UNITEDSTATES
SECURITIESAND EXCHANGE COMMISSION
Washington,D.C. 20549
Form
(MarkOne)
| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |
| For the quarterly period ended | |
| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Forthe period from ______________ to_______________
Commissionfile number:
(Exactname of registrant as specified in its charter)
| State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
(Addressof principal executive offices)
(Registrant’sTelephone Number, Including Area Code)
Indicateby check whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Actof 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) hasbeen subject to such filing requirements for the past 90 days.
Indicateby check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule405 of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrantwas required to submit such files).
Indicateby check mark whether registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company,or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smallerreporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act).
| Large accelerated filer ☐ | Accelerated filer ☐ |
| Smaller reporting company | |
| Emerging growth company |
Ifan emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complyingwith any new or revised financial standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicateby check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No
Securitiesregistered pursuant to Section 12(b) of the Act: None
Indicatethe number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: shares of Common Stock, $ par value, at August 13, 2025. As at that same date, the Company also has 160,672 Exchangeable Shares outstandingthat convert directly into common shares, which when combined with its Common Stock produce an amount equivalent to 26,728,441 outstandingvoting securities.
BIOTRICITYINC.
| 2 |
PART1
FINANCIALINFORMATION
Item1 – Condensed Consolidated Interim Financial Statements
| 3 |
BIOTRICITYINC.
CONDENSEDCONSOLIDATED INTERIM BALANCE SHEETS
ASOF JUNE 30, 2025 (unaudited) AND MARCH 31, 2025 (audited)
(Expressedin US Dollars, unless otherwise noted)
As at June 30, 2025 | As at March 31, 2025 | |||||||
| $ | $ | |||||||
| CURRENT ASSETS | ||||||||
| Cash | ||||||||
| Accounts receivable, net | ||||||||
| Inventory [Note 3] | ||||||||
| Deposits and other receivables | ||||||||
| Total current assets | ||||||||
| Deposits and other receivables [Note 10] | ||||||||
| Long-term accounts receivable | ||||||||
| Property and equipment [Note 12] | ||||||||
| Operating right of use assets [Note 10] | ||||||||
| TOTAL ASSETS | ||||||||
| CURRENT LIABILITIES | ||||||||
| Accounts payable and accrued liabilities [Note 4] | ||||||||
| Convertible promissory notes and short term loans [Note 5] | ||||||||
| Term loan, current | ||||||||
| Derivative liabilities [Note 8] | ||||||||
| Advance from customers | ||||||||
| Operating lease obligations, current [Note 10] | ||||||||
| Total current liabilities | ||||||||
| Federally guaranteed loans [Note 7] | ||||||||
| Term loan [Note 6] | ||||||||
| Derivative liabilities [Note 8] | ||||||||
| Operating lease obligations | ||||||||
| TOTAL LIABILITIES | ||||||||
| MEZZANINE EQUITY | ||||||||
| Series B Convertible Redeemable preferred stock, $ and $ par value, and shares authorized as of June 30, 2025 and March 31, 2025, respectively, and shares issued and outstanding as of June 30, 2025 and March 31, 2025, respectively [Note 9] | ||||||||
| STOCKHOLDERS’ DEFICIENCY | ||||||||
| Preferred stock, $ and $ par value, and shares authorized as of June 30, 2025 and March 31, 2025, respectively, and share issued and outstanding as of June 30, 2025 and March 31, 2025 [Note 9] | ||||||||
| Common stock, $ and $ par value, and shares authorized as at June 30, 2025 and March 31, 2025, respectively. Issued and outstanding common shares: and as at June 30, 2025 and March 31, 2025, respectively, and exchangeable shares of and outstanding as at June 30, 2025 and March 31, 2025, respectively [Note 9] | ||||||||
| Shares to be issued and shares of common stock as at June 30, 2025 and March 31, 2025, respectively) [Note 9] | ||||||||
| Additional paid-in-capital | ||||||||
| Accumulated other comprehensive income | ||||||||
| Accumulated deficit | ( | ) | ( | ) | ||||
| Total stockholders’ deficiency | ( | ) | ( | ) | ||||
| TOTAL LIABILITIES, MEZZANINE EQUITY AND STOCKHOLDERS’ DEFICIENCY | ||||||||
Commitmentsand contingencies [Note 11]
Subsequentevents [Note 13]
Seeaccompanying notes to unaudited condensed consolidated interim financial statements
| 4 |
BIOTRICITYINC.
CONDENSEDCONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
FORTHE THREE MONTHS ENDED JUNE 30, 2025 AND 2024 (unaudited)
(Expressedin US Dollars)
Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | |||||||
| $ | $ | |||||||
| REVENUE | ||||||||
| Cost of Revenue | ||||||||
| GROSS PROFIT | ||||||||
| OPERATING EXPENSES | ||||||||
| Selling, general and administrative expenses | ||||||||
| Research and development expenses | ||||||||
| TOTAL OPERATING EXPENSES | ||||||||
| (LOSS) PROFIT FROM OPERATIONS | ( | ) | ||||||
| Interest expense | ( | ) | ( | ) | ||||
| Accretion and amortization expenses [Note 5,6] | ( | ) | ( | ) | ||||
| Change in fair value of derivative liabilities [Note 8] | ( | ) | ( | ) | ||||
| Gain (loss) upon convertible promissory notes conversion and redemption [Note 9] | ( | ) | ||||||
| Other income (expense) [Note 9] | ( | ) | ||||||
| NET LOSS BEFORE INCOME TAXES | ( | ) | ( | ) | ||||
| Income taxes [Note 3] | ||||||||
| NET LOSS BEFORE DIVIDENDS | ( | ) | ( | ) | ||||
| Preferred Stock Dividends | ( | ) | ( | ) | ||||
| Deemed Dividends [Note 9] | ( | ) | ||||||
| NET LOSS ATTRIBUTABLE TO COMMON STOCKHOLDERS | ( | ) | ( | ) | ||||
| Translation adjustment | ( | ) | ||||||
| COMPREHENSIVE LOSS | ( | ) | ( | ) | ||||
| LOSS PER SHARE, BASIC AND DILUTED | ) | ) | ||||||
| WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING | ||||||||
Seeaccompanying notes to unaudited condensed consolidated interim financial statements
| 5 |
BIOTRICITYINC.
CONDENSEDCONSOLIDATED INTERIM STATEMENTS OF MEZZANINE EQUITY AND STOCKHOLDERS’ DEFICIENCY
FORTHE THREE MONTHS ENDED JUNE 30, 2025 AND 2024 (unaudited)
Mezzanine Equity | Total Mezzanine Equity | Preferred stock | Common stock and exchangeable common shares | Shares to be Issued | Additional paid in capital | Accumulated other comprehensive income | Accumulated deficit | Total Stockholders’ Deficiency | ||||||||||||||||||||||||||||||||||||||||||||
| Shares | $ | $ | Shares | $ | Shares | $ | Shares | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||
| Balance, March 31, 2025 | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||||||||||||||
| Issuance of common shares against preferred shares settlement [Note 9] | ( | ) | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Stock based compensation - ESOP [Note 9] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Translation adjustment | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||||||||||||||
| Net loss before dividends for the period | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||||||||||||||
| Preferred stock dividends | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||||||||||||||
| Balance, June 30, 2025 | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||||||||||||||
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Mezzanine Equity | Total Mezzanine Equity | Preferred stock | Common stock and exchangeable common shares | Shares to be Issued | Additional paid in capital | Accumulated other comprehensive income | Accumulated deficit | Total Stockholders’ Deficiency | ||||||||||||||||||||||||||||||||||||||||||||
| Shares | $ | $ | Shares | $ | Shares | $ | Shares | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||
| Balance, March 31, 2024 | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||||||||||||||
| Issuance of mezzanine equity [Note 9] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Issuance of common shares from shares to be issued [Note 9] | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||||||||||||||
| Issuance of common shares from at-the-market transaction [Note 9] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Conversion of mezzanine equity into common shares [Note 9] | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||||||||||||
| Conversion of preferred shares into common shares [Note 9] | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||||||||||||||
| Conversion of convertible notes into common shares [Note 9] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Issuance of shares for services [Note 9] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Issuance of shares for settlement of accounts payable [Note 9] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Stock based compensation - ESOP [Note 9] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Translation adjustment | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Net loss before dividends for the period | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||||||||||||||
| Preferred stock dividends | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||||||||||||||
| Deemed Dividend [Note 9] | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||||||||||||||
| Balance, June 30, 2024 | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||||||||||||||
Seeaccompanying notes to unaudited condensed consolidated interim financial statements
| 7 |
BIOTRICITYINC.
CONDENSEDCONSOLIDATED INTERIM STATEMENTS OF CASH FLOWS
FORTHE THREE MONTHS ENDED JUNE 30, 2025 AND 2024 (UNAUDITED)
(Expressedin US Dollars)
Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | |||||||
| $ | $ | |||||||
| CASH FLOWS FROM OPERATING ACTIVITIES | ||||||||
| Net loss | ( | ) | ( | ) | ||||
| Adjustments to reconcile net loss to net cash used in operations: | ||||||||
| Stock based compensation | ||||||||
| Issuance of shares for services | ||||||||
| Accretion and amortization expenses | ||||||||
| Change in fair value of derivative liabilities | ||||||||
| (Gain) loss upon convertible promissory notes conversion and redemption | ( | ) | ||||||
| Property and equipment depreciation | ||||||||
| Non-cash lease expense | ||||||||
| Changes in operating assets and liabilities: | ||||||||
| Accounts receivable, net | ( | ) | ( | ) | ||||
| Inventory | ( | ) | ( | ) | ||||
| Deposits and other receivables | ( | ) | ( | ) | ||||
| Accounts payable and accrued liabilities | ||||||||
| Net cash used in operating activities | ( | ) | ( | ) | ||||
| CASH FLOWS FROM FINANCING ACTIVITIES | ||||||||
| Issuance of common shares, net | ||||||||
| Issuance of preferred shares, net | ||||||||
| Proceeds from convertable promissory notes and short term loan | ( | ) | ||||||
| Preferred Stock Dividend | ( | ) | ( | ) | ||||
| Net cash provided by (used in) financing activities | ||||||||
| Net decrease in cash during the period | ( | ) | ||||||
| Effect of foreign currency translation | ( | ) | ( | ) | ||||
| Cash, beginning of period | ||||||||
| Cash, end of period | ||||||||
| Supplemental disclosure of cash flow information: | ||||||||
| Interest paid | ||||||||
| Taxes | ||||||||
Seeaccompanying notes to unaudited condensed consolidated interim financial statements
| 8 |
BIOTRICITYINC.
NOTESTO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
JUNE30, 2025 (Unaudited)
(Expressedin US dollars)
1.NATURE OF OPERATIONS
BiotricityInc. (formerly MetaSolutions, Inc.) (the “Company” or “Biotricity”) was incorporated under the laws of the Stateof Nevada on August 29, 2012. iMedical Innovations Inc. (“iMedical”) was incorporated on July 3, 2014 under the laws of theProvince of Ontario, Canada and became a wholly-owned subsidiary of Biotricity through reverse take-over on February 2, 2016.
TheCompany (directly and through its subsidiary) is engaged in research and development activities within the remote monitoring segmentof preventative care. It is focused on a realizable healthcare business model that has an existing market and commercialization pathway.As such, its efforts to date have been devoted to building and commercializing an ecosystem of technologies that enable access to thismarket.
2.BASIS OF PRESENTATION, MEASUREMENT AND CONSOLIDATION
The accompanying unaudited condensedconsolidated interim financial statements have been prepared in accordance with accounting principles generally accepted in the UnitedStates (“US GAAP”) for interim financial information and the Securities and Exchange Commission (“SEC”) instructionsto Form 10-Q and Article 8 of SEC Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generallyaccepted accounting principles for complete consolidated financial statements and should be read in conjunction with Biotricity’saudited consolidated financial statements for the years ended March 31, 2024 and 2023 and their accompanying notes.
The accompanying unaudited condensedconsolidated interim financial statements are expressed in United States dollars (“USD”). In the opinion of management, alladjustments (consisting of normal recurring accruals) considered necessary for a fair presentation of financial position and results ofoperations for the interim periods presented have been reflected herein. Operating results for the interim periods presented herein arenot necessarily indicative of the results that may be expected for the year ending March 31, 2025. The Company’s fiscal year-endis March 31.
The unaudited condensed consolidatedinterim financial statements include the accounts of the Company and its wholly-owned subsidiary. Significant intercompany accounts andtransactions have been eliminated.
Reclassifications
Certain amounts presented in the prior year period have been reclassifiedto confirm to current period consolidated interim financial statement presentation.
GoingConcern, Liquidity and Basis of Presentation
Theaccompanying condensed consolidated interim financial statements have been prepared assuming that the Company will continue as a goingconcern. The Company is commercializing its first product ecosystem and is concurrently continuing in development mode,operating a research and development program in order to develop, obtain regulatory clearance for, and commercialize other proposed products.The Company has incurred recurring losses from operations, and as of June 30, 2025, had an accumulated deficit of $
| 9 |
BIOTRICITYINC.
NOTESTO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
JUNE30, 2025 (Unaudited)
(Expressedin US dollars)
Managementanticipates the Company will continue on its revenue growth trajectory and improve its liquidity through continued business developmentand additional equity and debt capitalization of the Company.
Aswe proceed with the commercialization of the Bioflux, Biocore, and Biocare product development, we expect to continue to devote significantresources on capital expenditures, as well as research and development costs and operations, marketing and sales expenditures.
