As at
|
Notes
|
September 30, 2022
|
December 31, 2021
| |||||||||
Assets
| ||||||||||||
Current assets
| ||||||||||||
Cash and cash equivalents
|
$
|
78,060
|
$
|
221,188
| ||||||||
Guaranteed investment certificate
|
17,250
|
17,250
| ||||||||||
Sales taxes recoverable
|
43,578
|
25,867
| ||||||||||
Prepaid expenses and deposits
|
110,754
|
93,363
| ||||||||||
Contract asset
|
6
|
35,374
|
35,374
| |||||||||
285,016
|
393,042
| |||||||||||
Non-current assets
| ||||||||||||
Contract Asset
|
6
|
168,946
|
195,475
| |||||||||
Equipment
|
5
|
2,648
|
3,277
| |||||||||
Total assets
|
$
|
456,610
|
$
|
591,794
| ||||||||
Liabilities
| ||||||||||||
Current liabilities
| ||||||||||||
Accounts payable and accrued liabilities
|
12, 13
|
$
|
802,438
|
$
|
708,563
| |||||||
Contract liability
|
6
|
353,735
|
353,735
| |||||||||
Preference shares
|
8
|
692,525
|
611,386
| |||||||||
1,848,698
|
1,673,684
| |||||||||||
Non-current liabilities
| ||||||||||||
CEBA loan payable
|
9
|
39,153
|
34,255
| |||||||||
Deferred government grant income
|
5,636
|
8,454
| ||||||||||
Put liability
|
6
|
1,312,868
|
1,113,853
| |||||||||
Contract liability
|
6
|
1,689,444
|
1,954,746
| |||||||||
Royalty payable
|
7
|
4,340,392
|
2,649,181
| |||||||||
Total liabilities
|
9,236,191
|
7,434,173
| ||||||||||
Shareholders' deficiency
| ||||||||||||
Common shares
|
10
|
31,050,811
|
30,291,486
| |||||||||
Share subscriptions
|
10
|
266,360
|
-
| |||||||||
Contributed surplus
|
10
|
5,148,956
|
5,097,777
| |||||||||
Accumulated deficit
|
(45,245,708
|
)
|
(42,231,642
|
)
| ||||||||
Total shareholders' deficiency
|
(8,779,581
|
)
|
(6,842,379
|
)
| ||||||||
Total liabilities and shareholders' deficiency
|
$
|
456,610
|
$
|
591,794
|
/s/ "David Hall"
|
/s/ "Lee Buckler"
| |||
Director
|
Director
|
For the three months ended
|
For the nine months ended
| |||||||||||||||
Sept 30,
|
Sept 30,
|
Sept 30,
|
Sept 30,
| |||||||||||||
2022
|
2021
|
2022
|
2021
| |||||||||||||
$
|
$
|
$
|
$
| |||||||||||||
Revenue
| ||||||||||||||||
Licensing fees (Note 6)
|
88,434
|
88,434
|
265,302
|
265,302
| ||||||||||||
Expenses
| ||||||||||||||||
Research and development (Note 12)
|
176,079
|
259,061
|
404,576
|
917,782
| ||||||||||||
General and administrative (Note 12)
|
96,493
|
375,198
|
872,688
|
1,178,809
| ||||||||||||
Loss before other items
|
(184,138
|
)
|
(545,825
|
)
|
(1,011,962
|
)
|
(1,831,289
|
)
| ||||||||
Other items:
| ||||||||||||||||
Accretion on CEBA loan
|
(3,267
|
)
|
-
|
(4,898
|
)
|
-
| ||||||||||
Accretion on preference shares
|
(27,260
|
)
|
(27,260
|
)
|
(81,139
|
)
|
(121,508
|
)
| ||||||||
Accretion on put liability
|
(70,005
|
)
|
(56,226
|
)
|
(199,015
|
)
|
(159,843
|
)
| ||||||||
Accretion on royalty payable
|
(813,177
|
)
|
(232,790
|
)
|
(1,733,424
|
)
|
(388,850
|
)
| ||||||||
Foreign exchange gain (loss)
|
(17,851
|
)
|
(81,381
|
)
|
13,511
|
(68,121
|
)
| |||||||||
Gain on debt settlement (Note 10 b) i))
|
-
|
-
|
