue to scale our brand building and customer acquisition efforts, as well as expand our operations to facilitate higher revenues.
Results of Operations – Six months ended April 30, 2023 compared to six months ended April 30, 2022
The table below sets forth a summary of our results of operations for the six months ended April 30, 2023 and April 30, 2022:
Six months ended April 30, | ||||||||||||||||
2023 | 2022 | |||||||||||||||
(unaudited) | (unaudited) | Change | % Change | |||||||||||||
Revenues | $ | 1,401,624 | $ | 1,111,808 | $ | 289,816 | 26 | % | ||||||||
Cost of goods sold | (436,086 | ) | (376,088 | ) | (59,998 | ) | (16 | )% | ||||||||
Gross profit | $ | 965,538 | $ | 735,720 | $ | 229,818 | 31 | % | ||||||||
Gross margin | 69 | % | 66 | % |
Revenues
Our revenues increased 26% for the six months ended April 30, 2023 to $1,401,624 from $1,111,808 for the six months ended April 30, 2022, due primarily to the results of our expanded marketing and customer acquisition efforts.
Cost of goods sold
Our cost of goods sold increased 16% to $436,086 for the six months ended April 30, 2023 from $376,088 for the six months ended April 30, 2022. The increase was mainly due to the increase in goods sold during the six months ended April 30, 2023 compared to six months ended April 30, 2022 as explained above.
Gross profit
We recorded gross profit of $965,538 and $735,720 for the six months ended April 30, 2023 and the six months ended April 30, 2022. Our gross margin increased to 69% for the six months ended April 30, 2023 from 66% for the six months ended April 30, 2022. The increase in gross profit is primarily due to the fact that a larger portion of revenue came from Brüush Kits, which have a higher gross margin compared to Brüush Refills. The split between Brüush Kit and Brüush Refill sales was 78% and 22%, respectively during the six months ended April 30, 2023, compared to 60% and 40%, respectively during the six months ended April 30, 2022.
Operating expenses
The following table sets forth our operating expenses for the six months ended April 30, 2023, and April 30, 2022:
Six months ended April 30, | ||||||||||||||||
2023 | 2022 | % | ||||||||||||||
(unaudited) | (unaudited) | Change | Change | |||||||||||||
Advertising and marketing | $ | (4,483,815 | ) | $ | (2,567,496 | ) | $ | (1,916,319 | ) | (75 | )% | |||||
Depreciation expense | (2,110 | ) | (5,640 | ) | 3,530 | 63 | % | |||||||||
Commission | (62,447 | ) | (29,841 | ) | (32,606 | ) | (109 | )% | ||||||||
Consulting | (559,177 | ) | (482,991 | ) | (76,186 | ) | (16 | )% | ||||||||
Interest and bank charges | (224,344 | ) | (358,445 | ) | 134,101 | 37 | % | |||||||||
Inventory management | (18,143 | ) | (12,896 | ) | (5,247 | ) | (41 | )% | ||||||||
Merchant fees | (47,923 | ) | (56,460 | ) | 8,537 | 15 | % | |||||||||
Office and administrative expenses | (260,122 | ) | (123,782 | ) | (136,340 | ) | (110 | )% | ||||||||
Professional fees | (260,802 | ) | (73,519 | ) | (187,283 | ) | (255 | )% | ||||||||
Research and development | (1,680 | ) | - | (1,680 | ) | - | ||||||||||
Salaries and benefits | (757,208 | ) | (436,575 | ) | (320,633 | ) | (73 | )% | ||||||||
Share-based compensation | (406,154 | ) | (7,861 | ) | (398,293 | ) | (5067 | )% | ||||||||
Shipping and delivery | (450,147 | ) | (350,096 | ) | (100,051 | ) | (29 | )% | ||||||||
Travel and entertainment | (68,884 | ) | (127,359 | ) | 58,475 | 46 | % | |||||||||
$ | (7,602,956 | ) | $ | (4,632,961 | ) | $ | (2,969,995 | ) | (64 | )% |
Operating expenses for the six months ended April 30, 2023 were $7,602,956, compared to $4,632,961, for the six months ended April 30, 2022. The primary reasons for the increase are: (i) increased advertising and marketing efforts, particularly during the holiday season; (ii) increased shipping and delivery to facilitate a higher level of sales; (iii) a higher salaries and benefits expense due to expansion of the team during this period, including the addition of senior team members in operations and sales roles; (iii) a higher office and administrative expense as we expanded our office in Toronto to support a growing team; (iv) higher professional fees due to an increase in legal fees related to maintaining the Company’s listing on the Nasdaq Stock Market; and (v) and increased share-based compensation.