Basedon the above facts and assumptions, we believe our existing cash, along with anticipated near-term financings, will be sufficient tocontinue to meet our needs for the next twelve months from the filing date of this report. However, we will need to seek additional debtor equity capital to respond to business opportunities and challenges, including our ongoing operating expenses, protecting our intellectualproperty, developing or acquiring new lines of business and enhancing our operating infrastructure. The terms of our future financingsmay be dilutive to, or otherwise adversely affect, holders of our common stock. We may also seek additional funds through arrangementswith collaborators or other third parties. There can be no assurance we will be able to raise this additional capital on acceptable terms,or at all. If we are unable to obtain additional funding on a timely basis, we may be required to modify our operating plan and otherwisecurtail or slow the pace of development and commercialization of our proposed product lines.
| 10 |
BIOTRICITYINC.
NOTESTO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
JUNE30, 2025 (Unaudited)
(Expressedin US dollars)
3.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
RevenueRecognition
TheCompany adopted Accounting Standards Codification Topic 606, “Revenue from Contracts with Customers” (“ASC 606”)on April 1, 2018. In accordance with ASC 606, revenue is recognized when promised goods or services are transferred to customers in anamount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services by applyingthe core principles – (1) identify the contract with a customer, (2) identify the performance obligations in the contract, (3)determine the transaction price, (4) allocate the transaction price to performance obligations in the contract, and (5) recognize revenueas performance obligations are satisfied.
Boththe Bioflux mobile cardiac telemetry device, and the Biocore device are wearable devices. The cardiac data that the devices monitor andcollect is curated and analyzed by the Company’s proprietary algorithms and then securely communicated to a remote monitoring facilityfor electronic reporting and conveyance to the patient’s prescribing physician or other certified cardiac medical professional.Revenues earned are comprised of device sales revenues and technology fee revenues (technology as a service). The devices, together withtheir licensed software, are available for sale to the medical center or physician, who is responsible for the delivery of clinical diagnosisand therapy. The remote monitoring, data collection and reporting services performed by the technology culminate in a patient study thatis generally billable when it is complete and is issued to the physician. In order to recognize revenue, management considers whetheror not the following criteria are met: persuasive evidence of a commercial arrangement exists, and delivery has occurred or serviceshave been rendered. For sales of devices, which are invoiced directly, additional revenue recognition criteria include that the priceis fixed and determinable and collectability is reasonably assured; for device sales contracts with terms of more than one year, theCompany recognizes any significant financing component as revenue over the contractual period using the effective interest method, andthe associated interest income is reflected accordingly on the statement of operations and included in other income; for revenue thatis earned based on customer usage of the proprietary software to render a patient’s cardiac study, the Company recognizes revenuewhen the study ends based on a fixed billing rate. Costs associated with providing the services are recorded as the service is providedregardless of whether or when revenue is recognized.
TheCompany may also earn service-related revenue from contracts with other counterparties with which it consults. This contract work isseparate and distinct from services provided to clinical customers, but may be with a reseller or other counterparties that are workingto establish their operations in foreign jurisdictions or ancillary products or market segments in which the Company has expertise andmay eventually conduct business.
TheCompany recognized the following forms of revenue for the three months ended June 30, 2025 and 2024:
| 2025 | 2024 | |||||||
| $ | $ | |||||||
| Technology fees | ||||||||
| Device sales | ||||||||
| 11 |
BIOTRICITYINC.
NOTESTO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
JUNE30, 2025 (Unaudited)
(Expressedin US dollars)
Inventories
Inventoryis stated at the lower of cost and net realizable value, cost being determined on a weighted average cost basis. Market value of ourfinished goods inventory and raw material inventory is determined based on its estimated net realizable value, which is generally theselling price less normally predictable costs of disposal and transportation. The Company records write-downs of inventory that is obsoleteor in excess of anticipated demand or market value based on consideration of product lifecycle stage, technology trends, product developmentplans and assumptions about future demand and market conditions. Actual demand may differ from forecasted demand, and such differencesmay have a material effect on recorded inventory values. Inventory write-downs are charged to cost of revenue and establish a new costbasis for the inventory.
| June 30, 2025 | March 31, 2025 | |||||||
| $ | $ | |||||||
| Raw material | ||||||||
| Finished goods | ||||||||
Significantaccounting estimates and assumptions
Thepreparation of the condensed consolidated financial statements requires the use of estimates and assumptions to be made in applying theaccounting policies that affect the reported amounts of assets, liabilities, revenue and expenses and the disclosure of contingent assetsand liabilities. The estimates and related assumptions are based on previous experiences and other factors considered reasonable underthe circumstances, the results of which form the basis for making the assumptions about the carrying values of assets and liabilitiesthat are not readily apparent from other sources.
Theestimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the periodin which the estimate is revised if the revision affects only that period or in the period of the revision and future periods if therevision affects both current and future periods.
Significantaccounts that require estimates as the basis for determining the stated amounts include share-based compensation, impairment analysisand fair value of warrants, promissory notes, convertible notes and derivative liabilities:
| ● | Fair value of stock options |
TheCompany measures the cost of equity-settled transactions with employees by reference to the fair value of equity instruments at the dateat which they are granted. Estimating fair value for share-based payments requires determining the most appropriate valuation model fora grant of such instruments, which is dependent on the terms and conditions of the grant. The estimate also requires determining themost appropriate inputs to the Black-Scholes option pricing model, including the expected life of the instrument, risk-free rate, volatility,and dividend yield.
| ● | Fair value of warrants |
Indetermining the fair value of the warrant issued for services and issue pursuant to financing transactions, the Company used the Black-Scholesoption pricing model with the following assumptions: volatility rate, risk-free rate, and the remaining expected life of the warrantsthat are classified under equity.
| 12 |
BIOTRICITYINC.
NOTESTO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
JUNE30, 2025 (Unaudited)
(Expressedin US dollars)
| ● | Fair value of derivative liabilities |
Indetermining the fair values of the derivative liabilities from the conversion and redemption features, the Company used Monte-Carlo andlattice models with the following assumptions: dividend yields, volatility, risk-free rate and the remaining expected life. Changes inthose assumptions and inputs could in turn impact the fair value of the derivative liabilities and can have a material impact on thereported loss and comprehensive loss for the applicable reporting period.
| ● | Functional currency |
Determiningthe appropriate functional currencies for entities in the Company requires analysis of various factors, including the currencies andcountry-specific factors that mainly influence labor, materials, and other operating expenses.
| ● | Useful life of property and equipment |
TheCompany employs significant estimates to determine the estimated useful lives of property and equipment, considering industry trendssuch as technological advancements, past experience, expected use and review of asset useful lives. The Company makes estimates whendetermining depreciation methods, depreciation rates and asset useful lives, which requires considering industry trends and company-specificfactors. The Company reviews depreciation methods, useful lives and residual values annually or when circumstances change and adjustsits depreciation methods and assumptions prospectively.
| ● | Provisions |
Provisionsare recognized when the Company has a present obligation, legal or constructive, as a result of a previous event, if it is probable thatthe Company will be required to settle the obligation, and a reliable estimate can be made of the obligation. The amount recognized isthe best estimate of the expenditure required to settle the present obligation at the end of the reporting period, taking into accountthe risks and uncertainties surrounding the obligations. Provisions are reviewed at the end of each reporting period and adjusted toreflect the current best estimate of the expected future cash flows.
| ● | Contingencies |
Contingenciescan be either possible assets or possible liabilities arising from past events, which, by their nature, will be resolved only when oneor more uncertain future events occur or fail to occur. The assessment of the existence and potential impact of contingencies inherentlyinvolves the exercise of significant judgment and the use of estimates regarding the outcome of future events.
| ● | Inventory obsolescence |
Inventoriesare stated at the lower of cost and market value. Market value of our inventory, which is all purchased finished goods, is determinedbased on its estimated net realizable value, which is generally the selling price less normally predictable costs of disposal and transportation.The Company estimates net realizable value as the amount at which inventories are expected to be sold, taking into consideration fluctuationsin retail prices less estimated costs necessary to make the sale. Inventories are written down to net realizable value when the costof inventories is estimated to be unrecoverable due to obsolescence, damage, or declining selling prices.
| 13 |
BIOTRICITYINC.
NOTESTO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
JUNE30, 2025 (Unaudited)
(Expressedin US dollars)
| ● | Income and other taxes |
Thecalculation of current and deferred income taxes requires the Company to make estimates and assumptions and to exercise judgment regardingthe carrying values of assets and liabilities which are subject to accounting estimates inherent in those balances, the interpretationof income tax legislation across various jurisdictions, expectations about future operating results, the timing of reversal of temporarydifferences and possible audits of income tax filings by the tax authorities. In addition, when the Company incurs losses for incometax purposes, it assesses the probability of taxable income being available in the future based on its budgeted forecasts. These forecastsare adjusted to take into account certain non-taxable income and expenses and specific rules on the use of unused credits and tax losses.
Whenthe forecasts indicate that sufficient future taxable income will be available to deduct the temporary differences, a deferred taxasset is recognized for all deductible temporary differences. Changes or differences in underlying estimates or assumptions mayresult in changes to the current or deferred income tax balances on the consolidated interim balance sheets, a charge or credit toincome tax expense included as part of net income (loss) and may result in cash payments or receipts. Judgment includesconsideration of the Company’s future cash requirements in its tax jurisdictions. All income, capital and commodity taxfilings are subject to audits and reassessments. Changes in interpretations or judgments may result in a change in theCompany’s income, capital, or commodity tax provisions in the future. The amount of such a change cannot be reasonablyestimated.
| ● | Incremental borrowing rate for lease |
Thedetermination of the Company’s lease obligation and right-of-use asset depends on certain assumptions, which include the selectionof the discount rate. The discount rate is set by reference to the Company’s incremental borrowing rate. Significant assumptionsare required to be made when determining which borrowing rates to apply in this determination. Changes in the assumptions used may havea significant effect on the Company’s consolidated interim financial statements.
TheCompany has adopted the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification (“ASC”)Topic 260-10 which provides for calculation of “basic” and “diluted” earnings per share. Basic loss per shareof common stock is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period.Diluted earnings or loss per share of common stock is computed similarly to basic earnings or loss per share except the weighted averageshares outstanding are increased to include additional shares from the assumed exercise of any common stock equivalents, if dilutive.The Company’s warrants, options, convertible promissory notes, convertible preferred stock, shares to be issued and restrictedstock awards while outstanding are considered common stock equivalents for this purpose. Diluted earnings are computed utilizing thetreasury method for the warrants, stock options, shares to be issued and restricted stock awards. Diluted earnings with respect to theconvertible promissory notes and convertible preferred stock utilizing the if-converted method were not applicable during the periodspresented as no conditions required for conversion had occurred. No incremental common stock equivalents were included in calculatingdiluted loss per share because such inclusion would be anti-dilutive given the net loss reported for the periods presented.
Cash
Cashincludes cash on hand and balances with banks.
Asof June 30, 2025 and March 31, 2025, cash balance of US$
| 14 |
BIOTRICITYINC.
NOTESTO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
JUNE30, 2025 (Unaudited)
(Expressedin US dollars)
ForeignCurrency Translation
Thefunctional currency of the Company’s Canadian-based subsidiary is the Canadian dollar, and the US-based parent is the U.S.dollar. Transactions denominated in currencies other than the functional currency are translated into the functional currency at theexchange rates prevailing at the dates of the transaction. Monetary assets and liabilities denominated in foreign currencies aretranslated using the exchange rate prevailing at the consolidated interim balance sheet date. Non-monetary assets and liabilitiesare translated using the historical rate on the date of the transaction. All exchange gains or losses arising from translation ofthese foreign currency transactions are included in net income (loss) for the year. In translating the financial statements of theCompany’s Canadian subsidiaries from their functional currency into the Company’s reporting currency of United Statesdollars, consolidated interim balance sheet accounts are translated using the closing exchange rate in effect at the balance sheetdate and income and expense accounts are translated using an average exchange rate prevailing during the reporting period.Adjustments resulting from the translation, if any, are included in accumulated other comprehensive loss in stockholders’deficiency. The Company has not, to the date of these condensed consolidated interim financial statements, entered into derivativeinstruments to offset the impact of foreign currency fluctuations.
AccountsReceivable
Accountsreceivable consists of amounts due to the Company from medical facilities, which receive reimbursement from institutions andthird-party government and commercial payors and their related patients, as a result of the Company’s normal businessactivities. Accounts receivable is reported on the consolidated interim balance sheets net of an estimated allowance for doubtfulaccounts. The Company establishes an allowance for doubtful accounts for estimated uncollectible receivables based on historicalexperience, assessment of specific risk, review of outstanding invoices, and various assumptions and estimates that are believed tobe reasonable under the circumstances, and recognizes the provision as a component of selling, general and administrative expenses.Uncollectible accounts are written off against the allowance after appropriate collection efforts have been exhausted and when it isdeemed that a balance is uncollectible.
CustomerConcentration
Duringthe three months ended June 30, 2025, one customer comprised
FairValue of Financial Instruments
ASC820 defines fair value, establishes a framework for measuring fair value and expands required disclosure about fair value measurementsof assets and liabilities. ASC 820-10 defines fair value as the exchange price that would be received for an asset or paid to transfera liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction betweenmarket participants on the measurement date. ASC 820-10 also establishes a fair value hierarchy, which requires an entity to maximizethe use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The standard describes three levelsof inputs that may be used to measure fair value:
●Level 1 – Valuation based on quoted market prices in active markets for identical assets or liabilities.
●Level 2 – Valuation based on quoted market prices for similar assets and liabilities in active markets.
●Level 3 – Valuation based on unobservable inputs that are supported by little or no market activity, therefore requiring management’sbest estimate of what market participants would use as fair value.
| 15 |
BIOTRICITYINC.
