F-1/A

As filed with the Securities and Exchange Commission on November 7, 2022

Registration No. 333-264859

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Amendment No. 8

to

FORM F-1

REGISTRATION STATEMENT

UNDER

THE SECURITIES ACT OF 1933

MCLOUD TECHNOLOGIES CORP.

(Exact Name of Registrant as Specified in its Charter)

British Columbia, Canada	7372	Not applicable
(State or Other Jurisdiction of Incorporation or Organization)	(Primary Standard Industrial Classification Code Number)	(I.R.S. Employer Identification Number)

550-510 Burrard Street,

Vancouver, British Columbia

Canada, V6C 3A8

Tel: (284)494-2810

(Address, including zip code, and telephone number, including area code, of Registrant’s principal executive offices)

Russell H. McMeekin

Chief Executive Officer

550-510 Burrard Street

Vancouver, British Columbia

Canada, V6C 3A8

Tel: (284)494-2810

(Name, address, including zip code, and telephone number, including area code, of agent for service)

Copies to:

Marc J. Ross Avital Perlman Sichenzia Ross Ference LLP 1185 Avenue of the Americas, 31st Floor New York, NY 10036 Tel: (212) 930-9700 Brett Hanson Emily Humbert Fox Rothschild LLP 222 South Ninth Street, Suite 2000 Minneapolis, MN 55402 Tel: (612) 607-7000

Approximate date of commencement of proposed sale to the public: As soon as practicable after this Registration Statement becomes effective.

If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box.  ☒

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  ☐

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  ☐

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  ☐

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933.

Emerging growth company  ☒

If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, 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 7(a)(2)(B) of the Securities Act  ☐

The term “new or revised financial accounting standard” refers to any update issued by the Financial Accounting Standards Board to its Accounting Standards Codification after April 5, 2012.

The registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to such Section 8(a), may determine.

The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and is not soliciting an offer to buy these securities in any state or other jurisdiction where the offer or sale is not permitted.

PRELIMINARY PROSPECTUS SUBJECT TO COMPLETION DATED November 7, 2022

mCLOUD TECHNOLOGIES CORP.

1,400,000 9.0% Series A Cumulative Perpetual Preferred Shares

Warrants to purchase 35,000,000 Common Shares

Minimum Offering: $15,000,000 of

Securities

Maximum Offering: $35,000,000 of

Securities

We are offering for sale, on a “best efforts” basis, at a minimum of an aggregate of $15,000,000 (the “Minimum Amount”) of registered securities and up to a maximum of an aggregate of $35,000,000 (the “Maximum Amount”) of registered securities. We are offering up to 1,400,000 Units of 9.0% Series A Cumulative Perpetual Preferred Shares, no par value, with a $25.00 liquidation preference per share (the “Series A Preferred Shares”) with 25 warrants (each, a “Warrant”, and together, the “Warrants”) to purchase one common share, no par value per share (each, a “Common Share”, and together, the “Common Shares”), at an assumed combined public offering price of $25.00 per Series A Preferred Share and related Warrant, representing a public offering price of $24.75 per Series A Preferred Share and $0.01 per related Warrant. The Warrants are exercisable from the date of issuance and expire on November 29, 2026, at an exercise price per Common Share equal to $4.75. The Series A Preferred Shares and Warrants can only be purchased together in this offering but the Series A Preferred Shares and Warrants are immediately separable and will be issued separately. We do not intend to close our offering unless we sell at least a minimum number of the Series A Preferred Shares and accompanying Warrants at the price per share set forth above.

We are in the process of applying to have the Series A Preferred Shares sold in this offering listed on the Nasdaq Capital Market (“Nasdaq”) under the symbol “MCLDP”. There is no assurance that our listing application will be approved. We will not consummate this offering unless the Series A Preferred Shares will be listed on the Nasdaq Capital Market. The Warrants will be listed on Nasdaq along with the Listed Warrants (as defined below) under the symbol (“MCLDW”).

The liquidation preference of each Series A Preferred Share is $25.00. Upon liquidation, holders of Series A Preferred Shares will be entitled to receive the liquidation preference with respect to their Series A Preferred Shares plus an amount equal to accumulated but unpaid dividends with respect to such shares.

The Series A Preferred Shares have no voting rights with respect to matters that generally require the approval of voting shareholders. The Series A Preferred Shares are convertible into Common Shares of the Company following the issuance date based on a conversion ratio of (i) the $25.00 per share liquidation preference divided by (ii) $1.00 (subject to adjustment for certain dilutive issuances). Therefore, each Series A Preferred Share is initially convertible into 25 Common Shares. Upon such a conversion, any declared but unpaid dividends on the converted Series A Preferred Shares would be paid in cash. In the event that the conversion would result in the issuance of fractional Common Shares, we will pay the holder the cash value of such fractional shares in lieu of such fractional shares based on a price per Common Share equal to the then current conversion price.

