Financial Data and Key Metrics Changes - Biotricity reported a revenue increase from $452,000 in fiscal Q1 2021 to approximately $1.8 million in Q1 2022, representing a 290% year-over-year increase and a 49% sequential increase from the previous quarter [25][26][30] - The current trailing 12-month revenue is about $4.7 million, with a run rate of $7 million, indicating strong growth momentum [12][30] - The company incurred a net loss of $5.9 million in Q1 2022, compared to $3.4 million in the same period last year, largely due to R&D and infrastructure development expenses [30][34] Business Line Data and Key Metrics Changes - The company has expanded its sales force and increased its market presence from 17 states to 23 states, with plans to reach all 50 states [9][10] - The number of cardiologists using Biotricity's products increased from 450 to 1,100, marking a 146% increase in just seven months [19] - Patient access to hospitals and clinics using Biotricity's technology rose from 900,000 to 2.2 million, a 144% increase [21] Market Data and Key Metrics Changes - Biotricity's market opportunity is estimated at $1 billion, with potential to grow to $3 billion and eventually $30 billion as new products are developed [31][23] - The company is positioned to benefit from the increasing demand for real-time monitoring and connected medical devices, especially in the context of chronic diseases [15][20] Company Strategy and Development Direction - The company aims to replicate its successful expansion strategy across new states while deepening its penetration in existing markets [10][18] - Biotricity is focused on developing a comprehensive cardiac diagnostic and management portfolio, with plans to integrate additional technologies in the future [77][80] - The company is pursuing a technology-as-a-service model, which allows for a more scalable and efficient revenue generation approach [54][60] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving a revenue run rate of $8 million to $10 million by the end of 2021, supported by strong customer retention and sales execution [7][11] - Despite potential impacts from COVID-19 variants, the company believes it can maintain its growth trajectory due to its diversified account base [96][99] - The management is optimistic about future product launches and FDA approvals, which are expected to drive further growth [105][106] Other Important Information - The company has a strong focus on R&D, with plans to continue investing in product development to enhance its market position [30][34] - Biotricity's gross margin improved to 70% in the most recent quarter, indicating effective cost management as the company scales [42] Q&A Session Summary Question: Can you elaborate on R&D efforts and future product areas? - The company is focused on completing its cardiac diagnostic and management portfolio before exploring other areas like diabetes and sleep apnea [77][80] Question: How many salespeople does the company currently have? - The company aims to have 40 to 50 full-time sales reps, supported by inside sales clinical reps, to optimize account openings and growth [85][86] Question: What is the incremental revenue potential from existing clinics? - The company estimates that it could triple its revenue by fully executing its product portfolio within existing accounts [88] Question: How has the Delta variant impacted operations? - While there has been some impact due to staff holidays, the company remains insulated due to its wide network across 23 states [96][99] Question: What is the status of Biotres at the FDA? - The company has completed all required steps for FDA clearance and is awaiting a response, with no significant concerns about delays [105][106]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2021 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the period from ______________ to_______________ Commission file number: 000-56074 BIOTRICITY INC. (Exact name of registrant as specified in its charter) Nevada 30-0983531 State or other ju ...

PART I [ITEM 1. BUSINESS](index=3&type=section&id=ITEM%201.%20BUSINESS) Biotricity Inc. is a medical technology company specializing in biometric data monitoring solutions, particularly in the diagnostic mobile cardiac telemetry (MCT) market with its FDA-approved Bioflux® technology - Biotricity Inc. is a medical technology company focused on biometric data monitoring solutions, with an initial focus on the diagnostic mobile cardiac telemetry (MCT) market[11](index=11&type=chunk) - The company's FDA-approved Bioflux® MCT technology, comprising a monitoring device and software, was made available for limited release in April 2018 and expanded commercialization in fiscal year ended March 30, 2020[12](index=12&type=chunk) - Biotricity operates on an insourcing business model, selling Bioflux devices to physicians and earning recurring technology service fees for the use of its back-office software, which reduces operating overhead and enhances market penetration[12](index=12&type=chunk)[33](index=33&type=chunk) - The company is developing several ancillary technologies, including advanced ECG analysis software, the Biotres patch solution (Holter monitoring), and Bioflux® 2.0, with plans for further FDA clearances[14](index=14&type=chunk) - Biotricity is developing telemedicine technology with real-time streaming capabilities for medical devices, aiming to align with Bioflux and facilitate remote cardiac diagnostics and patient care[15](index=15&type=chunk) - The global ECG market is growing at a **CAGR of 5.6%**, driven by an aging population, increased chronic diseases, and improved diagnostic technology. The US market accounted for approximately **27% of the global ECG market** as of 2015[18](index=18&type=chunk)[23](index=23&type=chunk) - MCT is preferred by physicians over Holter/Extended Holter and Event Loop solutions due to its real-time continuous monitoring, arrhythmia detection, and cellular communication, which enhances patient safety and reduces physician liability[26](index=26&type=chunk)[27](index=27&type=chunk) - The Bioflux MCT solution offers a complete, turn-key system with a GSM-enabled device, ECG reporting software, and physician-based monitoring, providing a revenue model for physicians with recurring reimbursements[33](index=33&type=chunk)[34](index=34&type=chunk) - Biotricity received 510(k) clearance from the FDA for its Bioflux software in October 2016 and for its Bioflux device in December 2017, enabling its entry into the U.S. market[39](index=39&type=chunk) - The company plans to expand its technology platform into future markets such as blood pressure, diabetes, sleep apnea, chronic pain, and fetal monitoring, with Bioheart focusing on preventative care and Bionatal on remote fetal cardiac monitoring[44](index=44&type=chunk)[45](index=45&type=chunk)[46](index=46&type=chunk)[47](index=47&type=chunk) - Biotricity faces competition from six main players in the MCT market, including BioTelemetry (acquired by Philips) and Preventice (acquired by Boston Scientific), which primarily use an outsourced business model. Biotricity differentiates itself with an insourced, usage-based model and a device with a screen for better patient feedback[52](index=52&type=chunk)[53](index=53&type=chunk)[54](index=54&type=chunk)[55](index=55&type=chunk) - The company primarily relies on trade secret protection for its proprietary information and has filed an industrial design patent in Canada, with plans for additional patents[59](index=59&type=chunk)[62](index=62&type=chunk) Research and Development Costs | Fiscal Year Ended | R&D Costs ($) | |:------------------|:--------------| | March 31, 2021 | 2.1 million | | March 31, 2020 | 1.4 million | - Biotricity's products are subject to extensive regulation by the U.S. FDA and other governmental agencies, with its custom software and hardware classified as Class II medical devices, requiring 510(k) premarket clearance[67](index=67&type=chunk)[73](index=73&type=chunk)[84](index=84&type=chunk) - The company assembles devices at its Redwood City, California facility and uses Providence Enterprises as an FDA-qualified contract manufacturer, while also relying on a limited number of principal suppliers for components[91](index=91&type=chunk)[92](index=92&type=chunk)[93](index=93&type=chunk) Employee and Consultant Count (as of report date) | Category | Count | |:-----------|:------| | Employees | 44 | | Consultants| 20 | [ITEM 1A. RISK FACTORS](index=16&type=section&id=ITEM%201A.%20RISK%20FACTORS) The company faces significant risks due to its limited operating history, unproven profitability, and dependence on physician adoption and third-party reimbursement for its cardiac monitoring solutions - The company has a limited operating history and has not been profitable, with an accumulated deficit of **$62,817,688** as of March 31, 2021, making future profitability uncertain[100](index=100&type=chunk)[104](index=104&type=chunk) - Success is dependent on convincing physicians to utilize its cardiac monitoring solution, which is influenced by factors like sufficient and timely reimbursement, education on MCT benefits, product reliability, and competitive pricing[111](index=111&type=chunk)[112](index=112&type=chunk) - The company is subject to extensive governmental regulations (FDA, Health Canada) for manufacturing, labeling, and marketing, with potential for reclassification of Class II devices to Class III, significantly increasing costs and delays[114](index=114&type=chunk)[115](index=115&type=chunk)[116](index=116&type=chunk) - The ability of customers to obtain and maintain adequate third-party reimbursement for services using Biotricity's products is critical, as commercial payors may consider the technology experimental, leading to refusal of reimbursement[124](index=124&type=chunk)[125](index=125&type=chunk)[128](index=128&type=chunk)[130](index=130&type=chunk)[131](index=131&type=chunk) - Product defects, interruptions in telecommunications/data services, and potential product liability claims could adversely affect operations, reputation, and financial results[137](index=137&type=chunk)[138](index=138&type=chunk)[139](index=139&type=chunk)[140](index=140&type=chunk)[143](index=143&type=chunk) - Additional capital of approximately **$15 million** is required to fund operations, sales expansion, and product development, with no assurance that such funds will be available on acceptable terms, potentially leading to dilution for current stockholders[145](index=145&type=chunk)[146](index=146&type=chunk)[147](index=147&type=chunk) - The medical technology industry is highly competitive and subject to rapid technological change, with larger competitors possessing greater financial and marketing resources[163](index=163&type=chunk)[164](index=164&type=chunk) - The company relies on trade secrets and intellectual property protection, but there's a risk of misappropriation, infringement claims, or inability to obtain/enforce patents, which could harm competitiveness[170](index=170&type=chunk)[171](index=171&type=chunk)[173](index=173&type=chunk)[174](index=174&type=chunk) - Compliance with federal and state healthcare fraud and abuse laws (e.g., Anti-Kickback Statute, Stark law, False Claims Act) and privacy regulations (HIPAA) is critical, with potential for substantial penalties if violations occur[178](index=178&type=chunk)[179](index=179&type=chunk)[181](index=181&type=chunk)[182](index=182&type=chunk)[183](index=183&type=chunk) - The common stock trades on the OTCQB market, which has limited liquidity and is subject to price volatility. There is no assurance of NASDAQ listing, and the stock is subject to SEC's 'penny stock' rules, which can hinder trading[188](index=188&type=chunk)[189](index=189&type=chunk)[190](index=190&type=chunk)[205](index=205&type=chunk)[206](index=206&type=chunk)[207](index=207&type=chunk) - The CEO, Waqaas Al-Siddiq, beneficially owns approximately **20.69%** of outstanding shares, giving him substantial influence over corporate decisions and potentially creating conflicts of interest[195](index=195&type=chunk)[196](index=196&type=chunk) [ITEM 1B. UNRESOLVED STAFF COMMENTS](index=32&type=section&id=ITEM%201B.%20UNRESOLVED%20STAFF%20COMMENTS) The company has no unresolved staff comments to report - Not applicable[212](index=212&type=chunk) [ITEM 2. PROPERTIES](index=32&type=section&id=ITEM%202.%20PROPERTIES) Biotricity Inc. operates from leased executive offices in Redwood City, California (3,500 sq ft) and Toronto, Canada (5,000 sq ft) - The company's principal executive office is a leased **3,500 square feet** premises at 275 Shoreline Drive, Redwood City, California[213](index=213&type=chunk) - Additional executive offices are leased at 75 International Blvd., Suite 300, Toronto, ON Canada M9W 6L9, comprising approximately **5,000 square feet**[213](index=213&type=chunk) - Biotricity does not own any real estate and considers its current leased facilities adequate for its needs, including development work[213](index=213&type=chunk) [ITEM 3. LEGAL PROCEEDINGS](index=32&type=section&id=ITEM%203.