Note
|
March 31, 2020
|
December 31, 2019
|
|||||||
Assets
|
|||||||||
Current Assets:
|
|||||||||
Cash and cash equivalents
|
$
|
1,760,219
|
$
|
814,492
|
|||||
Amounts receivable
|
99,400
|
84,097
|
|||||||
Deposits
|
8
|
481,400
|
481,400
|
||||||
Prepaid expense
|
180,730
|
369,453
|
|||||||
Total Current Assets
|
$
|
2,521,749
|
$
|
1,749,442
|
|||||
-
|
|||||||||
Right of use assets - Leases
|
3
|
24,709
|
30,394
|
||||||
-
|
|||||||||
Patent Rights
|
4
|
1,649,465
|
1,601,745
|
||||||
-
|
|||||||||
Total Assets
|
$
|
4,195,923
|
$
|
3,381,581
|
|||||
Liabilities
|
|||||||||
Current Liabilities:
|
|||||||||
Accounts payable and accrued liabilities
|
5
|
$
|
10,184,977
|
$
|
11,412,896
|
||||
Current portion of lease liability
|
3
|
25,126
|
21,071
|
||||||
Warrant liability
|
6
|
2,373,057
|
3,621,444
|
||||||
Total Current Liabilities
|
$
|
12,583,160
|
$
|
15,055,411
|
|||||
Long-term lease liability
|
3
|
$
|
-
|
$
|
8,001
|
||||
Total Liabilities
|
$
|
12,583,160
|
$
|
15,063,412
|
|||||
Shareholders' Equity / (Deficiency)
|
|||||||||
Share Capital
|
7
|
$
|
198,693,476
|
$
|
194,859,415
|
||||
Contributed Surplus
|
8,532,103
|
8,303,527
|
|||||||
Deficit
|
(215,612,816
|
)
|
(214,844,773
|
)
|
|||||
Total Deficiency
|
$
|
(8,387,237
|
)
|
$
|
(11,681,831
|
)
|
|||
Total Liabilities and Deficiency
|
$
|
4,195,923
|
$
|
3,381,581
|
|||||
Going Concern (Note 1(d))
|
|||||||||
Commitments (Note 8)
|
|||||||||
Subsequent events (Note 10)
|
"signed" |
|
"signed" |
|
Charles Federico |
|
David McNally |
|
Chairman |
|
President and CEO |
|
Three Months Ended
|
Three Months Ended
|
||||||||
Note
|
March 31, 2020
|
March 31, 2019
|
|||||||
Revenue:
|
$
|
-
|
$
|
-
|
|||||
Expenses:
|
|||||||||
Amortization
|
$
|
14,095
|
$
|
6,175
|
|||||
Consulting fees
|
112,125
|
269,429
|
|||||||
Stock based compensation
|
7b
|
228,576
|
251,357
|
||||||
Insurance
|
123,162
|
118,489
|
|||||||
Management salaries and fees
|
541,595
|
648,586
|
|||||||
Marketing and investor relations
|
8,644
|
106,189
|
|||||||
Office and general
|
139,887
|
117,271
|
|||||||
Professional fees
|
358,486
|
103,385
|
|||||||
Rent
|
7,241
|
12,236
|
|||||||
Research and Development
|
46,119
|
14,408,612
|
|||||||
Travel
|
11,138
|
67,364
|
|||||||
Interest charges
|
212,697
|
-
|
|||||||
Foreign exchange (gain)
|
(73,503
|
)
|
(107,642
|
)
|
|||||
$
|
1,730,262
|
$
|
16,001,451
|
||||||
Finance Income (cost):
|
|||||||||
Interest
|
$
|
1,743
|
$
|
23,031
|
|||||
Gain (loss) on change in fair value of warrants
|
6
|
1,117,476
|
(10,476,625
|
)
|
|||||
Warrant liability issue cost
|
(157,000
|
)
|
(1,827,835
|
)
|
|||||
$
|
962,219
|
$
|
(12,281,429
|
)
|
|||||
Net and Comprehensive Loss For the Period
|
$
|
768,043
|
$
|
28,282,880
|
|||||
Basic and Diluted Loss Per Share