The Series A Preferred Shares are not redeemable prior to [            ], which is the first anniversary of the initial closing date of this offering, except for the circumstances described below.

On or after [            ], the Series A Preferred Shares may be redeemed at our option, in whole or in part, from time to time, at a redemption price of $25.00 per Series A Preferred Share, plus all dividends accumulated and unpaid (whether or not declared) on the Series A Preferred Shares up to, but not including, the date of such redemption, upon the giving of notice.

Upon the occurrence of any Delisting Event, Change of Control, or $8 VWAP Event (each as defined in the Prospectus Summary), whether before or after the twelve (12) month anniversary of the date of issuance of the Series A Preferred Shares, we may, at our option, redeem the Series A Preferred Shares, in whole or in part and within 90 days after the date of the Delisting Event, Change of Control or $8 VWAP Event, by paying $25.00 per share of Series A Preferred Shares, plus all dividends accumulated and unpaid (whether or not declared) on the Series A Preferred Stock up to, but not including, the date of such redemption.

Subject to the preferential rights, if any, of the holders of any class or series of capital stock of the Company ranking senior to the Series A Preferred Shares as to dividends, the holders of the Series A Preferred Shares will be entitled to receive, when, as and if declared by the Board (or a duly authorized committee of the Board), only out of funds legally available for the payment of dividends, cumulative cash dividends at the annual rate of 9.0% of the $25.00 liquidation preference per year (equivalent to $2.25 per year) until the beginning of the fifth year following the issuance of the Series A Preferred Shares, at which time the annual rate will increases 4.0% per calendar quarter until it reaches a maximum of 25.0%. For example, the initial increase in the dividend rate from 9.0% to 13.0% will result in an increase in the dividend amount, on an annual basis, from $2.25 to $3.25. Dividends on the Series A Preferred Shares will accumulate and be cumulative from, and including, the date of original issue by us of the Series A Preferred Shares. The Company can at its discretion, defer payment of all cumulative dividends under all circumstances until liquidation.

Our Common Shares and our warrants issued in November 2021 (the “Listed Warrants”) are currently listed on Nasdaq under the symbols “MCLD” and “MCLDW”, respectively. On November 2, 2022, the last reported sale price of our Common Shares was $1.10 per share and the last reported sale price of our Listed Warrants was $0.2799 per Listed Warrant. Our Common Shares are also listed on the TSXV under the symbol “MCLD”. On November 2, 2022 the last reported sale price of our Common Shares on the TSXV was CAD$1.46 per share.

An investment in our securities is highly speculative, involves a high degree of risk and should be considered only by persons who can afford the loss of their entire investment. See “Risk Factors” beginning on page 13 of this prospectus.

	Per Share		Per Related Twenty Five Warrants		Total if Minimum Offering is Raised		Total if Maximum Offering is Raised
Public offering price	$	24.75	$	0.25	$	15,000,000	$	35,000,000
Placement agent fees (1)	$	1.7325	$	0.0175	$	1,050,000	$	2,450,000
Proceeds, before expenses, to us	$	23.0175	$	0.2325	$	13,950,000	$	32,550,000

(1) See “Plan of Distribution” on page 129 of this prospectus for a description of all placement agent compensation payable in connection with this offering.

We do not intend to close this offering unless we sell at least a minimum number of Series A Preferred Shares and Warrants to result in gross proceeds equal to or greater than $15,000,000 (the “Minimum Amount”). Because this is a best efforts offering, the placement agent does not have an obligation to purchase any securities, and, as a result, there is a possibility that we may not be able to sell the minimum offering amount. We expect that the offering will end on the first to occur of (i) the sale of the maximum number of Series A Preferred Shares and Warrants resulting in gross proceeds of $35,000,000 and (ii) the conclusion of the 60 day offering period. Accordingly, we and the placement agent have made arrangements to place investor funds in a separate bank account to be held until the closing. Unless the Minimum Amount is subscribed for and accepted by the Company by the conclusion of the offering period, or waived by the Company, the offering will be terminated and all subscription proceeds will be returned to investors without interest or deduction.

