REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934
|
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Large accelerated filer ☐
|
|
|
Accelerated filer ☐
|
|
|
|
|
|
Emerging growth company
|
U.S. GAAP ☐
|
|
|
|
|
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Other ☐
|
|
|
Item 17 ☐
|
|
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Item 18 ☐
|
|
|
2 | |||
Item 1.
|
2 | ||
Item 2.
|
2 | ||
Item 3.
|
2 | ||
Item 4.
|
18
|
||
Item 4A.
|
23
|
||
Item 5.
|
23
|
||
Item 6.
|
30
|
||
Item 7.
|
37
|
||
Item 8.
|
37 | ||
Item 9.
|
37
|
||
Item 10.
|
38
|
||
Item 11.
|
50 | ||
Item 12.
|
51 | ||
51
|
|||
Item 13.
|
51
|
||
Item 14.
|
52 | ||
Item 15.
|
52 | ||
Item 16.
|
53 | ||
Item 16A.
|
53 | ||
Item 16B.
|
53 | ||
Item 16C.
|
53 | ||
Item 16D.
|
54 | ||
Item 16E.
|
54 | ||
Item 16F.
|
54 | ||
Item 16G.
|
54 | ||
Item 16H.
|
54 | ||
Item 16I.
|
55
|
||
55
|
|||
Item 17.
|
55
|
||
Item 18.
|
55
|
||
Item 19.
|
55
|
•
|
the sections of the Securities Exchange Act of 1934 (the “Exchange Act”) regulating the solicitation of proxies in respect of a security registered under the Exchange
Act;
|
•
|
the sections of the Exchange Act requiring insiders to file public reports of their stock ownership and trading activities and liability for insiders who profit from
trades made in a short period of time; and
|
•
|
the rules under the Exchange Act requiring the filing with the Securities and Exchange Commission (the “SEC”) of quarterly reports on Form 10-Q containing unaudited
financial and other specified information, or current reports on Form 8-K, upon the occurrence of specified significant events.
|
•
|
the ability to include only two years of audited financial statements and only two years of related Management’s Discussion and Analysis of Financial Condition and
Results of Operations disclosure;
|
•
|
to the extent that we no longer qualify as a foreign private issuer (“FPI”), reduced disclosure obligations regarding executive compensation in this annual report and
other periodic reports or registration statements; and
|
•
|
an exemption from compliance with the requirement that the Public Company Accounting Oversight Board has adopted regarding a supplement to the auditor’s report
providing additional information about the audit and the financial statements for this annual report and other periodic reports or registration statements.
|
Item 1. |
Identity of Directors, Senior Management and Advisors
|
Item 2. |
Offer Statistics and Expected Timetable
|
Item 3. |
Key Information
|
A. |
[Reserved]
|
B. |
Capitalization and Indebtedness.
|
C. |
Reasons for the Offer and Use of Proceeds.
|
D. |
Risk factors
|
• |
realizing revenue from our existing and additional new customers, in new markets and at margins that are sufficiently improved;
|
• |
realizing revenue from new product offerings, such as our mobile delivery app;
|
• |
establishing more substantial sales and marketing arrangements, either alone or with additional third parties;
|
• |
improving our profit and operating margins with existing and new customers;
|
• |
sourcing and leasing dedicated warehousing facility space; and
|
• |
raising sufficient funds to finance our activities, or on terms that are acceptable.
|
• |
the need for continued development of our financial and information management systems;
|
• |
the need to manage strategic relationships and agreements with distributors, customers, and strategic partners;
|
• |
difficulties in hiring and retaining skilled management, technical, and other personnel necessary to support and manage our business.
|
• |
we may face difficulties in maintaining existing or acquired vehicles, or acquiring new vehicles at costs that are reasonable and that will not negatively impact our operating margins.
|
• |
difficulties in running operations in more than one country simultaneously, and manage workforces in each such country under varying applicable laws.
|
• |
we have insufficient quantity of dedicated resources and experienced personnel involved in reviewing and designing internal controls. As a result, a material misstatement of the interim and annual
financial statements could occur and not be prevented or detected on a timely basis.
|
• |
we did not perform an entity level risk assessment to evaluate the implication of relevant risks on financial reporting, including the impact of potential fraud-related risks and the risks related to
non-routine transactions, if any, on our internal control over financial reporting. Lack of an entity-level risk assessment constituted an internal control design deficiency which resulted in more than a remote likelihood that a
material error would not have been prevented or detected, and constituted a material weakness.
|
• |
we have not achieved the optimal level of segregation of duties relative to key financial reporting functions.