%20LEGAL%20PROCEEDINGS) Biotricity Inc. is not currently involved in any legal or governmental regulatory proceedings that would have a material adverse effect on the company or its business - The company is not currently a party to any legal or governmental regulatory proceedings[215](index=215&type=chunk) - There are no pending or potential legal or governmental regulatory proceedings proposed to be initiated against the company that would have a material adverse effect[215](index=215&type=chunk) [ITEM 4. MINE SAFETY DISCLOSURES.](index=32&type=section&id=ITEM%204.%20MINE%20SAFETY%20DISCLOSURES.) This item is not applicable to Biotricity Inc. - Not applicable[216](index=216&type=chunk) PART II [ITEM 5. MARKET FOR COMMON EQUITY, RELATED STOCKHOLDER MATTERS, AND ISSUER PURCHASES OF EQUITY SECURITIES](index=33&type=section&id=ITEM%205.%20MARKET%20FOR%20COMMON%20EQUITY%2C%20RELATED%20STOCKHOLDER%20MATTERS%2C%20AND%20ISSUER%20PURCHASES%20OF%20EQUITY%20SECURITIES) Biotricity's common stock trades on the OTCQB marketplace under the symbol "BTCY" with a closing price of $3.95 per share as of June 18, 2021, with 37,850,064 common shares and 1,466,718 exchangeable shares outstanding - Biotricity's common stock is traded on the OTCQB marketplace under the symbol "**BTCY**" since February 1, 2016[219](index=219&type=chunk) Common Stock and Shareholder Information (as of June 18, 2021) | Category | Count | |:--------------------------|:-------------| | Common Shares Outstanding | 37,850,064 | | Exchangeable Shares | 1,466,718 | | Shareholders of Record | ~132 | | Special Voting Preferred Stock | 1 | | Series A Preferred Shares | 8,045 | - Series A preferred shares earn dividends at a rate of **12% per annum**. The company does not anticipate paying cash dividends on common stock in the foreseeable future, intending to retain earnings for growth and operations[222](index=222&type=chunk)[210](index=210&type=chunk) Common Stock Issuances (Fiscal Year Ended March 31, 2021) | Purpose | Shares Issued | Fair Value ($) | |:--------------------------------------|:--------------|:---------------| | Consultant Compensation | 1,900,042 | 2.5 million | | Convertible Note Conversion | 733,085 | 1.0 million | | Obligation for Future Issuance | 18,402 | - | | Restricted Shares to Directors | 250,000 | 242,500 | | Exchange of Exchangeable Shares | 898,084 | Non-cash | - The company adopted an equity incentive plan effective February 2, 2016, authorizing up to **5,443,761 shares** of common stock for issuance, with an automatic annual increase for up to 10 years, not exceeding **15%** of outstanding common and exchangeable shares[227](index=227&type=chunk)[228](index=228&type=chunk) Equity Compensation Plan Information (as of March 31, 2021) | Category | Number of Securities Underlying Warrants and Rights | Weighted Average Exercise Price ($) | |:----------------------------------------------------------------------|:----------------------------------------------------|:------------------------------------| | Warrants granted to Directors and Officers | 858,806 | 1.485 | | Other Warrant Compensation (Brokers, Placement Agents, Contractors, Consultants, Investors): | | | | - Broker and PA | 1,258,495 | 1.848 | | - Consultant | 1,271,749 | 1.474 | | - Convertible Note | 7,454,152 | 1.302 | | **Total** | **17,847,458** | **-** | [ITEM 6. SELECTED FINANCIAL DATA](index=36&type=section&id=ITEM%206.%20SELECTED%20FINANCIAL%20DATA) This section is not applicable to Biotricity Inc. as it is a smaller reporting company - Not applicable to a smaller reporting company[238](index=238&type=chunk) [ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS](index=36&type=section&id=ITEM%207.%20MANAGEMENT%27S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITION%20AND%20RESULTS%20OF%20OPERATIONS) Biotricity Inc. is an early-stage healthcare technology company focused on remote patient monitoring solutions, particularly its Bioflux MCT device, experiencing significant revenue growth in FY2021 but incurring substantial net losses and a working capital deficiency - Biotricity is a healthcare technology company developing software and hardware solutions for chronic health issues, with its first product being the Bioflux wearable medical cardiac solution for remote patient monitoring[243](index=243&type=chunk) - Revenue is recognized when promised goods or services (device sales and technology fees) are transferred to customers, with technology fees recognized when a patient's cardiac study is complete[244](index=244&type=chunk)[245](index=245&type=chunk) - Inventory is valued at the lower of cost or net realizable value, with write-downs recorded for obsolete or excess inventory[247](index=247&type=chunk) - The company uses estimates and assumptions for financial reporting, particularly for deferred income tax assets, derivatives, convertible promissory notes, stock options, and going concern assessment[248](index=248&type=chunk) - Fair value measurements for financial instruments are categorized into Level 1, Level 2, and Level 3 based on observability of inputs, with cash classified as Level 1 and derivative liabilities as Level 3[254](index=254&type=chunk)[255](index=255&type=chunk)[257](index=257&type=chunk) - The company adopted ASC 842 for leases, recognizing right-of-use assets and lease liabilities on the balance sheet for most leases[259](index=259&type=chunk)[260](index=260&type=chunk) - Research and development costs are expensed as incurred, with milestone payments to third parties expensed before regulatory approval and capitalized thereafter[262](index=262&type=chunk) - Stock-based compensation is recognized based on fair values, net of estimated forfeitures, over the requisite service period[263](index=263&type=chunk) - The company adopted ASU 2017-11 for down round features of warrants, treating them as equity, and accounts for convertible notes and embedded conversion options under ASC 815 and ASC 470-20[266](index=266&type=chunk) Key Financial Performance (Fiscal Years Ended March 31) | Metric | FY2021 ($) | FY2020 ($) | Change (%) | |:------------------------------------------|:---------------|:---------------|:-----------| | Revenue | 3,384,767 | 1,417,725 | 139% | | Cost of Revenue | 1,871,125 | 931,951 | 101% | | Gross Profit | 1,513,642 | 485,774 | 212% | | General and Administrative Expenses | 12,806,306 | 10,053,223 | 27% | | Research and Development Expenses | 2,059,130 | 1,363,235 | 51% | | Total Operating Expenses | 14,865,436 | 11,416,458 | 30% | | Accretion and Amortization Expenses | 2,481,155 | 92,416 | 2584% | | Change in Fair Value of Derivative Liabilities | (408,872) (gain)| 60,781 (expense)| - | | Net Loss Attributable to Common Stockholders | (16,453,324) | (11,324,870) | 45% | | Loss Per Share (Basic and Diluted) | (0.438) | (0.315) | 39% | | Translation Adjustment | 223,121 (gain) | (102,344) (loss)| - | - The company is in commercialization mode for Bioflux and continues product development, incurring recurring losses and an accumulated deficit of **$62,817,688** and a working capital deficiency of **$6,168,700** as of March 31, 2021[282](index=282&type=chunk)[284](index=284&type=chunk) - Biotricity requires approximately **$15 million** in additional funds to support its operating plan, including sales team growth, device orders, and further Bioflux development, and anticipates needing more capital for accelerated growth[287](index=287&type=chunk)[288](index=288&type=chunk) Cash Flow Activities (Fiscal Years Ended March 31) | Cash Flow Category | FY2021 ($) | FY2020 ($) | |:--------------------------------|:---------------|:---------------| | Net Cash Used in Operating Activities | (11,080,831) | (7,862,779) | | Net Cash Provided by Financing Activities | 12,203,480 | 8,879,169 | | Net Cash Used in Investing Activities | 0 | 0 | | Cash, End of Period | 2,201,562 | 949,848 | - The company has no off-balance sheet arrangements that have or are reasonably likely to have a material current or future effect on its financial condition[293](index=293&type=chunk) [ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK](index=49&type=section&id=ITEM%207A.%20QUANTITATIVE%20AND%20QUALITATIVE%20DISCLOSURES%20ABOUT%20MARKET%20RISK) This item is not applicable to Biotricity Inc. as it is a smaller reporting company - Not applicable to a smaller reporting company[294](index=294&type=chunk) [ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA](index=49&type=section&id=ITEM%208.%20FINANCIAL%20STATEMENTS%20AND%20SUPPLEMENTARY%20DATA) The company's financial statements and corresponding notes are included in the report starting on page F-1 - Financial statements and supplementary data are found beginning on page F-1 of the Annual Report on Form 10-K[295](index=295&type=chunk) [ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURES](index=49&type=section&id=ITEM%209.%20CHANGES%20IN%20AND%20DISAGREEMENTS%20WITH%20ACCOUNTANTS%20ON%20ACCOUNTING%20AND%20FINANCIAL%20DISCLOSURES) There are no changes in or disagreements with accountants on accounting and financial disclosures to report - None[295](index=295&type=chunk) [ITEM 9A. CONTROLS AND PROCEDURES](index=49&type=section&id=ITEM%209A.%20CONTROLS%20AND%20PROCEDURES) Biotricity's management concluded that the company's disclosure controls and procedures were effective as of March 31, 2021, providing reasonable assurance for timely and accurate reporting - As of March 31, 2021, the company's Chief Executive Officer and principal financial officer concluded that disclosure controls and procedures were effective in ensuring material information is accumulated, communicated, recorded, processed, summarized, and reported timely[295](index=295&type=chunk)[297](index=297&type=chunk) - Management is responsible for establishing and maintaining adequate internal control over financial reporting and concluded that it was effective as of March 31, 2021, based on the COSO framework[298](index=298&type=chunk)[299](index=299&type=chunk) - As a smaller reporting company and an Emerging Growth Company (EGC), Biotricity is exempt from the requirement for an independent registered public accounting firm's attestation report on internal control over financial reporting[300](index=300&type=chunk) - No material changes in internal controls over financial reporting occurred during the fiscal year ended March 31, 2021[302](index=302&type=chunk) [ITEM 9B. OTHER INFORMATION](index=50&type=section&id=ITEM%209B.%20OTHER%20INFORMATION) There is no other information to report under this item - None[304](index=304&type=chunk) PART III [ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE](index=51&type=section&id=ITEM%2010.%20DIRECTORS%20AND%20EXECUTIVE%20OFFICERS%20AND%20CORPORATE%20GOVERNANCE) Biotricity's executive officers include Waqaas Al-Siddiq (President, CEO, Chairman) and John Ayanoglou (CFO), supported by a board of directors comprising Dr. Norman M. Betts, Patricia Kennedy, David A. Rosa, and Steve Salmon Executive Officers and Directors | Name | Age | Position | |:-----------------|:----|:------------------------------------------| | Waqaas Al-Siddiq | 35 | President, CEO, Chairman of the Board | | Dr. Norman M. Betts | 65 | Director | | Patricia Kennedy | 60 | Director | | David A. Rosa | 55 | Director | | Steve Salmon | 60 | Director | | John Ayanoglou | 55 | Chief Financial Officer | - Waqaas Al-Siddiq is the founder of iMedical and has served as Chairman and CEO since July 2014, bringing experience in remote monitoring and capital raising[308](index=308&type=chunk) - John Ayanoglou has served as CFO since October 2017, with prior CFO experience in publicly-listed companies and a background in financial services[314](index=314&type=chunk) - Patricia J. Kennedy filed a Form 4 late, reporting the issuance of **125,000 shares** of common stock for board services[316](index=316&type=chunk) - The Board of Directors has three standing committees: Audit, Compensation, and Nominating and Corporate Governance, with members elected annually[332](index=332&type=chunk) - The Audit Committee is responsible for selecting independent auditors, ensuring their independence, reviewing financial results, and overseeing risk assessment. It consists of Norman Betts (Chairman), David A. Rosa, and Patricia Kennedy, all deemed financially literate and independent[333](index=333&type=chunk)[334](index=334&type=chunk)[335](index=335&type=chunk) - The Compensation Committee reviews and approves executive and director compensation, administers equity incentive plans, and establishes compensation policies. It consists of David Rosa (Chairman) and Steve Salmon[336](index=336&type=chunk)[337](index=337&type=chunk) - The Nominating and Corporate Governance Committee identifies and screens director candidates, recommends nominees, and oversees corporate governance practices. It consists of David Rosa (Chairman) and Patricia Kennedy[338](index=338&type=chunk)[339](index=339&type=chunk) - Biotricity adopted a Code of Business Conduct and Ethics on April 12, 2016, applicable to its principal executive, financial, and accounting officers[340](index=340&type=chunk) - Dr. Betts, Steve Salmon, Ms. Kennedy, and Mr. Rosa are considered independent directors based on NASDAQ's definition[343](index=343&type=chunk) [ITEM 11. EXECUTIVE COMPENSATION](index=49&type=section&id=ITEM%2011.