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

The date of this prospectus is                     , 2022

Maxim Group LLC

TABLE OF CONTENTS

Prospectus Summary	1
Risk Factors	13
Forward-Looking Statements	33
Use of Proceeds	34
Dividend Policy	34
Currency and Exchange Rates	34
Capitalization	35
Unaudited Pro Forma Combined Financial Information	37
Management’s Discussion and Analysis of Financial Condition and Results of Operations	42
Our Business	89
Management	101
Related Party Transactions	117
Principal Shareholders	118
Description of Share Capital	118
Certain Income Tax Considerations	124
Enforceability of Civil Liabilities	128
Determination of Offering Price	128
Plan of Distribution	128
Legal Matters	133
Experts	133
Where You Can Find More Information	133
Financial Statements	F-1

You should rely only on the information contained in this prospectus or in any free writing prospectus we may authorize to be delivered or made available to you. Neither we, nor the placement agent have authorized anyone to provide you with different information. The information in this prospectus is accurate only as of the date of this prospectus, regardless of the time of delivery of this prospectus, or any free writing prospectus, as the case may be, or any sale of Series A Preferred Shares and Warrants in our company.

For investors outside the United States: Neither we, nor the placement agent, have done anything that would permit this offering or possession or distribution of this prospectus in any jurisdiction where action for that purpose is required, other than in the United States. Persons outside the United States who come into possession of this prospectus must inform themselves about, and observe any restrictions relating to, the offering of the Series A Preferred Shares and Warrants and the distribution of this prospectus outside the United States.

PROSPECTUS SUMMARY

This summary highlights information that we present more fully in the rest of this prospectus. This summary does not contain all of the information you should consider before buying Series A Preferred Shares and Warrants in this offering. This summary contains forward-looking statements that involve risks and uncertainties, such as statements about our plans, objectives, expectations, assumptions or future events. In some cases, you can identify forward-looking statements by terminology such as “anticipate,” “estimate,” “plan,” “project,” “continuing,” “ongoing,” “expect,” “we believe,” “we intend,” “may,” “should,” “will,” “could,” and similar expressions denoting uncertainty or an action that may, will or is expected to occur in the future. These statements involve estimates, assumptions, known and unknown risks, uncertainties and other factors that could cause actual results to differ materially from any future results, performances or achievements expressed or implied by the forward-looking statements. You should read the entire prospectus carefully, including the “Risk Factors” section and the financial statements and the notes to those statements.

Corporate Information

We are a Canadian corporation and our principal executive offices are located at 550-510 Burrard St., Vancouver, British Columbia, V6C 3A8 and the registered office is located at 2686 Point Grey Rd., Vancouver, BC, V6K 1A5, Canada and our phone number is (604) 669-9973.

Our Company

Overview

The Company delivers solutions combining Internet of Things (IoT), artificial intelligence (AI), and the cloud to unlock the untapped potential of energy- intensive assets such as:

• HVAC units and refrigerators in commercial buildings;

• control systems, heat exchangers, and compressors at process industry facilities; and

• wind turbines generating renewable energy at onshore wind farms.

IoT enables inexpensive, readily scalable connectivity to these and other under-served assets. Data from these IoT sensors are taken into the cloud, where digital twins of these assets are created, and AI is applied to identify opportunities to optimize asset performance. Asset operators and maintainers who manage these assets in the field are guided through a portfolio of mobile, connected applications that enable these teams to take asset management actions that ensure optimal performance.

Through the Company’s proprietary AssetCare platform, AI is used to identify opportunities to improve asset performance and enable asset operators and maintainers to take direct action creating these measurable improvements. Some key applications of the Company’s AssetCare technology at work include:

• curbing wasted energy while improving occupant comfort in commercial facilities through AI-powered adaptive control;

• maximizing asset availability and production yields of renewable energy sources through continuous performance assessment and predictive maintenance; and

• optimizing the uptime and manage the operational risk of industrial process plants, including oil and gas facilities, through continuous AI-powered advisory and assistance to process operators in the field.

In all markets, the Company uses a commercial Software-as-a-Service (“SaaS”) business model to distribute its AssetCare solution. Customers pay a simple, subscription-based price that is determined by number of assets, asset size or complexity, and the expected efficiency gains to be created using AI and analytics. Set up as multi-year, recurring subscriptions, customers pay no fees upfront to onboard an AssetCare solution; any upfront costs are leveraged across the lifetime of the initial subscription period. Certain software and technologies used in AssetCare solutions are also offered to some customers on a perpetual basis.

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Marketing Channels

The Company maintains a robust presence in seven countries: Canada, the United States, the United Kingdom, the Kingdom of Bahrain as the gateway to markets in the Middle East, China, Singapore and Australia, supplemented by a growing international network of channel and delivery partners around the world.