|
• |
our ability to retain and increase sales to existing customers, attract new customers, and satisfy our customers’ demands;
|
• |
our ability to retain and expand our network of sellers, and to maintain and cost effectively manage costs of our workforce;
|
• |
our ability to offer products on favorable terms, manage inventory, securing warehouse facility space, ability to buy or lease new fleet vehicles, and on favorable terms, including costs related to
branded vehicles and fulfill orders;
|
• |
the introduction of competitive stores, websites, products, services, price decreases, or improvements;
|
• |
changes in usage or adoption rates of the Internet, e-commerce, electronic devices, and web services;
|
• |
timing, effectiveness, and costs of expansion and upgrades of our systems and infrastructure;
|
• |
the success of our geographic, service, and product line expansions;
|
• |
the extent to which we finance, and the terms of any such financing for, our current operations and future growth;
|
• |
the outcomes of legal proceedings and claims, which may include significant monetary damages or injunctive relief and could have a material adverse impact on our operating results;
|
• |
variations in the mix of products and services we sell;
|
• |
factors affecting our reputation or brand image;
|
• |
the extent to which we invest in technology and content, fulfillment, and other expense categories;
|
• |
increases in the prices of fuel and gasoline, as well as increases in the prices of other energy products and commodities like paper and hardware products;
|
• |
our ability to collect amounts owed to us when they become due;
|
• |
the extent to which use of our services is affected by spyware, viruses, phishing and other spam emails, denial of service attacks, data theft, computer intrusions, outages, and similar events; and
|
• |
disruptions from natural or man-made disasters, extreme weather, domestic or global pandemics, geopolitical events and security issues (including terrorist attacks and armed hostilities), labor or trade
disputes, and similar events.
|
Item 4. |
Information on the Company
|
A. |
History and development of the Company
|
B. |
Business overview
|
• |
Targeting to be cash flow positive by the end of calendar year 2023;
|
• |
Targeting 50 percent or higher revenue growth for calendar year 2023 and significantly improving operating margins by up to 15 percent;
|
• |
Increasing the number of merchants in various verticals for next-day and same-day delivery services for the B2B markets, enabling easier customer acquisitions and business integration;
|
• |
Hiring sales leaders and execution teams in current and potential markets;
|
• |
Expanding revenue diversification through large e-commerce contracts, and potential acquisitions;
|
• |
Continue expanding into the Amazon and FedEx Ground ecosystem throughout Canada and the United States;
|
• |
Integrate artificial intelligence and prediction algorithms into our platform to maximize revenue potential, streamline services and increase overall margins;
|
• |
Integrate a new last-mile delivery platform to maximize revenue potential, streamline services and increase overall margins; and
|
• |
Deliver more than twenty million total packages by the end of 2023.
|
C. |
Organizational structure
|
D. |
Property, plant and equipment
|
Item 4A. |
Unresolved Staff Comments
|
Item 5. |
Operating and Financial Review and Prospects
|
A. |
Operating Results
|
For the year ended December 31,
|
||||
2022
|
2021
|
2020
|
||
C$
|
C$
|
C$
|
||
Revenue
|
11,242,660
|
7,521,952
|
6,317,329
|
|
Total revenue and other income
|
11,247,316
|
7,521,952
|
6,317,329
|
(in C$)
|
||||||||||||
2022
|
2021
|
2020
|
||||||||||
Net cash used in operating activities
|
(1,043,347
|
)
|
(1,076,788
|
)
|
(927,129
|
)
|
||||||
Net cash from/(used in) investing activities
|
373,350
|
(1,567,465
|
)
|
(112,034
|
)
|
|||||||
Net cash from/(used in) financing activities
|
216,847
|
2,908,071
|
999,238
|
C. |
Research and development
|
D. |
Trend Information
|
E. |
Critical Accounting Estimates
|
Item 6. |
Directors, Senior Management and Employees
|
A. |
Directors and Senior Management
|
Name
|
Age
|
Position
|
||
Rich Wheeless
|
43
|
Chief Executive Officer, Chief Financial Officer, Chairman of the Board of Directors
|
||
Brock Vandrick
|
35
|
Director
|
||
Robert Faissal
|
54
|
Director
|
B. |
Compensation
|
|
Salary
($)
|
|
|
Stock
awards
($)
|
|
|
Option
awards
($)
|
|
|
Incentive plan
compensation
($)
|
|
|
All other
compensation
($)
|
|
|
Total
($)
|
|
|||||||
Rich Wheeless
|
$
|
267,535
|
-
|
-
|
-
|
-
|
$
|
267,535
|
||||||||||||||||
Brock Vandrick
|
-
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||||||
Robert Faissal
|
-
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||||||
Total
|
$
|
267,535
|
-
|
-
|
-
|
-
|
267,535
|
C. |
Board Practices
|
• |
representing and serving the interests of shareholders by overseeing and appraising the strategies, policies and performance of the Company. This includes overviewing the financial and human resources the
Company has in place to meet its objectives and the review of management performance;
|
• |
protecting and optimizing company performance and building sustainable value for shareholders in accordance with any duties and obligations imposed on the Board by law and the Company’s Articles and
within a framework of prudent and effective controls that enable risk to be assessed and managed;
|
• |
responsible for the overall corporate governance of the Company and its subsidiaries, including monitoring the strategic direction of the Company and those entities, formulating goals for management and
monitoring the achievement of those goals;
|
• |
setting, reviewing and ensuring compliance with the Company’s values (including the establishment and observance of high ethical standards); and
|
• |
ensuring shareholders are kept informed of the Company’s performance and major developments affecting its state of affairs.
|
• |
selecting, appointing and evaluating from time to time the performance of, determining the remuneration of, and planning for the successor of, the CEO;
|
• |
reviewing procedures in place for appointment of senior management and monitoring of its performance, and for succession planning;
|
• |
overseeing the Company, including its control and accountability systems;
|
• |
input into and final approval of management development of corporate strategy, including setting performance objectives and approving operating budgets;
|
• |
reviewing and guiding systems of risk management and internal control and ethical and legal compliance. This includes reviewing procedures in place to identify the main risks associated with the Company’s
businesses and the implementation of appropriate systems to manage these risks;
|
• |
overseeing and monitoring compliance with the corporate governance policies;
|
• |
monitoring corporate performance and implementation of strategy and policy;
|
• |
approving major capital expenditure, acquisitions and divestitures, and monitoring capital management;
|
• |
monitoring and reviewing management processes in place aimed at ensuring the integrity of financial and other reporting;
|
• |
monitoring and reviewing policies and processes in place relating to occupational health and safety, compliance with laws, and the maintenance of high ethical standards; and
|
• |
performing such other functions as are prescribed by law or are assigned to the Board.