-
|
31,137
| ||||||||||||
Government grant income
|
-
|
-
|
2,818
|
4,032
| ||||||||||||
Gain (loss) on re-measurement of derivative liability (Note 7)
|
-
|
107,400
|
-
|
(705,951
|
)
| |||||||||||
Interest income
|
-
|
-
|
43
|
69
| ||||||||||||
Net and comprehensive loss
|
(1,115,698
|
)
|
(836,082
|
)
|
(3,014,066
|
)
|
(3,240,324
|
)
| ||||||||
Loss per Basic and diluted share
|
(0.03
|
)
|
(0.03
|
)
|
(0.05
|
)
|
(0.10
|
)
| ||||||||
Weighted average shares outstanding
|
35,688,231
|
32,076,391
|
35,351,758
|
33,479,325
|
Sept 30,
2022
|
Sept 30,
2021
| |||||||
Operating activities
| ||||||||
Net loss
|
$
|
(3,014,066
|
)
|
$
|
(3,240,324
|
)
| ||
Add items not involving cash:
| ||||||||
Accretion and accrued dividends
|
81,139
|
74,210
| ||||||
Accretion on CEBA loan
|
4,898
|
-
| ||||||
Accretion on royalty payable
|
1,691,211
|
388,850
| ||||||
Amortization of contract asset
|
26,529
|
26,529
| ||||||
Accretion of put liability (Note 6)
|
199,015
|
159,843
| ||||||
Gain on debt settlement
|
(31,137
|
)
| ||||||
Government grant income
|
(2,818
|
)
|
-
| |||||
Loss on re-measurement of derivative liability
|
-
|
705,951
| ||||||
Revenue from contract liability (Note 6)
|
(265,302
|
)
|
(265,302
|
)
| ||||
Depreciation (Note 5)
|
629
|
861
| ||||||
Stock-based compensation (Note 10 (e))
|
51,179
|
351,757
| ||||||
Changes in non-cash working capital balances:
| ||||||||
Sales taxes recoverable
|
(17,711
|
)
|
6,936
| |||||
Prepaid expenses and deposits
|
(17,391
|
)
|
(1,177
|
)
| ||||
Accounts payable and accrued liabilities
|
93,875
|
(167,305
|
)
| |||||
Net cash used in operating activities
|
(1,168,813
|
)
|
(1,990,308
|
)
| ||||
Financing activities
| ||||||||
Increase in CEBA loan
|
-
|
1,201
| ||||||
Increase in royalty payable
|
1,633,069
| |||||||
Gross proceeds on issuance of shares for settlement of debt
|
311,364
| |||||||
Gross proceeds on issuance of common shares (Note 10 b))
|
759,325
|
1,017,201
| ||||||
Increase in share subscriptions
|
266,360
|
240,995
| ||||||
Decrease in derivative liability
|
(624,549
|
)
| ||||||
Net cash provided by financing activities
|
1,025,685
|
2,267,916
| ||||||
Increase (Decrease) in cash and cash equivalents during the period
|
(143,128
|
)
|
227,608
| |||||
Cash and cash equivalents, beginning of the period
|
221,188
|
34,636
| ||||||
Cash and cash equivalents, end of the period
|
$
|
78,060
|
$
|
311,971
|
Common Stock
|
Contributed
|
Accumulated
| ||||||||||||||||||||||
Shares
|
Amount
|
Share
subscription
|
Surplus
|
Deficit
|
Total
| |||||||||||||||||||
Balance, January 1, 2021
|
34,959,207
|
$
|
30,291,486
|
$
|
-
|
$
|
5,097,777
|
$
|
(42,231,642
|
)
|
$
|
(6,842,379
|
)
| |||||||||||
Stock-based compensation (Note 10 (e))
|
-
|
-
|
-
|
51,179
|
-
|
51,179
| ||||||||||||||||||
Common shares issued private placement
|
4,218,470
|
759,325
|
-
|
-
|
-
|
759,325
| ||||||||||||||||||
Share subscriptions
|
-
|
-
|
266,360
|
-
|
-
|
266,360