%20EXECUTIVE%20COMPENSATION) Executive compensation for Waqaas Al-Siddiq (CEO) and John Ayanoglou (CFO) includes base salary, bonuses, and significant option/warrant awards, with Mr. Al-Siddiq's total compensation for FY2021 at $891,286 and Mr. Ayanoglou's at $422,677 Summary Executive Compensation (Fiscal Years Ended March 31) | Name and Principal Position | Fiscal Year | Salary ($) | Bonus ($) | Option Awards ($) | Other Compensation ($) | Total ($) | |:----------------------------|:------------|:-----------|:----------|:------------------|:-----------------------|:----------| | Waqaas Al-Siddiq, CEO | 2021 | 390,000 | 195,000 | 294,286 | 12,000 | 891,286 | | | 2020 | 390,000 | 195,000 | 1,330,151 | 12,000 | 1,912,151 | | John Ayanoglou, CFO | 2021 | 225,000 | - | 194,677 | 3,000 | 422,677 | | | 2020 | 200,000 | - | 75,272 | - | 275,272 | Outstanding Equity Awards for Named Executive Officers (as of March 31, 2021) | Name | Number of Securities Underlying Options Exercisable () | Number of Securities Underlying Options Unexercisable () | Option Exercise Price ($) | Option Expiration Date | |:-----------------|:--------------------------------------------------------|:----------------------------------------------------------|:--------------------------|:-----------------------| | Waqaas Al-Siddiq | 4,149,988 | 1,050,000 | 1.05 to 1.44 | July 2026 to April 2030 | | John Ayanoglou | 838,806 | - | 0.48 to 3.50 | April 2027 to March 2031 | - Waqaas Al-Siddiq's employment agreement, effective April 10, 2020, sets his annual salary at **$390,000**, with eligibility for a cash and/or equity bonus of up to **50%** of his salary. He is entitled to **12 months of severance** if terminated without just cause or for good reason[323](index=323&type=chunk) - John Ayanoglou's initial base salary as CFO (effective October 27, 2017) was **$200,000**, increasing to **$300,000** for calendar 2021. He receives warrants to purchase common stock annually, vesting monthly over **12 months**[324](index=324&type=chunk) Non-Employee Director Compensation (Fiscal Years Ended March 31) | Name | Fiscal Year | Cash Paid ($) | Stock Awards ($) | Other Compensation ($) | Total ($) | |:-----------------|:------------|:--------------|:-----------------|:-----------------------|:----------| | Dr. Norman M. Betts | 2021 | 24,000 | 125,000 | - | 149,000 | | | 2020 | 24,000 | 87,500 | - | 111,500 | | Patricia Kennedy | 2021 | 24,000 | 125,000 | - | 149,000 | | | 2020 | 24,000 | 87,500 | - | 111,500 | | David A. Rosa | 2021 | 36,000 | 289,486 | - | 257,000 | | | 2020 | 24,000 | 87,500 | - | 119,500 | | Steve Salmon | 2021 | 24,000 | - | - | 24,000 | | | 2020 | - | - | - | - | [ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT](index=52&type=section&id=ITEM%2012.%20SECURITY%20OWNERSHIP%20OF%20CERTAIN%20BENEFICIAL%20OWNERS%20AND%20MANAGEMENT) As of June 18, 2021, Waqaas Al-Siddiq, the CEO, is the largest beneficial owner with 20.69% of common stock, including options, while directors and executive officers as a group collectively own 25.64% Beneficial Ownership of Common Stock (as of June 18, 2021) | Name of Beneficial Owner | Shares of Common Stock Beneficially Owned | % of Shares of Common Stock Beneficially Owned | |:------------------------------|:------------------------------------------|:-----------------------------------------------| | Waqaas Al-Siddiq | 8,949,810 | 20.69% | | Isa Khalid Abdulla Al-Khalifa | 2,814,594 | 7.21% | | Riazul Huda | 1,806,315 | 4.63% | | John Ayanoglou | 930,473 | 2.38% | | Norman M. Betts | 352,500 | * | | Patricia Kennedy | 263,021 | * | | David A. Rosa | 595,147 | * | | Steve Salmon | - | * | | All directors and executive officers as a group (6 persons) | 11,090,951 | 25.64% | *Less than 1% - The table assumes **39,014,942 shares** outstanding as of June 18, 2021, including common stock and exchangeable share common stock equivalents[347](index=347&type=chunk) - Waqaas Al-Siddiq's ownership includes options to purchase **4,237,474 shares** exercisable within 60 days[348](index=348&type=chunk) [ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE](index=54&type=section&id=ITEM%2013.%20CERTAIN%20RELATIONSHIPS%20AND%20RELATED%20TRANSACTIONS%2C%20AND%20DIRECTOR%20INDEPENDENCE) There are no certain relationships and related transactions to report, with director independence discussed in Item 10 - None[352](index=352&type=chunk) [ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES](index=54&type=section&id=ITEM%2014.%20PRINCIPAL%20ACCOUNTANT%20FEES%20AND%20SERVICES) Biotricity paid $79,730 in audit fees for the fiscal year ended March 31, 2021, an increase from $72,600 in the prior year, with all audit and permissible non-audit services pre-approved by the Board Principal Accountant Fees (Fiscal Years Ended March 31) | Fee Category | FY2021 ($) | FY2020 ($) | |:-------------|:-----------|:-----------| | Audit Fees | 79,730 | 72,600 | | Total Fees | 79,730 | 72,600 | - Audit fees consist of audit and review services, consents, and review of SEC-filed documents[354](index=354&type=chunk) - The Board pre-approves all audit and permitted non-audit services by the independent auditors, including annual approval of scope and fee estimates for year-end audits[355](index=355&type=chunk) - To date, the company has not engaged its auditors for any non-audit related services[355](index=355&type=chunk) PART IV [ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES](index=55&type=section&id=ITEM%2015.%20EXHIBITS%2C%20FINANCIAL%20STATEMENT%20SCHEDULES) This section lists all exhibits and financial statement schedules filed as part of the 10-K report, including organizational documents, various agreements, forms of securities, and corporate governance documents - The exhibits include organizational documents such as Amended and Restated Articles of Incorporation and By-Laws[358](index=358&type=chunk) - Various agreements are listed, including the Exchange Agreement, Voting and Exchange Trust Agreement, Support Agreement, and Software Development and Services Agreement[358](index=358&type=chunk)[359](index=359&type=chunk) - Forms of securities like Secured Convertible Debenture, Warrants, Convertible Promissory Notes, and Subscription Agreements are included[358](index=358&type=chunk)[359](index=359&type=chunk) - Corporate governance documents such as the 2016 Equity Incentive Plan, Employment Agreements, Code of Business Conduct and Ethics, and committee charters (Audit, Compensation, Nominating and Corporate Governance) are part of the exhibits[358](index=358&type=chunk)[359](index=359&type=chunk) [SIGNATURES](index=63&type=section&id=SIGNATURES) The 10-K report was duly signed on June 21, 2021, by Biotricity Inc.'s Chief Executive Officer and President, Waqaas Al-Siddiq, and Chief Financial Officer, John Ayanoglou, along with the directors - The report was signed on **June 21, 2021**[362](index=362&type=chunk)[364](index=364&type=chunk) - Signatories include Waqaas Al-Siddiq (Chairman, President, and Chief Executive Officer) and John Ayanoglou (Chief Financial Officer), as well as directors Norman M. Betts, David A. Rosa, Patricia Kennedy, and Steve Salmon[363](index=363&type=chunk)[364](index=364&type=chunk) Consolidated Financial Statements [Report of Independent Registered Public Accounting Firm](index=65&type=section&id=Report%20of%20Independent%20Registered%20Public%20Accounting%20Firm) SRCO Professional Corporation issued an unqualified opinion on Biotricity Inc.'s consolidated financial statements for FY2021 and FY2020, affirming fair presentation in accordance with US GAAP, with derivative liabilities valuation identified as a critical audit matter - SRCO Professional Corporation issued an **unqualified opinion** on Biotricity Inc.'s consolidated financial statements for the years ended March 31, 2021 and 2020, affirming fair presentation in accordance with US GAAP[367](index=367&type=chunk) - The valuation of derivative liabilities was identified as a **critical audit matter** due to the use of complex models and non-observable inputs requiring management's estimation and judgment[373](index=373&type=chunk) - The audit procedures for derivative liabilities included reviewing underlying instrument terms, testing management's valuation process, evaluating methodologies, and assessing the reasonableness of assumptions and inputs[374](index=374&type=chunk) [Consolidated Balance Sheets](index=67&type=section&id=Consolidated%20Balance%20Sheets) As of March 31, 2021, Biotricity Inc. reported total assets of $4.44 million, an increase from $2.00 million in 2020, while total liabilities significantly increased to $11.27 million from $5.00 million, and stockholders' deficiency worsened to $(6.83) million from $(3.00) million Consolidated Balance Sheet Highlights (as of March 31) | Category | 2021 ($) | 2020 ($) | Change ($) | Change (%) | |:-------------------------------|:-------------|:-------------|:-------------|:-----------| | **CURRENT ASSETS** | | | | | | Cash | 2,201,562 | 949,848 | 1,251,714 | 131.7% | | Accounts receivable, net | 1,520,836 | 486,187 | 1,034,649 | 212.8% | | Inventory | 272,493 | 85,720 | 186,773 | 217.9% | | Total current assets | 4,321,555 | 1,658,829 | 2,662,726 | 160.5% | | **TOTAL ASSETS** | **4,438,033**| **2,004,416**| **2,433,617**| **121.4%** | | **CURRENT LIABILITIES** | | | | | | Accounts payable and accrued liabilities | 2,520,124 | 1,521,689 | 998,435 | 65.6% | | Convertible promissory notes and short term loans | 4,278,018 | 2,068,302 | 2,209,716 | 106.8% | | Derivative liabilities | 3,633,856 | 0 | 3,633,856 | - | | Total current liabilities | 10,490,255 | 3,803,021 | 6,687,234 | 175.8% | | **TOTAL LIABILITIES** | **11,271,197**| **5,004,809**| **6,266,388**| **125.2%** | | **TOTAL STOCKHOLDERS' DEFICIENCY** | **(6,833,164)**| **(3,000,393)**| **(3,832,771)**| **127.7%** | | Accumulated deficit | (62,817,688) | (46,364,364) | (16,453,324) | 35.5% | [Consolidated Statements of Operations and Comprehensive Loss](index=68&type=section&id=Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Loss) For FY2021, Biotricity Inc. reported a significant increase in revenue to $3.38 million, up 139% from $1.42 million in 2020, but total operating expenses also rose to $14.87 million, leading to a net loss of $(16.45) million, a 45% increase from the prior year Consolidated Statements of Operations and Comprehensive Loss (Fiscal Years Ended March 31) | Metric | FY2021 ($) | FY2020 ($) | Change ($) | Change (%) | |:------------------------------------------|:---------------|:---------------|:-------------|:-----------| | Revenue | 3,384,767 | 1,417,725 | 1,967,042 | 138.7% | | Cost of Revenue | 1,871,125 | 931,951 | 939,174 | 100.8% | | Gross profit | 1,513,642 | 485,774 | 1,027,868 | 211.6% | | General and administrative expenses | 12,806,306 | 10,053,223 | 2,753,083 | 27.4% | | Research and development expenses | 2,059,130 | 1,363,235 | 695,895 | 51.0% | | Total operating expenses | 14,865,436 | 11,416,458 | 3,448,978 | 30.2% | | Accretion and amortization expenses | 2,481,155 | 92,416 | 2,388,739 | 2584.8% | | Change in fair value of derivative liabilities | (408,872) | 60,781 | (469,653) | - | | Net Loss Attributable to Common Stockholders | (16,453,324) | (11,324,870) | (5,128,454) | 45.3% | | Loss Per Share, Basic and Diluted | (0.438) | (0.315) | (0.123) | 39.0% | | Weighted Average Number of Common Shares Outstanding | 37,522,978 | 35,956,180 | 1,566,798 | 4.4% | [Consolidated Statements of Stockholders' Deficiency](index=69&type=section&id=Consolidated%20Statements%20of%20Stockholders%27%20Deficiency) Biotricity Inc.'s stockholders' deficiency significantly increased from $(3.00) million in March 2020 to $(6.83) million in March 2021, primarily due to a net loss of $(15.49) million and preferred stock dividends of $(0.96) million Consolidated Statements of Stockholders' Deficiency (Fiscal Years Ended March 31) | Category | Balance, March 31, 2019 ($) | Balance, March 31, 2020 ($) | Balance, March 31, 2021 ($) | |:------------------------------------------|:----------------------------|:----------------------------|:----------------------------| | Preferred Stock | 1 | 9 | 9 | | Common Stock and Exchangeable Shares | 35,362 | 36,382 | 39,015 | | Shares to be Issued | 91,498 | 169,490 | 280,960 | | Additional Paid-in Capital | 33,889,916 | 44,015,397 | 56,298,726 | | Accumulated Other Comprehensive (Loss) Income | (754,963) | (857,307) | (634,186) | | Accumulated Deficit | (35,039,495) | (46,364,364) | (62,817,688) | | **Total Stockholders' Deficiency** | **(1,777,681)** | **(3,000,393)** | **(6,833,164)** | - Net loss before preferred stock dividends for FY2021 was **$(15,491,176)**, contributing significantly to the accumulated deficit[381](index=381&type=chunk) - Preferred stock dividends of **$(962,148)** were recorded in FY2021[381](index=381&type=chunk) - Additional paid-in capital increased due to issuance of investor warrants (**$5,758,572**), private placement warrants (**$1,258,878**), and common shares for services and exercise of warrants (**$2,485,493**)[381](index=381&type=chunk) [Consolidated Statements of Cash Flows](index=70&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) For FY2021, Biotricity Inc. experienced a net cash outflow from operating activities of $(11.08) million, offset by a significant increase in net cash provided by financing activities to $12.20 million, ending the period with $2.20 million in cash Consolidated Statements of Cash Flows (Fiscal Years Ended March 31) | Cash Flow Category | FY2021 ($) | FY2020 ($) | Change ($) | Change (%) | |:----------------------------------------|:---------------|:---------------|:-------------|:-----------| | Net Cash Used in Operating Activities | (11,080,831) | (7,862,779) | (3,218,052) | 40.9% | | Net Cash Provided by Financing Activities | 12,203,480 | 8,879,169 | 3,324,311 | 37.4% | | Net Cash Used in Investing Activities | 0 | 0 | 0 | 0.0% | | Effect of Foreign Currency Translation | 129,065 | (130,189) | 259,254 | - | | Net Decrease in Cash During the Period | 1,190,590 | 1,016,389 | 174,201 | 17.1% | | Cash, End of Period | 2,201,562 | 949,848 | 1,251,714 | 131.8% | - Operating cash outflow was primarily due to selling expenses, research, product development, business development, marketing, and general operations[290](index=290&type=chunk) - Financing cash inflow was mainly from the issuance of **$11.4 million** (net proceeds) in convertible and promissory notes, and **$1.6 million** from federally guaranteed loans[291](index=291&type=chunk) - Interest paid was **$204,161** in FY2021, down from **$335,352** in FY2020[384](index=384&type=chunk) [Notes to Consolidated Financial Statements](index=71&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) [1. NATURE OF OPERATIONS](index=71&type=section&id=1.