The Company employs sales team members in these countries charged with direct sales efforts of AssetCare solutions. Global marketing efforts to support these sales efforts include virtual campaigns and events to attract new customers, strengthen relationships with existing customers, and building brand presence and visibility. The Company also hosts an annual user conference called mCloud Connect, which includes head-liners from well-known industry leaders, panels, and interactive sessions to gather “voice of the customer” feedback, which is used to improve the Company’s portfolio of AssetCare offerings.

The Company has conducted extensive research to size the markets and opportunities it can access through its AssetCare platform. The Company estimates it has the capability of serving over 7.3 million commercial buildings and over 34,000 industrial sites in 20 different locales worldwide, with each building or site representing multiple potential connectable assets, workers, or 3D digital twins.

Serviceable commercial buildings include restaurants, mid-size retail (including retail finance sites such as bank branches), and long-term care facilities. In these buildings, the Company connects to assets such as HVAC, lighting, and refrigeration units. Connectable workers include people involved in the day-to-day operation or maintenance of these commercial buildings, including mechanical service workers and facility managers.

Industrial sites include oil and gas, liquefied natural gas, and floating production storage and offloading facilities, as well as wind farms, mining processing plants, and pulp and paper facilities. In these locations, connectable assets include process control systems, heat exchangers, pumps, and gas compressors. Connectable workers include field operators, maintainers, engineers, asset managers, and plant managers. The Company’s experience in delivering digital 3D models from entire multi-billion-dollar assets the size of a floating production storage and offloading (FPSO) vessel down to asset subcomponents such as wind turbine blades creates large obtainable market opportunities.

Based on the average monthly fee currently generated per connection or 3D digital twin, the Company estimates the current obtainable market opportunity to be approximately $24 billion in recurring revenue per annum including all potential targeted assets, workers, and 3D digital twins that the Company can currently address.

Intangible Properties

mCloud’s success depends in part on its ability to create unique intellectual property that improves the Company’s ability to create and deliver customer value in the principal markets where it does business. The Company relies on the use of intellectual property rights, including patents, copyrights, registered trademarks, and trade secrets in Canada, the United States and the European Union.

The Company retains a portfolio of 15 technology patents in the areas of HVAC energy efficiency, 3D, and asset management, a global customer base in industries including retail, healthcare, heavy industry, oil and gas, nuclear power generation, and renewable energy, and a portfolio of 12 registered trademarks, including marks related to mCloud and AssetCare. Please see “Our Business – Intellectual Property.”

The Company also uses key domain names, including acrx.com, fdsi.site, fdsi.us, fielddiagnostics.com, fmdiagnosticscoe.com, mysamobile.com, peatanalytics.com, mcloudcorp.com, assetcare.io, assetcare.net, myldar.com, ngrain.com, ngrain.ca, ngrain.net, ngrain.org and i3dimensions.com.

The Company further protects its proprietary source code and algorithms as trade secrets, limiting access to these to employees who have a need to know such information.

Environmental Protection

The Company does not see any financial or operational effects from environmental protection requirements on capital expenditures, profit or loss, and competitive position in this financial year. In the future, the Company may see enhanced demand for AssetCare in businesses who have a mandate to become more energy efficient or demonstrate they have instituted effective methane emission reduction and mitigation programs in response to new government regulations.

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Employees

As of the date of this prospectus, the Company and its subsidiaries have 216 employees employed in 14 offices in Canada, the United States, Greater China, the Middle East, Southeast Asia, and Australia. As of the year ended December 31, 2021, the Company and its subsidiaries had 216 employees employed in 14 offices in Canada, the United States, Greater China, the Middle East, Southeast Asia, and Australia. As of the year ended December 31, 2020, the Company and its subsidiaries had 227 employees employed in 14 offices in Canada, the United States, Greater China, the Middle East, and Southeast Asia. As of the year ended December 31, 2019, the Company and its subsidiaries had over 216 employees employed in twelve offices in Canada, the United States, Greater China, the Middle East, and Southeast Asia. The fluctuation in the Company’s number of employees is not significant, and none of the Company’s employees belong to any labour unions. Furthermore, all of the Company’s employees are employed on a full-time basis.

Incentive stock options may be granted only to employees of the Company or a “parent corporation” or “subsidiary corporation” thereof (as such terms are defined in Sections 424(e) and 424(f) of the Code). Stock awards other than incentive stock options (including non-statutory stock options, stock appreciation rights, restricted stock awards, restricted stock unit awards, and other stock awards, collectively “Stock Awards”) may be granted to employees, directors and consultants; provided, however, that Stock Awards may not be granted to employees, directors and consultants who are providing Continuous Service only to any “parent” of the Company, as such term is defined in Rule 405, subject to certain exceptions set out in the Company’s Incentive Stock Option Plan.