| ||||||||||||||||||
Net loss for the period
|
-
|
-
|
-
|
(3,014,066
|
)
|
(3,014,066
|
)
| |||||||||||||||||
Balance, September 30, 2022
|
39,177,677
|
$
|
31,050,811
|
$
|
266,360
|
$
|
5,148,956
|
$
|
(45,245,708
|
)
|
$
|
(8,779,581
|
)
|
Common Stock
|
Contributed
|
Share
|
Accumulated
| |||||||||||||||||||||
Shares
|
Amount
|
Surplus
|
Subscriptions
|
Deficit
|
Total
| |||||||||||||||||||
Balance, January 1, 2021
|
29,951,419
|
$
|
28,471,140
|
$
|
4,626,021
|
$
|
-
|
$
|
(38,158,327
|
)
|
$
|
(5,061,166
|
)
| |||||||||||
Common shares issued - Mainpointe (Note 7)
|
2,506,802
|
1,015,401
|
-
|
-
|
-
|
1,015,401
| ||||||||||||||||||
Common shares issued - warrant exercised (Note 11 b) v))
|
5,000
|
1,800
|
-
|
-
|
-
|
1,800
| ||||||||||||||||||
Common shares issued - shares for debt (Note 11 b) ii)
|
889,612
|
311,364
|
-
|
-
|
-
|
311,364
| ||||||||||||||||||
Common shares issued - dividends on preference shares (Note 11 b) iii))
|
126,492
|
47,737
|
-
|
-
|
-
|
47,737
| ||||||||||||||||||
Share subscriptions (Note 11 b) i))
|
-
|
-
|
-
|
240,995
|
-
|
240,995
| ||||||||||||||||||
Stock-based compensation (Note 11 e))
|
-
|
-
|
351,757
|
-
|
-
|
255,831
| ||||||||||||||||||
Net loss for the period
|
-
|
-
|
-
|
-
|
(3,240,324
|
)
|
(2,404,242
|
)
| ||||||||||||||||
Balance, September 30, 2021
|
33,479,325
|
$
|
29,847,442
|
$
|
4,977,778
|
$
|
240,995
|
$
|
(41,398,651
|
)
|
$
|
(6,332,436
|
)
|
1.
|
Corporate Information
|
2.
|
Basis of Presentation
|
2. |
Basis of Presentation - continued
|
a)
|
Continuance of Operations
|
3. |
Critical Accounting Estimates and Judgements
|
3. |
Critical Accounting Estimates and Judgements - continued
|
3. |
Critical Accounting Estimates and Judgements - continued
|
4. |
Accounting Standards, Amendments and Interpretations
|
5. |
Equipment
|
Furniture and Equipment
|
Computer Equipment
|
Total
| ||||||||||
Cost:
At December 31, 2021
|
$
|
14,249
|
$
|
41,751
|
$
|
56,000
| ||||||
Additions
|
-
|
-
|
-
| |||||||||
Disposals
|
-
|
-
|
-
| |||||||||
At September 30, 2022
|
14,249
|
41,751
|
56,000
| |||||||||
Depreciation:
At December 31, 2021
|
12,808
|
39,915
|
52,723
| |||||||||
Depreciation
|
216
|
413
|
629
| |||||||||
At September 30, 2022
|
13,024
|
40,328
|
53,352
| |||||||||
Net book value at September 30, 2022
|
$
|
1,225
|
$
|
1,423
|
$
|
2,648
|
Furniture and Equipment
|
Computer Equipment
|
Total
| ||||||||||
Cost:
At December 31, 2020
|
$
|
14,249
|
$
|
41,751
|
$
|
56,000
| ||||||
Additions
|
-
|
-
|
-
| |||||||||
Disposals
|
-
|
-
|
-
| |||||||||
At September 30, 2021
|
14,249
|
41,751
|
56,000
| |||||||||
Depreciation:
At December 31, 2020
|
12,447
|
39,128
|
51,575
| |||||||||
Depreciation
|
270
|
591
|
861
| |||||||||
At September 30, 2021
|
12,717
|
39,719
|
52,436
| |||||||||
Net book value at September 30, 2021
|
$
|
1,532
|
$
|
2,032
|
$
|
3,564
|
6. |
Licensing and Collaboration Agreement - YOFOTO (China) Health Industry Co. Ltd.