|
• |
appointment of a Chair;
|
• |
appointment and removal of the CEO;
|
• |
appointment of directors to fill a vacancy or as additional directors;
|
• |
establishment of Board committees, their membership and delegated authorities;
|
• |
approval of dividends;
|
• |
development and review of corporate governance principles and policies;
|
• |
approval of major capital expenditure, acquisitions and divestitures in excess of authority levels delegated to management;
|
• |
calling of meetings of shareholders; and
|
• |
any other specific matters nominated by the Board from time to time.
|
Name
|
|
Position
|
|
Year First
Appointed
|
|
Current term
expires
|
Robert Faissal
|
|
Director
|
|
2019
|
|
2023
|
Brock Vandrick
|
|
Director
|
|
2022
|
|
2023
|
Rich Wheeless
|
|
CEO, CFO, Board Chairman
|
|
2020
|
|
2023
|
D. |
Employees
|
|
2022
|
2021
|
2020
|
|||||||||
Category of Activity
|
||||||||||||
Research and Development
|
1
|
1
|
1
|
|||||||||
Finance and Administration
|
10
|
10
|
10
|
|||||||||
Couriers
|
182
|
163
|
105
|
|||||||||
Total
|
193
|
174
|
116
|
|
2022
|
2021
|
2020
|
|||||||||
Geographic Location
|
||||||||||||
Canada
|
103
|
120
|
116
|
|||||||||
United States
|
90
|
54
|
-
|
|||||||||
Total
|
193
|
174
|
116
|
E. |
Share Ownership
|
|
Number
|
Percentage
|
||||||
Common shares
|
||||||||
Rich Wheeless
|
9,000,000
|
4.58
|
%
|
|||||
Brock Vandrick
|
-
|
-
|
||||||
Robert Faissal
|
1,000,000
|
0.51
|
%
|
|||||
Total
|
10,000,000
|
5.09
|
%
|
|
No of
options
|
Grant
date
|
Expiry
date
|
Exercise
price
|
|||||||||
Rich Wheeless
|
1,000,000
|
|
May 6, 2020
|
May 6, 2025
|
|
$
|
0.09
|
||||||
Brian Storseth
|
500,000
|
|
May 6, 2020
|
May 6, 2025
|
|
$
|
0.09
|
||||||
Robert Faissal
|
400,000
|
|
May 6, 2020
|
May 6, 2025
|
|
$
|
0.09
|
||||||
Alex Nuttall
|
300,000
|
|
May 6, 2020
|
May 6, 2025
|
|
$
|
0.09
|
No of
options
|
|
Grant
date
|
|
Expiry
date
|
Exercise
price
|
|||||||
Rich Wheeless
|
1,000,000
|
|
November 12, 2020
|
|
November 12, 2025
|
$
|
0.075
|
|||||
Brian Storseth
|
500,000
|
|
November 12, 2020
|
|
November 12, 2025
|
$
|
0.075
|
|||||
Robert Faissal
|
300,000
|
|
November 12, 2020
|
|
November 12, 2025
|
$
|
0.075
|
|||||
Alex Nuttall
|
300,000
|
|
November 12, 2020
|
|
November 12, 2025
|
$
|
0.075
|
No of
options
|
|
Grant
date
|
|
Expiry
date
|
Exercise
price
|
|||||||
Rich Wheeless
|
1,000,000
|
|
January 22, 2021
|
|
January 22, 2026
|
$
|
0.145
|
|||||
Brian Storseth
|
500,000
|
|
January 22, 2021
|
|
January 22, 2026
|
$
|
0.145
|
|||||
Robert Faissal
|
250,000
|
|
January 22, 2021
|
|
January 22, 2026
|
$
|
0.145
|
|||||
Alex Nuttall
|
250,000
|
|
January 22, 2021
|
|
January 22, 2026
|
$
|
0.145
|
A. |
Major shareholders
|
B. |
Related Party Transactions
|
C. |
Interests of Experts and Counsel
|
Item 8. |
Financial Information
|
A. |
Consolidated Statements and Other Financial Information
|
B. |
Significant Changes
|
Item 9. |
The Offer and Listing
|
A. |
Offer and listing details
|
B. |
Plan of Distribution
|
C. |
Markets
|
D. |
Selling Shareholders
|
E. |
Dilution
|
F. |
Expenses of the issue
|
Item 10. |
Additional Information
|
A. |
Share Capital
|
B. |
Memorandum and Articles of Association
|
• |
borrow money in the manner and amount, on the security, from the sources and on the terms and conditions that the directors consider appropriate;
|
• |
issue bonds, debentures and other debt obligations either outright or as security for any liability or obligation of the Company or any other person and at such discounts or premiums and on such other
terms as the directors consider appropriate;
|
• |
guarantee the repayment of money by any other person or the performance of any obligation of any other person; and
|
• |
mortgage, charge, whether by way of specific or floating charge, grant a security interest in, or give other security on, the whole or any part of the present and future assets and undertaking of the
Company.