Operating loss before other items
Six months ended April 30, | ||||||||||||||||
2023 | 2022 | % | ||||||||||||||
(unaudited) | (unaudited) | Change | Change | |||||||||||||
Gross profit | $ | 965,538 | $ | 735,720 | $ | 229,818 | 31 | % | ||||||||
Operating expenses | (7,602,956 | ) | (4,632,961 | ) | (2,969,995 | ) | (64 | )% | ||||||||
Operating loss before other items | $ | (6,637,418 | ) | $ | (3,897,241 | ) | $ | (2,740,177 | ) | (70 | )% |
Our operating loss before other items was $6,637,418 for the six months ended April 30, 2023 as compared to an operating loss before other items of $3,897,241 for the six months ended April 30, 2022. The increase of $2,740,177 in operating loss is due to an increase in overall operating expenses as described above.
Other items
The following table sets forth our other income (loss) for the six months ended April 30, 2023, and April 30, 2022:
Six months ended April 30, | ||||||||||||||||
2023 | 2022 | % | ||||||||||||||
(unaudited) | (unaudited) | Change | Change | |||||||||||||
Foreign exchange | $ | (31,745 | ) | $ | 19,737 | $ | (51,482 | ) | (261 | )% | ||||||
Gain on revaluation of warrant derivative | 1,473,271 | 181,078 | 1,292,193 | 714 | % | |||||||||||
Financing costs | (417,794 | ) | (3,150,000 | ) | 2,732,206 | 87 | % | |||||||||
Other income (refer to Note 11 of the financial statements) | 159,324 | - | 159,324 | 100 | % | |||||||||||
Write down of prepaid inventory (refer to Note 5 of the financial statements) | (130,150 | ) | - | (130,150 | ) | (100 | )% | |||||||||
$ | 1,052,906 | $ | (2,949,185 | ) | $ | 4,002,091 | 136 | % |
Income from other items was $1,052,906 for the six months ended April 30, 2023 as compared to a loss from other items of $2,949,185 for the six months ended April 30, 2022. This is largely due to the $1,473,271 gain on the revaluation of the warrant derivative for six months ended April 30, 2023 in comparison to a gain of $181,078 during the six months ended April 30, 2022. The main drivers of the gain on the revaluation of the warrant derivative from the time of issuance are the decrease in the estimated stock price for the underlying shares. This gain is offset by financing costs of $417,794 related to the transaction costs incurred on issuance of warrants during the December 2022 private placement. See “Subsequent Events — December 2022 Private Placement and Inducement Letter” below.
The following table shows the evolution of the Company’s derivate warrant liability:
Balance, October 31, 2022 | $ | 1,242,580 | ||
Issued during the period | 1,974,626 | |||
Change in fair value of derivative | (1,473,271 | ) | ||
Derecognition of warrant derivative | (636,160 | ) | ||
Balance, April 30, 2023 | $ | 1,107,775 |
Selected Quarterly Information
The following table presents selected financial information for each of the previous eight quarters:
April 30, | January 31, | October 31, | July 31, | |||||||||||||
2023 | 2023 | 2022 | 2022 | |||||||||||||
Revenues | $ | 325,532 | $ | 1,076,092 | $ | 789,678 | $ | 730,956 | ||||||||
Net loss | (475,091 | ) | (5,109,421 | ) | (625,947 | ) | (1,292,898 | ) | ||||||||
Net loss per share | (0.95 | ) | (32.58 | ) | (2.00 | ) | (9.00 | ) |
April 30, | January 31, | October 31, | July 31, | |||||||||||||
2022 | 2022 | 2021 | 2021 | |||||||||||||
Revenues | $ | 301,978 | $ | 809,830 | $ | 528,359 | $ | 516,367 | ||||||||
Net loss | (2,732,972 | ) | (4,113,453 | ) | (1,568,006 | ) | (1,929,305 | ) | ||||||||
Net loss per share | (17.39 | ) | (26.25 | ) | (10.00 | ) | (12.25 | ) |
Liquidity and Capital Resources
The following table sets forth a summary of our cash flows from (used in) operating activities, investing activities and financing activities for the six months ended April 30, 2023 and April 30, 2022:
Six months ended April 30, | ||||||||||||||||
2023 | 2022 | % | ||||||||||||||
(unaudited) | (unaudited) | Change | Change | |||||||||||||
Net cash flows used in operating activities | $ | (4,746,426 | ) | $ | (3,360,441 | ) | $ | (1,385,985 | ) | (41 | )% | |||||
Net cash flows used in investing activities | (1,405 | ) | (2,042 | ) | 637 | 31 | % | |||||||||
Net cash flows from financing activities | 4,869,231 | 3,760,725 | 1,108,506 | 29 | % | |||||||||||
$ | 121,400 | $ | 398,242 | $ | (276,842 | ) | (70 | )% |
Net cash used in operating activities
Cash flows used in operations, which is generally the net income or loss adjusted for non-cash items, such as amortization and depreciation, fair valuation changes of the warrant derivative and changes in non-cash working capital items, was an outflow of $4,746,426 for the six months ended April 30, 2023, as compared to an outflow of $3,360,441 for the six months ended April 30, 2022. The main factor that contributed to the increase in cash outflow from operations was the higher operating loss of $6,637,418 for the six months ended April 30, 2023 compared to the operating loss for the six months ended April 30, 2022 of $3,897,241.