|
•
|
the common shares that were not subject to the put - $715,280 ($794,755 less costs of $79,476);
|
•
|
the 1,071,580 warrants issued - $161,684 ($179,649 less costs of $17,965); and
|
•
|
the put liability - $520,426 ($578,251 less costs of $57,825).
|
6. |
Licensing and Collaboration Agreement - YOFOTO (China) Health Industry Co. Ltd. - continued
|
7. |
Investment and U.S. Partnership - Mainpointe Pharmaceuticals, LLC
|
•
|
$500,000 within five (5) days of receipt of conditional approval from the TSX Venture Exchange ($492,092 on February 8, 2021),
|
•
|
$1,200,000 by February 15, 2021 (received $490,000 on March 23, 2021 and $717,871 on April 23, 2021),
|
•
|
$700,000 by April 21, 2021 (received $500,528 on August 30, 2021, $199,472 received on November 29, 2021), and
|
•
|
$300,000 by August 21, 2021 ($298,921 received on November 29, 2021).
|
7.
|
Investment and U.S. Partnership - Mainpointe Pharmaceuticals, LLC - continued
|
Tranche receipt date
|
Tranche amount
$
|
Share capital or share subscription
$
|
Royalty payable
$
|
Loss on remeasurement of derivative liability
$
|
Derivative liability
$
| |||||||||||||||
February 8, 2021
|
492,092
|
364,512
|
346,287
|
(218,707
|
)
|
-
| ||||||||||||||
March 23, 2021
|
490,000
|
272,222
|
344,815
|
(127,037
|
)
|
445,384
| ||||||||||||||
April 23, 2021
|
717,871
|
378,667
|
507,376
|
(168,172
|
)
|
(163,892
|
)
| |||||||||||||
August 30, 2021
|
500,528
|
240,995
|
352,224
|
(92,691
|
)
|
(225,991
|
)
| |||||||||||||
November 30, 2021
|
498,393
|
203,049
|
350,845
|
(55,501
|
)
|
(55,501
|
)
| |||||||||||||
Total*
|
2,698,884
|
1,459,445
|
1,901,547
|
(662,108
|
)
|
-
|
Issue Date
|
Number of common shares
| |||
February 8, 2021
|
729,024
| |||
April 23, 2021
|
1,777,778
| |||
December 17, 2021
|
1,479,882
| |||
3,986,684
|
a)
|
5% of the amounts earned by and paid to the Company from the sale of any of its "NBDS Products" defined as its RCS-01 (NBDS Fibroblast Therapy - Treatment for Aging Skin), RCT-01 (NBDS Fibroblast Therapy - Treatment for Chronic Tendinosis) and any other product which is comprised of the non-bulbar dermal sheath cells patented by the Company, and
|
b)
|
20% of the amounts earned by and paid to the Company from the sale of any of its "DSC Products" defined as its RCH-01 (DSC Therapy for Treatment Androgenic Alopecia) and any other product which is comprised of the dermal sheath cup cells patented by the Company.
|
7. |
Investment and U.S. Partnership - Mainpointe Pharmaceuticals, LLC - continued
|
a)
|
four (4) years, or
|
b)
|
when MainPointe has earned USD $2,000,000 in gross income from the sale of the products in the RepliCel Injector Product Line.