%20NATURE%20OF%20OPERATIONS) Biotricity Inc., incorporated in Nevada in 2012, and its wholly-owned Canadian subsidiary iMedical Innovations Inc., are engaged in research and development within the remote monitoring segment of preventative care, focusing on building technology for an existing healthcare market - Biotricity Inc. was incorporated on **August 29, 2012**, in Nevada, and iMedical Innovations Inc. became a wholly-owned subsidiary through a reverse take-over on **February 2, 2016**[386](index=386&type=chunk) - Both entities focus on research and development in remote monitoring for preventative care, aiming to build technology for an existing healthcare market with a commercialization pathway[387](index=387&type=chunk) [2. BASIS OF PRESENTATION, MEASUREMENT AND CONSOLIDATION](index=71&type=section&id=2.%20BASIS%20OF%20PRESENTATION%2C%20MEASUREMENT%20AND%20CONSOLIDATION) The consolidated financial statements are prepared in accordance with US GAAP and expressed in USD, including accounts of wholly-owned subsidiaries with intercompany transactions eliminated - Consolidated financial statements are prepared in accordance with US GAAP and expressed in United States dollars, including wholly-owned subsidiaries with eliminated intercompany accounts[388](index=388&type=chunk) - The company is an emerging growth entity in early commercialization, with recurring losses, an accumulated deficit of **$62,817,688**, and a working capital deficiency of **$6,168,700** as of March 31, 2021[391](index=391&type=chunk) - Management is pursuing funding sources (e.g., private placements, government loans) to support operations and alleviate substantial doubt about its ability to meet obligations for at least one year[391](index=391&type=chunk) - The COVID-19 pandemic's ultimate impact on operations remains unknown but is anticipated to have a material adverse impact on the business, financial condition, and results of operations[395](index=395&type=chunk)[396](index=396&type=chunk) [3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES](index=72&type=section&id=3.%20SUMMARY%20OF%20SIGNIFICANT%20ACCOUNTING%20POLICIES) Biotricity's significant accounting policies include revenue recognition under ASC 606 for device sales and technology fees, inventory valuation, and the use of estimates for financial statement preparation, along with specific accounting for EPS, foreign currency, receivables, fair value, leases, income taxes, R&D, stock-based compensation, and convertible notes - Revenue is recognized under ASC 606 when promised goods or services (Bioflux device sales and technology fees) are transferred to customers, with technology fees recognized upon completion of a patient's cardiac study[397](index=397&type=chunk)[398](index=398&type=chunk)[399](index=399&type=chunk) - Inventory is stated at the lower of cost or net realizable value, with write-downs recorded for obsolete or excess inventory[401](index=401&type=chunk) - The preparation of financial statements requires management to make estimates and assumptions, particularly for deferred income tax assets, derivatives, convertible promissory notes, and stock options[402](index=402&type=chunk) - Basic and diluted earnings per share are calculated in accordance with ASC Topic 260-10, excluding anti-dilutive shares[403](index=403&type=chunk) - Foreign currency transactions are translated into the functional currency at prevailing exchange rates, with monetary assets and liabilities translated at balance sheet date rates[406](index=406&type=chunk) - Accounts receivable are reported net of an estimated allowance for doubtful accounts, based on historical experience and risk assessment[407](index=407&type=chunk) - Fair value measurements are defined by ASC 820 and categorized into Level 1 (quoted market prices), Level 2 (similar assets in active markets), and Level 3 (unobservable inputs)[408](index=408&type=chunk)[409](index=409&type=chunk) - Operating leases are accounted for under ASC 842, recognizing right-of-use assets and corresponding lease liabilities based on the present value of future minimum lease payments[413](index=413&type=chunk)[414](index=414&type=chunk) - Income taxes are accounted for under ASC 740, recognizing deferred tax assets and liabilities for timing differences, with a valuation allowance established when necessary[415](index=415&type=chunk) - Research and development costs are charged to operations as incurred, with milestone payments expensed before regulatory approval and capitalized thereafter[416](index=416&type=chunk) - Stock-based payments are recognized in the statement of operations based on their fair values, net of estimated forfeitures, over the vesting period (ASC 718)[417](index=417&type=chunk)[418](index=418&type=chunk) - The company adopted ASU 2017-11 for down round features of warrants, treating them as equity. Convertible notes and embedded conversion options are accounted for under ASC 815 and ASC 470-20[420](index=420&type=chunk) - The company is evaluating the impact of recently issued accounting pronouncements, including ASU 2016-13 (Credit Losses), ASU 2019-07 (SEC Sections Updates), ASU 2019-12 (Income Taxes), ASU 2030-20 (Financial Instruments Improvements), and ASU 2021-04 (Equity-Classified Written Call Options)[421](index=421&type=chunk)[422](index=422&type=chunk)[423](index=423&type=chunk)[424](index=424&type=chunk)[425](index=425&type=chunk) [4. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES](index=79&type=section&id=4.%20ACCOUNTS%20PAYABLE%20AND%20ACCRUED%20LIABILITIES) As of March 31, 2021, Biotricity's accounts payable and accrued liabilities totaled $2,520,124, an increase from $1,521,689 in 2020, including amounts due to a shareholder who is also a director and executive of the company Accounts Payable and Accrued Liabilities (as of March 31) | Category | 2021 ($) | 2020 ($) | |:----------------------|:------------|:------------| | Trade and other payables | 1,041,385 | 1,094,072 | | Accrued liabilities | 1,478,739 | 427,617 | | **Total** | **2,520,124**| **1,521,689**| - Included in these liabilities are **$182,995** (2021) and **$379,881** (2020) due to a shareholder who is a director and executive of the company[429](index=429&type=chunk) [5. CONVERTIBLE PROMISSORY NOTES AND SHORT TERM LOANS](index=79&type=section&id=5.%20CONVERTIBLE%20PROMISSORY%20NOTES%20AND%20SHORT%20TERM%20LOANS) Biotricity issued $12.59 million in face value of Series A and Series B convertible promissory notes during FY2021, raising $11.38 million in net cash proceeds, with significant debt discounts and derivative liabilities recognized - During FY2021, the company issued **$11,275,500** (face value) in Series A convertible promissory notes and **$500,000** in additional promissory notes, and **$1,312,500** (face value) in Series B convertible promissory notes[432](index=432&type=chunk)[434](index=434&type=chunk)[448](index=448&type=chunk) - Net cash proceeds from Series A Notes issuance amounted to **$10,135,690**, and from Series B Notes issuance amounted to **$1,240,000**[442](index=442&type=chunk)[452](index=452&type=chunk) - The notes generally have a **1-year term** with interest rates between **10% and 12%**, and allow for conversion into equity, often at a discount to the volume-weighted average price or future financing price[431](index=431&type=chunk)[437](index=437&type=chunk)[438](index=438&type=chunk)[439](index=439&type=chunk)[440](index=440&type=chunk)[449](index=449&type=chunk)[450](index=450&type=chunk) - The company recognized debt issuance costs of **$2,311,854** and initial debt discounts of **$9,400,503** for the Series A and B Notes[447](index=447&type=chunk)[453](index=453&type=chunk)[454](index=454&type=chunk) - Embedded conversion and redemption features, along with investor and placement agent warrants, were initially accounted for as derivative liabilities (totaling **$7,429,236** at issuance) and later transferred to equity when warrant exercise prices became fixed[445](index=445&type=chunk)[446](index=446&type=chunk)[452](index=452&type=chunk)[454](index=454&type=chunk) - During FY2021, **$739,000** (face value) of Series A Notes were converted into **751,487 common shares**, resulting in a loss on conversion of **$103,375**[447](index=447&type=chunk)[473](index=473&type=chunk) Convertible Notes Summary (as of March 31, 2021) | Metric | Amount ($) | |:------------------------------------------|:-------------| | Face value of Series A and Series B Notes issued | 12,588,000 | | Debt discount | (9,400,503) | | Debt issuance cost | (2,311,854) | | Day 1 value of convertible notes issued | 875,643 | | Accretion of debt discount | 1,802,807 | | Amortization of debt issuance cost | 678,348 | | Total accretion and amortization expenses | 2,481,155 | | Conversion to common shares | (739,000) | | Balance at March 31, 2021 | 2,617,798 | [6. FEDERALLY GUARANTEED LOANS](index=82&type=section&id=6.%20FEDERALLY%20GUARANTEED%20LOANS) Biotricity received $370,900 from an Economic Injury Disaster Loan (EIDL) in April 2020 and $1,200,000 from a Paycheck Protection Program (PPP) Loan in May 2020, with the PPP Loan subsequently forgiven in May 2021 - In April 2020, the company received a **$370,900** Economic Injury Disaster Loan (EIDL) from the U.S. Small Business Administration (SBA) with a **30-year term** and **3.75% interest**[456](index=456&type=chunk) - In May 2020, Biotricity received a **$1,200,000** Paycheck Protection Program (PPP) Loan under the CARES Act, bearing **1.0% interest**[457](index=457&type=chunk) - The PPP Loan was forgiven by the SBA in May 2021, and the forgiveness was recognized as a **$1,156,453 reduction to payroll expense** and **$43,547 reduction to rent expense** for the fiscal year ended March 31, 2021[457](index=457&type=chunk)[458](index=458&type=chunk)[502](index=502&type=chunk) [7. DERIVATIVE LIABILITIES](index=82&type=section&id=7.%20DERIVATIVE%20LIABILITIES) Biotricity recognized derivative liabilities related to the variable conversion and redemption features of its Series A preferred shares and convertible notes, as well as associated warrants, measured at fair value using lattice and Monte Carlo methodologies - The company issued Series A preferred shares in December 2019 and January 2020, and additional shares in May 2020, with embedded variable conversion and redemption features[459](index=459&type=chunk)[460](index=460&type=chunk) - These embedded derivatives were bundled and valued as a single, compound embedded derivative, bifurcated from the underlying equity instrument, and treated as a derivative liability measured at fair value[461](index=461&type=chunk) Derivative Liabilities (as of March 31) | Category | 2021 ($) | 2020 ($) | |:------------------------------------------|:------------|:------------| | Derivative liabilities | 410,042 | 1,144,733 | | Derivative fair value at issuance (FY2021) | 41,749 | - | | Change in fair value of derivatives | (776,440) | - | - The lattice methodology was used to value preferred share derivative components, and Monte Carlo methodology for convertible note and warrant derivative components[463](index=463&type=chunk) Derivative Liabilities from Convertible Notes and Warrants (FY2021) | Category | Amount ($) | |:------------------------------------------|:-------------| | Derivative fair value at issuance: | | | - Series A notes | 6,932,194 | | - Series B notes | 497,042 | | **Total initial fair value** | **7,429,236**| | Fair value change upon end of warrants derivative treatment | (82,444) | | Carrying amount of warrants transferred equity | (3,937,664) | | Conversion to common shares | (225,284) | | Change in fair value of derivative liabilities | 450,012 | | **Balance at March 31, 2021** | **3,633,856**| - Upon finalization of the exercise price for warrants (January 8, 2021), the related derivative liabilities were marked to market and transferred to equity[446](index=446&type=chunk)[462](index=462&type=chunk) [8. STOCKHOLDERS' DEFICIENCY](index=83&type=section&id=8.