Net cash used in investing activities
Cash used in investing activities was $1,405 for the six months ended April 30, 2023 as compared to $2,042 for the six months ended April 30, 2022. Investing activities in both the current period and the comparative period consisted of purchases of equipment.
Net cash from financing activities
Cash provided by financing activities was $4,869,231 for the six months ended April 30, 2023 as compared to $3,760,725 for the six months ended April 30, 2022. The increase in cash provided from financing activities is due to: (i) a private placement that closed on December 9, 2022 for aggregate gross proceeds of approximately $3.0 million, before deducting fees to the placement agent and other offering expenses payable by the Company; and (ii) the issuance of an unsecured promissory note on March 20, 2023 in a principal amount of US$2,749,412 to Target Capital 14 LLC. The unsecured promissory note was issued at an original issue discount of 15% with a maturity date of July 18, 2023. See “Subsequent Events — Issuance of Convertible Note” below.
As of April 30, 2023, the Company had a working capital deficit of $5,180,536, compared to a working capital deficit of $1,408,415 as of October 31, 2022.
Funding requirements
As of and for the six-month period ended April 30, 2023, the Company has recurring losses, a working capital deficit of $5,180,536 (October 31, 2022 – working capital deficit of $1,408,415), an accumulated deficit totaling $31,970,826 (October 31, 2022 – accumulated deficit of $26,386,314) and negative cash flows used in operating activities of $4,746,426 (October 31, 2022 – negative cash flows used in operating activities of $12,590,778). The ability of the Company to carry out its business objectives is dependent on its ability to raise additional capital to support current operations and planned development.
Off-balance asset arrangements
During the periods presented, we did not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.
Financial Instruments and Risk Management
The following table shows the valuation techniques used in measuring Level 3 fair values for the derivative liability as well as the significant unobservable inputs used.
Type | Valuation technique | Key inputs | Inter-relationship
between significant inputs and fair value measurement | |||
Warrant derivative liability | The fair value of the warrant derivative liability at initial recognition and at period-end has been calculated using the Black Scholes option pricing model. | Key observable inputs ● Share price ● Risk free interest rate ● Dividend yield Key unobservable inputs ● Expected volatility |
The estimated fair value would increase (decrease) if: ● The share price was higher (lower) ● The risk-free interest rate was higher (lower) ● The dividend yield was lower (higher) ● The expected volatility was higher (lower) |
For the fair values of the derivative liability, reasonably possible changes to the expected volatility, the most significant unobservable input would have the following effects:
Unobservable Inputs | Change | Impact on comprehensive loss | ||||||||||
Six months ended April 30, 2023 | Six months ended April 30, 2022 | |||||||||||
Volatility | 20 | % | $ | 435,415 | $ | 261,511 |
The Company is exposed in varying degrees to a variety of financial instrument-related risks. The Board of Directors approves and monitors the risk management processes, inclusive of documented investment policies, counterparty limits, and controlling and reporting structures.
Risk Management
In the normal course of our business, we are exposed to a number of financial risks that can affect our operating performance and financial condition. These risks, and the actions taken to manage them, are as noted below.
Interest rate risk
Interest rate risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company is not exposed to any material interest rate risk.
Credit risk
Credit risk is the risk of loss associated with the counterparty’s inability to fulfill its payment obligations. For financial assets, this is typically the gross carrying amount, net of any amounts offset and any impairment losses.
The Company’s principal financial assets are cash and trade accounts receivable. The Company’s credit risk is primarily concentrated in its cash which is held with institutions with a high credit worthiness. Credit risk is not concentrated with any particular customer. The Company’s accounts receivable consists primarily of GST receivable. Trade receivables are generally insignificant.
At April 30, 2023, the Company’s maximum credit risk exposure is $152,604.