Foreign Operations

The Company operates in multiple geographies around the world, including North America (the United States and Canada), Europe (the United Kingdom and continental Europe), Southeast Asia (primarily Greater China), the Middle East (primarily Saudi Arabia), and Australia with most of its business taking place outside of Canada. mCloud is not dependent on business in any one region for its success.

Research and Development

The Company’s customers use its software to monitor their assets and rely on the Company to provide updates and releases as part of its software maintenance and support services. Consequently, while the Company has not implemented a formal research and development policy for the past three years, the Company is and has been (including, but not limited to, the past three years) engaged with a number of research and development initiatives as a part of its ongoing effort to continually update its software and develop new products.

Fixed Assets

On September 27, 2021, the Company executed a 12-year lease for its office in Calgary, Alberta located at 8 Avenue SW, Stephen Avenue Place, Calgary, Alberta, Canada. In total, the Company has leased 33,000 square feet of the property, situated on the 3rd and 33rd floor of the building located at the aforementioned address. The lease term commences on December 1, 2022, preceded by a fixturing period which the Company will use to build out the office space to their specifications. The Company is currently in the design and scoping stage, and has not yet finalized its plans for the precise use of the property, and does not yet have any plans to construct, expand, or improve the facilities. No environmental issues have currently been identified that will affect the Company’s utilization of the asset.

Material Effects

Certain government regulations have a material impact on the Company’s business. The Company has implemented certain measures to address and conform to all the frameworks noted below, and others as required, and conducts an annual review to ensure compliance with such frameworks and regulations.

The Company is required to adhere to such frameworks as the EU’s General Data Protection Regulations, the EU’s ePrivacy Regulation, Brazil’s General Data Protection Law, the California Consumer Privacy Act, the California Online Privacy Protection Act, and various other regulations in effect in other U.S. states, which require the Company, among other things, to have a valid privacy policy, block cookies before the user provides consent, allow users to opt-in or opt-out of receiving communications from the Company, show a notice of collection, and keep records of consent and processing. While the Company does not yet do business in Brazil, and has not reached the required number of users in California for the applicable regulations noted above to have effect, the Company has implemented measures to ensure that it remains compliant with these frameworks in advance of such compliance being legally required.

Data security practices are monitored and regulated by the Federal Trade Commission in the U.S., the Office of the Privacy Commissioner in Canada, and the European Data Protection Board of the EU. Canada, in particular, has several privacy law statutes that the Company is required to adhere to, such as the Personal Information Protection and Electronic Documents Act, the Personal Information Protection Act (Alberta), the Personal Information Protection Act (British Columbia), and An Act Respecting the Protection of Personal Information in the Private Sector (Quebec).

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Generally speaking, the Company is also required to comply with and respect the competition, consumer protection, and taxation laws, and intellectual property laws and regulations handed down by standard copyright and trademark laws in each of the jurisdictions it operates in. For confidential government contracts that require specific approvals to examine, possess, or transfer intellectual property, the Company is required to adhere to the International Traffic in Arms Regulations in the US, and the Canadian Controlled Goods Program in Canada. Additionally, the Company also follows and adheres to the best practices set out in the various National Institute of Standards and Technology frameworks, the Information Technology Infrastructure Library framework, and the Certified Information Systems Security Professional framework.

Emerging Growth Company Status

As a company with less than $1.07 billion in revenue during our last two fiscal periods (the years ended December 31, 2020 and 2021), we qualify as an “emerging growth company” as defined in the Jumpstart Our Business Startups Act, or JOBS Act, enacted in April 2012, and may take advantage of reduced reporting requirements that are otherwise applicable to public companies. These provisions include, but are not limited to:

• not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act,

• reduced disclosure obligations regarding executive compensation in periodic reports, proxy statements and registration statements, and

• exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved.

We may take advantage of these provisions until the last day of our fiscal year following the fifth anniversary of the date of the first sale of our common equity securities pursuant to an effective registration statement under the Securities Act of 1933, as amended (the “Securities Act”). However, if certain events occur before the end of such five-year period, including if we become a “large accelerated filer,” our annual gross revenues exceed $1.07 billion or we issue more than $1.00 billion of non-convertible debt in any three-year period, we will cease to be an emerging growth company before the end of such five-year period.