|
• |
determine the maximum number of shares of that class that the Company is authorized to issue;
|
• |
determine the maximum number of shares of that series that the Company is authorized to issue, determine that there is no such maximum number, or alter any such determination;
|
• |
create an identifying name for the shares of that series, or alter any such identifying name; and
|
• |
attach special rights or restrictions to the shares of that series, or alter any such special rights or restrictions.
|
• |
each such shareholder or proxy holder shall be deemed to be present at the meeting; and
|
• |
the meeting shall be deemed to be held at the location specified in the notice of the meeting.
|
D. |
Exchange controls
|
E. |
Taxation
|
• |
75% or more of its gross income for such year is “passive income” which for this purpose generally includes dividends, interest, royalties, rents and gains from commodities and securities transactions and
gains from assets that produce passive income; or
|
• |
50% or more of the value of its gross assets (based on an average of the quarterly values of the gross assets) during such year is attributable to assets that produce passive income or are held for the
production of passive income.
|
F.
|
Dividends and paying agents
|
G.
|
Statement by experts
|
H.
|
Documents on Display
|
I.
|
Subsidiary Information
|
I.
|
Annual Report to Security Holders
|
Item 11. |
Quantitative and Qualitative Disclosures about Market Risk
|
Item 12. |
Description of Securities Other than Equity Securities
|
A. |
Debt Securities
|
B. |
Warrants and Rights
|
C. |
Other Securities
|
D.
|
American Depositary Shares
|
Item 13. |
Defaults, Dividend Arrearages and Delinquencies
|
Item 14. |
Material Modifications to the Rights of Security Holders and the Use of Proceeds
|
Item 15. |
Controls and Procedures
|
• |
the Company has insufficient quantity of dedicated resources and experienced personnel involved in reviewing and designing internal controls. As a result, a material misstatement of the interim and annual
financial statements could occur and not be prevented or detected on a timely basis.
|
• |
the Company did not perform an entity level risk assessment to evaluate the implication of relevant risks on financial reporting, including the impact of potential fraud-related risks and the risks
related to non-routine transactions, if any, on our internal control over financial reporting. Lack of an entity-level risk assessment constituted an internal control design deficiency which resulted in more than a remote likelihood
that a material error would not have been prevented or detected, and constituted a material weakness.
|
• |
the Company has not achieved the optimal level of segregation of duties relative to key financial reporting functions.
|
• |
the Company would need to add sufficient number of independent directors to the board and appoint an audit committee.
|
• |
the Company would need to add sufficient knowledgeable accounting personnel to properly segregate duties and to affect a timely, accurate preparation of the financial statements.
|
• |
upon the hiring of additional accounting personnel, the Company would need to develop and maintain adequate written accounting policies and procedures.
|
Item 16. |
[Reserved]
|
Item 16A. |
Audit Committee Financial Expert
|
Item 16B. |
Code of Ethics
|
Item 16C. |
Principal Accounting Fees and Services
|
Fiscal 2020
C$
|
||||
Audit Fees
|
$
|
40,000
|
||
Audit Related Fees
|
$
|
5,000
|
||
Tax Fees
|
$
|
900
|
||
Total remuneration
|
$
|
45,900
|
Estimated
Fiscal 2022
C$
|
Fiscal 2021
C$
|
|||||||
Audit Fees
|
$
|
57,155
|
$
|
50,708
|
||||
Audit Related Fees
|
$
|
-
|
$
|
-
|
||||
Tax Fees
|
$
|
1,000
|
$
|
1,000
|
||||
Total remuneration
|
$
|
58,155
|
$
|
51,708
|
Item 16D. |
Exemptions from the Listing Standards for Audit Committees
|
Item 16E. |
Purchases of Equity Securities by the Issuer and Affiliated Purchasers
|
Item 16F. |
Changes in registrant’s Certifying Accountant
|
Item 16G. |
Corporate Governance
|
Item 16H. |
Mine Safety Disclosure
|
Item 16I. |
Disclosure Regarding Foreign Jurisdictions That Prevent Inspections
|
Item 17. |
Financial Statements
|
Item 18. |
Financial Statements
|
Page
|
|
Financial Statements for December 31, 2022, 2021, and 2020 and the years then ended:
|
|
Report of Independent Registered Public Accounting Firm (PCAOB ID |
) F-2 |
F-3
|
|
F-4
|
|
F-5
|
|
F-6
|
|
F-7
|
Notes
|
December 31,
2022
$
|
December 31,
2021
$
|
||||||||||
ASSETS
|
||||||||||||
Current assets
|
||||||||||||
Cash
|