NOTESTO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
JUNE30, 2025 (Unaudited)
(Expressedin US dollars)
Ininstances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy,the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that issignificant to the fair value measurement in its entirety. The Company’s assessment of the significance of a particular input tothe fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability.
Fairvalue estimates discussed herein are based upon certain market assumptions and pertinent information available to management. The respectivecarrying value of certain on-balance-sheet financial instruments approximated their fair values due to the short-term nature of theseinstruments or interest rates that are comparable to market rates. These financial instruments include cash, accounts receivable, depositsand other receivables, convertible promissory notes and short term loans, federally-guaranteed loans, term loans, accounts payable andaccrued liabilities. The Company’s derivative liabilities are carried at fair values and are classified as Level 3 financial instruments.The Company’s bank accounts are maintained with financial institutions of reputable credit, therefore, bear minimal credit risk.
Thefair value of financial instruments measured on a recurring basis is as follows:
Asof June 30, 2025 | ||||||||||||||||
| Description | Total | Level 1 | Level 2 | Level 3 | ||||||||||||
| Assets: | ||||||||||||||||
| Cash | $ | $ | $ | $ | ||||||||||||
| Total assets at fair value | $ | $ | $ | $ | ||||||||||||
| Liabilities: | ||||||||||||||||
| Derivative liabilities, short-term | $ | $ | $ | $ | ||||||||||||
| Derivative liabilities, long-term | ||||||||||||||||
| Total liabilities at fair value | $ | $ | $ | $ | ||||||||||||
Asof March 31, 2025 | ||||||||||||||||
| Description | Total | Level 1 | Level 2 | Level 3 | ||||||||||||
| Assets: | ||||||||||||||||
| Cash | $ | $ | $ | $ | ||||||||||||
| Total assets at fair value | $ | $ | $ | $ | ||||||||||||
| Liabilities: | ||||||||||||||||
| Derivative liabilities, short-term | $ | $ | $ | $ | ||||||||||||
| Derivative liabilities, long-term | ||||||||||||||||
| Total liabilities at fair value | $ | $ | $ | $ | ||||||||||||
Therewere no transfers between fair value hierarchy levels during the three months ended June 30, 2025 and 2024.
Propertyand Equipment
Propertyand equipment are stated at cost less accumulated depreciation. Depreciation is computed using the straight-line method over the estimateduseful lives of the assets. Leasehold improvements are amortized over the shorter of the lease term or the estimated useful lives ofthe assets. Maintenance and repairs are charged to expense as incurred, and improvements and betterments are capitalized. Depreciationof property and equipment is provided using the straight-line method for substantially all assets with estimated lives as follow:
| Office equipment | |
| Leasehold improvement |
| 16 |
BIOTRICITYINC.
NOTESTO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
JUNE30, 2025 (Unaudited)
(Expressedin US dollars)
Impairmentfor Long-Lived Assets
TheCompany applies the provisions of ASC Topic 360, Property, Plant, and Equipment, which addresses financial accounting and reportingfor the impairment or disposal of long-lived assets. ASC 360 requires impairment losses to be recorded on long-lived assets, includingright-of-use assets, used in operations when indicators of impairment are present and the undiscounted cash flows estimated to be generatedby those assets are less than the assets’ carrying amounts. In that event, a loss is recognized based on the amount by which thecarrying amount exceeds the fair value of the long-lived assets. Loss on long-lived assets to be disposed of is determined in a similarmanner, except that fair values are reduced for the cost of disposal. Based on its review at June 30, 2025 and March 31, 2025, the Companybelieves there was
Leases
TheCompany is the lessee in a lease contract when the Company obtains the right to use the asset. Operating leases are included in the lineitems Operating right of use assets, Operating lease obligations, current, and Operating lease obligations, long-term in the consolidatedinterim balance sheet.
Right-of-use(“ROU”) asset represents the Company’s right to use an underlying asset for the lease term and lease obligationsrepresent the Company’s obligations to make lease payments arising from the lease, both of which are recognized based on thepresent value of the future minimum lease payments over the lease term at the commencement date. Leases with a lease term of 12months or less at inception are not recorded on the consolidated interim balance sheet and are expensed on a straight-line basisover the lease term in the consolidated interim statement of operations and comprehensive loss. The Company determines the leaseterm by agreement with lessor. As the Company’s lease does not provide implicit interest rate, the Company uses theCompany’s incremental borrowing rate based on the information available at commencement date in determining the present valueof future payments. Refer to Note 10 for further discussion.
IncomeTaxes
TheCompany accounts for income taxes in accordance with ASC 740. The Company provides for Federal, State and Provincial income taxespayable, as well as for those deferred because of the timing differences between reporting income and expenses for consolidatedinterim financial statement purposes versus tax purposes. Deferred tax assets and liabilities are recognized for the future taxconsequences attributable to differences between the carrying amount of assets and liabilities for financial reporting purposes andthe amounts used for income tax purposes. Deferred tax assets and liabilities are measured using the enacted tax rates expected toapply to taxable income in the years in which those temporary differences are expected to be recoverable or settled. The effect of achange in tax rates is recognized as income or expense in the period of the change. A valuation allowance is established, whennecessary, to reduce deferred income tax assets to the amount that is more likely than not to be realized.
Researchand Development
Researchand development costs, which relate primarily to product and software development, are charged to operations as incurred. Under certainresearch and development arrangements with third parties, the Company may be required to make payments that are contingent on the achievementof specific developmental, regulatory and/or commercial milestones. Before a product receives regulatory approval, milestone paymentsmade to third parties are expensed when the milestone is achieved. Milestone payments made to third parties after regulatory approvalis received are capitalized and amortized over the estimated useful life of the approved product.
| 17 |
BIOTRICITYINC.
NOTESTO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
JUNE30, 2025 (Unaudited)
(Expressedin US dollars)
Selling,General and Administrative
Selling,general and administrative expenses consist primarily of personnel-related costs including stock-based compensation for personnel infunctions not directly associated with research and development activities. Other significant costs include sales and marketing costs,investor relations and legal costs relating to corporate matters, professional fees for consultants assisting with business developmentand financial matters, and office and administrative expenses.
TheCompany accounts for share-based payments in accordance with the provision of ASC 718, which requires that all share-based paymentsissued to acquire goods or services, including grants of employee stock options, be recognized in the consolidated interimstatements of operations and comprehensive loss based on their fair values, net of estimated forfeitures. ASC 718 requiresforfeitures to be estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ fromthose estimates. Compensation expense related to share-based awards is recognized over the requisite service period, which isgenerally the vesting period.
TheCompany accounts for stock based compensation awards issued to non-employees for services, as prescribed by ASC 718-10, at either thefair value of the services rendered or the instruments issued in exchange for such services, whichever is more readily determinable,using the guidelines in ASC 505-50. The Company issues compensatory shares for services including, but not limited to, executive, management,accounting, operations, corporate communication, financial and administrative consulting services.
ConvertibleNotes Payable and Derivative Instruments
TheCompany has adopted the provisions of ASU 2017-11 to account for the down round features of warrants issued with private placementseffective as of April 1, 2017. In doing so, warrants with a down round feature previously treated as derivative liabilities in theconsolidated interim balance sheet and measured at fair value are henceforth treated as equity, with no adjustment for changes infair value at each reporting period. Previously, the Company accounted for conversion options embedded in convertible notes inaccordance with ASC 815. ASC 815 generally requires companies to bifurcate conversion options embedded in convertible notes fromtheir host instruments and to account for them as free-standing derivative financial instruments. ASC 815 provides for an exceptionto this rule when convertible notes, as host instruments, are deemed to be conventional, as defined by ASC 815-40. The Companyaccounts for convertible notes deemed conventional and conversion options embedded in non-conventional convertible notes whichqualify as equity under ASC 815, in accordance with the provisions of ASC 470-20, which provides guidance on accounting forconvertible securities with beneficial conversion features. Accordingly, the Company records, as a discount to convertible notes,the intrinsic value of such conversion options based upon the differences between the fair value of the underlying common stock atthe commitment date of the note transaction and the effective conversion price embedded in the note. Debt discounts under thesearrangements are amortized over the term of the related debt.
SeriesB Convertible Preferred Stock
TheSeries B convertible preferred stock (“Series B Preferred Stock”) was accounted for as mezzanine equity and the embeddedconversion and redemption features was accounted for as derivative liabilities with change in fair value at each reporting periodend charged to the consolidated interim statement of operation and comprehensive loss in accordance with ASC 480 and ASC815.
| 18 |
BIOTRICITYINC.
NOTESTO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
JUNE30, 2025 (Unaudited)
(Expressedin US dollars)
TheCompany accounted for preferred stock redemptions and conversions in accordance to ASU-260-10-S99. For preferred stock redemptions andconversion, the difference between the fair value of consideration transferred to the holders of the preferred stock and the carryingamount of the preferred stock is accounted as deemed dividend distribution and subtracted from net loss.
SegmentInformation
Operatingsegments are defined as components of an entity where discrete financial information is evaluated regularly by the chief operating decisionmaker in deciding how to allocate resources and assessing performance. The Company has identified its Chief Executive Officer (“CEO”)as the chief operating decision maker (“CODM”). The Company operates in one operating segment. The Company’s CODM allocatesresources and assesses performance at the consolidated level. The Company’s property and equipment and operating right of use leaseasset are in the United States as of June 30, 2025 and 2024.
TheCODM uses net loss for purposes of making operating decisions, allocating resources, and evaluating financial performance. Significantexpenses include non-cash stock-based compensation, depreciation and amortization, and write-off of property and equipment, which arereflected in the Consolidated interim Statements of Cash Flows.
Thelong-lived assets outside of U.S. are not material as of June 30, 2025. The measure of segment assets is reported on the balancesheet as total consolidated assets. Refer to the Consolidated Interim Balance Sheets as of June 30, 2025 and 2024 for totalconsolidated assets.
| 19 |
BIOTRICITYINC.
NOTESTO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
JUNE30, 2025 (Unaudited)
(Expressedin US dollars)
RecentlyIssued Accounting Pronouncements
InNovember 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income (Subtopic 220-40): Expense DisaggregationDisclosures. This update requires public business entities to disclose, in the notes to financial statements, specific information aboutcertain costs and expenses to provide more detailed insights into the nature of expense components. The guidance is effective for annualreporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Early adoptionis permitted. The Company is evaluating the impact of this standard on its financial reporting and disclosures.
OnNovember 26, 2024, the FASB issued ASU 2024-04, Debt—Debt with Conversion and Other Options (Subtopic 470-20): Induced Conversionsof Convertible Debt Instruments. This amendment clarifies the accounting for certain settlements of convertible debt instruments thatoccur at terms different from the original contractual conversion terms, specifically addressing whether such settlements should be accountedfor as induced conversions or extinguishments. The standard is effective for all entities for fiscal years beginning after December 15,2025, including interim periods within those fiscal years. Early adoption is permitted. The Company is currently evaluating the impactof adopting ASU 2024-04 on its financial condition, results of operations, and cash flows. The Company continues to evaluate the impactof the new accounting pronouncement, including enhanced disclosure requirements, on our business processes, controls and systems.
TheCompany continues to evaluate the impact of the new accounting pronouncement, including enhanced disclosure requirements, on our businessprocesses, controls and systems, however there is no new accounting pronouncement for this quarter.
| 20 |
BIOTRICITYINC.
NOTESTO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
JUNE30, 2025 (Unaudited)
(Expressedin US dollars)
4.ACCOUNTS PAYABLE AND ACCRUED LIABILITIES
As at June 30, 2025 | As at March 31, 2025 | |||||||
| $ | $ | |||||||
| Trade and other payables | | |||||||
| Accrued liabilities | ||||||||
| Deferred revenue | ||||||||
| Total | ||||||||
Tradeand other payables and accrued liabilities as at June 30, 2025 and March 31, 2025 included $
5.CONVERTIBLE PROMISSORY NOTES AND SHORT TERM LOANS
SeriesA Convertible Promissory Notes:
Duringthe year ended March 31, 2021, the Company issued $
Forthe first series of Series A Notes, commencing six months following the Issuance Date, and at any time thereafter (provided the Holderhas not received notice of the Company’s intent to prepay the note), at the sole election of the Holder, any amount of the outstandingprincipal and accrued interest of this note (the “Outstanding Balance”) could be converted into that number of shares ofCommon Stock equal to:
Forthe first series of Series A Notes,
Forthe second series of Series A Notes, the notes could be converted into shares of common stock, at the option of the holder, commencingsix months from issuance, at a conversion price equal to the lower of $
Forthe second series of Series A Notes,
| 21 |
BIOTRICITYINC.
NOTESTO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
JUNE30, 2025 (Unaudited)
(Expressedin US dollars)
Priorto January 8, 2021 (final closing date), the Company determined that the conversion and redemption features contained in those Notesrepresented a single compound derivative liability that meets the requirements for liability classification under ASC 815. The Companyaccounted for these obligations by determining the fair value of the related derivative liabilities associated with the embedded conversionand redemption features.
Forthe Series A Notes, The Company recognized debt issuance costs in the amount of $
OnDecember 30, 2022, the Company exchanged $
Duringthe year ended March 31 2025,, all of the Series A notes had been converted into common shares, with the exception of notes held by twoinvestors, with a remaining face value in the amount of $
Duringthe year ended March 31, 2025, the Company recognized discount amortization of $ (2024: $
Asof March 31, 2025, and March 31, 2024, the Company recorded $
Duringthe years ended March 31, 2025, and March 31, 2024, the Company recognized interest expense in the amount of $
| 22 |
BIOTRICITYINC.