Foreign exchange risk
Foreign currency risk arises from fluctuations in foreign currencies versus the United States dollar that could adversely affect reported balances and transactions denominated in those currencies. As at April 30, 2023, a portion of the Company’s financial assets are held in Canadian dollars. The Company’s objective in managing its foreign currency risk is to minimize its net exposure to foreign currency cash flows by transacting, to the greatest extent possible, with third parties in United States dollars. The Company does not currently use foreign exchange contracts to hedge its exposure of its foreign currency cash flows as management has determined that this risk is not significant at this point in time. The Company is not exposed to any material foreign currency risk.
Liquidity risk
Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they fall due. The Company has a planning and budgeting process in place to help determine the funds required to support the Company’s normal operating requirements on an ongoing basis.
Historically, the Company’s primary source of funding has been the issuance of equity securities for cash, primarily through the issuance of common shares. The Company’s access to financing is always uncertain. There can be no assurance of continued access to significant equity funding.
As of April 30, 2023, the Company had cash of $194,321 and current liabilities of $6,066,387, compared to $72,921 and $2,593,913, respectively, as of October 31, 2022. Appropriate going concern disclosures have been made in Notes to the financial statements. To address the negative working capital balance and any short-term cash shortfalls as of April 30, 2023, the Company issued convertible debentures for gross proceeds of $3,341,176 in June 2023.
Capital Management
In the management of capital, the Company includes components of shareholders’ equity. The Company aims to manage its capital resources to ensure financial strength and to maximize its financial flexibility by maintaining strong liquidity and by utilizing alternative sources of capital including equity, debt and bank loans or lines of credit to fund continued growth. The Company sets the amount of capital in proportion to risk and based on the availability of funding sources. 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. Issuance of equity has been the primary source of capital to date. Additional debt and/or equity financing may be pursued in future as deemed appropriate to balance debt and equity. To maintain or adjust the capital structure, the Company may issue new shares, take on additional debt or sell assets to reduce debt.
Contractual Obligations
All of our contractual maturities for liabilities as at April 30, 2023 and October 31, 2022 are within one year, consisting of accounts payable and accrued expenses and loans payable.
Related Party Transactions
Key management personnel are those persons having authority and responsibility for planning, directing, and controlling the activities of the Company, directly or indirectly. Key management personnel include the Company’s executive officers and Board of Director members.
All related party transactions are in the normal course of operations. All amounts either due from or due to related parties other than specifically disclosed are non-interest bearing, unsecured and have no fixed terms of repayments.
Related party transactions with directors, subsequent and former directors and companies and entities over which they have significant influence:
Six months ended | ||||||||
April 30, 2023 | April 30, 2022 | |||||||
Consulting fees | $ | 11,163 | $ | - | ||||
Director fees | 93,000 | 47,905 | ||||||
Professional fees | - | 50,000 | ||||||
Salaries | 321,234 | 110,354 | ||||||
Share-based compensation | 405,419 | - | ||||||
$ | 830,816 | $ | 208,259 |
Accounts payable and accrued liabilities – As of April 30, 2023, $11,163 (October 31, 2022 - $33,918) due to related parties was included in accounts payable and accrued liabilities.
Critical Accounting Estimates and Judgments
The preparation of the Company’s Financial Statements in conformity with IFRS requires management to make judgments, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimate is revised, if the revision affects only that period, or in the period of the revision and future periods, if revision affects current and future periods.
The key assumptions concerning the future and other key sources of estimation uncertainty at the reporting date, which have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year, are prepared in accordance with the same accounting policies, critical estimates and methods described in the Company’s Financial Statements. The Company based its assumptions and estimates on parameters available when the Financial Statements were prepared. Existing circumstances and assumptions about future developments, however, may change due to market changes or circumstances arising that are beyond the control of the Company. Such changes are reflected in the assumptions when they occur.
Recent Accounting Pronouncements
None that specifically apply to the Company as evaluated by management.
Subsequent Events
Litigation
During the subsequent period, litigation was brought against the Company by the Toronto Dominion Bank (“TD Bank”) in which TD Bank made a claim for an amount of $1,721,345 (the “Principal Amount”) relating to a bank overdraft. TD Bank and the Company reached a settlement agreement in which the Company agreed to repay the Principal Amount plus interest and additional costs. The Settlement was guaranteed by a letter of credit issued to TD Bank by the Royal Bank of Canada in a notional amount of $2,000,000.