|
|
||||||||||
Accounts receivable
|
5
|
|
|
|||||||||
Prepaid expenses
|
|
|
||||||||||
|
|
|||||||||||
Customer contract
|
3,4,7 |
|||||||||||
Vehicles and Right-of-use assets
|
6
|
|
||||||||||
Total assets
|
|
|
||||||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
||||||||||||
Current liabilities
|
||||||||||||
Accounts payable and accrued liabilities
|
9
|
|
|
|||||||||
Purchase obligation
|
3,4 |
|||||||||||
Convertible Note
|
14
|
|
|
|||||||||
Derivative liability
|
14
|
|
|
|||||||||
Sales tax payable
|
|
|
||||||||||
Short-term loan payable
|
8 |
|
|
|||||||||
Lease obligations - current
|
13
|
|
|
|||||||||
|
|
|||||||||||
Lease obligations
|
13
|
|
|
|||||||||
Total liabilities
|
|
|
||||||||||
SHAREHOLDERS’ (DEFICIT) EQUITY
|
||||||||||||
Share capital
|
9
|
|
|
|||||||||
Contributed surplus
|
|
|
||||||||||
Accumulated other comprehensive income
|
( |
) | ||||||||||
Deficit
|
(
|
)
|
(
|
)
|
||||||||
Total shareholders’ (deficit) equity
|
(
|
)
|
|
|||||||||
Total liabilities and shareholders’ (deficit) equity
|
|
|
Notes
|
2022
$
|
2021
$
|
2020
$
|
|||||||||||||
SALES
|
|
|
|
|
||||||||||||
COST OF SALES
|
15 |
(
|
)
|
(
|
)
|
(
|
)
|
|||||||||
GROSS PROFIT
|
|
|
||||||||||||||
EXPENSES
|
||||||||||||||||
Amortization of intangible assets
|
7 |
|
|
|
||||||||||||
Bad debt expense
|
4 |
|||||||||||||||
Consulting fees
|
|
|
|
|||||||||||||
Foreign exchange |
( |
) | ||||||||||||||
Marketing and promotion
|
|
|
|
|||||||||||||
Management and director fees
|
10
|
|
|
|
||||||||||||
Office and miscellaneous
|
|
|
|
|||||||||||||
Professional fees
|
|
|
|
|||||||||||||
Regulatory and filing fees
|
|
|
|
|||||||||||||
Salaries
|
10 |
|
|
|
||||||||||||
Share-based compensation
|
9
|
|
|
|
||||||||||||
Travel and accommodation
|
|
|
|
|||||||||||||
(
|
)
|
(
|
)
|
(
|
)
|
|||||||||||
Loss before other items
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||||||
Other expenses:
|
||||||||||||||||
Other income
|
||||||||||||||||
Debt Settlement
|
14 |
|
|
(
|
)
|
|||||||||||
Derivative liability
|
14 |
|
(
|
)
|
(
|
)
|
||||||||||
Interest expense
|
13, 14
|
(
|
)
|
(
|
)
|
(
|
)
|
|||||||||
Gain (loss) on disposal of asset
|
6 |
|
|
|
||||||||||||
Write-off of asset
|
( |
) | ||||||||||||||
|
(
|
)
|
(
|
)
|
||||||||||||
Net loss for the year
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||||||
Foreign currency translation adjustment
|
( |
) | ||||||||||||||
Comprehensive loss for the year
|
( |
) | ( |
) | ( |
) | ||||||||||
Basic and diluted loss per share
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||||||
Weighted average number of shares outstanding – basic and diluted
|
|
|
|
Number of
shares
|
Amount
$
|
Contributed
Surplus
$
|
Subscriptions
received in advance
$
|
Deficit
$
|
AOCI
$
|
Total
$
|
||||||||||||||||||||||
Balance, December 31, 2019
|
|
|
|
|
(
|
)
|
|
|
||||||||||||||||||||
|
||||||||||||||||||||||||||||
Option exercises
|
|
|
(
|
)
|
(
|
)
|
|
|
|
|||||||||||||||||||
Warrant exercises
|
||||||||||||||||||||||||||||
Convertible note
|
||||||||||||||||||||||||||||
Debt settlement
|
|
|
|
|
||||||||||||||||||||||||
In lieu of consulting fees
|
|
|
|
|
|
|
||||||||||||||||||||||
Write-off subscription receivable |
- | ( |
) | ( |
) | |||||||||||||||||||||||
Share-based compensation
|
-
|
|
|
|
|
|
|
|||||||||||||||||||||
Net and comprehensive loss for the year
|
-
|
|
|
|
( |
) |
|
(
|
)
|
|||||||||||||||||||
Balance, December 31, 2020
|
|
|
|
|
(
|
)
|
|
(
|
)
|
|||||||||||||||||||
|
||||||||||||||||||||||||||||
Shares issued pursuant to:
|
||||||||||||||||||||||||||||
Convertible note
|
||||||||||||||||||||||||||||
In lieu of consulting fees
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Acquisition of Web-to-door
|
||||||||||||||||||||||||||||
Warrant exercises
|
||||||||||||||||||||||||||||
Option exercises
|
( |
) | ||||||||||||||||||||||||||
Share-based compensation
|
-
|
|
|
|
|
|
|
|||||||||||||||||||||
Net and comprehensive loss for the year
|
-
|
|
|
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||||||||||||||
Balance, December 31, 2021 | ( |
) | ( |
) | ||||||||||||||||||||||||
Shares issued pursuant to:
|
||||||||||||||||||||||||||||
Convertible note
|
||||||||||||||||||||||||||||
In lieu of consulting fees
|
||||||||||||||||||||||||||||
Acquisition of customer contract
|
||||||||||||||||||||||||||||
Share-based compensation |
- | |||||||||||||||||||||||||||
Net and comprehensive loss for the year |
- | ( |
) | ( |
) | |||||||||||||||||||||||
Balance, December 31, 2022 |
( |
) | ( |
) |
2022
$
|
2021
$
|
2020
$ |
