greh_10q.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 10-Q

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2021.

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from________ to_________.

Commission File Number: 001-38298

Zomedica Corp.

(Exact name of registrant as specified in its charter)

Alberta, Canada

N/A

(State or other jurisdiction of
incorporation or organization)

(I.R.S. Employer

Identification Number)

100 Phoenix Drive, Suite 125

Ann Arbor, Michigan

48108

(Address of principal executive offices)

(Zip code)

(734) 369-2555

(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large, accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
		Emerging growth company	☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☒

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Shares, without par value	ZOM	NYSE American

As of November 12, 2021, 979,894,668 shares of the registrant’s common shares, without par value, were issued and outstanding.

Zomedica Corp.

FORM 10-Q

FOR THE QUARTERLY PERIOD ENDED

SEPTEMBER 30, 2021

TABLE OF CONTENTS

		Page
	PART I
	FINANCIAL INFORMATION

Item 1.	Condensed Financial Statements	3
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	24
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	34
Item 4.	Controls and Procedures	34

	PART II
	OTHER INFORMATION

Item 1.	Legal Proceedings	35
Item 1A.	Risk Factors	35
Item 6.	Exhibits	37

Table of Contents

PART I — FINANCIAL INFORMATION

Item 1. Financial Statements.

Zomedica Corp.

Condensed consolidated balance sheets

As of September 30, 2021, and December 31, 2020

(Unaudited) (Stated in United States dollars)

	September 30,			December 31,
	2021			2020

Assets

Current assets
Cash and cash equivalents	$	271,411,043		$	61,991,703
Inventory		1,423,923			-
Prepaid expenses and deposits		1,633,846			1,727,814
Trade receivables		6,938			-
Other receivables		258,359			146,207
Total current assets		274,734,109			63,865,724

Prepaid expenses and deposits		168,020			13,924
Property and equipment, net		706,266			583,007
Right-of-use asset		1,419,790			1,318,716
Intangible assets, net		473,966			362,663
Total assets	$	277,502,151		$	66,144,034

Liabilities, mezzanine and shareholders' equity

Current liabilities
Accounts payable and accrued liabilities	$	4,464,874		$	1,248,628
Current portion of debt obligations		-			527,360
Current portion of lease obligations		407,278			252,788
Total current liabilities		4,872,152			2,028,776

Lease obligations		1,069,687			1,087,998
Total liabilities		5,941,839			3,116,774

Commitments and contingencies (Note 13)

Mezzanine equity:
Series 1 preferred shares, no par value;
20 shares authorized
0 and 12 Series 1 preferred shares issued and outstanding		-			11,961,397
at September 30, 2021 and December 31, 2020, respectively

Shareholders' equity
Unlimited common shares, no par value;
979,738,168 and 642,036,228 issued and outstanding		380,928,831			104,783,612
at September 30, 2021 and December 31, 2020, respectively
Common shares subscribed		-			459,600
Additional paid-in capital		6,732,887			14,792,276
Accumulated deficit		(116,101,406	)		(68,969,625	)
Total shareholders' equity		271,560,312			51,065,863

Total liabilities, mezzanine equity and shareholders' equity	$	277,502,151		$	66,144,034

The accompanying notes are an integral part of these condensed consolidated financial statements.

Table of Contents

Zomedica Corp.

Condensed consolidated statements of loss and comprehensive loss

For the three and nine months ended September 30, 2021, and 2020

(Unaudited) (Stated in United States dollars)

	Three months ended September 30,						Nine months ended September 30,
	2021			2020			2021			2020

Net revenue	$	22,514		$	-		$	52,331		$	-
Cost of revenue		17,899			-			59,433			-
Gross profit		4,615			-			(7,102	)		-

Expenses
Research and development		288,453			2,702,103			1,008,083			7,205,674
Selling, general and administrative		6,124,382			2,298,330			14,593,952			5,430,812
Loss from operations		(6,408,220	)		(5,000,433	)		(15,609,137	)		(12,636,486	)
Interest income		(94,302	)		(21,238	)		(261,556	)		(21,566	)
Interest expense		-			-			6,054			732
Loss on disposal of assets		26,760			-			269,707			128,931
Gain on extinguishment of debt		-			-			(533,414	)		-
Other gains		(600	)		(1,963	)		(2,481	)		(7,463	)
Foreign exchange loss		5,609			2,743			5,731			1,462
Loss before income taxes		(6,345,687	)		(4,979,975	)		(15,093,178	)		(12,738,582	)
Income tax expense		-			-			-			-
Net loss and comprehensive loss	$	(6,345,687	)	$	(4,979,975	)	$	(15,093,178	)	$	(12,738,582	)

Weighted average number of common shares - basic and diluted		978,494,076			550,541,878			948,664,410			291,314,002

Loss per share - basic and diluted (Note 16)	$	(0.01	)	$	(0.01	)	$	(0.05	)	$	(0.04	)

The accompanying notes are an integral part of these condensed consolidated financial statements.

Table of Contents

Zomedica Corp.

Condensed consolidated statements of shareholders’ equity

For the three and nine months ended September 30, 2021 and 2020

(Unaudited) (Stated in United States dollars)

	Series 1 preferred shares				Common shares					Common stock			Additional paid-			Accumulated
For the nine months ending September 30, 2021	Shares		Amount		Shares		Amount			subscribed			in capital			deficit			Total
Balance at December 31, 2020		-		-		642,036,228	$	104,783,612		$	459,600		$	14,792,276		$	(68,969,625	)	$	51,065,863
Stock issuance for financing		-		-		105,013,158		199,525,000			-			-			-			199,525,000
Stock issuance costs		-		-		-		(14,280,914	)		-			-			-			(14,280,914	)
Stock-based compensation		-		-		-		-			-			4,502,597			-			4,502,597
Stock issued from warrant exercises		-		-		200,951,905		44,082,183			(459,600	)		(11,511,046	)		-			32,111,537
Stock issued from stock option exercises		-		-		7,017,776		2,818,950			-			(1,050,940	)		-			1,768,010
Preferred share exchange		-		-		24,719,101		44,000,000			-			-			(32,038,603	)		11,961,397
Net loss		-		-		-		-			-			-			(15,093,178	)		(15,093,178	)
Balance at September 30, 2021		-		-		979,738,168	$	380,928,831		$	-		$	6,732,887		$	(116,101,406	)	$	271,560,312

	Series 1 preferred shares				Common shares					Common stock			Additional paid-			Accumulated
For the three months ending September 30, 2021	Shares		Amount		Shares		Amount			subscribed			in capital			deficit			Total
Balance at June 30, 2021		-		-		977,950,993	$	380,222,091		$	-		$	5,601,641		$	(109,755,719	)	$	276,068,013
Stock-based compensation		-		-		-		-			-			1,437,778			-			1,437,778
Stock issued from stock option exercises		-		-		1,787,175		706,740			-			(306,532	)		-			400,208

SEC Form 10-Q filed by Zomedica Pharmaceuticals Corp.