|
$
|
(0.02
|
)
|
$
|
(1.22
|
)
|
|||
Weighted Average Number of Common Shares
|
|||||||||
Basic and Diluted
|
44,272,288
|
23,185,888
|
Note
|
Share Capital
Number
|
Share Capital
Amount
|
Contributed
Surplus
|
Deficit
|
Total Equity / (Deficiency)
|
|||||||||||||||||
Balance - December 31, 2018
|
21,675,849
|
$
|
170,502,394
|
$
|
6,652,409
|
$
|
(172,937,694
|
)
|
$
|
4,217,109
|
||||||||||||
Issued pursuant to agency agreement
|
7a
|
|
8,455,882
|
13,717,131
|
-
|
-
|
13,717,131
|
|||||||||||||||
Share issue expense
|
-
|
(1,495,501
|
)
|
-
|
-
|
(1,495,501
|
)
|
|||||||||||||||
Warrants exercised during the period
|
7a
|
|
1,018,506
|
7,002,043
|
-
|
-
|
7,002,043
|
|||||||||||||||
Stock based compensation
|
7b
|
|
-
|
-
|
251,357
|
-
|
251,357
|
|||||||||||||||
Net and Comprehensive loss
|
-
|
-
|
-
|
(28,282,880
|
)
|
(28,282,880
|
)
|
|||||||||||||||
Balance - March 31, 2019
|
31,150,237
|
$
|
189,726,067
|
$
|
6,903,766
|
$
|
(201,220,574
|
)
|
$
|
(4,590,741
|
)
|
|||||||||||
Balance - December 31, 2019
|
39,907,681
|
$
|
194,859,415
|
$
|
8,303,527
|
$
|
(214,844,773
|
)
|
$
|
(11,681,831
|
)
|
|||||||||||
Issued pursuant to agency agreement
|
7a
|
|
11,909,196
|
3,037,204
|
-
|
-
|
3,037,204
|
|||||||||||||||
Share issue expense
|
-
|
$
|
(214,263
|
)
|
-
|
-
|
(214,263
|
)
|
||||||||||||||
Warrants exercised during the period
|
7a
|
|
2,400,000
|
$
|
1,011,120
|
-
|
-
|
1,011,120
|
||||||||||||||
Stock based compensation
|
7b
|
|
-
|
-
|
$
|
228,576
|
-
|
228,576
|
||||||||||||||
Net and Comprehensive loss
|
-
|
-
|
-
|
$
|
(768,043
|
)
|
(768,043
|
)
|
||||||||||||||
Balance - March 31, 2020
|
54,216,877
|
$
|
198,693,476
|
$
|
8,532,103
|
$
|
(215,612,816
|
)
|
$
|
(8,387,237
|
)
|
Three Months Ended
|
Three Months Ended
|
||||||||
Note
|
March 31, 2020
|
March 31, 2019
|
|||||||
-
|
|||||||||
Cash provided by (used in):
|
|||||||||
Operating activities:
|
|||||||||
Net loss for the period
|
$
|
(768,043
|
)
|
$
|
(28,282,880
|
)
|
|||
Items not involving cash:
|
|||||||||
-
|
|||||||||
Amortization
|
14,095
|
6,175
|
|||||||
Stock based compensation
|
7(b)
|
228,576
|
251,357
|
||||||
Other share compensation
|
-
|
-
|
|||||||
Warrant liability-fair value adjustment
|
6
|
(1,117,476
|
)
|
10,476,625
|
|||||
Warrant liability-foreign exchange adjustment
|
6
|
(51,091
|
)
|
(106,057
|
)
|
||||
Non-cash issuance costs
|
26,240
|
-
|
|||||||
Non-cash settlement included in payables
|
250,574
|
-
|
|||||||
Changes in non-cash working capital items:
|
|||||||||
Amounts receivable, prepaid expenses and deposits
|
173,420
|
(1,577,929
|
)
|
||||||
Accounts payable and accrued liabilities
|
5
|
(1,227,919
|
)
|
47,756
|
|||||
Cash used in operating activities
|
$
|
(2,471,624
|
)
|
$
|
(19,184,953
|
)
|
|||
Financing activities:
|
|||||||||
Net cash proceeds from issuance of common shares and warrants
|
3,477,427
|
31,377,908
|
|||||||
Repayment of lease liabilities
|
3
|
(3,946
|
)
|
-
|
|||||
Cash provided by financing activities
|
$
|
3,473,481
|
$
|
31,377,908
|
|||||
Investing Activities:
|
|||||||||
Cost of Patents
|
(56,130
|
)
|
(53,758
|
)
|
|||||
Cash used in investing activities
|
$
|
(56,130
|
)
|
$
|
(53,758
|
)
|
|||
Increase in cash and cash equivalents
|
945,727
|
12,139,197
|
|||||||
Cash and cash equivalents, beginning of the period
|
814,492
|
11,471,243
|
|||||||
Cash and cash equivalents, end of the period
|
$
|
1,760,219
|
$
|
23,610,440
|
|||||
Cash and cash equivalents comprise:
|
|||||||||
Cash
|
$
|
1,495,982
|
$
|
582,622
|
|||||
Cash equivalents
|
264,237
|
23,027,818
|
|||||||
$
|
1,760,219
|
$
|
23,610,440
|
1.
|
DESCRIPTION OF BUSINESS
|
(a)
|
Statement of Compliance
|
(b)
|
Basis of Measurement
|
(c)
|
Functional and Presentation Currency
|
(d)
|
Going Concern
|
(e)
|
Use of Estimates and Judgements
|
1.
|
DESCRIPTION OF BUSINESS (continued)
|
2.
|
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
|
(a)
|
Warrant Liability
|
(b)
|
Fair Value Measurement
|
3.
|
LEASE ASSETS
|
For the three months ended March 31, 2020
|
Cost
|
Accumulated
Amortization
|
Net Book
Value
|
|||||||||
Balance at December 31, 2019
|
$
|
34,172
|
$
|
(3,778
|
)
|
$
|
30,394
|
|||||
Additions during the period
|
-
|
-
|
-
|
|||||||||
Amortization in the period
|
-
|
(5,685
|
)
|
(5,685
|
)
|
|||||||
Balance at March 31, 2020
|
$
|
34,172
|
$
|
(9,463
|
)
|
$
|
24,709
|
4. |
PATENT RIGHTS
|
For the three months ended March 31, 2020 |
Cost |
Accumulated
Amortization &
Impairment Losses
|
Net Book Value
|
|||||||||
Balance at December 31, 2019
|
$
|
1,856,750
|
$
|
(255,005
|
)
|
$
|
1,601,745
|
|||||
Additions during the quarter
|
56,130
|
-
|
56,130
|
|||||||||
Amortization in the quarter
|
-
|
|
(8,410
|
) |
(8,410
|
)
|
||||||
Balance at March 31, 2020
|
$ |
1,912,880
|
$ |
(263,415
|
) |
$ |
1,649,465
|
|||||
|
|
|
|
|||||||||
|
|
|
|
|
|
|||||||
Balance at December 31, 2018
|
$
|
1,398,713
|
$
|
(226,228
|
)
|
$
|
1,172,485
|
|
||||
Additions during the quarter | 53,758 |
- |
53,758 |
|||||||||
Amortization in the quarter | - |
(6,175 |
) |
(6,175 |
) |
|||||||
Balance at March 31, 2019 | $ |
1,452,471 |
$ |
(232,403 |
) |
$ |
1,220,068 |
5. |
ACCOUNTS PAYABLE AND ACCRUED LIABILITIES
|
6. |
WARRANT LIABILITY
|
Three Months Ended | Year Ended | |||||||||||||||
March 31, 2020 | December 31, 2019 | |||||||||||||||
Number of
Warrants
|
Amount
|
Number of
Warrants
|
Amount
|
|||||||||||||
Opening Balance
|
21,203,411
|
$
|
3,621,444
|
13,901,859
|
$
|
11,250,167
|
||||||||||
Issue of warrants expiring, March 21, 2024
|
-
|
-
|
8,455,882
|
15,897,059