Foreign Private Issuer Status

We are a “foreign private issuer,” as defined in Rule 405 under the Securities Act and Rule 3b-4(c) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). As a result, we are not subject to the same requirements as U.S. domestic issuers. Under the Exchange Act, we will be subject to reporting obligations that, to some extent, are more lenient and less frequent than those of U.S. domestic reporting companies. For example, we will not be required to issue quarterly reports or proxy statements. We will not be required to disclose detailed individual executive compensation information. Furthermore, our directors and executive officers will not be required to report equity holdings under Section 16 of the Exchange Act and will not be subject to the insider short-swing profit disclosure and recovery regime.

As an exempted Canadian company listed on the Nasdaq Capital Market, we are subject to the Nasdaq Stock Market corporate governance listing standards. However, the Nasdaq Stock Market rules permit a foreign private issuer like us to follow the corporate governance practices of its home country. Certain corporate governance practices in Canada, which is our home country, may differ significantly from the Nasdaq Stock Market corporate governance listing standards.

A description of the significant ways in which our governance practices currently differ from those followed by domestic companies pursuant to the Rule 5600 series of the Nasdaq Stock Market Rules is set out below:

• Quorum Requirement—Nasdaq Listing Rule 5620(c) provides that the minimum quorum requirement for a meeting of shareholders is 331/3% of the outstanding common voting shares. We do not follow this Nasdaq Listing Rule. Instead, we follow our articles which provide that the quorum for the transaction of business at a meeting of shareholders is two persons who are, or who represent by proxy, shareholders who, in the aggregate, hold at least 5% of the issued shares.

• Shareholder Approval Requirements—In certain instances, Nasdaq Listing Rule 5635 requires each issuer to obtain shareholder approval before an issuance of securities in connection with: (i) the acquisition of the stock or assets of another company; (ii) equity-based compensation of officers, directors, employees or consultants; and (iii) transactions other than public offerings. We do not follow this Nasdaq Listing Rule. Instead, we comply with the laws, rules and regulations of Canada and the Province of British Columbia and the policies of the TSX Venture Exchange, which have different requirements for shareholder approval (including, in certain instances, not requiring any shareholder approval) in connection with issuances of securities in the circumstances listed above.

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Notes on Prospectus Presentation

Numerical figures included in this prospectus have been subject to rounding adjustments. Accordingly, numerical figures shown as totals in various tables may not be arithmetic aggregations of the figures that precede them. Certain market data and other statistical information contained in this prospectus is based on information from independent industry organizations, publications, surveys and forecasts. Some market data and statistical information contained in this prospectus are also based on management’s estimates and calculations, which are derived from our review and interpretation of the independent sources listed above, our internal research and our knowledge of the global bitters and spirits industry. While we believe such information is reliable, we have not independently verified any third-party information and our internal data has not been verified by any independent source.

Except where the context otherwise requires and for purposes of this prospectus only:

• Depending on the context, the terms “we,” “us,” “our company,” and “our” refer to mCloud Technologies Corp., and its consolidated subsidiaries:

• “preferred shares” refer to our Series A Preferred Shares, no par value.

• all references to “CAD”, “CAD$” and “Canadian dollar” are to the legal currency of Canada, and all references to “USD,” “$”, “US$” and “U.S. dollars” are to the legal currency of the United States.

Unless otherwise noted, all currency figures in this filing are in U.S. dollars. The financial statements of the Company included herein are reported in Canadian dollars and are prepared in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board.

We make no representation that the Canadian dollar amounts or U.S. dollar amounts referred to in this prospectus could have been or could be converted into U.S. dollars or Canadian dollar amounts, as the case may be, at any particular rate or at all. Any discrepancies in any table between the amounts identified as total amounts and the sum of the amounts listed therein are due to rounding.

The Offering

Series A Preferred Shares	1,400,000 Series A Preferred Shares on a best efforts basis
Offering Price	$25.00 per Series A Preferred Share and Warrant on a combined basis
Warrants	Warrants to purchase up to 35,000,000 Common Shares, which are exercisable on the date of issuance and expire on November 29, 2026, at an exercise price per Common Share equal to $4.75.
Minimum and Maximum Offering Amount; Offering Period	We do not intend to close this offering unless we sell at least a minimum number of Series A Preferred Shares and Warrants to result in gross proceeds equal to or greater than $15,000,000 (the “Minimum Amount”). Because this is a best efforts offering, the placement agent does not have an obligation to purchase any securities, and, as a result, there is a possibility that we may not be able to sell the minimum offering amount. We expect that the offering will end on the first to occur of (i) the sale of the maximum number of Series A Preferred Shares and Warrants resulting in gross proceeds of $35,000,000 and (ii) the conclusion of the 60 day offering period. Accordingly, we and the placement agent have made arrangements to place investor funds in a separate bank account to be held until the closing. Unless the Minimum Amount is subscribed for and accepted by the Company by the conclusion of the offering period, or waived by the Company, the offering will be terminated and all subscription proceeds will be returned to investors without interest or deduction.
Number of Series A Preferred Shares issued and outstanding before this offering	0
Number of Series A Preferred Shares outstanding after this offering	1,400,000 shares, if the maximum number of Series A Preferred Shares are sold in this offering.
Number of Common Shares outstanding prior to offering	16,224,788 shares.