NOTESTO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
JUNE30, 2025 (Unaudited)
(Expressedin US dollars)
Duringthe three months ended June 30, 2025, and June 30, 2024, the Company recognized discount amortization of $ as accretion and amortizationexpense. As of June 30, 2025, the discount on Series A convertible notes was fully amortized.
Asof June 30, 2025, and March 31, 2025, the Company recorded $
Duringthe three months ended June 30, 2025, and June 30, 2024, the Company recognized interest expense in the amount of $
SeriesB Convertible Notes
Duringthe year ended March 31, 2021, the Company also issued $
Commencingsix months following the issuance date, and at any time thereafter, subject to the Company’s Conversion Buyout clause, at the soleelection of the holder, any amount of the outstanding principal and accrued interest of the note (the “outstanding balance”)could be converted into that number of shares of Common Stock equal to: (i) the outstanding balance divided by (ii) the Conversion Price.Partial conversions of the note shall have the effect of lowering the outstanding principal amount of the note. The holder may exercisesuch conversion right by providing written notice to the Company of such exercise in a form reasonably acceptable to the Company (a “conversionnotice”). Conversion price means (subject in all cases to proportionate adjustment for stock splits, stock dividends, and similartransactions), seventy-five percent (75%) multiplied by the average of the three (3) lowest closing prices during the previous ten (10)trading days prior to the receipt of the conversion notice.
Netproceeds to the Company from convertible note issuances to March 31, 2021 amounted to $
| 23 |
BIOTRICITYINC.
NOTESTO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
JUNE30, 2025 (Unaudited)
(Expressedin US dollars)
TheCompany recognized debt issuance costs in the amount of $
Duringthe year ended March 31, 2022, $
Duringthe year ended March 31, 2023, $
Duringthe year ended March 31, 2023, $
Duringthe year ended March 31, 2024, the Company redeemed $
Duringthe year ended March 31, 2025, the Company redeemed $
Asof June 30, 2025, there were no Series B Notes outstanding
Asof June 30, 2025, and March 31, 2025, the Company recorded accrued interest in the amount of $
Duringthe three months ended June 30, 2025, and June 30, 2024, the Company recognized interest expense in the amount of $ and $
| 24 |
BIOTRICITYINC.
NOTESTO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
JUNE30, 2025 (Unaudited)
(Expressedin US dollars)
SeriesC Convertible Notes
TheCompany has issued Series C Notes in total of $
TheSeries C Notes were sold under subscription agreements to accredited investors. The Notes mature one year from the final closing dateof the offering and accrue interest at
ForSeries C Notes, commencing six months following the Issuance Date, and at any time thereafter, at the sole election of the Holder, anyamount of the outstanding principal and accrued interest of this note (the “Conversion Amount”) could be converted into thatnumber of shares of Common Stock equal to: the Conversion Amount divided by the “Optional Conversion Price”, which is definedas lower of
ForSeries C Notes, “Mandatory Conversion,”
Priorto the final closing date (October 23, 2023), the Company determined that the conversion features contained in those Note, as well asthe obligations to issue investor warrants and placement agent warrants represented a single compound derivative liability that meetsthe requirements for liability classification under ASC 815. The Company accounted for these obligations by determining the fair valueof the related derivative liabilities associated with the embedded conversion features, as well as the obligations related to investorwarrant and placement agent warrant issuance. Subsequently, the exercise price of all warrants was concluded and locked to $
| 25 |
BIOTRICITYINC.
NOTESTO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
JUNE30, 2025 (Unaudited)
(Expressedin US dollars)
Forthe Series C Notes, the Company recognized debt issuance costs of $
Duringthe three months ended June 30, 2025, and June 30, 2024, the Company recognized discount amortization of $ and $
Duringthe three months ended June 30, 2025, there were no conversions of convertible notes into common shares or shares to be issued. Accordingly,no debt settlements or related gains/losses upon conversion were recognized during the period.
Duringthe three months ended June 30, 2025, convertible notes with a face value of $
Asof June 30, 2025, and March 31, 2025, the Company recorded accrued interest in the amount of $
Duringthe three months ended June 30, 2025, and June 30, 2024, the Company recognized interest expense in the amounts of $
ConvertiblePreferred Notes
TheCompany entered into a convertible preferred note financing on September 25, 2023 and issued a convertible note (“Preferred Note”)for a principal amount of $
TheCompany also issued a Preferred Note on October 25, 2023 in the principal amount of $
TheCompany issued a further Preferred Note in January 2024 for a principal amount of $
| 26 |
BIOTRICITYINC.
NOTESTO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
JUNE30, 2025 (Unaudited)
(Expressedin US dollars)
TheCompany also issued a Preferred Note on June 17, 2024, for a principal amount of $
Duringthe year ended March 31, 2025, the Company issued $
Duringthe three months ended June 30, 2025, the Company issued $
Asof June 30, 2025, and March 31, 2025, the Company recorded accrued interest in the amount of $
Duringthe three months ended June 30, 2025 and 2024, the Company recognized interest expense in the amount of $
OtherConvertible Notes
OnJanuary 23, 2023, the Company issued $
Theconversion of the Notes is automatic upon a Qualified Financing which is in the control of the Company, or at maturity of the notes,upon mutual agreement by the noteholder and the Company. Since the conversion is not in control of the holder of the note, the Companydid not recognize a derivative liability in connection with the conversion option of the Notes.
Asof June 30, 2025, and March 31, 2025, respectively, the discount on Other Convertible Notes was fully amortized.
| 27 |
BIOTRICITYINC.
NOTESTO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
JUNE30, 2025 (Unaudited)
(Expressedin US dollars)
OtherShort-term loans and Promissory Notes
InDecember 2022, the Company entered into a short-term bridge loan agreement with a collateralized merchant finance company that advancedgross proceeds of $
InDecember 2022, the Company also entered into a short-term collateralized bridge loan agreement with a finance company that advanced grossproceeds of $
InDecember 2022, the Company entered into a promissory note agreement with an individual investor that resulted in gross proceeds of $
OnDecember 30, 2022, the Company extinguished
| 28 |
BIOTRICITYINC.
NOTESTO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
JUNE30, 2025 (Unaudited)
(Expressedin US dollars)
OnMarch 29, 2023, the Company entered into an additional collateralized bridge loan agreement with a finance company that advanced grossproceeds of $
InJune 2023, the Company entered into a secured revolving account purchase credit and inventory financing facility (the “RevolvingFacility”) with a revolving loan lender, pursuant to which the lender may from time to time purchase certain discrete account receivablesfrom the Company (with full recourse) or may make loans and provide other financial accommodations, the payment of which are guaranteedand secured by certain assets of the Company.
OnJuly 13, 2023, the Company entered into another short-term bridge loan agreement with a collateralized merchant finance company thatadvanced gross proceeds of $
OnAugust 11, 2023, the Company issued two short term promissory notes (“August 2023 Notes”), each for a principal amount of$
| 29 |
BIOTRICITYINC.
NOTESTO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
JUNE30, 2025 (Unaudited)
(Expressedin US dollars)
OnDecember 8, 2023, the Company entered into a short-term bridge loan agreement with a collateralized merchant finance company that advancedgross proceeds of $
DuringFebruary 2024, the Company entered into a promissory note agreement with an individual investor that resulted in gross proceeds of $
| 30 |
BIOTRICITYINC.
NOTESTO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
JUNE30, 2025 (Unaudited)
(Expressedin US dollars)
6.TERM LOAN AND CREDIT AGREEMENT
TermLoan
OnDecember 21, 2021, the Company entered into a Credit Agreement (“Credit Agreement”) with SWK Funding LLC (“Lender’);as part of this, the Company has borrowed $
TheCompany and Lender also entered into a Guarantee and Collateral Agreement (“Collateral Agreement”) wherein the Company agreedto secure the Credit Agreement with all of the Company’s assets. The Company and Lender also entered into an Intellectual PropertySecurity Agreement dated December 21, 2021 (the “IP Security Agreement”) wherein the Credit Agreement is also secured bythe Company’s right title and interest in the Company’s Intellectual Property.
InNovember 2024, the Company completed an additional transaction with its term lender to receive an additional $
Theamortization of such debt discount was included in the accretion and amortization expenses. For the three months ended June 30, 2025and 2024, the amortization of debt discount expense was $
Totalinterest expense on the term loan for the three months ended June 30, 2025 and 2024 $
TheCompany had accrued interest payable of $
| 31 |
BIOTRICITYINC.
NOTESTO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
JUNE30, 2025 (Unaudited)
(Expressedin US dollars)
7.FEDERALLY GUARANTEED LOAN
EconomicInjury Disaster Loan (“EIDL”)
InApril 2020, the Company received $
InMay 2021, the Company received an additional $
Asof June 30, 2025 and March 31, 2025, the Company recorded accrued interest of $ for the EIDL loan.
Interestexpense on the above loan was $
8.DERIVATIVE LIABILITIES
TheCompany analyzed the compound features of variable conversion and redemption embedded in the preferred shares instrument, for potentialderivative accounting treatment on the basis of ASC 820 (Fair Value in Financial Instruments), ASC 815 (Accounting for Derivative Instrumentsand Hedging Activities), Emerging Issues Task Force (“EITF”) Issue No. 00–19 and EITF 07–05, and determined thatthe embedded derivatives should be bundled and valued as a single, compound embedded derivative, bifurcated from the underlying equityinstrument, treated as a derivative liability, and measured at fair value. A roll-forward of activity is presented below for the threemonths ended June 30, 2025 and 2024:
| Fiscal Year 2026 | Fiscal Year 2025 | |||||||
| $ | $ | |||||||
| Derivative liabilities, beginning of period - March 31 | ||||||||
| New issuance [Note 9] | ||||||||
| Change in fair value of derivatives during period – June 30 | ||||||||
| Reduction due to preferred shares converted [Note 9] | ( | ) | ||||||
| Derivative liabilities, end of period | ||||||||
| 32 |
BIOTRICITYINC.
NOTESTO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
JUNE30, 2025 (Unaudited)
(Expressedin US dollars)
Thelattice methodology was used to value the derivative components of Series A Preferred Stock, using the following assumptions during thethree months ended June 30, 2025 and 2024:
| June 30, 2025 | June 30, 2024 | |||||||
| Dividend yield (%) | ||||||||
| Risk-free rate for term (%) | ||||||||
| Volatility (%) | ||||||||
| Remaining terms (Years) | ||||||||
| Stock price ($ per share) | ||||||||
TheMonte Carlo simulation methodology was used to value the derivative components of Series B Preferred Stock, using the following assumptionsduring the three months ended June 30, 2025:
| June 30, 2025 | June 30, 2024 | |||||||
| Dividend yield (%) | ||||||||
| Risk-free rate for term (%) | ||||||||
| Volatility (%) | ||||||||
| Remaining terms (Years) | ||||||||
| Stock price ($ per share) | ||||||||
Inaddition, the Company recorded derivative liabilities related to the conversion and redemption features of the convertible notes, aswell as warrants that were issued in connection with the convertible notes (Note 5). Any noteholder and placement agent warrants thatwere issued after the finalization of exercise price was accounted for as equity. A roll-forward of activity is presented below for thethree months ended June 30, 2025 and 2024:
| Fiscal Year 2026 | Fiscal Year 2025 | |||||||
| $ | $ | |||||||
| Balance beginning of period – March 31 | ||||||||
| Conversion to common shares | ( | ) | ||||||
| Change in fair value of derivative liabilities | ||||||||
| Convertible note redemption | ( | ) | ( | ) | ||||
| Balance end of period – June 30 | ||||||||
TheMonte-Carlo methodology was used to value the convertible note and warrant derivative components during the three months ended June 30,2025 and 2024, using the following assumptions:
| June 30, 2025 | June 30, 2024 | |||||||
| Risk-free rate for term (%) | ||||||||
| Volatility (%) | ||||||||
| Remaining terms (Years) | ||||||||
| Stock price ($ per share) | ||||||||
| 33 |
BIOTRICITYINC.
NOTESTO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
JUNE30, 2025 (Unaudited)
(Expressedin US dollars)
9.STOCKHOLDERS’ DEFICIENCY
(a)Authorized and Issued Stock
Asat June 30, 2025, the Company is authorized to issue (March 31, 2025 – ) shares of common stock ($par value), and (March 31, 2025 – ) shares of preferred stock ($ par value), of which (March 31,2025 – ) are designated shares of Series A preferred stock ($ par value) and (March 31, 2025 – ) are designatedshares of Series B preferred stock ($ par value).
AtJune 30, 2025, common shares and shares directly exchangeable into equivalent common shares that were issued and outstanding totaled (March 31, 2025 – )shares; these were comprised of (March 31, 2025 – )shares of common stock and (March 31, 2025 – )exchangeable shares. At June 30, 2025, there were shares of Series A Preferred Stock issued and outstanding (March 31, 2025 – ),and shares of Series B Preferred Stock issued and outstanding (March 31, 2025 – ).There is also one share of the Special Voting Preferred Stock issued and outstanding held by one holder of record, which is theTrustee in accordance with the terms of the Trust Agreement and outstanding as at June 30, 2025 and March 31, 2025.
(b)Series A Preferred Stock
Thenumber of Series A Preferred Stock issued and outstanding as of June 30, 2025 and 2024 was and , respectively.
TheSeries A Preferred Stock is junior to the Company’s existing undesignated preferred stock, and unless otherwise set forth in theapplicable certificate of designations, shall be junior to any future issuance of preferred stock. The purchase price (the “PurchasePrice”) for the Series A Preferred Stock to date has been $
PreferredStock Dividends
Dividendsshall be paid at the rate of
Conversion
TheSeries A Preferred Stock is convertible into shares of common stock commencing 24 months after the issuance date of the Series A PreferredStock; on a monthly basis, up to
| 34 |
BIOTRICITYINC.