|
||||||||||||
Issue of warrants expiring, March 27, 2025
|
3,500,000
|
475,300
|
-
|
-
|
||||||||||||
Warrants exercised during the period
|
(2,400,000
|
)
|
(555,120
|
)
|
(1,018,506
|
)
|
(3,742,824
|
)
|
||||||||
Warrants expired during the period
|
-
|
-
|
(135,824
|
)
|
-
|
|||||||||||
Foreign exchange adjustment during the period
|
-
|
(51,091
|
)
|
-
|
17,687
|
|||||||||||
Fair value adjustment during the period
|
-
|
(1,117,476
|
)
|
-
|
(19,800,645
|
)
|
||||||||||
Ending Balance
|
22,303,411
|
$
|
2,373,057
|
21,203,411
|
$
|
3,621,444
|
7. |
SHARE CAPITAL |
a) | Authorized: |
unlimited number of common shares, no par
|
|
|
|
|
Issued: |
54,216,877 (December 31, 2019: 39,907,681) |
7. |
SHARE CAPITAL (continued) |
Grant Date
|
Common shares
issued
|
Value
|
|||||||
January 3, 2020
|
500,000
|
$
|
219,600
|
||||||
January 6, 2020
|
500,000
|
229,300
|
|||||||
January 8, 2020
|
400,000
|
195,160
|
|||||||
January 10, 2020
|
500,000
|
247,550
|
|||||||
January 17, 2020
|
600,000
|
303,000
|
|||||||
January 23, 2020
|
600,000
|
295,320
|
|||||||
February 6, 2020
|
600,000
|
282,000
|
|||||||
February 13, 2020
|
708,048
|
300,000
|
|||||||
4,408,048
|
$
|
2,071,930
|
7. |
SHARE CAPITAL (continued) |
Grant Date
|
Common shares
issued
|
Value
|
||||||
August 30, 2019
|
2,417,162
|
$
|
3,000,000
|
|||||
November 8, 2019
|
100,000
|
42,560
|
||||||
November 8, 2019
|
100,000
|
42,560
|
||||||
November 12, 2019
|
100,000
|
42,970
|
||||||
November 12, 2019
|
100,000
|
42,000
|
||||||
November 13, 2019
|
100,000
|
42,970
|
||||||
November 14, 2019
|
300,000
|
128,910
|
||||||
November 15, 2019
|
2,500,000
|
1,074,250
|
||||||
November 19, 2019
|
2,067,282
|
888,311
|
||||||
|
7,784,444
|
$
|
5,304,531
|
b)
|
Stock Options and Compensation Options
|
7. |
SHARE CAPITAL (continued) |
|
Three months ended
March 31, 2020 |
Year Ended
December 31, 2019 |
||||||||||||||
Number of
Stock Options(1)
|
Weighted average
Exercise Price (CDN)
|
Number of
Stock Options(1)
|
Weighted average
Exercise Price (CDN)
|
|||||||||||||
Balance Beginning
|
860,379
|
$
|
5.89
|
875,433
|
$
|
18.20
|
||||||||||
Granted
|
25,765
|
0.66
|
35,719
|
4.54
|
||||||||||||
Expired/Forfeited
|
-
|
-
|
(50,773
|
)
|
31.79
|
|||||||||||
Balance Ending
|
886,144
|
$
|
5.74
|
860,379
|
$
|
5.89
|
|
Three months ended
March 31, 2020 |
Year Ended
December 31, 2019 |
||||||||||||||
Number of
Stock Options
|
Weighted average
Exercise Price (USD)
|
Number of
Stock Options
|
Weighted average
Exercise Price (USD)
|
|||||||||||||
Balance Beginning
|
854,042
|
$
|
2.65
|
50,349
|
$
|
1.55
|
||||||||||
Granted
|
-
|
-
|
843,693
|
2.72
|
||||||||||||
Expired/Forfeited
|
(467,255
|
)
|
2.20
|
(40,000
|
)
|
3.72
|
||||||||||
Balance Ending
|
386,787
|
$
|
3.19
|
854,042
|
$
|
2.65
|
1.