||||||||||
Operating activities
|
||||||||||||
Loss for the year
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Add non-cash items:
|
||||||||||||
Amortization
|
|
|
|
|||||||||
Share-based compensation
|
|
|
|
|||||||||
Accrued interest
|
|
|
|
|||||||||
Shares issued in lieu of consulting fees
|
|
|
|
|||||||||
(Gain) / Loss on debt settlement
|
( |
) | ||||||||||
Unrealized foreign exchange loss (gain)
|
|
|
(
|
)
|
||||||||
Impairment of asset
|
|
|
|
|||||||||
Fair value of derivative
|
(
|
)
|
|
|
||||||||
Gain on disposal of asset
|
( |
) | ||||||||||
Changes in non-cash working capital items
|
||||||||||||
Sales tax payable
|
|
|
|
|||||||||
Prepaid expenses
|
|
(
|
)
|
(
|
)
|
|||||||
Accounts receivable
|
(
|
)
|
|
|
||||||||
Accounts payable and accrued liabilities
|
|
(
|
)
|
|
||||||||
Net cash flows used in operating activities
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Investing activity
|
||||||||||||
Cash acquired on business combination
|
|
|
|
|||||||||
Sale of vehicles
|
|
|
|
|||||||||
Acquisition of Trucking |
( |
) | ||||||||||
Purchase of vehicles
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Net cash flows provided (used) by investing activity
|
|
(
|
)
|
(
|
)
|
|||||||
Financing activities
|
||||||||||||
Loan repayments |
( |
) | ( |
) | ( |
) | ||||||
Loan proceeds |
||||||||||||
Convertible note
|
|
|
|
|||||||||
Exercise of options
|
|
|
|
|||||||||
Exercise of warrants
|
|
|
|
|||||||||
Lease payments
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Subscriptions received
|
|
|
|
|||||||||
Net cash flows provided (used) by financing activities
|
|
|
|
|||||||||
Foreign exchange on cash
|
( |
) | ||||||||||
Change in cash during the year
|
(
|
)
|
|
(
|
)
|
|||||||
Cash – beginning of the year
|
|
|
|
|||||||||
Cash – end of the year
|
|
|
|
|||||||||
Supplemental cash flow information:
|
||||||||||||
Income taxes paid
|
|
|||||||||||
Interest paid
|
|
|
|
|||||||||
Non-Cash Items: |
||||||||||||
Shares issued pursuant to asset acquisition |
||||||||||||
Shares issued for convertible note settlement |
1.
|
NATURE OF OPERATIONS AND GOING CONCERN
|
2. |
BASIS OF PRESENTATION
|
Classification
IFRS 9 |
|
Cash
|
|
Accounts receivable
|
|
Accounts payable and accrued liabilities
|
|
Convertible note
|
|
Derivative liability
|
|
Short term loan
|
|
• |
Fixed payments, including in-substance fixed payments;
|
• |
Variable lease payments that depend on an index or rate, initially measured using the index or rate as at the commencement date;
|
• |
Amounts expected to be payable under a residual value guarantee; and
|
• |
The exercise price under a purchase option that the Company is reasonably certain to exercise, lease payments in an option renewal period if the Company is reasonably certain to exercise an extension option, and penalties for
early termination of a lease unless the Company is reasonably certain not to terminate early.
|
3. |
TRUCKING ACQUISITION
|
• |
USD $
|
• |
USD $
|
• |
USD $
|
• |
USD $
|
Purchase price consideration
|
US $
|
|||
Consideration – cash
|
|
|||
Consideration – shares
|
|
|||
Fair value of consideration
|
|
|||
Cash
|
|
|||
Prepaid expenses
|
|
|||
Loans payable
|
(
|
)
|
||
Accounts payable and accrued liabilities
|
(
|
)
|
||
Customer contract
|
|
|||
Total net assets acquired and liabilities assumed
|
|
4. |
ASSET ACQUISITION
|
Purchase price consideration
|
$ |
|||
Consideration – cash
|
|
|||
Consideration – shares
|
|
|||
Fair value of consideration
|
|
|||
Vehicles
|
|
|||
Customer contract
|
|
|||
Total net assets acquired
|
|
5. |
ACCOUNTS RECEIVABLE
|
December 31, 2022
$
|
December 31, 2021
$
|
|||||||
Accounts receivable
|
|
|
6. |
VEHICLES AND RIGHT-OF-USE ASSETS
|
Vehicles
$
|
ROU Assets
$
|
Total
$
|
||||||||||
Cost
|
||||||||||||
Balance, December 31, 2020
|
|
|
|
|||||||||
Additions
|
|
|
|
|||||||||
Disposal
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Balance, December 31, 2021
|
|
|
|
|||||||||
Additions
|
||||||||||||
Disposal
|
( |
) | ( |
) | ( |
) | ||||||
Foreign exchange
|
||||||||||||
Balance, December 31, 2022 | ||||||||||||
Accumulated amortization
|
||||||||||||
Balance, December 31, 2020
|
|
|
|
|||||||||
Amortization
|
|
|
|
|||||||||
Disposal
|
( |
) | ( |
) | ( |
) | ||||||
Balance, December 31, 2021
|
|
|
|
|||||||||
Amortization
|
|
|
|
|||||||||
Disposal
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Foreign exchange |
||||||||||||
Balance, December 31, 2022
|
|
|
|
|||||||||
Balance, December 31, 2021
|
|
|
|
|||||||||
Balance, December 31, 2022
|
|
|
|
7. |