NOTESTO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
JUNE30, 2025 (Unaudited)
(Expressedin US dollars)
OtherAdjustments and Rights
●The Conversion Rate (and shares issuable upon conversion of the Series A Preferred Stock) will be appropriately adjusted to reflect stocksplits, stock dividends business combinations and similar recapitalization.
●The Holders shall be entitled to a proportionate share of certain qualifying distributions on the same basis as if they were holdersof the Company’s common stock on an as converted basis.
CompanyRedemption
TheCompany may redeem all or part of the outstanding Series A Preferred Stock after one year from the date of issuance by paying an amountequal to the aggregate Purchase Price paid, adjusted for any reduction in Series A Preferred Stock holdings, multiplied by
(c)Series B Preferred Stock and Mezzanine Equity
OnSeptember 19, 2023, the Company entered into a security purchase agreement (the “Purchase Agreement”) with an institutionalinvestor (the “Investor”) for the issuance and sale of shares of the Company’s newly designated Series B ConvertiblePreferred Stock, at a purchase price of $ per share of Preferred Stock, and after accounted for other issuance related costs, thenet proceeds received was in the amount of $
Duringthe three months ended March 31, 2024 a further Series B preferred shares were issued for net proceeds of $
Duringthe three months ended June 30, 2025, Series B preferred shares were issued, and
Pursuantto the initial Purchase Agreement, on September 19, 2023, the Company filed a certificate of designations of Series B Convertible PreferredStock (the “Certificate of Designations”) with the Nevada Secretary of State designating shares of the Company’sshares of Preferred Stock as Series B Convertible Preferred Stock and setting forth the voting and other powers, preferences and relative,participating, optional or other rights of the Preferred Shares. Each share of Series B Preferred Stock has a stated value of $per share.
TheSeries B Preferred Stock, with respect to the payment of dividends, distributions and payments upon the liquidation, dissolution andwinding up of the Company, ranks senior to all capital stock of the Company unless the holders of the majority of the outstanding sharesof Series B Preferred Stock consent to the creation of other capital stock of the Company that is senior or equal in rank to the SeriesB Preferred Stock.
Holdersof Series B Preferred Stock will be entitled to receive cumulative dividends (“Dividends”), in shares of common stock orcash on the stated value at an annual rate of
| 35 |
BIOTRICITYINC.
NOTESTO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
JUNE30, 2025 (Unaudited)
(Expressedin US dollars)
PreferredStock, upon any redemption, or upon any required payment upon any Bankruptcy Triggering Event (as defined in the Certificate of Designations).
Holdersof Series B Preferred Stock will be entitled to convert shares of Series B Preferred Stock into a number of shares of common stock determinedby dividing the stated value (plus any accrued but unpaid dividends and other amounts due) by the conversion price. The initial conversionprice is $
TheSeries B Preferred Stock will automatically convert to common stock upon the 24-month anniversary of the initial issuance date of theSeries B Preferred Stock.
Atany time after the earlier of a holder’s receipt of a Triggering Event notice and such holder becoming aware of a Triggering Eventand ending on the 20th trading day after the later of (x) the date such Triggering Event is cured and (y) such holder’s receiptof a Triggering Event notice, such holder may require the Company to redeem such holder’s shares of Series B Preferred Stock.
Uponany Bankruptcy Triggering Event (as defined in the Certificate of Designations), the Company will be required to immediately redeem allof the outstanding shares of Series B Preferred Stock.
TheCompany will have the right at any time to redeem all or any portion of the Series B Preferred Stock then outstanding at a price equalto
Holdersof the Series B Preferred Stock will have the right to vote on an as-converted basis with the common stock, subject to the beneficialownership limitation set forth in the Certificate of Designations.
OnApril 1, 2024, the Company filed an Amended Certificate of Designations of Series B Convertible Preferred Stock (the “Amended Certificateof Designations”) with the Nevada Secretary of State. The Amended Certificate of Designations removes the provision in the originalcertificate of designations for the Series B Convertible Preferred Stock filed on September 19, 2023 that provided the holders of theSeries B Preferred Stock with the right to vote on an as converted basis with the Company’s common stock, subject to the beneficialownership limitation set forth in the Certificate of Designations. The Amended Certificate of Designations provides that except as requiredby law, the Series B Preferred Stock is nonvoting. All other powers, preferences and relative, participating, optional or other rightsof the Series B Preferred Stock remain unchanged.
| 36 |
BIOTRICITYINC.
NOTESTO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
JUNE30, 2025 (Unaudited)
(Expressedin US dollars)
TheSeries B Preferred Stock was accounted for as Mezzanine Equity in accordance with ASC 480 - Distinguishing Liabilities fromEquity and the embedded conversion and redemption features was separated from the host instrument and recognized as derivativeliabilities with change in fair value at each reporting period end recognized in the consolidated interim statement of operationsand comprehensive loss. (Note 8).
Duringthe three months ended December 31, 2023, Series B preferred shares and dividends accrued thereon were converted into commonshares. As a result of the conversion, the Company reduced the book value of mezzanine equity by $ and reduced its accrued dividendsliability by $
Duringthe three months ended March 31, 2024, Series B preferred shares and dividends accrued thereon were converted into to be issuedcommon shares. As a result of the conversion, the Company reduced the book value of mezzanine equity by $. The Company also reducedthe fair value of derivative liabilities related to the shares converted by $ . The Company recognized corresponding credits tobe issued common share par value and paid in capital.
Duringthe year ended March 31, 2025, Series B preferred shares and dividends accrued thereon were converted into common shares.As a result of the conversion, the Company reduced the book value of mezzanine equity by $
Duringthe three months ended June 30, 2025, the Company issued common shares to complete the settlement of a Series B preferred shareconversion that was initiated and recognized during the year ended March 31, 2025. These issuances were made in accordance with the termsof the original conversion and did not result from a new conversion notice. No Series B preferred share conversions occurred during thethree months ended June 30, 2025.
Aroll-forward of activity is presented below for the three months ended June 30, 2025:
| Fiscal Year 2026 | ||||
| $ | ||||
| Balance beginning of year – March 31 | ||||
| Net proceeds received pursuant to the issuance of preferred shares | ||||
| Recognition of derivative liabilities (Note 8) | ||||
| Conversion into common shares | ||||
| Balance end of year – June 30 | ||||
(d)Share issuances
Shareissuances during the three months ended June 30, 2025
Duringthe three months ended June 30, 2025, the Company issued common shares to Series B preferred shareholders, in relation to the settlement of a Series B preferred share conversion that was initiated and recognized during theyear ended March 31, 2025.
Shareissuances during the three months ended June 30, 2024
TheCompany issued common shares to Series B preferred shareholders in relation to shares to be issued obligation as of March 2024for Series B preferred share conversions.
| 37 |
BIOTRICITYINC.
NOTESTO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
JUNE30, 2025 (Unaudited)
(Expressedin US dollars)
TheCompany issued another common shares to Series B preferred shareholders for an additional request to convert Series B preferredshares (Note 9(c)).
Duringthe three months ended June 30, 2024, convertible notes with a face value of $
conversionof $
Duringthe three months ended June 30, 2024, $
TheCompany issued common shares in settlement of $ in amount due to a shareholder which was part of the accounts payable.The Company recognized a loss upon debt extinguishment of $
TheCompany issued common shares for net proceeds of $
Inaddition, the Company issued common shares for services received with a fair value of $which was recognized as a general and administrative expensewith a corresponding credit to additional paid-in capital.
(e)Shares to be issued
Activityduring the three months ended June 30, 2025
.
Activityduring the three months ended June 30, 2024
TheCompany issued common shares to Series B preferred shareholders in relation to shares to be issued obligation as of March 31,2024 for Series B preferred share conversions.
TheCompany issued
(f)Warrant issuances, exercises and other activity
Warrantexercises and issuances during the three months ended June 30, 2025
.
Warrantexercises and issuances during the three months ended June 30, 2024
.
| 38 |
BIOTRICITYINC.
NOTESTO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
JUNE30, 2025 (Unaudited)
(Expressedin US dollars)
Warrantactivity during the three months ended June 30, 2025 is indicated below:
| Broker Warrants | Consultant and Noteholder Warrants | Warrants Issued on Convertible Notes | Total | |||||||||||||
| As at March 31, 2025 | ||||||||||||||||
| As at June 30, 2025 | ||||||||||||||||
| Exercise Price | $ | $ | $ | |||||||||||||
| Expiration Date | ||||||||||||||||
(g)Stock-based compensation
2016Equity Incentive Plan
OnFebruary 2, 2016, the Board of Directors of the Company approved the Company’s 2016 Equity Incentive Plan (the “Plan”).The purpose of the Plan is to advance the interests of the Company and its stockholders by providing an incentive to attract, retainand reward persons performing services for the Company and by motivating such persons to contribute to the growth and profitability ofthe Company. The Plan seeks to achieve this purpose by providing for awards in the form of options, stock appreciation rights, restrictedstock purchase rights, restricted stock bonuses, restricted stock units, performance shares, performance units and other stock-basedawards.
ThePlan shall continue in effect until its termination by the board of directors or committee formed by the board; provided, however, thatall awards shall be granted, if at all, on or before the day immediately preceding the tenth (10th) anniversary of the effective date.The maximum number of shares of stock that may be issued under the Plan is shares ; provided that the maximumnumber of shares of stock that may be issued under the Plan will automatically increase on January 1 of each year for not more than 10 years from the effective date, so the number of sharesthat may be issued is an amount no greater than 20% of the Company’s outstanding shares of stock and shares of stock underlyingany outstanding exchangeable shares as of such January 1; provided further that no such increase shall be effective if it would violateany applicable law or stock exchange rule or regulation, or result in adverse tax consequences to the Company or any participant thatwould not otherwise result but for the increase.
Duringthe three months ended June 30, 2025, and June 30, 2024, the Company granted and stock options and recorded stock-based compensationof $ and $, respectively, under selling, general and administrative expenses with corresponding credit to additional paidin capital.
| 39 |
BIOTRICITYINC.
NOTESTO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
JUNE30, 2025 (Unaudited)
(Expressedin US dollars)
Asof June 30,2025 Number of Options outstanding were with the weighted average exercise price of .
June 30, 2025 | June 30, 2024 | |||||||
| Exercise price ($) | - | |||||||
| Risk free interest rate (%) | - | |||||||
| Expected term (Years) | - | - | ||||||
| Expected volatility (%) | % - | % - | ||||||
| Expected dividend yield (%) | ||||||||
| Fair value of option ($) | - | - | ||||||
| Expected forfeiture (attrition) rate (%) | ||||||||
2023Equity Incentive Plan and the Employee Stock Purchase Plans
OnMarch 31, 2023, the Company adopted the 2023 Equity Incentive Plan (the “2023 Plan”). The 2023 Plan authorizes grants ofequity-based and incentive cash awards to eligible participants designated by the 2023 Plan’s administrator. The 2023 Plan willbe administered by the Compensation Committee of the Company’s Board of Directors (the “Board”). An aggregate of shares of the Company’s common stock (the “Common Stock”), plus the number of shares available for issuance under theCompany’s 2016 Equity Incentive Plan that had not been made subject to outstanding awards, were reserved for issuance under the2023 Plan. Unless earlier terminated by the Board, the 2023 Plan will remain in effect until all Common Stock reserved for issuance hasbeen issued, provided, however, that all awards shall be granted, if at all, on or before the day immediately preceding the tenth (10th)anniversary of the effective date of the 2023 Plan.
| 40 |
BIOTRICITYINC.
NOTESTO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
JUNE30, 2025 (Unaudited)
(Expressedin US dollars)
TheCompany also adopted the Employee Stock Purchase Plan (the “ESPP”). The ESPP allows eligible employees of the Company andthe Company’s designated subsidiaries the ability to purchase shares of the Company’s Common Stock at a discount, subjectto various limitations. Under the ESPP, employees will be granted the right to purchase Common Stock at a discount during a series ofsuccessive offerings, the duration and timing of which will be determined by the ESPP administrator (the “Administrator”).In no event can any single offering period be longer than 27 months. The purchase price (the “Purchase Price”) for each offeringwill be established by the Administrator. With respect to an offering under Section 423 of the Internal Revenue Code of 1986 (“Section423 Offering”), in no case may such Purchase Price be less than the lesser of (i) an amount equal to 85 percent of the fair marketvalue on the commencement date, or (ii) an amount not less than 85 percent of the fair market value the on the purchase date. In theevent of financial hardship, an employee may withdraw from the ESPP by providing a request at least 20 Business Days before the end ofthe offering period (the “Offering Period”). Otherwise, the employee will be deemed to have exercised the purchase rightin full as of such exercise date. Upon exercise, the employee will purchase the number of whole shares that the participant’s accumulatedpayroll deductions will buy at the Purchase Price. If an employee wants to decrease the rate of contribution, the employee must makea request at least 20 Business Days before the end of an Offering Period (or such earlier date as determined by the Administrator). Anemployee may not transfer any rights under the ESPP other than by will or the laws of descent and distribution. During a participant’slifetime, purchase rights under the ESPP shall be exercisable only by the participant.
10.OPERATING LEASE RIGHT-OF-USE ASSETS AND LEASE OBLIGATIONS
TheCompany has one operating lease primarily for office and administration.
DuringDecember 2021, the Company entered into a new lease agreement. The Company paid $
Whenmeasuring the lease obligations, the Company discounted lease payments using its incremental borrowing rate. The weighted-average-rateapplied is
Fiscal Year 2025 | Fiscal Year 2024 | |||||||
| Right of Use Asset | $ | $ | ||||||
| Beginning balance at March 31 | ||||||||
| Amortization | ( | ) | ( | ) | ||||
| Ending balance at June 30 | ||||||||
| 2025 | 2024 | |||||||
| Lease Liability | $ | $ | ||||||
| Beginning balance at March 31 | ||||||||
| Repayment and interest accretion, net | ( | ) | ( | ) | ||||
| Ending balance at June 30 | ||||||||
| 41 |
BIOTRICITYINC.