|
Payback Period (years)
|
Royalty payable estimate at December 31, 2021
($)
|
Accretion expense for December 31, 2021
($)
|
Effective interest rate
| |||||||||||
2.34 (current estimate)
|
2,649,181
|
732,069
|
57
|
%
| ||||||||||
5.00
|
2,394,851
|
480,274
|
40
|
%
| ||||||||||
7.50
|
2,273,368
|
360,048
|
31
|
%
| ||||||||||
10.00
|
2,203,707
|
291,122
|
25
|
%
|
7. |
Investment and U.S. Partnership - Mainpointe Pharmaceuticals, LLC - continued
|
8. |
Preference shares
|
•
|
a fixed dividend rate which shall accrue on a daily basis (based on a 360- day year consisting of 12 30-day months) at a rate of seven (7%) per annum;
|
•
|
the right of the Class A Shareholder to convert the paid up amount of each Class A Share, from time-to-time, into shares of the Company (each, a "Share") at any time prior to the date that is five (5) years from the date of issuance of the Class A Shares at a conversion price of $0.33;
|
•
|
voting rights only on matters pertaining to Class A Shares until they are converted to common shares at which time all voting rights attach; and
|
•
|
a first priority over all Shares or shares of any other class of the Company as to dividends and upon liquidation.
|
(i)
|
$0.468 per Class A Share for the period from the date of issuance (the "Issue Date") to the date that is the first anniversary of the Issue Date;
|
(ii)
|
$0.536 for the period from the date that is the day after the first anniversary of the Issue Date to the date that is the second anniversary of the Issue Date;
|
(iii)
|
$0.604 for the period from the date that is the day after the second anniversary of the Issue Date to the date that is the third anniversary of the Issue Date;
|
(iv)
|
$0.672 for the period from the date that is the day after the third anniversary of the Issue Date to the date that is the fourth anniversary of the Issue Date; and
|
(v)
|
$0.740 for the period from the date that is the day after the fourth anniversary of the Issue Date and the date that is the fifth anniversary of the Issue Date.
|
8. |
Preference shares - continued
|
September 30, 2022
|
December 31, 2021
| |||||||
Opening preference share liability
|
$
|
611,386
|
$
|
517,773
| ||||
Dividends accrued
|
22,872
|
30,495
| ||||||
Accretion
|
58,267
|
110,855
| ||||||
Settlement of dividends through issuance of common shares (Note 13)
|
-
|
(47,737
|
)
| |||||
Exercisable, September 30, 2022 & December 31, 2021
|
$
|
692,526
|
$
|
611,386
|
9. |
Government grant
|
10. |
Share Capital
|
a)
|
Authorized:
|
b)
|
Issued and Outstanding:
|
i)
|
On August 30, 2020, the Company has received $500,828 from Mainpointe towards the Investment and U.S. Partnership (see Note 7). The common shares to be issued is 741,522 which had a value of $240,995 on this date.
|
10. |
Share Capital
|
b)
|
Issued and Outstanding:
|
iii) |
On May 17, 2021, Replicel issued 126,492 common shares in settlement of $47,737 on accrued dividends on issued preference shares (Note 8).