CUSTOMER CONTRACTS
|
$
|
||||
Balance, December 31, 2020 |
||||
Additions |
||||
Foreign exchange |
||||
Balance, December 31, 2021
|
|
|||
Additions
|
|
|||
Amortization
|
(
|
)
|
||
Foreign exchange
|
|
|||
Balance, December 31, 2022
|
|
8. |
LOAN PAYABLE
|
9. |
SHARE CAPITAL
|
a)
|
On January 1, 2022, the Company issued
|
|||
b)
|
On January 20, 2022, the Company issued
|
|||
c)
|
On February 15, 2022, the Company issued
|
|||
d)
|
On May 4, 2022, the Company issued
|
|||
e)
|
On May 9, 2022, the Company issued
|
|||
f)
|
On May 13, 2022, the Company issued
|
|||
g)
|
On June 30, 2022, the Company issued
|
|||
h)
|
On June 30, 2022, the Company issued
|
a) |
On January 7, 2021, the Company issued
|
b) |
On January 13, 2021, the Company issued
|
c) |
On January 15, 2021, Company issued
|
d) |
On February 2, 2021, the Company issued
|
e) |
On February 17, 2021, the Company issued
|
f) |
On March 15, 2021, the Company issued
|
g) |
On May 20, 2021, the Company issued
|
h) |
On June 2, 2021, the Company issued
|
i) |
On September 15, 2021, the Company issued
|
j) |
On September 22, 2021, the Company issued
|
k) |
On September 30, 2021, the Company issued
|
l) |
On November 15, 2021, the Company issued
|
m) |
On December 7, 2021, the Company issued
|
n) |
On December 29, 2021, the Company issued
|
o) |
The Company issued
|
p) |
The Company issued
|
Number of
Options
#
|
Weighted Average
Exercise Price
$
|
|||||||
Balance, December 31, 2020
|
|
|
||||||
Granted
|
|
|
||||||
Exercised
|
(
|
)
|
|
|||||
Cancelled
|
(
|
)
|
|
|||||
Balance, December 31, 2021
|
|
|
||||||
Granted
|
|
|
||||||
Expired
|
(
|
)
|
|
|||||
Balance, December 31, 2022
|
|
|
Expiry
Date
|
Exercise price
$
|
Remaining
life (years)
|
Options
outstanding
|
|||||||||
|
|
|
|
|||||||||
|
|
|
|
|||||||||
|
|
|
|
|||||||||
|
|
|
|
|||||||||
|
|
|
|
|||||||||
|
|
|
|
|||||||||
|
|
|
|
|||||||||
|
|
|
|
|||||||||
|
|
|
|
|||||||||
|
|
|
|
|||||||||
|
|
|
|
|||||||||
|
|
|
|
|||||||||
|
|
|
|
|||||||||
|
|
Number of
Options
#
|
Weighted Average
Exercise Price
$
|
|||||||
Balance, December 31, 2020
|
|
|
||||||
Exercised
|
(
|
)
|
|
|||||
Expired
|
(
|
)
|
|
|||||
Balance, December 31, 2021 and December 31, 2022
|
|
|
10. |
RELATED PARTY TRANSACTIONS
|
2022
$
|
2021
$
|
2020
$
|
||||||||||
Consulting fees
|
|
|
||||||||||
Management fees
|
|
|
||||||||||
Salaries and wages
|
||||||||||||
Share-based compensation
|
|
|
||||||||||
|
|
11. |
SEGMENTED INFORMATION
|
2022
|
2021
|
|||||||
$ |
$ |
|||||||
Net gain (loss)
|
||||||||
Canada
|
(
|
)
|
(
|
)
|
||||
USA
|
(
|
)
|
|
|||||
(
|
)
|
(
|
)
|
December 31, 2022
|
December 31, 2021
|
|||||||
$ |
$ |
|||||||
Assets
|
||||||||
Canada
|
|
|
||||||
USA
|
|
|
||||||
|
|
12. |
FINANCIAL INSTRUMENTS
|
• |
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.
|
13. |
LEASE OBLIGATIONS
|
$ |
||||
Balance, December 31, 2020
|
|
|||
Lease additions
|
|
|||
Lease credit
|
(
|
)
|
||
Interest expense
|
|
|||
Payments
|
(
|
)
|
||
Balance, December 31, 2021
|
|
|||
Interest expense
|
|
|||
Lease termination
|
(
|
)
|
||
Payments
|
(
|
)
|
||
Balance, December 31, 2022
|
|
December 31, 2022
$
|
December 31, 2021
$
|
|||||||
Less than 1 year
|
|
|
||||||
1-5 years
|
|
|
||||||
5 + years
|
|
|
||||||
Total minimum lease payments
|
|
|
||||||
Less: Imputed Interest
|
(
|
)
|
(
|
)
|
||||
Total lease obligations
|
|
|
||||||
Current portion of lease obligations
|
(
|
)
|
(
|
)
|
||||
Non-current portion of lease obligations
|
|
|
14. |
CONVERTIBLE PROMISSORY NOTE
|
December 31,
2021
|
||||
Risk-free interest rate
|
|
%
|
||
Estimated life
|
|
|||
Expected volatility
|
|
%
|
||
Expected dividend yield
|
|
%
|
Convertible Debt
$
|
Derivative Liability
$ |
|||||||
Balance, December 31, 2020
|
|
|
||||||
Additions
|
|
|
||||||
Interest expense
|
|
|
||||||
Accretion
|
|
|
||||||
Change in fair value of derivative liability
|
|
|
||||||
Conversion of convertible debt
|
(
|
)
|
(
|
)
|
||||
Foreign exchange on loan
|
|
|
||||||
Balance, December 31, 2021
|
|
|
||||||
Interest expense
|
||||||||
Accretion
|
||||||||
Change in fair value of derivative liability
|
( |
) | ||||||
Conversion of convertible debt
|
( |
) | ||||||
Foreign exchange on loan
|
||||||||
Balance, December 31, 2022 |
15. |
COST OF SALES
|
2022
$
|
2021
$
|
2020
$
|
||||||||||
Amortization of vehicles
|
|
|
||||||||||
Driver expenses
|
|
|
||||||||||
Fuel
|
|
|
||||||||||
Short term vehicle rentals
|
|
|
||||||||||
Salaries and wages
|
|
|
||||||||||
|
|
Exhibit
Number
|
|
Description of Exhibit
|
|
Articles of ParcelPal Technology Inc.