NOTESTO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
JUNE30, 2025 (Unaudited)
(Expressedin US dollars)
| June 30, 2025 | March 31, 2025 | |||||||
| Lease Liability | $ | $ | ||||||
| Current portion of operating lease liability | ||||||||
| Noncurrent portion of operating lease liability | ||||||||
Theoperating lease expense was $
Thefollowing table represents the contractual undiscounted cash flows for lease obligations as at June 30, 2025:
| Calendar year | $ | |||
| 2025 | ||||
| 2026 | ||||
| 2027 | ||||
| Total undiscounted lease liability | ||||
| Less imputed interest | ( | ) | ||
| Total | ||||
11.COMMITMENTS AND CONTINGENCIES
Thereare no claims against the Company that were assessed as significant, which were outstanding as at June 30, 2025 or March 31, 2025 and,consequently, no provision for such has been recognized in the condensed consolidated interim financial statements.
12.PROPERTY AND EQUIPMENT
Duringthe year-ended March 31, 2022, the Company purchased leasehold improvements of $
| Cost | Office equipment | Leasehold improvement | Total | |||||||||
| $ | $ | $ | ||||||||||
| Balance at March 31, 2025 | ||||||||||||
| Balance at June 30, 2025 | ||||||||||||
| 42 |
BIOTRICITYINC.
NOTESTO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
JUNE30, 2025 (Unaudited)
(Expressedin US dollars)
| Accumulated depreciation | Office equipment | Leasehold improvement | Total | |||||||||
| $ | $ | $ | ||||||||||
| Balance at March 31, 2025 | ||||||||||||
| Depreciation for the period | ||||||||||||
| Disposals | ||||||||||||
| Balance at June 30, 2025 | ||||||||||||
| Net book value | ||||||||||||
| Balance at March 31, 2025 | ||||||||||||
| Balance at June 30, 2025 | ||||||||||||
13.SUBSEQUENT EVENTS
TheCompany’s management has evaluated subsequent events during the period from July 1 to August 14, 2025, the date the condensed consolidatedinterim financial statements were issued, pursuant to the requirements of ASC 855, and has determined the following material subsequentevents:
| ● | The Company issued $ |
| 43 |
Item2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
CautionaryNote Regarding Forward-Looking Statements
Exceptfor historical information contained herein, this “Management’s Discussion and Analysis of Financial Condition and Resultsof Operations” contains forward-looking statements. These statements involve known and unknown risks, uncertainties and other factorswhich may cause the actual results, performance, or achievements of the Company to be materially different from any future results, performance,or achievements expressed or implied by such forward-looking statements. These forward-looking statements are based on various factorsand were derived utilizing numerous important assumptions and other important factors that could cause actual results to differ materiallyfrom those in the forward-looking statements. Important assumptions and other factors that could cause actual results to differ materiallyfrom those in the forward-looking statements, include but are not limited to: (a) any fluctuations in sales and operating results; (b)risks associated with international operations; (c) regulatory, competitive and contractual risks; (d) development risks; (e) the abilityto achieve strategic initiatives, including but not limited to the ability to achieve sales growth across the business segments througha combination of enhanced sales force, new products, and customer service; (f) competition in the Company’s existing and potentialfuture product lines of business; (g) the Company’s ability to obtain financing on acceptable terms if and when needed; (h) uncertaintyas to the Company’s future profitability; (i) uncertainty as to the future profitability of acquired businesses or product lines;and (j) uncertainty as to any future expansion of the Company. Other factors and assumptions not identified above were also involvedin the derivation of these forward-looking statements and the failure of such assumptions to be realized as well as other factors mayalso cause actual results to differ materially from those projected. The Company assumes no obligation to update these forward-lookingstatements to reflect actual results, changes in assumptions or changes in other factors affecting such forward-looking statements, exceptas may be required under applicable law. Past results are no guaranty of future performance. Any such forward-looking statements speakonly as of the dates they are made. When used in this Report, the words “believes,” “anticipates,” “expects,”“estimates,” “plans,” “intends,” “will” and similar expressions are intended to identifyforward-looking statements.
ThisManagement’s Discussion and Analysis of Financial Condition and Results of Operations should be read in conjunction with the financialstatements and footnotes thereto included in this Quarterly Report on Form 10-Q (the “Financial Statements”).
CompanyOverview
BiotricityInc. (the “Company”, “Biotricity”, “we”, “us”, “our”) is a medical technologycompany focused on biometric data monitoring solutions. Our aim is to deliver innovative, remote monitoring solutions to the medical,healthcare, and consumer markets, with a focus on diagnostic and post-diagnostic solutions for lifestyle and chronic illnesses. We approachthe diagnostic side of remote patient monitoring by applying innovation within existing business models where reimbursement is established.We believe this approach reduces the risk associated with traditional medical device development and accelerates the path to revenue.In post-diagnostic markets, we intend to apply medical grade biometrics to enable consumers to self-manage, thereby driving patient complianceand reducing healthcare costs. We intend to first focus on a segment of the diagnostic mobile cardiac telemetry market, otherwise knownas COM, while providing our chosen markets with the capability to also perform other cardiac studies.
| 44 |
Wedeveloped our Bioflux® (“Bioflux”) COM technology, which has received clearance from the U.S. Food and Drug Administration(“FDA”), comprised of a monitoring device and software components, which we made available to the market under limited releaseon April 6, 2018, to assess, establish and develop sales processes and market dynamics. Full market release of the Bioflux device forcommercialization occurred in April 2019. The fiscal year ended March 31, 2021 marked our first year of expanded commercialization efforts,focused on sales growth and expansion. In 2021, we commenced the initial launch of Bioheart, a direct-to-consumer heart monitor thatoffers the same continuous heart monitoring technology used by physicians. In addition to developing and receiving regulatory approvalor clearance of other technologies that enhance our ecosystem, in 2022, we launched our Biocore Cardiac Monitoring Device(“Biocore”, previously branded as Biotres), a three-lead device for ECG and arrhythmia monitoring intended for lower riskpatients, a much broader addressable market segment. We have since expanded our sales efforts to 35 states, and intend to expand furtherand compete in the broader US market using an insourcing business model. Our technology has a large potential total addressable market,which can include hospitals, clinics and physicians’ offices, as well as other Independent Diagnostic Testing Facilities (“IDTFs)”.We believe our technological and clinical advantage combined with our solution’s insourcing model, which empowers physicians withstate-of-the-art technology and charges technology service fees for its use, has the benefit of a reduced operating overhead for us,and enables a more efficient market penetration and distribution strategy.
Weare a technology company focused on earning utilization-based recurring technology fee revenue. The Company’s ability to grow thistype of revenue is predicated on the size and quality of its sales force and their ability to penetrate the market and place deviceswith clinically focused, repeat users of its cardiac study technology. The Company plans to grow its sales force in order to addressnew markets and achieve sales penetration in the markets currently served.
Fullmarket release of the Bioflux COM device for commercialization launched in April 2019, after receiving its second and final requiredFDA clearance. To commence commercialization, we ordered device inventory from our FDA-approved manufacturer and hired a small, captivesales force, with deep experience in cardiac technology sales; we expanded on our limited market release, which identified potentialanchor clients who could be early adopters of our technology. We then expanded our sales force and geographic footprint.
In2021, we received a 510(k) clearance from the FDA for our Bioflux Software II System, engineered to improve workflows and reduce estimatedreview time from 5 minutes to 30 seconds. This improvement in review time reduces operational costs and allows us to continue to focuson excellent customer service and industry-leading response times to physicians and their at-risk patients. Additionally, these advancesmean we can focus our resources on high-level operations and sales.
During2021 and the early part of 2022, we also commercially launched our Bioheart technology, which is a consumer technology whose developmentwas forged out of prior the development of the clinical technologies that are already part of our technology ecosystem, the Biosphere.In recognition of our product development, in November 2022, Bioheart received recognition as one of TIME’s Best Inventions of2022.
TheCOVID-19 pandemic has highlighted the importance of telemedicine and remote patient monitoring technologies. We continue to develop atelemedicine platform, with capabilities of real-time streaming of medical devices. Telemedicine offers patients the ability to communicatedirectly with their health care providers without the need of leaving their home. Telemedicine aligns with our technology platform andfacilitates remote visits and remote prescriptions for cardiac diagnostics; it can also serve as a means of establishing referral andother synergies across the network of doctors and patients that use the technologies we are building within the Biotricity ecosystem.We intend to continue to provide improved care to patients that may otherwise elect not to go to medical facilities and continue to provideeconomic benefits and cost savings to healthcare service providers and payers that reimburse. Our goal is to position ourselves as anall-in-one cardiac diagnostic and disease management solution. We continue to grow our data set of billions of patient heartbeats, allowingus to further develop our predictive capabilities relative to atrial fibrillation and arrythmias.
| 45 |
InJanuary 2022, we received the 510(k) FDA clearance of our Biocore (previously named Biotres) patch solution, which is a novel productin the field of Holter monitoring. This three-lead technology can provide connected Holter monitoring that is designed to produce moreaccurate arrythmia detection than is typical of competing remote patient monitoring solutions. It is also foundational, since alreadydeveloped improvements to this technology will follow which are not known by us to be currently available in the market, for clinicaland consumer patch solution applications. In October 2023, we launched the cellular version of this device, the Biocore Pro.
InOctober 2022, we launched Biocare, after successfully piloting this technology in two facilities that provide cardiac care to more than60,000 patients. This technology and other consumer technologies and applications such as the Biokit and Biocare have been developedto allow us to transform and use our strong cardiac footprint to expand into remote chronic care management solutions that will be partof the Biosphere. The technology puts actionable data into the hands of physicians to assist them in making effective treatment decisionsquickly. During March 2023, we launched our patient-facing Biocare app on Android and Apple app stores. This further allows us to expandour footprint in providing full-cycle chronic care management solutions to our clinic and patient network. In January 2024, we appointedDr. Fareeha Siddiqui, a scientist and expert in community health and diagnostics, to the position of VP of Healthcare to spearhead theroll-out and Biocare adoption to existing and new customers.
Weare also developing several other ancillary technologies, which will require further FDA clearances, which we anticipateapplying for within the next twelve months. Among these are:
| ● | advanced ECG algorithms and analysis software for further improvements in sensitivity and specificity to analyze and synthesize patient ECG monitoring data with the purpose of distilling it down to the important information that requires clinical intervention, while reducing the amount of human intervention necessary in the process; | |
| ● | the Biocore® 2.0, which is the next generation of our award winning Biocore® |
Weidentified the importance of recent developments in accelerating our path to profitability, including the launch of important new productsidentified, which have a ready market through cross-selling to existing large customer clinics, and large new distribution partnershipsthat allow us to sell into large hospital networks.
Additionally,in September 2022, we were awarded a NIH Grant from the National Heart, Blood, and Lung Institute for AI-Enabled real-time monitoring,and predictive analytics for stroke due to chronic kidney failure. This is a significant achievement that broadens our technology platform’sdisease space demographic. The grant focuses on Bioflux-AI as an innovative system for real-time monitoring and prediction of strokeepisodes in chronic kidney disease patients. We received $238,703 under this award in March 2023, which we used to defray research anddevelopment and other associated costs.
Ourmission is to innovate and create transformative healthcare products while ensuring financial discipline, to drive margin and revenuegrowth to deliver value creation for our investors. Our commitment to innovation means that we harness data intelligently to explorenovel avenues for enhancing healthcare outcomes.
Asa result of providing our Bioflux and Biocore products, Biotricity has monitored well over two billion heartbeats for atrial fibrillation(afib), a leading cause of strokes. Over the past two years, these efforts have benefited over 28,000 patients diagnosed with afib, byproviding them with the prospect of earlier medical intervention – which also produces significant healthcare savings to patientsand the healthcare system.
Weare expanding our AI technology development in remote cardiac care, leveraging proprietary AI technology to provide a suite of predictivemonitoring tools to enhance new disease profiling, improve patient management, and revolutionize the healthcare industry for diseaseprevention.
| 46 |
Wehave also strengthened relationships with Amazon and Google. The healthcare AI market opportunity is projected to grow to $208.2 billionby 2030 according to Grand View Research. We have already established a strong foothold, having built a powerful proprietarycardiac AI model that combines Google’s TensorFlow, AWS infrastructure, big data and a continuous learning engine. This combinationallows us to rapidly improve our cardiac technology. In the near future, we believe the capabilities of our cardiac AI model will allowus to support healthcare professionals in handling exponentially more patients while identifying the most critical data. This will enablehealthcare workers to elevate the quality of care while serving a larger number of patients. As growing patient numbers further stressthe shortage of healthcare professionals, our technology could help alleviate this pressing issue. We have engineered our technologyto not only improve patient care and outcomes, but to do so in a manner that supports more patients. This has led to increasing salesof our remote cardiac monitoring devices and the ramp-up of our subscription-based service, increasing our recurring revenue over thepast few quarters.
Froma market perspective, increasing interest and demand continue to drive the adoption of our suite of products, which are focused on chroniccardiac disease prevention and management. Our efforts in commercialization and development have yielded tremendous progress in remotemonitoring solutions for diagnostic and post-diagnostic products.