%20STOCKHOLDERS%27%20DEFICIENCY) Biotricity's stockholders' deficiency reflects its authorized capital of 125 million common shares and 10 million preferred shares, with significant share issuances for private placements, services, and convertible note conversions, and stock-based compensation recognized for options granted - As of March 31, 2021, the company is authorized to issue **125,000,000 common shares** (**$0.001 par value**) and **10,000,000 preferred shares** (**$0.001 par value**), with **20,000** designated as Series A preferred stock[464](index=464&type=chunk) Outstanding Shares (as of March 31) | Share Type | 2021 (shares) | 2020 (shares) | |:-----------------------|:--------------|:--------------| | Common Shares | 36,124,964 | 32,593,751 | | Exchangeable Shares | 2,889,978 | 3,788,064 | | Total Common & Exchangeable | 39,014,942 | 36,381,815 | | Series A Preferred Stock | 8,045 | 7,830 | | Special Voting Preferred Stock | 1 | 1 | - The reverse takeover transaction on **February 2, 2016**, involved the exchange of iMedical shares for Biotricity common stock or exchangeable shares, and adjustments to options and warrants[466](index=466&type=chunk)[467](index=467&type=chunk)[468](index=468&type=chunk) - During FY2021, the company recorded preferred stock dividends of **$962,148** and made payments of **$602,969**[472](index=472&type=chunk) - **733,085 common shares** were issued in FY2021 from convertible note conversions, with an additional **18,402 shares** to be issued, resulting in a loss on conversion of **$103,375**[473](index=473&type=chunk) - **1,900,042 common shares** were issued for services and warrant exercises in FY2021[474](index=474&type=chunk) - The company recognized an obligation to issue **18,402 common shares** to convertible note holders and **250,000 common shares** to directors as of March 31, 2021[475](index=475&type=chunk) - In FY2021, **97,500 warrants** were exercised for **$67,941**. The company issued **449,583 warrants** for advisor/consultant services and **1,065,857 warrants** to brokers, and **5,631,132 warrants** to convertible note holders[478](index=478&type=chunk)[479](index=479&type=chunk) Warrants Outstanding (as of March 31) | Category | 2021 (warrants) | 2020 (warrants) | |:---------------------------------------|:----------------|:----------------| | Broker Warrants | 1,258,495 | 321,314 | | Consultant and Noteholder Warrants | 2,130,555 | 2,049,837 | | Warrants Issued on Convertible Notes | 7,454,152 | 2,734,530 | | Private Placement Warrants | 0 | 1,163,722 | | **Total** | **10,843,202** | **6,269,403** | - The 2016 Equity Incentive Plan authorizes stock options. In FY2020, the term of certain prior options was extended to **10 years**, resulting in a one-time charge of **$1,600,515** in stock-based compensation. In FY2021, **$790,535** in stock-based compensation was recorded[481](index=481&type=chunk)[483](index=483&type=chunk)[484](index=484&type=chunk)[485](index=485&type=chunk) Stock Option Activities (as of March 31) | Activity | Number of Options (2021) | Exercise Price ($) (2021) | |:-------------------------|:-------------------------|:--------------------------| | Outstanding as of March 31, 2020 | 4,393,610 | 3.1069 | | Granted | 2,610,647 | 1.0072 | | Outstanding as of March 31, 2021 | 7,004,256 | 2.3268 | [9. INCOME TAXES](index=90&type=section&id=9.%20INCOME%20TAXES) Biotricity Inc. reported no income tax recovery for FY2021 and FY2020 due to non-deductible expenses and a full valuation allowance against deferred tax assets, despite having significant non-capital losses available to offset future taxable income Income Tax Recovery (Fiscal Years Ended March 31) | Category | FY2021 ($) | FY2020 ($) | |:------------------------------|:--------------|:--------------| | Net loss | (15,491,176) | (11,066,942) | | Expected income tax recovery | (4,027,706) | (2,877,405) | | Non-deductible expenses | 1,313,530 | 912,038 | | Other temporary differences | (38,579) | (43,975) | | Change in valuation allowance | 2,752,755 | 2,009,342 | | **Income tax recovery** | **-** | **-** | Deferred Tax Assets (as of March 31) | Category | 2021 ($) | 2020 ($) | |:------------------------------|:--------------|:--------------| | Non-capital loss carry forwards | 7,311,800 | 4,636,203 | | Other temporary differences | 41,256 | 79,834 | | Valuation allowance | (7,353,056) | (4,716,037) | | **Total** | **-** | **-** | - A full valuation allowance was established against deferred tax assets due to negative evidence from incurred losses, indicating that realization of these assets is not more likely than not[490](index=490&type=chunk) - As of March 31, 2021, the company has approximately **$28,122,308** in non-capital losses available to offset future taxable income, expiring between **2035 and 2038**[491](index=491&type=chunk) - The company is not subject to any uncertain tax positions as of March 31, 2021 and 2020[492](index=492&type=chunk) [10. COMMITMENTS AND CONTINGENCIES](index=91&type=section&id=10.%20COMMITMENTS%20AND%20CONTINGENCIES) As of March 31, 2021, Biotricity Inc. has no significant outstanding claims or provisions for such claims recognized in its consolidated financial statements - There are no significant claims against the company outstanding as of March 31, 2021, and no provision for such claims has been recognized[493](index=493&type=chunk) [11. OPERATING LEASE RIGHT-OF-USE ASSETS AND LEASE OBLIGATIONS](index=91&type=section&id=11.%20OPERATING%20LEASE%20RIGHT-OF-USE%20ASSETS%20AND%20LEASE%20OBLIGATIONS) Biotricity Inc. has one operating lease for office and administration, with a right-of-use asset balance of $66,120 and a current lease obligation of $58,257 as of March 31, 2021 - The company has one operating lease for office and administration, with a weighted-average discount rate of **10%** applied to lease payments[494](index=494&type=chunk) Operating Lease Right-of-Use Asset and Lease Obligation (as of March 31, 2021) | Category | Amount ($) | |:------------------------------------------|:-----------| | Operating lease right-of-use asset - initial recognition | 413,236 | | Amortization | (347,116) | | **Balance at March 31, 2021 (ROU Asset)** | **66,120** | | Operating lease obligation - initial recognition | 413,236 | | Repayment and interest accretion | (354,979) | | **Balance at March 31, 2021 (Lease Obligation)** | **58,257** | | Current portion of operating lease obligation | 58,257 | | Noncurrent portion of operating lease obligation | Nil | - The operating lease expense for the year ended March 31, 2021, was **$213,826**, included in general and administrative expenses[495](index=495&type=chunk) Contractual Undiscounted Lease Obligations (as of March 31, 2021) | Period | Amount ($) | |:-------------------|:-----------| | Less than one year | 58,731 | | Beyond one year | - | | **Total** | **58,731** | [12. KEY MANAGEMENT COMPENSATION](index=91&type=section&id=12.%20KEY%20MANAGEMENT%20COMPENSATION) Key management compensation for Biotricity Inc. totaled $2,503,773 for the fiscal year ended March 31, 2021, a decrease from $3,247,343 in 2020, including salaries, allowances, and stock-based compensation for directors, shareholders, and executive officers Key Management Compensation (Fiscal Years Ended March 31) | Category | FY2021 ($) | FY2020 ($) | |:-------------------------|:--------------|:--------------| | Salary and allowance | 981,000 | 854,000 | | Stock based compensation | 1,522,773 | 2,393,343 | | **Total** | **2,503,773** | **3,247,343** | - Salary and allowance include salary, consulting fees, car allowance, vacation pay, bonus, and other allowances paid or payable to a shareholder, directors, and executive officers[499](index=499&type=chunk) - Stock-based compensation represents the fair value of options, shares, warrants, and equity incentive plan awards for directors, shareholders, and executive officers[500](index=500&type=chunk) [13. SUBSEQUENT EVENTS](index=91&type=section&id=13.%20SUBSEQUENT%20EVENTS) Subsequent to March 31, 2021, Biotricity Inc. received forgiveness for its $1,200,000 PPP Loan in May 2021, which had been accrued in the financial results, and an additional $499,000 from an EIDL - In May 2021, the **$1,200,000 PPP Loan** was forgiven by the SBA, with the impact already accrued in the financial results as of March 31, 2021[502](index=502&type=chunk) - The company received an additional **$499,000** in an Economic Injury Disaster Loan (EIDL) subsequent to year-end[503](index=503&type=chunk)

Financial Data and Key Metrics Changes - Biotricity reported a revenue increase from $362,920 in Q4 fiscal 2020 to $1.2 million in Q4 fiscal 2021, representing a 227% year-over-year increase and a sequential 19% increase over the previous quarter [28][29] - The company incurred a net loss of $5.5 million in Q4 2021, compared to a loss of $4.8 million in the same period of the previous year [37][41] - Gross margin improved to 69% in Q4 2021 from an adjusted gross margin of 22% in the prior quarter [34][35] Business Line Data and Key Metrics Changes - The company has expanded its network to 1,300 cardiologists, servicing 2.6 million patients, up from 375 cardiologists and 750,000 patients a year ago [20][21] - The focus remains on the Bioflux product, which is central to the company's strategy and growth [21][22] Market Data and Key Metrics Changes - Biotricity operates in 23 states, with plans for geographic expansion into larger markets such as California and Illinois [31][32] - The company aims to leverage its Technology-as-a-Service (TaaS) model to penetrate new markets and expand its product offerings [32][34] Company Strategy and Development Direction - The company envisions becoming a $1 billion entity by expanding its total addressable market from $1 billion with Bioflux to at least $30 billion in the next growth phase [38][60] - Biotricity is focused on remote patient monitoring in the cardiac space, emphasizing the importance of connected healthcare devices [13][14] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about post-COVID growth, citing increased awareness of the importance of monitoring for high-risk patients [10][51] - The company anticipates continued triple-digit revenue growth, with expectations for Q1 2022 to reach approximately 250% year-over-year growth [30][42] Other Important Information - The company is in an R&D and infrastructure development phase, preparing for the launch of its Biotres product [37][74] - Biotricity's business model is designed to reduce overhead and improve margins, allowing for better scalability and efficiency [24][25] Q&A Session Summary Question: What are the key factors driving revenue growth? - Management highlighted the reopening of the country post-COVID, expansion of the sales force, and increased awareness of monitoring as key factors driving revenue growth [67] Question: What is the utilization rate of Bioflux devices? - Management indicated that approximately 70-80% of revenue growth is coming from new accounts, with the remainder from optimizing existing device utilization [70] Question: How do you see gross margins improving over time? - Management stated that as the business scales, costs associated with devices will decrease, leading to improved gross margins [72] Question: What is the growth strategy for Biotres? - Biotricity plans to deploy Biotres in existing accounts first and then include it in new account offerings, focusing on high-end diagnostics with Bioflux as the primary product [74]