Issuance of Convertible Note
On June 26, 2023, the Company issued an unsecured convertible note in an aggregate principal amount of $3,341,176 (the “June 2023 Note”) to Target Capital 14 LLC (“Target Capital”) with a maturity date of June 26, 2024. The conversion price in effect is equal to $6.25 for the first seven months, and thereafter, 90% of the lowest closing price of the Company’s shares for the previous three trading days prior to the conversion date; provided, however, that such price shall in no event be less than $3.75. Consequently, a maximum of 890,980 shares of Common Stock are issuable by the Company upon conversion of the June 2023 Note. The June 2023 Note contains customary and standard representations and warranties, and covenants.
In connection with the issuance of the June 2023 Note, the Company entered into a securities purchase agreement with Target Capital and issued to Target Capital a common share purchase warrant to purchase 400,941 common shares (the “Purchase Warrant”), with an exercise price of $0.001 or on a cashless basis. The Purchase Warrants are classified as financial liabilities since the terms allows for a cashless net share settlement at the option of the holder.
The June 2023 Note cancelled an unsecured promissory note in the principal amount of $2,749,412 (the “Note”) that was issued to Target Capital on March 20, 2023 (the “March 2023 Note”). The March 2023 Note was issued at an original issue discount of 15% with a maturity date of July 18, 2023. As a result, the Company has no obligations pursuant to the March 2023 Note.
December 2022 Private Placement and Inducement Letter
On December 9, 2022, the Company closed a $3 million private placement transaction, pursuant to which the Company issued to certain investors (the “Holders”) common share purchase warrants (the “Existing Warrants”), each warrant exercisable for one share of Common Stock. On August 22, 2023, the Company issued an offer letter to the Holders (the “Inducement Letter”), providing the Holders the opportunity to exercise for cash all or some of the Existing Warrants at an exercise price of $3.33 per share of Common Stock in consideration for the issuance to each exercising Holder of a new Common Stock purchase warrant (the “New Warrant”) exercisable at an exercise price of $3.33 per share for a number of shares of Common Stock equal to 250% of the number of shares of Common Stock issued in connection with the Inducement Letter. In connection with the Inducement Letter, the Holders elected to exercise Existing Warrants for 633,026 shares of Common Stock. As a result of such exercise, New Warrants exercisable for an aggregate 1,582,565 shares of Common Stock were issued.
Share Capital
From August 1 to August 25, 2023, a total of 883,131 shares were issued from warrants being exercised for proceeds of $2,855,979. On August 10 and 14, 2023, the company issued 50,000 and 150,000 common shares, respectively, as compensation for consulting services.
Outstanding Share Data
The Company is authorized to issue an unlimited number of common shares without par value.
As at April 30, 2023, the Company had a total of 511,361 common shares outstanding and 19,689 restricted share units (“RSUs”) outstanding, and none of the RSUs had vested.
As of April 30, 2023, the following options were outstanding and vested, entitling the holders thereof the right to purchase one common share for each option held as follows:
Outstanding | Exercise Price | Expiry Date | Vested | |||||||||
3,207 | CAD$172.50 | November 9, 2025 | 3,207 | |||||||||
40,800 | $ | 6.25 | April 3, 2028 | - | ||||||||
44,007 | 3,207 |
The following table discloses the number of warrants outstanding as at April 30, 2023:
Number of warrants | Exercise Price | Expiry date | ||||||
10,736 | CAD$86.75 | August 3, 2024 | ||||||
18,474 | CAD$260.50 | August 3, 2024 | ||||||
163,565 | $ | 52 | August 4, 2027 | |||||
10,514 | $ | 130 | August 4, 2027 | |||||
11,931 | $ | 0.025 | August 4, 2027 | |||||
266,420 | $ | 52 | November 3, 2027 | |||||
118,667 | $ | 15 | June 9, 2028 | |||||
78,000 | $ | 15 | June 9, 2028 | |||||
11,333 | $ | 0.025 | No expiry | |||||
689,640 |
As of September 13, 2023, the Company had a total of 1,594,492 shares outstanding and 19,689 restricted share units (“RSUs”) outstanding, and 6,563 RSUs had vested.
The Company also had the following warrants outstanding as of such date:
Number of warrants | Exercise Price | Expiry date | ||||||
10,736 | CAD$86.85 | August 3, 2024 | ||||||
18,474 | CAD$260.55 | August 3, 2024 | ||||||
149,142 | $ | 52 | August 4, 2027 | |||||
10,514 | $ | 130 | August 4, 2027 | |||||
266,420 | $ | 52 | November 3, 2027 | |||||
11,931 | $ | 0.025 | August 4, 2027 | |||||
1,582,566 | $ | 3.33 | June 9, 2028 | |||||
2,049,783 |