Resultsof Operations
Thefollowing table sets forth our results of operations for the three months ended June 30, 2025 and 2024.
| For the 3 months ended June 30, | ||||||||||||
| 2025 | 2024 | Period to Period Change | ||||||||||
| Revenue | $ | 3,873,993 | $ | 3,201,743 | $ | 672,250 | ||||||
| Cost of revenue | 757,193 | 838,575 | 81,382 | |||||||||
| Gross profit | 3,116,800 | 2,363,168 | 753,632 | |||||||||
| Gross Margin | 80.5 | % | 73.8 | % | 6.6 | % | ||||||
| Operating expenses: | ||||||||||||
| Selling, general and administrative | 2,138,692 | 2,966,119 | (827,427 | ) | ||||||||
| Research and development | 696,163 | 513,895 | 182,268 | |||||||||
| Total operating expenses | 2,834,855 | 3,480,014 | (645,159 | ) | ||||||||
| Profit (Loss) from operations | 281,945 | (1,116,846 | ) | 1,398,791 | ||||||||
| Interest expense | (850,254 | ) | (768,673 | ) | (81,581 | ) | ||||||
| Accretion and amortization expenses | (153,572 | ) | (1,144,728 | ) | 991,156 | |||||||
| Change in fair value of derivative liabilities | (25,200 | ) | (306,862 | ) | 281,662 | |||||||
| Gain (loss) upon convertible promissory note conversion and redemption | 8,433 | (127,611 | ) | 136,044 | ||||||||
| Other income | 66,671 | (229,800 | ) | 296,471 | ||||||||
| Net loss before income taxes | (671,977 | ) | (3,694,520 | ) | 3,022,543 | |||||||
| Income taxes | — | — | — | |||||||||
| Net loss before dividends | $ | (671,977 | ) | $ | (3,694,520 | ) | $ | 3,022,543 | ||||
| 47 |
Thisis the first quarter in the Company’s history that it has reported positive profit from operations, before deducting various costsof capital such as interest and dividends.
Netloss before dividends for the three months ended June 30, 2025, demonstrate year-over-year revenue growth and improvements in key operatingmetrics. Specifically, our recurring technology fees, device sales, and gross margins all demonstrated positive growth while maintainingcost control through management’s efforts to ensure cost reduction and expense management in order to make progress on its planto achieve positive cash flow and profitability.
Revenueand cost of revenue
Toincrease the penetration of our sales activities and expand our geographic footprint, we actively sell into 31 U.S. states as of June30, 2025. The Company earned combined device sales and technology fee income of $3.9 million during the three months ended June30, 2025 – 21% growth in revenue over the $0.7 million earned in the prior year comparable quarter.
Technologyfee revenue increased to $3.4 million during the three months ended June 30, 2025, which is a 12% increase over the corresponding three-monthperiod of the prior year. The majority of this revenue is recurring, and its growth can be attributed to strong customer retention thatis supported by the quality of customer and cardiologist-friendly support services that emphasize accuracy of diagnostics and ease-of-use.Device sales comprised 13% of our total revenue, or $503 thousand for the three-month period ended June 30, 2025. Gross profit percentagewas 80.5% for the three months ended June 30, 2025, as compared to 73.8% in the corresponding prior year quarter. This increase in grossmargin is a result of improved margins on technology fee revenue as well as significantly improved margin on device sales. Given consistentgross margin on technology fees of approximately 81.3%, and efficiencies gained in using AI in data processing as well as an evolvingrevenue mix where technology fees are expected to comprise an increasing proportion of revenue, we anticipate continued improvement inoverall blended gross margin over time. Technology fees comprised 87% of total revenue for the three-month period ended June 30, 2025.
OperatingExpenses
Totaloperating expenses for the three months ended June 30, 2025, were $2.8 million as compared to $3.5 million for the three months endedJune 30, 2024. See further explanations below.
Selling,General and administrative expenses
Ourselling, general and administrative expenses for the three months ended June 30, 2025 was $2.1 million, compared to approximately $3.0million during the three months ended June 30, 2024 – a 28% reduction. The reduction was a result of increased monitoring of spendingefficiency over our fixed general and administrative expenses in the current period.
Researchand development expenses
Forthe three months ended June 30, 2025 we recorded research and development expenses of $0.7 million, compared to $0.5 million incurredfor three months ended June 30, 2024. The research and development activity related to both existing and new products. The increase inresearch and development activity was a result of the timing of activities associated with the development of new technologies for ourecosystem and product enhancements.
InterestExpense
Forthe three months ended June 30, 2025 and 2024, we incurred interest expenses of $0.85 million and $0.77 million, respectively. The increasein interest expense during the current period was the result of an increase in borrowings when compared to the prior year period.
Accretionand amortization expenses
Forthe three months ended June 30, 2025 and 2024, we incurred accretion expenses of $0.2 million and $1.1 million, respectively. The expensefor the quarter decreased due to full amortization of Convertible Notes Series C.
Changein fair value of derivative liabilities
| 48 |
Forthe three months ended June 30, 2025 and 2024, we recognized a loss of $25 thousand versus a gain of $307 thousand, respectively, relatedto the change in fair value of derivative liabilities. The fair value changes were largely attributed to the underlying change in ourmezzanine equity, convertible notes and equity fair value.
Lossupon convertible promissory notes conversion
Duringthe three months ended June 30, 2025 and 2024, we recorded a gain of $8 thousand versus a loss of $128 thousand, respectively, relatedto the redemption and conversion of our convertible promissory notes. The change of gain or loss upon conversion upon convertible notes conversionwas largely the result of increased volumes of conversions in the current quarter as compared to comparable quarter in the prior year.
Otherincome (expense)
Duringthe three months ended June 30, 2025, we recognized $67 thousand in net other income, which consisted of processing fees and late paymentcharges. During the three months ended June 30, 2024, we recognized $230 thousand in net other expense attributed to financing componentprovisions contained in our revenue contracts.
EBITDAand Adjusted EBITDA
Earningsbefore interest, taxes, depreciation and amortization expenses (EBITDA) and Adjusted EBITDA, which are presented below, are non-generallyaccepted accounting principles (non-GAAP) measures that we believe are useful to management, investors and other users of our financialinformation in evaluating operating profitability. EBITDA is calculated by adding back interest, taxes, depreciation and amortizationexpenses to net income.
Thisis the first quarter in the Company’s history that it has reported positive EBITDA. The Company reported EBITDA of $0.33 millionfor the three months ended June 30, 2025, compared to negative $1.8 million in the corresponding period of the prior year.
AdjustedEBITDA is calculated by excluding from EBITDA the effect of the following non-operational items: equity in earnings and losses of unconsolidatedbusinesses and other income and expense, net, as well as the effect of special items that related to one-time, non-recurring expenditures. We believe that this measure is useful to management, investors and other users of our financial information in evaluating the effectivenessof our operations and underlying business trends in a manner that is consistent with management’s evaluation of business performance.Further, the exclusion of non-operational items and special items enables comparability to prior period performance and trend analysis.See notes in the table below for additional information regarding special items.
Weprovide non-GAAP financial information to enhance the understanding of Biotricity’s GAAP financial information, and it should beconsidered by the reader in addition to, but not instead of, the financial statements prepared in accordance with GAAP. We believe thatproviding these non-GAAP measures in addition to the GAAP measures allows management, investors and other users of our financial informationto more fully and accurately assess business performance. The non-GAAP financial information presented may be determined or calculateddifferently by other companies and may not be directly comparable to that of other companies.
Managementconsiders the EBITDA and adjusted EBITDA measures for the three month period ended June 30, 2025, which improved by 119% and 127%, respectively,when compared to the corresponding prior year period, to be indicators of the Company’s progress towards breakeven profitabilityas well as improvement towards operating cash-flow break-even.
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EBITDAand Adjusted EBITDA
3 months ended June 30, 2025 | 3 months ended June 30, 2024 | |||||||
| $ | $ | |||||||
| Net loss attributable to common stockholders | (754,293 | ) | (6,948,292 | ) | ||||
| Add: | ||||||||
| Provision for income taxes | — | — | ||||||
| Interest expense | 850,254 | 768,673 | ||||||
| Accretion and amortization expenses | 153,572 | 1,144,728 | ||||||
| Depreciation | 1,488 | 1,488 | ||||||
| Preferred stock dividends (2) | 82,316 | 3,253,772 | ||||||
| EBITDA | 333,337 | (1,779,631 | ) | |||||
| Add (Less) | ||||||||
| Share based compensation (1) | 5,935 | 58,978 | ||||||
| Other (income)/loss (3) | (66,671 | ) | 229,800 | |||||
| (Gain) loss upon convertible promissory notes conversion and redemption (3) | (8,433 | ) | 127,611 | |||||
| Fair value change on derivative liabilities (3) | 25,200 | 306,862 | ||||||
| Adjusted EBITDA | 289,368 | (1,056,380 | ) | |||||
| Weighted average number of common shares outstanding | 26,284,734 | 14,169,441 | ||||||
| Adjusted Earnings (Loss) per Share, Basic and Diluted | 0.011 | (0.075 | ) | |||||
(1)Share based compensation is a non-cash item therefore is removed from our adjusted EBITDA analysis
(2)Preferred stock dividend payment is at Company’s discretion and therefore is removed from our EBITDA analysis
(3)These items relate to financing transactions and therefore do not reflect the Company’s core operating activities
TranslationAdjustment
Translationadjustment was a loss of $36 thousand versus a gain of $24 thousand for the three months ended June 30, 2025 and 2024, respectively.This translation adjustment represents gains and losses that result from the translation of currency in the financial statements fromour functional currency of Canadian dollars to the reporting currency in U.S. dollars over the course of the reporting period.
Liquidityand Capital Resources
Managementhas noted the existence of substantial doubt about our ability to continue as a going concern. Additionally, our independent registeredpublic accounting firm included an explanatory paragraph in the report on our financial statements as of and for the years ended March31, 2025 and 2024, noting the existence of substantial doubt about our ability to continue as a going concern. Our existingcash deposits may not be sufficient to fund our operating expenses through at least twelve months from the date of this filing. To continueto fund operations, we will need to secure additional funding through public or private equity or debt financings, through collaborationsor partnerships with other companies or other sources. We may not be able to raise additional capital on terms acceptable to us, or atall. Any failure to raise capital when needed could compromise our ability to execute our business plan. If we are unable to raise additionalfunds, or if our anticipated operating results are not achieved, we believe planned expenditure may need to be reduced in order to extendthe time period that existing resources can fund our operations. If we are unable to obtain the necessary capital, it may have a materialadverse effect on our operations and the development of our technology, or we may have to cease operations altogether.
Thedevelopment and commercialization of our product offerings are subject to numerous uncertainties, and we could use our cash resourcessooner than we expect. Additionally, the process of developing our products is costly, and the timing of progress can be subject to uncertainty;our ability to successfully transition to profitability may be dependent upon achieving further regulatory approvals and achieving alevel of product sales adequate to support our cost structure. Though we are optimistic with respect to our revenue growth trajectoryand our cost control initiatives, we cannot be certain that we will ever be profitable or generate positive cash flow from operatingactivities.
| 50 |
TheCompany is in commercialization mode, while continuing to pursue the development of its next generation COM product as well as new products.
Wegenerally require cash to:
| ● | purchase devices that will be placed in the field for pilot projects and to produce revenue, | |
| ● | launch sales initiatives, | |
| ● | fund our operations and working capital requirements, | |
| ● | develop and execute our product development and market introduction plans, | |
| ● | fund research and development efforts, and | |
| ● | pay any expense obligations as they come due. |
TheCompany is in the early stages of commercializing its products. It is concurrently in development mode, operating a research and developmentprogram in order to develop an ecosystem of medical technologies, and, where required or deemed advisable, obtain regulatory approvalsfor, and commercialize other proposed products. The Company launched its first commercial sales program as part of a limited market release,during the year ended March 31, 2019, using an experienced professional in-house sales team. A full market release ensued during theyear ended March 31, 2020. Management anticipates the Company will continue on its revenue growth trajectory and improve its liquiditythrough continued business development and after additional equity and debt capitalization of the Company. The Company has incurred recurringlosses from operations, and as at March 31, 2025, has an accumulated deficit of $139 million (2024: $128 million), the Company has aworking capital deficit of $16 million (2024: $18 million).
OnAugust 30, 2021 the Company completed an underwritten public offering of its common stock that concurrently facilitated its listing onthe Nasdaq Capital Market. On August 1, 2024, the Company received a notice from Nasdaq stating that Nasdaq has determined to delistthe Company’s shares of common stock on The Nasdaq Capital Market, effective at the open of business on August 5, 2024. Nasdaqreached its decision pursuant to Nasdaq Listing Rule 5550(b)(2) because the Company no longer complied with the minimum $35 million marketvalue of listed securities. Following the suspension of trading on The Nasdaq Capital Market, the Company’s shares of common stockwere again listed on the OTCQB under the symbol “BTCY.”
Duringthe fiscal year ended March 31, 2023, the Company raised short-term loans and promissory notes, net of repayments of $1,476,121 fromvarious lenders, and also raised convertible notes, net of redemptions of $2,355,318 from various lenders. During the fiscal year endedMarch 31, 2024, the Company raised short-term loans and promissory notes, net of repayments of $853,030 and convertible notes, net ofredemptions of $2,962,386 from various lenders. The Company sold 36,897 common shares through use of its registration statement, forgross proceeds of $123,347, raising a net amount of $119,285 after paying a 3% placement fee and other issuance expenses. Additionally,on September 19, 2023, the Company entered into a security purchase agreement with an institutional investor for the issuance and saleof 220 shares of the Company’s newly designated Series B Convertible Preferred Stock, at a purchase price of $9,091 per share ofSeries B Preferred Stock (Note 9), or gross proceeds of $2,000,000. Net proceeds after issuance costs were $1,900,000. During the threemonths ending March 31, 2024, 110 Series B preferred shares were issued for net proceeds of $925,000.