Financial Performance - Total revenue for the three months ended December 31, 2020, was $1,001,252, representing a 162% increase compared to $381,899 for the same period in 2019[15]. - Net revenue for the nine months ended December 31, 2020, reached $1,077,299, up 48% from $727,721 in the same period of 2019[15]. - The company reported a net loss of $3,900,246 for the three months ended December 31, 2020, compared to a net loss of $2,371,005 for the same period in 2019, indicating a 64% increase in losses[15]. - The net loss for the nine months ended December 31, 2020, was $10,019,631, compared to a net loss of $6,492,391 for the same period in 2019, indicating a worsening financial performance[19]. - The company reported a net loss before dividends of $10,019,631, compared to a loss of $6,468,720 in the previous period, indicating a significant increase in losses[24]. - The company incurred a net loss of $4.1 million for the three months ended December 31, 2020, compared to a net loss of $2.4 million in the same period of the prior year[131]. Assets and Liabilities - Total current assets increased to $4,942,238 as of December 31, 2020, from $1,658,829 as of March 31, 2020, marking a 197% growth[10]. - Total liabilities rose to $15,847,391 as of December 31, 2020, compared to $5,004,809 as of March 31, 2020, reflecting a 216% increase[11]. - The company’s accumulated deficit increased to $57,033,331 as of December 31, 2020, from $46,364,364 as of March 31, 2020, representing a 23% rise[13]. - The accumulated deficit as of December 31, 2020, reached $57,033,331, with a working capital deficiency of $3,501,151[32]. Expenses - General and administrative expenses for the three months ended December 31, 2020, were $3,688,868, compared to $2,179,928 for the same period in 2019, a 69% increase[15]. - Research and development expenses for the three months ended December 31, 2020, totaled $681,411, up from $447,639 in the same period of 2019, a 52% increase[15]. - Total operating expenses for the three and nine months ended December 31, 2020 were $4.4 million and $11.2 million, respectively, compared to $2.6 million and $7.2 million in the prior year[134]. - Research and development expenses for the three and nine months ended December 31, 2020 were $0.7 million and $1.5 million, respectively, reflecting increased activity for new technologies and FDA clearance pursuits[136]. Financing Activities - The company raised $1,570,900 from federally guaranteed loans during the three months ended June 30, 2020, which is expected to be forgivable[32]. - The company generated net cash proceeds of $9,617,221 from financing activities, compared to $9,464,675 in the previous period, showing strong financing support[24]. - The company issued $3,738,500 in a new series of convertible promissory notes during the three months ended December 31, 2020, with a maturity of one year and an interest rate of 12% per annum[165]. - The net proceeds from convertible note issuances to December 31, 2020, amounted to $6,031,719 after payment of the placement agent fee[165]. - Between January 1 and February 15, 2021, the Company issued an additional $4,885,000 in Notes under subscription agreements to accredited investors[165]. Shareholder Information - The weighted average number of common shares outstanding was 37,256,315 for the three months ended December 31, 2020, compared to 36,176,520 for the same period in 2019[15]. - The company had a total of 37,796,315 common exchangeable shares outstanding as of December 31, 2020, an increase from 36,291,753 shares as of December 31, 2019[22]. - The company issued 540,000 shares for services during the three months ended December 31, 2020, valued at $519,916[16]. - The company recognized its contractual obligations to issue 339,500 shares of common stock to advisors, with a fair value of $250,715, expensed in general and administrative and research and development expenses[77]. Strategic Initiatives - The company is focused on developing a range of medical technologies and obtaining regulatory approvals for commercialization, indicating a strategic emphasis on innovation and market expansion[27]. - The company launched its first commercial sales program during the year ended March 31, 2019, and a full market release occurred in the year ended March 31, 2020, indicating progress in commercialization[32]. - Biotricity Inc. focuses on biometric data monitoring solutions for medical, healthcare, and consumer markets, aiming to reduce healthcare costs and improve patient compliance[107]. - The company is committed to improving patient care and providing economic benefits to healthcare providers through its innovative solutions[111]. Regulatory and Market Developments - The company submitted its application for a 510(k) clearance from the FDA for its Biotres patch solution on February 11, 2021[103]. - Biotricity's Bioflux® MCT technology received FDA approval and was made available for limited release on April 6, 2018, marking the start of expanded commercialization efforts[109]. - The COVID-19 pandemic has increased the importance of telemedicine, and Biotricity is negotiating a licensing agreement for a telemedicine platform to enhance its Bioflux product[111].

Financial Data and Key Metrics Changes - Revenue increased from $0.4 million in fiscal Q3 2020 to just over $1 million in Q3 2021, representing a 162% year-over-year increase and a sequential increase of 34.5% over Q2 2021 [16][17][21] - The company incurred a net loss of approximately $4.1 million compared to $2.4 million in the prior year [21][22] - Operating expenses increased approximately 66.3% year-over-year to $4.4 million, driven by infrastructure and sales team expansion [22] Business Line Data and Key Metrics Changes - The company has achieved 11 quarters of consecutive growth, with triple-digit year-over-year growth and approximately 20% to 40% sequential growth [7][12] - Over 700 cardiologists across 20 states are using the company's product, marking a 150% year-over-year increase in the number of physicians [8][9] - The current addressable market in the cardiac diagnostic space is approximately $1.2 billion, expected to grow to $4 billion with the approval of the new product, Biotres [9][10] Market Data and Key Metrics Changes - The company has expanded its geographic presence from 12 states to 20 states [9] - The cardiac monitoring market is experiencing increased demand due to the shift towards remote monitoring, accelerated by COVID-19 [34][80] Company Strategy and Development Direction - The company aims to double its sales force and expand its market presence to 30 states by the end of the year [53][55] - Focus on developing a complete suite of products to enhance the cardiologist-patient relationship and increase revenue [20][32] - The company is committed to a technology-as-a-service model, which allows for better integration with physician practices and improved patient care [70][96] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving triple-digit growth for fiscal 2021 and 2022, supported by a recurring revenue model [47][48] - The company is focused on accelerating growth through product pipeline execution and deeper market penetration [71][73] - Management acknowledged potential risks but emphasized the unique business model designed for growth and value [69][70] Other Important Information - The company completed a financing round, raising approximately $11.7 million to support growth initiatives [13][24] - The Biotres product is designed to address unmet needs in the Holter market and is expected to be profitable despite market pressures faced by competitors [62][63] Q&A Session Summary Question: Current sales force headcount and future plans - The company is focusing on doubling its sales force and expanding its market presence to 30 states by the end of the year [53][54] Question: Impact of pricing pressure from competitors - The Bioflux product is unaffected by pricing pressures faced by competitors like iRhythm, and the Biotres product is designed to be profitable within the current reimbursement framework [62][63] Question: Risks associated with growth execution - The company is confident in its growth trajectory and is focused on accelerating growth through product pipeline execution [69][71] Question: Guidance for future quarters - If Biotres is approved, it is expected to have a 20% to 30% impact on overall performance, with continued quarter-over-quarter growth of 25% to 40% [73] Question: Broadening investor base and potential uplisting - The company is committed to increasing awareness and plans to pursue a national exchange listing to expand its investor base [75][76] Question: Differences in physician payment structures - The company provides technology to physicians who bill for both professional and technical fees, resulting in a more favorable financial arrangement compared to competitors [96][97] Question: Breakdown of utilization revenues versus sales revenues - Utilization revenues are becoming a larger percentage of total revenue, while device sales are decreasing as a fraction of revenue [103][104]

Financial Data and Key Metrics Changes - Revenue increased from $346,000 in Q2 fiscal 2020 to $745,000 in Q2 fiscal 2021, representing a 115% year-over-year increase and a sequential 65% increase over Q1 fiscal 2021 [28] - Net loss for the quarter was $3.2 million, with operating expenses increasing approximately 21% year-over-year to $3.2 million [32][34] - R&D expenses were $402,000, a 43% increase over the previous quarter, consistent with ongoing product development [35] Business Line Data and Key Metrics Changes - The core business focuses on remote patient monitoring (RPM) with a technology platform for chronic care conditions, particularly in the cardiac space [7][10] - The Bioflux platform, launched in early 2019, allows real-time monitoring of high-risk patients, addressing the limitations of traditional passive recording devices [12][14] - The company has expanded its geographical coverage to 18 states and aims to double that by the end of 2021, with a 99% retention rate among cardiologists [15] Market Data and Key Metrics Changes - The total addressable market (TAM) for the company's products is projected to increase from $1 billion to $3 billion with the introduction of new products targeting low-risk patients [42][65] - The chronic care market is estimated to be a $50 billion market, highlighting the significant growth potential in cardiac management [74] Company Strategy and Development Direction - The company aims to expand its solution offerings to cover a broader spectrum of cardiac complexities and chronic conditions [39][45] - A strategic partnership with Verizon was announced to develop applications for first responders, indicating a diversification of the technology platform [16] - The focus is on enhancing the technology-as-a-service (TaaS) model to create recurring revenue streams and improve patient care [10][20] Management's Comments on Operating Environment and Future Outlook - Management believes that remote monitoring will continue to grow post-pandemic, as it has become a best practice in healthcare [26] - The company is confident in achieving triple-digit growth for fiscal 2021 and 2022 based on its recurring revenue model [36] - The management emphasizes the importance of growth over immediate profitability, aligning with market opportunities [88] Other Important Information - The company has successfully sourced $4.2 million in funding to support ongoing business needs, including expanding the sales force and R&D [36] - The recent FDA clearance of the Bioflux Software II System is expected to enhance operational efficiency and reduce analysis time [22][23] Q&A Session Summary Question: Can you explain the device and the choice of 4G/5G over Bluetooth? - The FDA requires real-time data transmission for cardiac monitoring, which necessitates a cellular connection to avoid risks associated with Bluetooth dependency [49][50] Question: Is the $1.2 million revenue tied solely to Bioflux? - All revenue recognized so far is Bioflux-oriented, with additional products and services expected to contribute in the next quarter [57] Question: What is the strategy for business development and competition? - The company plans to expand its sales force and believes that its unique telemedicine approach for chronic cardiac patients sets it apart from competitors [60][61] Question: When does the company expect to achieve profitability? - The focus remains on growth rather than immediate profitability, with a strong recurring revenue model supporting this strategy [87] Question: How do consumer devices like Apple Watch impact Biotricity? - Consumer devices serve as screening tools, leading patients to seek proper diagnostics through Bioflux, which is essential for treatment decisions [89]

Financial Performance - Total revenue for the three months ended September 30, 2020, was $744,585, a significant increase from $345,906 in the same period of 2019, representing a growth of 115.5%[13] - Net loss for the three months ended September 30, 2020, was $3,155,424, compared to a net loss of $2,008,114 for the same period in 2019, indicating an increase in losses of 57.2%[13] - The company reported a comprehensive loss of $3,229,964 for the three months ended September 30, 2020, compared to a comprehensive loss of $2,024,443 for the same period in 2019, an increase of 59.7%[13] - The company’s net revenue for the six months ended September 30, 2020, was $584,925, compared to $446,604 for the same period in 2019, reflecting an increase of 30.9%[13] - For the six months ended September 30, 2020, Biotricity Inc. reported a net loss before dividends of $6,119,386, compared to a net loss of $4,097,714 for the same period in 2019, reflecting an increase in losses of approximately 49.3%[21] - The Company incurred a net loss of $3.2 million during the three months ended September 30, 2020, equating to a loss of $0.085 per share[135] - The net loss attributable to common stockholders for the three and six months ended September 30, 2020 was $3.2 million and $6.5 million, compared to $2.0 million and $4.1 million in the prior year[143] Assets and Liabilities - Total current assets as of September 30, 2020, amounted to $1,827,741, up from $1,658,829 as of March 31, 2020, reflecting a growth of 10.2%[12] - Total liabilities increased to $9,480,683 as of September 30, 2020, compared to $5,004,809 as of March 31, 2020, marking a rise of 89.5%[12] - The total stockholders' deficiency as of September 30, 2020, was $(7,412,996), worsening from $(3,000,393) as of March 31, 2020[12] - The company has an accumulated deficit of $52,914,182 as of September 30, 2020, indicating ongoing financial challenges[27] - Biotricity's working capital deficiency stood at $5,276,690 as of September 30, 2020, highlighting liquidity concerns[27] Cash Flow and Financing - Cash used in operating activities for the six months ended September 30, 2020, was $4,529,273, which is a significant increase from $2,790,973 in the same period of 2019[21] - The total cash provided by financing activities for the six months ended September 30, 2020, was $4,178,788, compared to $2,804,140 in the same