|
vi) |
On January 22, 2021, RepliCel signed three strategic agreements with MainPointe consisting of a Share Purchase Agreement, a Distribution Agreement, and a Royalty Agreement. The strategic investment of $2,700,000 under the Share Purchase Agreement from MainPointe will be spread over an 8-month period
|
c) |
Stock Option Plans:
|
10. |
Share Capital - continued
|
Number of Options
|
Weighted Average Exercise Price
| |||||||
Outstanding, December 31, 2021
|
2,825,000
|
$
|
0.41
| |||||
Granted
|
-
|
$
|
-
| |||||
Expired
|
(50,000
|
)
|
$
|
-
| ||||
Outstanding, September 30, 2022
|
2,775,000
|
$
|
0.41
| |||||
Exercisable, September 30, 2022
|
2,750,000
|
$
|
0.40
|
Number of Options
|
Weighted Average Exercise Price
| |||||||
Outstanding, December 31, 2020
|
1,730,000
|
$
|
0.51
| |||||
Granted
|
1,715,000
|
$
|
0.40
| |||||
Expired
|
(5,000
|
)
|
$
|
0.85
| ||||
Outstanding and Exercisable, September 30, 2021
|
3,440,000
|
$
|
0.45
|
Issue Date
|
Warrants Outstanding
|
Weighted Average
|
Expiry Date
| ||
Exercise Price
| |||||
15-Jul-20
|
1,819,555
|
$
|
0.36
|
15-Jul-23
| |
Outstanding, December 31, 2021
|
1,819,555
|
0.36
| |||
04-May-22
|
2,109,324
|
0.40
|
04-May-25
| ||
Outstanding, September 30, 2022
|
3,928,789
|
$
|
0.38
|
30-September-2022
|
30-September-2021
| |||||||
Companies controlled by directors of the Company (a)
|
$
|
55,125
|
$
|
38,875
| ||||
Directors or officers of the Company
|
136,333
|
57,333
| ||||||
$
|
191,458
|
$
|
96,208
|
2)
|
These amounts are unsecured, non-interest bearing and have no fixed terms of repayment.
|
Three months ended
|
Nine months ended
| |||||||||||||||
30-Sept-22
|
30-Sept-21
|
30-Sept-22
|
30-Sept-21
| |||||||||||||
Research and development
|
$
|
15,000
|
$
|
16,282
|
$
|
22,250
|
$
|
40,904
| ||||||||
General and administration
|
-
|
-
|
-
|
-
| ||||||||||||
$
|
15,000
|
$
|
16,282
|
$
|
22,500
|
$
|
40,904
|
Three months ended
|
Nine months ended
| |||||||||||||||
30-Sept-22
|
30-Sept-21
|
30-Sept-22
|
30-Sept-21
| |||||||||||||
General and administrative - salaries
|
$
|
86,250
|
$
|
84,000
|
$
|
258,500
|
$
|
252,000
| ||||||||
Directors' fees
|
17,750
|
21,750
|
61,250
|
57,333
| ||||||||||||
Stock-based compensation
|
24,517
|
96,148
|
46,484
|
327,407
| ||||||||||||
$
|
128,517
|
$
|
201,898
|
$
|
366,234
|
$
|
636,740
|
13. |
Financial Instruments and Risk Management
|
•
|
Currency risk;
|
•
|
Credit risk;
|
•
|
Liquidity risk; and
|
•
|
Interest rate risk.
|
13. |
Financial Instruments and Risk Management - continued
|
Years of Expiry
|
Financial Instruments
|
Amounts
| |||
Within 1 year
|
Accounts payable and accrued liabilities
|
$
|
802,438
| ||
Within 2 to 5 years
|
CEBA loan payable
|
$
|
39,153
| ||
Within 2 to 5 years
|
Preference shares
|
$
|
958,430
| ||
Greater than 5 years
|
Put liability
|
$
|
3,393,337
| ||
Greater than 5 years
|
Royalty payable
|
$
|
20,284,800
| ||
Total
|
$
|
25,478,158
|
15. |
Capital Management
|
17. |
Segmental Reporting
|
18.
|
Events after the Reporting Date
|
Each Unit consists of one common share of the Company (each, a "Share") and one-half of one share purchase warrant (each, a "Warrant"). Each whole Warrant entitles the holder thereof to purchase one additional Share of the Company at a price of $0.20 per Share for a period of three years from closing of the Offering. The Offering is subject to the approval of the Exchange. Insiders may participate in the Offering.
Finders' fees may be payable in connection with the Offering in accordance with the policies of the Exchange. All securities issued in connection with the Offering will be subject to a statutory hold period expiring four months and one day after closing of the Offering.
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RepliCel Life Sciences Inc. published this content on 30 November 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 30 November 2022 11:11:46 UTC.