Duringthe three months and year ended March 31, 2025, convertible notes with a face value of $nil and $1,487,700 and accrued interest of $niland $237,230, were converted into nil and 2,173,089 common shares, respectively. As of March 31, 2025, 581,599 shares are recognizedas an obligation for shares to be issued relating to the conversions. The fair value of common shares issued during the three monthsand year ended March 31, 2025 is $nil and $2,431,178, respectively, and is determined based on market price upon conversion. Total valueof debt settled is in the amount of $nil and $ 2,234,232, respectively, which consisted of the face value of notes converted, accruedinterest of $nil and $237,230, respectively, and relevant derivative liability of $nil and $509,303, respectively. The Company recognizeda loss upon conversion of $nil and $196,945, respectively, representing the difference between the value of debt settled and fair valueof shares issued and to be issued.
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Duringthe three months and the year ended March 31, 2025, convertible notes with a face value of $25,000 and $150,000 and accrued interestof $5,021 and $34,864, were redeemed for a cash payment of $30,021 and $184,864. The Company recorded a gain on redemption of $8,391and $50,692 related to the conversion, representing the difference between the value of the debt settled and the cash payment value.
Duringthe year ended March 31, 2025, the Company issued $1,985,000 in unsecured convertible promissory notes to private investors; $100,000of the notes mature on their six-month anniversary of issuance and bear interest of 20%; $710,000 of the notes mature on their twentyfour-month anniversary of issuance and bear interest of 10%; and $1,175,000 of the notes mature on their eighteen-month anniversary ofissuance and bear not interest; all of the notes have conversion features that require the mutual consent of the investor and the Company.Since the conversion is not in control of the holder of the note, the Company did not recognize a derivative liability in connectionwith the conversion option of the Other Convertible Notes.
InNovember 2024, the Company completed an additional transaction with its term lender to receive an additional $635 thousand in term loanproceeds, and interest relief through the capitalization of approximately $1.5 million in interest amounts due on its existing term loan.As part of this arrangement, the Company issued 600,000, 7-year share warrants to the term lender with a strike price of $0.50 per shareand agreed to increase the term loan exit fee to $1.425 million at the end of its 5-year term. Concurrently, the Company received waiverand forbearance relief on certain term loan covenants and their respective defaults.
Duringperiod three months ended March 31 , 2025, the Company also raised additional funding from private investors in the amount of $337 thousandin the form of promissory notes and convertible promissory notes.
OnJune 30, 2025, we had cash deposits in the aggregate of approximately $0.4 million.
Thisis the fourth consecutive three-month period in which the Company has reported positive Free Cash Flow, which is defined as the operatingcash flow generated by the Company that is available to pay for dividend and interest obligations. Free Cash Flow is a non-generallyaccepted accounting principle (“non-GAAP”) measure that represents the cash that the Company generates from its operationsafter deducting cash used on operating expenses and any capital asset spending. Unlike other accounting measures such as earnings ornet income, this measure of profitability excludes non-cash expenses, but includes spending on capital assets and changes in workingcapital on the Company’s Balance Sheet. This is a key measure that management and investors use to evaluate progress towards Companyprofitability.
3 months ended June 30, 2025 | 3 months ended June 30, 2024 | |||||||
| $ | $ | |||||||
| Net cash used in operating activities | (373,389 | ) | (1,494,240 | ) | ||||
| Add: | ||||||||
| Interest expense | 850,254 | 768,673 | ||||||
| Less: | ||||||||
| Investment in capital assets | - | - | ||||||
| Free Cash Flows | 476,865 | (725,567 | ) | |||||
| Weighted average number of common shares outstanding | 26,284,734 | 14,169,441 | ||||||
| Free Cash Flow per Share, Basic and Diluted | 0.018 | (0.051 | ) | |||||
TheCompany has developed and continues to pursue sources of funding that management believes will be sufficient to support the Company’soperating plan and alleviate any substantial doubt as to its ability to meet its obligations at least for a period of one year from thedate of these consolidated interim financial statements.
Aswe proceed with the commercialization of the Biocore and Biocare products and continue their development, we expect to continue to devotesignificant resources on capital expenditures, as well as research and development costs and operations, marketing and sales expenditures.
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Basedon the above facts and assumptions, we believe our existing cash, along with anticipated near-term financings, will be sufficient tocontinue to meet our needs for the next twelve months from the filing date of this report. However, we will need to seek additional debtor equity capital to respond to business opportunities and challenges, including our ongoing operating expenses, protecting our intellectualproperty, developing or acquiring new lines of business and enhancing our operating infrastructure. The terms of our future financingmay be dilutive to, or otherwise adversely affect, holders of our common stock. We may also seek additional funds through arrangementswith collaborators or other third parties. There can be no assurance we will be able to raise this additional capital on acceptable terms,or at all. If we are unable to obtain additional funding on a timely basis, we may be required to modify our operating plan and otherwisecurtail or slow the pace of development and commercialization of our proposed product lines.
Thefollowing is a summary of cash flows for each of the periods set forth below.
| For the Three Months Ended | ||||||||
| June 30, | ||||||||
| 2025 | 2024 | |||||||
| Net cash used in operating activities | $ | (373,389 | ) | $ | (1,494,240 | ) | ||
| Net cash used in investing activities | — | — | ||||||
| Net cash provided by financing activities | 435,705 | 868,180 | ||||||
| Net Increase (decrease) in cash | $ | 62,316 | $ | (626,060 | ) | |||
NetCash Used in Operating Activities
Duringthe three months ended June 30, 2025, we used cash in operating activities in the amount of $0.37 million. compared to $1.5million forthe corresponding prior year period The cash in operating activities was primarily due to selling expenses as well as research, productdevelopment, business development, marketing and general operations. The decrease in cash used reflects management’s concertedeffort to contain costs while increasing revenues.
NetCash Used in Investing Activities
Netcash used in investing activities was Nil and Nil during the three months ended June 30, 2025 and 2024.
NetCash Provided by Financing Activities
Netcash provided by financing activities was $0.44 million as compared to net cash used of $0.9 million during the three months ended June30, 2025 and 2024, respectively.
Forthe three months ended June 30, 2025, the net cash provided by financing activities was primarily due to the proceeds fromconvertible promissory notes and short term loan, in the amount of $0.442 million.
CriticalAccounting Estimates
Ourconsolidated interim financial statements are prepared in accordance with GAAP. These accounting principles require us to makeestimates and judgments that can affect the reported amounts of assets and liabilities as of the date of the financial statements aswell as the reported amounts of revenue and expense during the periods presented. We believe that the estimates and judgments uponwhich we rely are reasonably based upon information available to us at the time that we make these estimates and judgments. To theextent that there are material differences between these estimates and actual results, our financial results will be affected. Theaccounting policies that reflect our more significant estimates and judgments and which we believe are the most critical to aid infully understanding and evaluating our reported financial results are described in “Management’s Discussion and Analysisof Financial Condition and Results of Operations”, included in our 2025 Form 10-K/A filed on July 18, 2025.
| 53 |
Duringthe three months ended June 30, 2025, there were no material changes to our critical accounting estimates disclosed in “Management’sDiscussion and Analysis of Financial Condition and Results of Operations” included in our 2025 Form 10-K/A filed on July 18, 2025.
RecentAccounting Pronouncements
Referto Note 3— Summary of Significant Accounting Policies to our condensed consolidated interim financial statements includedelsewhere in this report for a discussion of recently issued accounting pronouncements.
Off-BalanceSheet Arrangements
Wehave no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition,changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.
Item3. Quantitative and Qualitative Disclosures About Market Risk
Notrequired for a smaller reporting company.
Item4. Controls and Procedures.
Evaluationof Disclosure Controls and Procedures
TheCompany maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in the Company’sExchange Act reports is recorded, processed, summarized and reported within the time communicated to the Company’s management,including its Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosurebased closely on the definition of “disclosure controls and procedures” in Rule 13a-15(e). The Company’s disclosurecontrols and procedures are designed to provide a reasonable level of assurance of reaching the Company’s desired disclosure controlobjectives. In designing and evaluating the disclosure controls and procedures, management recognized that any controls and procedures,no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and managementnecessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Therefore,even a system which is determined to be effective cannot provide absolute assurance that all control issues have been detected or prevented.Our systems of internal controls are designed to provide reasonable assurance with respect to financial statement preparation and presentation.
Atthe end of the period being reported upon, the Company carried out an evaluation, under the supervision and with the participation ofthe Company’s management, including the Company’s Chief Executive Officer and Chief Financial Officer, of the effectivenessof the design and operation of the Company’s disclosure controls and procedures. Based on the foregoing, our Chief Executive Officerand Chief Financial Officer concluded that our disclosure controls and procedures were effective to ensure that the material informationrequired to be included in our Securities and Exchange Commission reports is accumulated and communicated to our management, includingour principal executive and financial officer, as well as recorded, processed, summarized and reported within the time periods specifiedin Securities and Exchange Commission rules and forms relating to the Company.
Changesin Internal Controls
Therewere no changes in the Company’s internal controls over financial reporting that occurred during the three-month period ended June30, 2025 that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.
| 54 |
PARTII
OTHERINFORMATION
Item1. Legal Proceedings.
Fromtime to time, we may be involved in various claims and legal proceedings relating to claims arising out of our operations. We are notcurrently a party to any material legal proceedings. Regardless of outcome, litigation can have an adverse impact on us because of defenseand settlement costs, diversion of management resources and other factors.
Item1A. Risk Factors
Notrequired for smaller reporting companies.
Item2. Unregistered Sales of Equity Securities and Use of Proceeds.
None.
Item3. Defaults Upon Senior Securities.
None.
Item4. Mine Safety Disclosures.
Notapplicable.
Item5. Other Information.
Duringthe quarter ended June 30, 2025, no director or officer of the Company
Item6. Exhibits
| 31.1 | Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002* | |
| 31.2 | Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002* | |
| 32.1 | Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002** | |
| 32.2 | Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002** | |
| 101.INS | Inline XBRL Document Set for the financial statements and accompanying notes in Part I, Item 1, of this Quarterly Report on Form 10-Q. | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
*Filed herewith.
**Furnished herewith.
| 55 |
SIGNATURES
Pursuantto the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf bythe undersigned, thereunto duly authorized, this 14th day of August 2025.
BIOTRICITYINC.
| By: | /s/ Waqaas Al-Siddiq | |
| Name: | Waqaas Al-Siddiq | |
| Title: | Chief Executive Officer | |
| (principal executive officer) | ||
| By: | /s/ John Ayanoglou | |
| Name: | John Ayanoglou | |
| Title: | Chief Financial Officer | |
| (principal financial and accounting officer) |
| 56 |
Exhibit31.1
BIOTRICITYINC.
CERTIFICATIONPURSUANT TO RULE 13a-14(a) OR 15d-14(a) OF THE SECURITIES
EXCHANGEACT OF 1934, AS ADOPTED PURSUANT TO SECTION 302 OF THE
SARBANES-OXLEYACT OF 2002
I,Waqaas Al-Siddiq, certify that:
| 1. | I have reviewed this Quarterly Report on Form 10-Q of Biotricity Inc.; |
| 2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
| 3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
| 4. | The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
| (a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; | |
| (b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; | |
| (c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and | |
| (d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
| 5. | The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
| (a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and | |
| (b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
Date:August 14, 2025
| /s/ Waqaas Al-Siddiq | |
| Waqaas Al-Siddiq | |
| Chief Executive Officer | |
| (Principal Executive Officer) |
Exhibit31.2
BIOTRICITYINC.
CERTIFICATIONPURSUANT TO RULE 13a-14(a) OR 15d-14(a) OF THE SECURITIES
EXCHANGEACT OF 1934, AS ADOPTED PURSUANT TO SECTION 302 OF THE
SARBANES-OXLEYACT OF 2002
I,John Ayanoglou, certify that:
| 1. | I have reviewed this Quarterly Report on Form 10-Q of Biotricity Inc.; |
| 2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
| 3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
| 4. | The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
| (a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; | |
| (b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; | |
| (c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and | |
| (d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
| 5. | The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
| (a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and | |
| (b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
Date:August 14, 2025
| /s/ John Ayanoglou | |
| John Ayanoglou | |
| (Principal Financial and Accounting Officer) |
Exhibit32.1
BIOTRICITYINC.
CERTIFICATIONPURSUANT TO
18U.S.C. §1350,
ASADOPTED PURSUANT TO
SECTION906 OF THE SARBANES-OXLEY ACT OF 2002
Inconnection with the Quarterly Report on Form 10-Q of Biotricity Inc. (the “Company”) for the quarterly period ended June30, 2025, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Waqaas Al-Siddiq, ChiefExecutive Officer of the Company, certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Actof 2002, that:
| (1) | The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and | |
| (2) | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
Date:August 14, 2025
| /s/ Waqaas Al-Siddiq | |
| Waqaas Al-Siddiq | |
| Chief Executive Officer | |
| (Principal Executive Officer) |
Exhibit32.2
BIOTRICITYINC.
CERTIFICATIONPURSUANT TO
18U.S.C. §1350,
ASADOPTED PURSUANT TO
SECTION906 OF THE SARBANES-OXLEY ACT OF 2002
Inconnection with the Quarterly Report on Form 10-Q of Biotricity Inc. (the “Company”) for the quarterly period ended June30, 2025, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, John Ayanoglou, ChiefFinancial Officer of the Company, certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Actof 2002, that:
| (1) | The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and | |
| (2) | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
Date:August 14, 2025
| /s/ John Ayanoglou | |
| John Ayanoglou | |
| (Principal Financial and Accounting Officer) |