|
After giving consideration for 30:1 share consolidation effected June 20, 2018.
|
7. |
SHARE CAPITAL (continued) |
Canadian Dollar Denominated Options | ||||||||||||
Exercise Price
(CDN)
|
Number
Outstanding
|
Weighted-average
remaining contractual
life (years)
|
Options
Exercisable
|
|||||||||
$0.66
|
25,765
|
6.83
|
25,765
|
|||||||||
$3.28
|
31,498
|
5.42
|
31,498
|
|||||||||
$4.50
|
18,936
|
3.03
|
18,936
|
|||||||||
$4.54
|
743,122
|
3.99
|
370,354
|
|||||||||
$4.80
|
3,040
|
0.46
|
3,040
|
|||||||||
$7.49
|
5,590
|
5.27
|
5,590
|
|||||||||
$9.00
|
11,481
|
5.27
|
11,481
|
|||||||||
$9.60
|
1,105
|
0.52
|
1,105
|
|||||||||
$11.70
|
6,667
|
0.69
|
6,667
|
|||||||||
$12.00
|
1,948
|
0.68
|
1,948
|
|||||||||
$30.00
|
28,260
|
1.40
|
28,260
|
|||||||||
$30.60
|
2,096
|
0.73
|
2,096
|
|||||||||
$32.40
|
810
|
0.83
|
810
|
|||||||||
$45.30
|
560
|
0.36
|
560
|
|||||||||
$51.60
|
5,266
|
0.19
|
5,268
|
|||||||||
886,144
|
3.96
|
513,378
|
||||||||||
US Dollar Denominated Options | ||||||||||||
Exercise Price
(USD)
|
Number
Outstanding
|
Weighted-average
remaining contractual
life (years)
|
Options
Exercisable
|
|||||||||
$1.55
|
50,349
|
1.72
|
50,349
|
|||||||||
$2.20
|
2,165
|
2.30
|
2,165
|
|||||||||
$3.40
|
294,273
|
6.12
|
197,273
|
|||||||||
$3.72
|
40,000
|
2.44
|
-
|
|||||||||
386,787
|
5.14
|
249,787
|
||||||||||
Total
|
1,272,931
|
4.32
|
763,165
|
|||||||||
7. |
SHARE CAPITAL (continued) |
2020 - CDN
|
2019 – US
|
||
Fair Value calculated
|
CDN $0.43
|
-
|
|
Share price at grant
|
CDN $.62
|
-
|
|
Exercise price
|
CDN $0.66
|
-
|
|
Expected Option Life
|
3.5 years
|
-
|
|
Risk free interest rate
(based on government bonds)
|
1.41%
|
-
|
|
Expected Volatility
|
109.00%
|
-
|
|
Expected dividends
|
Nil
|
-
|
c)
|
Warrants
|
8. |
COMMITMENTS |
9. |
RELATED PARTY TRANSACTIONS |
9. |
RELATED PARTY TRANSACTIONS (continued) |
March 31, 2020 | December 31, 2019 | |||||||||||||||
Number of Shares
|
%
|
Number of Shares
|
%
|
|||||||||||||
John Barker
|
32,714
|
0.06
|
32,714
|
0.08
|
||||||||||||
Stephen Randall
|
22,993
|
0.04
|
22,993
|
0.06
|
||||||||||||
David McNally
|
4,167
|
0.01
|
4,167
|
0.01
|
||||||||||||
John Schellhorn
|
294
|
0.00
|
294
|
0.00
|
||||||||||||
Total
|
60,168
|
0.11
|
60,168
|
0.15
|
||||||||||||
Common Shares Outstanding
|
54,216,877
|
100
|
%
|
39,907,681
|
100
|
%
|
10. |
SUBSEQUENT EVENTS
|
10. |
SUBSEQUENT EVENTS (contined)
|