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Liquidation Preference	The liquidation preference of each Series A Preferred Share is $25.00 per share. Upon liquidation, holders of Series A Preferred Shares will be entitled to receive the liquidation preference with respect to their Series A Preferred Shares plus an amount equal to accumulated but unpaid dividends with respect to such shares.
Conversion	The Series A Preferred Shares will be convertible into common Shares based on a conversion ratio of (i) the $25.00 per share liquidation preference divided by (ii) $1.00 (subject to adjustment for certain dilutive issuances). Therefore, each Series A Preferred Share is initially convertible into 25 Common Shares. Upon such a conversion, any declared but unpaid dividends shall be paid to the holder of Series A Preferred Shares in cash. In the event that the conversion would result in the issuance of fractional Common Shares, we will pay the holder the cash value of such fractional shares in lieu of such fractional shares based on a price per Common Share equal to the then current conversion price.
Dividends	Subject to the preferential rights, if any, of the holders of any class or series of capital stock of the Company ranking senior to the Series A Preferred Shares as to dividends, the holders of the Series A Preferred Shares will be entitled to receive, when, as and if declared by the Board (or a duly authorized committee of the Board), only out of funds legally available for the payment of dividends, cumulative cash dividends at the annual rate of 9.0% of the $25.00 liquidation preference per year (equivalent to $2.25 per year) until the beginning of the fifth year, at which time the annual rate will increase 4.0% per calendar quarter until it reaches a maximum of 25.0%. Dividends on the Series A Preferred Shares will accumulate and be cumulative from, and including, the date of original issue by us of the Series A Preferred Shares. However, the Company will be entitled to defer the payment of any declared dividends on the Series A Preferred Shares until the occurrence of a liquidation or Board approved Change of Control of the Company.
Ranking	The Series A Preferred Shares will rank, as to dividend rights and rights upon our liquidation, dissolution or winding up: (1) Senior to all classes or series of our common shares and to all other equity securities issued by us other than any equity securities issued with terms specifically providing that those equity securities rank on a parity with the Series A Preferred Shares; (2) Junior to any future equity securities issued by us with terms specifically providing that those equity securities rank senior to the Series A Preferred Shares with respect to the payment of dividends and the distribution of assets upon our liquidation, dissolution or winding up; and (3) Effectively junior to all our existing and future indebtedness (including indebtedness convertible into our common shares or preferred shares) and to the indebtedness and other liabilities of (as well as any preferred equity interests held by others in) our existing or future subsidiaries.
No Maturity Date	The Series A Preferred Shares are perpetual and have no maturity date, and we are not required to redeem the Series A Preferred Shares. Accordingly, all Series A Preferred Shares will remain outstanding indefinitely, unless and until they are redeemed or converted in accordance with their terms.
Preemptive Rights	Holders of Series A Preferred Shares will have no preemptive rights.