|
|
|
||
|
Form of Warrant.
|
|
|
||
|
Convertible Promissory Note Agreement between ParcelPal Technology Inc. and Tangiers Global, LLC, dated June 29, 2020.
|
|
|
||
|
Convertible Promissory Note Agreement between ParcelPal Technology Inc. and Tangiers Global, LLC, dated April 14, 2020.
|
|
Convertible Promissory Note Agreement between ParcelPal Technology Inc. and Tangiers Global, LLC, dated September 29, 2020
|
||
Registration Rights Agreement between ParcelPal Technology Inc. and Tangiers Global, LLC, dated December 16, 2020.
|
||
Investment Agreement between ParcelPal Technology Inc. and Tangiers Global, LLC, dated December 16, 2020
|
||
Convertible Promissory Note Agreement between ParcelPal Technology Inc. and Tangiers Global, LLC, dated March 12, 2021
|
||
ParcelPal Technology Inc. Stock Option Plan
|
||
|
Stock Purchase Agreement, dated August 31, 2021
|
|
Convertible Promissory Note between the Company and Tangiers Global LLC, dated September 15, 2021
|
||
Capital Loan Agreement between the Company and ACH Capital West, LLC, dated July 21, 2022.
|
||
Capital Loan Agreement between the Company and ACH Capital West, LLC, dated October 3, 2022.
|
||
4.12***
|
Stock Purchase Agreement dated March 14, 2023.
|
|
|
Platform Agreement between ParcelPal Technology Inc. and Lineten Technologies Inc, dated February 14, 2020.
|
|
|
||
|
Transportation Agreement between ParcelPal Technology Inc. and Amazon Canada Fulfillment Services, Inc., dated February 11, 2021.
|
|
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Consulting Agreement for Chief Executive Officer of ParcelPal Technology Inc., dated March 27, 2020.
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Transportation Services Agreement between ParcelPal Technology Inc. and Goodfood Market Inc., dated May 26, 2020.
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Delivery Service Agreement between ParcelPal Technology Inc. and Bayshore Specialty Rx, dated March 31, 2021
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Delivery Service Agreement between ParcelPal Technology Inc. and Oco Meals, dated March 29, 2021
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General Delivery Service Agreement between ParcelPal Technology Inc. and CareRx Corporation, dated November 19, 2020
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Exclusive Services Agreement by ParcelPal Logistics Inc., dated August 31, 2021
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Independent Service Provider Agreement between Fedex Ground Package System, Inc. and ParcelPal Logistics USA, Inc., dated June 4, 2022
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Certification of Chief Executive Officer and Chief Financial Officer as required by Rule 13a-14(a) of the Securities Exchange Act of 1934
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Certification of Chief Executive Officer and Chief Financial Officer as required by Rule 13a-14(b) of the Securities Exchange Act of 1934
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Consent of Independent Registered Public Accounting Firm of BF Borgers CPA PC
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101.INS
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Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document).
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101.SCH
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Inline XBRL Taxonomy Extension Schema Document.
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101.CAL
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Inline XBRL Taxonomy Extension Calculation Linkbase Document.
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101.DEF
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Inline XBRL Taxonomy Extension Definition Linkbase Document.
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101.LAB
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Inline XBRL Taxonomy Extension Label Linkbase Document.
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101.PRE
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Inline XBRL Taxonomy Extension Presentation Linkbase Document.
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104
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Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101).
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# |
Filed herewith.
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* |
Filed as an Exhibit to our Form 20-F filed with the SEC and Sedar on August 4, 2020, as subsequently amended, and incorporated herein by reference.
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** |
Filed as an Exhibit to our Form 6-K filed with the SEC and Sedar on September 17, 2021.
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*** |
Filed as an Exhibit to our Form 6-K filed with the SEC and Sedar on March 17, 2023.
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Ω |
Portions of this exhibit (indicated by brackets and asterisks) have been omitted because the Company has determined that the information is both not material and is the type that the Company
treats as private or confidential.
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^ |
Certain of the exhibits and schedules to this exhibit have been omitted in accordance with Regulation S-K Item 601(a)(5). The Company agrees to furnish a copy of all omitted exhibits and
schedules to the SEC upon its request.
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PARCELPAL LOGISTICS INC.
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/s/ Rich Wheeless
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Rich Wheeless
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Chief Executive Officer, Chief Financial Officer, Director
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Date: May 15, 2023
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