period of 2019, indicating improved financing efforts[21] - Biotricity raised $1,570,900 from federally guaranteed loans during the three months ended June 30, 2020, as part of its efforts to improve liquidity amid the COVID-19 pandemic[27] - The Company issued $3,302,000 in a new series of convertible promissory notes during the three months ended September 30, 2020, with a maturity of one year and an interest rate of 12% per annum[49] - The net proceeds from convertible note issuances to September 30, 2020, amounted to $2,905,760 after payment of the placement agent fee[49] - The Company raised $3,030,620 in promissory notes and short-term loans during the year ended March 31, 2020, and launched a private placement offering of convertible notes that raised net cash proceeds of $2.9 million as of September 30, 2020[148] Expenses - Total operating expenses for the three and six months ended September 30, 2020 were $3.2 million and $6.8 million, respectively, compared to $2.2 million and $4.5 million in the prior year[138] - General and administrative expenses increased to $2.8 million and $6.0 million for the three and six months ended September 30, 2020, with approximately $0.8 million and $1.0 million of these increases attributed to investments in the sales force and infrastructure[139] - Research and development expenses for the three months ended September 30, 2020, were $402,340, up from $218,525 in the same period of 2019, representing an increase of 83.8%[13] - Research and development expenses rose to $0.4 million and $0.8 million for the three and six months ended September 30, 2020, compared to $0.2 million and $0.4 million in the prior year, driven by new technology development and FDA clearance pursuits[140] Shareholder Information - The weighted average number of common shares outstanding for the three months ended September 30, 2020, was 37,172,815, compared to 35,659,133 for the same period in 2019, an increase of 4.2%[13] - As of September 30, 2020, the company had 33,647,809 shares of common stock issued and outstanding, an increase from 32,593,769 shares as of March 31, 2020[62] - The company issued 874,500 shares during the six months ended September 30, 2020, with a fair value of $1,343,816[72] - The Company recognized obligations to issue a total of 412,500 shares of common stock, with a fair value of $400,591[73] Business Development - The company has developed a healthcare business model focused on remote monitoring and preventative care, with ongoing research and development activities[23] - Management anticipates achieving profitable status through continued business development and additional equity or debt capitalization[27] - The Company launched its first commercial sales program in 2019 and a full market release in 2020, aiming to enhance market presence[27] - The Company expanded its sales efforts to 16 states, aiming for broader market competition in the U.S.[113] - The Company has received FDA clearance for its Bioflux Software II System, which reduces ECG analysis time from 5 minutes to 30 seconds, improving operational efficiency[114] - The Company is developing several ancillary technologies, including advanced ECG analysis software and the Biotres patch solution, with FDA applications anticipated within the next twelve months[114] - The Company has negotiated terms to license MD Matrix Inc.'s telemedicine platform, which will enhance remote patient monitoring capabilities[115] Market Impact - The Company experienced a 30% decrease in business activities in April 2020 due to the pandemic, but saw a recovery with pent-up demand in subsequent months[134] - The Company achieved 84.4% of the total revenues earned in the full fiscal year ended March 31, 2020 during the half-year ended September 30, 2020[134] - The gross margin for the three and six months ended September 30, 2020 was 43.6% and 48.9%, respectively[136]

Financial Performance - Total revenue for the three months ended June 30, 2020, was $451,898, representing a 38% increase from $327,000 in the same period of 2019[14] - Gross profit for the same period was $260,436, compared to $176,414 in 2019, indicating a significant improvement in profitability[14] - The net loss before income taxes for Q2 2020 was $3,157,179, compared to a loss of $2,089,601 in Q2 2019, reflecting a worsening financial position[14] - The company reported a net loss attributed to common stockholders of $3,394,394 for the three months ended June 30, 2020, compared to $2,089,601 in the prior year[14] - For the three months ended June 30, 2020, Biotricity Inc. reported a net loss of $3,157,179, compared to a net loss of $2,089,601 for the same period in 2019, indicating an increase in losses of approximately 51.2% year-over-year[18] - The loss per share for the three months ended June 30, 2020, was $(0.900), significantly higher than $(0.060) in the same period of 2019[14] - Gross margin improved to 57.6% for the three months ended June 30, 2020, compared to 53.9% for the same period in the prior year[130] Operating Expenses - Total operating expenses increased to $3,629,116 from $2,266,015 year-over-year, primarily due to higher general and administrative expenses[14] - Total operating expenses for the three months ended June 30, 2020, were $3.6 million, an increase from $2.3 million in the corresponding period of fiscal 2019[132] - General and administrative expenses rose to $3.2 million for the three months ended June 30, 2020, up from $2.1 million in the same period of 2019, primarily due to marketing and sales force expansion costs[133] - Research and development expenses increased to $423,883 for the three months ended June 30, 2020, compared to $213,496 in the same period of 2019, reflecting ongoing efforts for FDA clearance and product development[134] Financial Position - Current assets decreased to $1,124,061 as of June 30, 2020, down from $1,658,829 as of March 31, 2020[10] - Total liabilities increased to $6,374,244 as of June 30, 2020, compared to $5,004,809 as of March 31, 2020, indicating rising financial obligations[13] - The company’s accumulated deficit grew to $49,758,758 as of June 30, 2020, from $46,364,364 at the end of the previous quarter[13] - The company incurred a working capital deficiency of $2,696,943 as of June 30, 2020, and has an accumulated deficit of $49,758,758[24] Cash Flow - Cash used in operating activities for the three months ended June 30, 2020, was $2,393,110, compared to $1,328,375 for the same period in 2019, reflecting a significant increase in cash outflows[18] - Net cash used in operating activities for the three months ended June 30, 2020, was $2,393,107, compared to $1,328,375 for the same period in 2019[146] - Net cash provided by financing activities was $1,573,987 for the three months ended June 30, 2020, compared to $1,329,802 for the same period in 2019[147] Financing Activities - Biotricity raised $1,570,900 from federally guaranteed loans during the three months ended June 30, 2020, as part of its efforts to improve liquidity amid the COVID-19 pandemic[24] - The company issued 8,045 Series A preferred shares, raising $6,100,000 in cash proceeds and converting $1,945,000 of promissory notes and accrued interest into shares[24] - The company received a $370,900 Economic Injury Disaster Loan (EIDL) with a 30-year term and a 3.75% interest rate, with no payments required in the first 12 months[49] - A Paycheck Protection Program (PPP) loan of $1.2 million was received, with a two-year term and a 1.0% interest rate, allowing for potential forgiveness under certain conditions[50] - The company anticipates requiring approximately $8 million to accelerate the commercialization of Bioflux and other technologies[144] - The company plans to seek additional funds through equity or debt offerings to meet future liquidity requirements[145] Shareholder Equity - The weighted average number of common shares outstanding increased to 36,768,299 from 35,397,458 year-over-year, reflecting potential dilution[14] - The Company is authorized to issue 125,000,000 shares of common stock and 10,000,000 shares of preferred stock as of June 30, 2020[56] - The Company had 33,384,769 shares of common stock issued and outstanding as of June 30, 2020, an increase from 32,593,769 as of March 31, 2020[57] - The Company issued 791,000 common shares valued at $1,063,754 as compensation for consultants and advisors during the period of April 22 to June 22, 2020[160] Derivative Liabilities and Warrants - As of June 30, 2020, the Company had derivative liabilities totaling $982,340, a decrease from $1,144,733 as of March 31, 2020, reflecting a change in fair value of $(204,142) during the period[55] - The Company issued 50,000 warrants during the three months ended June 30, 2020, with a fair value of $45,113, expensed in general and administrative expenses[70] - As of June 30, 2020, the total outstanding warrants were 5,332,893, which included 2,034,837 Consultant Warrants and 1,823,020 Warrants issued on the conversion of Convertible Notes[73] - The exercise price for the outstanding warrants ranged from $0.48 to $7.59, with expiration dates varying from April 2020 to July 2022[73] Research and Development - The Company is focused on developing technology for remote monitoring in preventative care, with ongoing research and development activities aimed at commercialization[20] - The Company is developing advanced ECG analysis software and the Biotres patch solution, anticipating FDA applications within the next twelve months[108] - The Company is in commercialization mode while pursuing the development of its next generation MCT product and other new products[139] Accounting and Compliance - The company adopted ASC 842 for lease accounting, requiring the recognition of right-of-use assets and lease liabilities on the balance sheet[34] - The company evaluated the impact of new accounting pronouncements, including ASU 2016-13, which changes the impairment model for financial assets[39] - The Company recognized a gain of $204,142 related to the change in fair value of derivative liabilities during the three months ended June 30, 2020[136] Related Party Transactions - Total related party transactions amounted to $386,544 for the three months ended June 30, 2020, down from $443,807 in the same period of 2019[88]

Part I [Business](index=4&type=section&id=ITEM%201.%20BUSINESS) Biotricity Inc. specializes in biometric data monitoring solutions, with its Bioflux MCT product targeting diagnostic and post-diagnostic care - The company focuses on biometric data monitoring solutions, with its initial product, **Bioflux MCT**, targeting the diagnostic mobile cardiac telemetry market[12](index=12&type=chunk) - **Bioflux MCT** was commercially launched in **April 2018**. After a limited market release, the company expanded its sales force in fiscal 2019, leading to **double-digit sales growth** and an **over 80% re-order rate**[13](index=13&type=chunk) - The company is developing new products, including **Biotres** (an ECG Holter solution) and advanced ECG analysis software, to expand its technology ecosystem[40](index=40&type=chunk)[41](index=41&type=chunk) - Biotricity's business model is an **'insourcing' model**, selling devices to physicians and earning **recurring technology service fees** from its back-office software solution, which differs from the traditional outsourcing model of competitors[37](index=37&type=chunk) [Risk Factors](index=17&type=section&id=ITEM%201A.%20RISK%20FACTORS) The company faces significant business, industry, and securities risks, including limited operating history, intense competition, extensive regulation, and stock volatility - Business Risks: The company has a limited operating history, an accumulated deficit of **$46.4 million** as of March 31, 2020, and requires additional capital to fund operations and growth. The COVID-19 pandemic also poses a significant risk to operations[103](index=103&type=chunk)[105](index=105&type=chunk)[110](index=110&type=chunk)[154](index=154&type=chunk) - Industry & Regulatory Risks: The business is subject to **intense competition** and **extensive FDA regulation** for its Class II medical devices. Failure to obtain or maintain regulatory approvals or adequate third-party reimbursement could materially harm the business[120](index=120&type=chunk)[121](index=121&type=chunk)[130](index=130&type=chunk)[175](index=175&type=chunk) - Securities Risks: The company's common stock is quoted on the **OTCQB market**, has limited liquidity, and is subject to the SEC's **'penny stock' rules**, which can hinder trading. The market price may be volatile[200](index=200&type=chunk)[201](index=201&type=chunk)[217](index=217&type=chunk) - Control Risk: The CEO, Mr. Al-Siddiq, beneficially owns approximately **23.06%** of outstanding shares, giving him substantial influence over corporate actions and director elections[208](index=208&type=chunk) [Unresolved Staff Comments](index=35&type=section&id=ITEM%201B.%20UNRESOLVED%20STAFF%20COMMENTS) The company reports no unresolved staff comments - Not applicable[224](index=224&type=chunk) [Properties](index=35&type=section&id=ITEM%202.%20PROPERTIES) The company leases approximately 3,500 sq ft in Redwood City, CA, and 5,000 sq ft in Toronto, ON, for its executive offices - The company leases office space in Redwood City, CA (approx. **3,500 sq ft**) and Toronto, ON (approx. **5,000 sq ft**)[225](index=225&type=chunk) [Legal Proceedings](index=35&type=section&id=ITEM%203.%20LEGAL%20PROCEEDINGS) The company is not currently involved in any material legal or governmental regulatory proceedings - The company is not currently involved in any material legal proceedings[227](index=227&type=chunk) [Mine Safety Disclosures](index=35&type=section&id=ITEM%204.%20MINE%20SAFETY%20DISCLOSURES.) This item is not applicable to the company - Not applicable[228](index=228&type=chunk) Part II [Market for Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities](index=36&type=section&id=ITEM%205.%20MARKET%20FOR%20COMMON%20EQUITY%2C%20RELATED%20STOCKHOLDER%20MATTERS%2C%20AND%20ISSUER%20PURCHASES%20OF%20EQUITY%20SECURITIES) The company's common stock trades on OTCQB, with **33.4 million** shares outstanding as of July 2020, and capital was raised through notes and preferred shares - The company's common stock is traded on the **OTCQB** under the symbol **'BTCY'**[231](index=231&type=chunk) Common Stock Market Price Information | Period (FY 2020) | High ($) | Low ($) | | :--- | :--- | :--- | | Fourth Quarter | 2.25 | 0.661 | | Third Quarter | 0.849 | 0.2601 | | Second Quarter | 0.75 | 0.48 | | First Quarter | 0.98 | 0.535 | - As of July 10, 2020, there were **33,384,753** shares of common stock outstanding[234](index=234&type=chunk) - During fiscal year 2020, the company raised **$3.1 million** in promissory notes and short-term loans and issued **7,830 Series A preferred shares** for **$6.0 million** in cash and conversion of **$1.83 million** in notes[240](index=240&type=chunk) [Selected Financial Data](index=40&type=section&id=ITEM%206.%20SELECTED%20FINANCIAL%20DATA) This item is not applicable as the company is a smaller reporting company - Not applicable to a smaller reporting company[253](index=253&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A)](index=40&type=section&id=ITEM%207.%20MANAGEMENT%27S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITION%20AND%20RESULTS%20OF%20OPERATIONS) In FY2020, revenue grew to **$1.42 million** with a **256%** increase, but operating expenses led to an **$11.3 million** net loss, requiring additional capital for operations Consolidated Statements of Operations Data | Metric | FY Ended Mar 31, 2020 | FY Ended Mar 31, 2019 | | :--- | :--- | :--- | | **Revenue** | **$1,417,725** | **$398,200** | | Gross Profit | $692,454 | $59,865 | | Total Operating Expenses | $11,623,138 | $8,651,930 | | *General & Administrative* | *$10,259,903* | *$7,342,739* | | *Research & Development* | *$1,363,235* | *$1,309,191* | | **Net Loss** | **($11,324,869)** | **($8,592,065)** | | Loss Per Share | ($0.315) | ($0.257) | - Revenue increased **256%** year-over-year, from **$398,200** in FY2019 to **$1,417,725** in FY2020, driven by the full market release of the Bioflux device[289](index=289&type=chunk) - The company has an accumulated deficit of **$46,364,364** as of March 31, 2020 and requires additional capital to fund its growth plans, estimating a need for approximately **$8 million**[299](index=299&type=chunk)[304](index=304&type=chunk) - Net cash used in operating activities was **$7.9 million** in FY2020, compared to **$5.2 million** in FY2019. Net cash provided by financing activities was **$8.9 million** in FY2020, primarily from the issuance of preferred shares and promissory notes[307](index=307&type=chunk)[308](index=308&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=50&type=section&id=ITEM%207A.%20QUANTITATIVE%20AND%20QUALITATIVE%20DISCLOSURES%20ABOUT%20MARKET%20RISK) This item is not applicable as the company is a smaller reporting company - Not applicable to a smaller reporting company[311](index=311&type=chunk) [Financial Statements and Supplementary Data](index=50&type=section&id=ITEM%208.%20FINANCIAL%20STATEMENTS%20AND%20SUPPLEMENTARY%20DATA) Audited financial statements and supplementary data for FY2020 and FY2019 are included, starting on page F-1 - Financial statements are provided starting on page **F-1** of the report[312](index=312&type=chunk) [Changes in and Disagreements with Accountants on Accounting and Financial Disclosures](index=50&type=section&id=ITEM%209.%20CHANGES%20IN%20AND%20DISAGREEMENTS%20WITH%20ACCOUNTANTS%20ON%20ACCOUNTING%20AND%20FINANCIAL%20DISCLOSURES) The company reports no changes in or disagreements with its accountants on accounting and financial disclosures - None reported[312](index=312&type=chunk) [Controls and Procedures](index=50&type=section&id=ITEM%209A.%20CONTROLS%20AND%20PROCEDURES) Management concluded that disclosure controls and internal control over financial reporting were effective as of March 31, 2020 - Management concluded that disclosure controls and procedures were **effective** as of the end of the fiscal year[314](index=314&type=chunk) - Management concluded that the company's internal control over financial reporting was **effective** as of March 31, 2020, based on the COSO framework[316](index=316&type=chunk) - **No material changes** to internal controls over financial reporting occurred during the fiscal year ended March 31, 2020[319](index=319&type=chunk) [Other Information](index=51&type=section&id=ITEM%209B.%20OTHER%20INFORMATION) The company reports no other information for this item - None[321](index=321&type=chunk) Part III [Directors and Executive Officers and Corporate Governance](index=52&type=section&id=ITEM%2010.%20DIRECTORS%20AND%20EXECUTIVE%20OFFICERS%20AND%20CORPORATE%20GOVERNANCE) This section details the company's executive officers and directors, including their biographies and corporate governance structures like board committees and independence - The executive team is led by founder **Waqaas Al-Siddiq** as President, CEO, and Chairman, and **John Ayanoglou** as CFO[325](index=325&type=chunk)[335](index=335&type=chunk) - The Board of Directors includes members with experience in finance, medical devices, and corporate governance, such as **Dr. Norman M. Betts**, **Patricia Kennedy**, **David A. Rosa**, and **Steve Salmon**[327](index=327&type=chunk)[329](index=329&type=chunk)[332](index=332&type=chunk)[334](index=334&type=chunk) - The Board has established an **audit committee** and a **compensation committee**. Three directors, Dr. Betts, Ms. Kennedy, and Mr. Rosa, are considered **independent** under NASDAQ rules[349](index=349&type=chunk)[353](index=353&type=chunk) [Executive Compensation](index=54&type=section&id=ITEM%2011.%20EXECUTIVE%20COMPENSATION) This section details executive compensation for FY2020 and FY2019, including salary, bonus, and option awards for the CEO and CFO, and compensation for non-employee directors Summary Compensation Table | Name and Principal Position | Year | Salary ($) | Bonus ($) | Option Awards ($) | Total ($) | | :--- | :--- | :--- | :--- | :--- | :--- | | **Waqaas Al-Siddiq** (CEO) | 2020 | 390,000 | 195,000 | 1,330,151 | **1,912,151** | | | 2019 | 360,000 | 150,000 | 1,235,040 | **1,775,248** | | **John Ayanoglou** (CFO) | 2020 | 200,000 | - | 75,272 | **275,272** | | | 2019 | 152,870 | - | 116,217 | **312,837** | - CEO Waqaas Al-Siddiq's employment agreement provides for a base salary of **$390,000** and a potential bonus of up to **50%** of his salary[341](index=341&type=chunk) - Non-employee directors receive compensation in the form of **cash fees, stock awards, and option awards**[347](index=347&type=chunk)[348](index=348&type=chunk) [Security Ownership of Certain Beneficial Owners and Management](index=57&type=section&id=ITEM%2012.%20SECURITY%20OWNERSHIP%20OF%20CERTAIN%20BENEFICIAL%20OWNERS%20AND%20MANAGEMENT) This section details beneficial ownership of common stock as of July 2020, with CEO Waqaas Al-Siddiq holding **23.06%** and all directors and executive officers as a group holding **28.72%** Security Ownership Table | Name of Beneficial Owner | % of Shares Beneficially Owned | | :--- | :--- | | Waqaas Al-Siddiq (CEO) | 23.06% | | Isa Khalid Abdulla Al-Khalifa | 7.57% | | All directors and executive officers as a group (6 persons) | 28.72% | [Certain Relationships and Related Transactions, and Director Independence](index=59&type=section&id=ITEM%2013.%20CERTAIN%20RELATIONSHIPS%20AND%20RELATED%20TRANSACTIONS%2C%20AND%20DIRECTOR%20INDEPENDENCE) The company reports no disclosable related party transactions and confirms the independence of three directors under NASDAQ rules - The company reported **no disclosable related party transactions**[365](index=365&type=chunk) - Directors Dr. Betts, Ms. Kennedy, and Mr. Rosa are determined to be **independent**[353](index=353&type=chunk) [Principal Accountant Fees and Services](index=59&type=section&id=ITEM%2014.%20PRINCIPAL%20ACCOUNTANT%20FEES%20AND%20SERVICES) This section details fees paid to the principal accountant for FY2020 and FY2019, primarily for audit services, with all services pre-approved by the Board Fees Paid to Principal Accountant | Fee Category | 2020 ($) | 2019 ($) | | :--- | :--- | :--- | | Audit Fees | 72,600 | 72,775 | | Audit-Related Fees | - | - | | Tax Fees | - | - | | All Other Fees | - | - | | **Total Fees** | **72,600** | **72,775** | Part IV [Exhibits, Financial Statement Schedules](index=60&type=section&id=Item%2015.%20Exhibits%2C%20Financial%20Statement%20Schedules) This section lists all exhibits filed with the Form 10-K, including corporate governance documents, securities agreements, material contracts, and SOX certifications - Lists key corporate documents, including **Articles of Incorporation** (Exhibit 3.1) and **By-Laws** (Exhibit 3.2)[371](index=371&type=chunk) - Includes forms of various financing instruments, such as **convertible notes** and **warrants** (Exhibits 4.3 - 4.12)[371](index=371&type=chunk) - Contains material agreements, such as the **2016 Equity Incentive Plan** (Exhibit 10.5) and the **CEO's Employment Agreement** (Exhibit 10.9)[371](index=371&type=chunk)[372](index=372&type=chunk) - Includes required CEO and CFO certifications under **Sections 302 and 906 of the Sarbanes-Oxley Act** (Exhibits 31.1, 31.2, 32.1, 32.2)[372](index=372&type=chunk) Consolidated Financial Statements [Report of Independent Registered Public Accounting Firm](index=64&type=section&id=Report%20of%20Independent%20Registered%20Public%20Accounting%20Firm) The independent auditor issued an unqualified opinion on the financial statements for FY2020 and FY2019, noting conformity with U.S. GAAP and the adoption of ASC 842 - The auditor issued an **unqualified opinion**, stating the financial statements are **fairly presented** in accordance with **U.S. GAAP**[381](index=381&type=chunk) - The report highlights the adoption of the new lease accounting standard, **ASC 842**, as of April 1, 2019[382](index=382&type=chunk) [Consolidated Financial Statements Tables](index=65&type=section&id=Consolidated%20Financial%20Statements%20Tables) The consolidated financial statements show **$2.0 million** in total assets, a **$3.0 million** stockholders' deficiency, **$1.42 million** revenue, and an **$11.3 million** net loss for FY2020 Consolidated Balance Sheet | Balance Sheet (As of March 31, 2020) | Amount ($) | | :--- | :--- | | Total Current Assets | 1,658,829 | | **Total Assets** | **2,004,416** | | Total Current Liabilities | 3,803,021 | | **Total Liabilities** | **5,004,809** | | **Total Stockholders' Deficiency** | **(3,000,393)** | Consolidated Statement of Operations | Statement of Operations (Year Ended March 31, 2020) | Amount ($) | | :--- | :--- | | Revenue | 1,417,725 | | Gross Profit | 692,454 | | Total Operating Expenses | 11,623,138 | | **Net Loss Attributed to Common Stockholders** | **(11,324,869)** | Consolidated Statement of Cash Flows | Statement of Cash Flows (Year Ended March 31, 2020) | Amount ($) | | :--- | :--- | | Net cash used in operating activities | (7,862,779) | | Net cash provided by financing activities | 8,879,168 | | Net increase in cash | 1,016,388 | | **Cash, end of year** | **949,848** | [Notes to Consolidated Financial Statements](index=69&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) The notes detail liquidity challenges, recurring losses, and reliance on financing, including **$3.1 million** from notes and **$6.0 million** from preferred stock in FY2020, and the adoption of ASC 842 - The company has incurred recurring losses, with an accumulated deficit of **$46.4 million** and a working capital deficiency of **$2.1 million** as of March 31, 2020, indicating a reliance on external financing to continue operations[405](index=405&type=chunk) - In FY2020, the company raised **$3.1 million** in promissory notes and short-term loans. It also issued **7,830 Series A preferred shares** for **$6.0 million** in cash and the conversion of **$1.83 million** in notes[405](index=405&type=chunk)[440](index=440&type=chunk)[456](index=456&type=chunk) - The company adopted the new lease accounting standard **ASC 842** on April 1, 2019, recognizing a right-of-use asset of **$264,472** and a lease obligation of **$270,085** as of March 31, 2020[492](index=492&type=chunk)[494](index=494&type=chunk) - Subsequent to year-end, in April and May 2020, the company received a **$1.2 million** Paycheck Protection Program (PPP) loan and a **$379,000** Emergency Injury Disaster Loan (EIDL) under the **CARES Act**[497](index=497&type=chunk)