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Voting Rights

In any matter in which the Series A Preferred Shares may vote, as described below, each Series A Preferred Share shall be entitled to one vote per $25.00 of liquidation preference; provided that if the Series A Preferred Shares and any other stock ranking on parity to the Series A Preferred Shares as to dividend rights and rights as to the distribution of assets upon the Corporation’s liquidation, dissolution or winding up are entitled to vote together as a single class on any matter, the holders of each will vote in proportion to their respective liquidation preferences. So long as any Series A Preferred Shares remain outstanding, the Company will not, without the consent or the affirmative vote of the holders of at least two-thirds of the outstanding Series A Preferred Shares and each other class or series of preferred stock entitled to vote thereon (voting together as a single class), given in person or by proxy, either in writing without a meeting or by vote at any meeting called by the Company for the purpose: (i) authorize, create or issue, or increase the number of authorized or issued number of shares of, any class or series of capital stock ranking senior to the Series A Preferred Shares with respect to payment of dividends or the distribution of assets upon the liquidation, dissolution or winding up of the Company or reclassify any authorized capital stock of the Company into any such shares, or create, authorize or issue any obligation or security convertible into or evidencing the right to purchase any such shares; or (ii) amend, alter or repeal the provisions of the Articles of Incorporation, as amended, including the terms of the Series A Preferred Shares, whether by merger, consolidation, transfer or conveyance of all or substantially all of the Company’s assets or otherwise, so as to materially and adversely affect the rights, preferences, privileges or voting powers of the Series A Preferred Shares, taken as a whole. If any event described in paragraph (ii) above would materially and adversely affect the rights, preferences, privileges or voting powers of the Series A Preferred Shares, taken as a whole, disproportionately relative to any other class or series of voting preferred stock (as defined below), the affirmative vote of the holders of at least two-thirds of the outstanding shares of the Series A Preferred Shares, voting as a separate class, will also be required. Furthermore, if holders of shares of the Series A Preferred Shares receive the $25.00 per share of the Series A Preferred Shares liquidation preference plus all declared and unpaid dividends thereon or greater amounts pursuant to the occurrence of any of the events described in paragraph (ii) above, then such holders shall not have any voting rights with respect to the events described in such paragraph. As used herein, “voting preferred stock” means any other class or series of the Company’s preferred stock ranking equally with the Series A Preferred Shares as to dividends (whether cumulative or non-cumulative) and the distribution of the Company’s assets upon liquidation, dissolution or winding up and upon which like voting rights to the Series A Preferred Shares have been conferred and are exercisable.

Use of Proceeds

We intend to use the proceeds from this offering for working capital and general corporate purposes, including retiring convertible debenture debt that was due June 30, 2022. See “Use of Proceeds” for more information.

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Restrictions on Dividends, Redemption and Repurchases So long as any Series A Preferred Share remains outstanding, unless we also have either paid or declared and set apart for payment full cumulative dividends on the Series A Preferred Shares for all past completed dividend periods, we will not during any dividend period:   (1) pay or declare and set apart for payment any dividends or declare or make any distribution of cash or other property on Common Shares or other capital stock that ranks junior to or on parity with the Series A Preferred Shares with respect to dividend rights and rights to the distribution of assets upon our voluntary or involuntary liquidation, dissolution or winding up (other than, in each case, (a) a dividend paid in Common Shares or other stock ranking junior to the Series A Preferred Shares with respect to dividend rights and rights to the distribution of assets upon our voluntary or involuntary liquidation, dissolution or winding up or (b) any declaration of a Common Share dividend in connection with any stockholders’ rights plan, or the issuance of rights, stock or other property under any stockholders’ rights plan, or the redemption or repurchase of rights pursuant to such plan);   (2) redeem, purchase or otherwise acquire Common Shares or other capital stock that ranks junior to or on parity with the Series A Preferred Shares (other than the Series A Preferred Shares) with respect to dividend rights and rights to the distribution of assets upon our voluntary or involuntary liquidation, dissolution or winding up (other than (a) by conversion into or exchange for Common Shares or other capital stock ranking junior to the Series A Preferred Shares with respect to dividend rights and rights to the distribution of assets upon our voluntary or involuntary liquidation, dissolution or winding up, (b) the redemption of shares of capital stock pursuant to the provisions of our memorandum of articles, as amended, relating to the restrictions upon ownership and transfer of our capital stock, (c) a purchase or exchange offer made on the same terms to holders of all outstanding A Preferred Shares and any other capital stock that ranks on parity with the Series A Preferred Shares with respect to dividend rights and rights to the distribution of assets upon our voluntary or involuntary liquidation, dissolution or winding up, (d) purchases, redemptions or other acquisitions of shares of our capital stock ranking junior to the Series A Preferred Shares with respect to dividend rights and rights to the distribution of assets upon our voluntary or involuntary liquidation, dissolution or winding up pursuant to any employment contract, dividend reinvestment and stock purchase plan, benefit plan or other similar arrangement with or for the benefit of employees, officers, directors, consultants or advisors, (e) through the use of the proceeds of a substantially contemporaneous sale of stock ranking junior to the Series A Preferred Shares with respect to dividend rights and rights to the distribution of assets upon our voluntary or involuntary liquidation, dissolution or winding up, or (f) purchases or other acquisitions of shares of our capital stock pursuant to a contractually binding stock repurchase plan existing prior to the preceding Dividend Payment Date on which dividends were not paid in full); or   (3) redeem, purchase or otherwise acquire Series A Preferred Shares (other than (a) by conversion into or exchange for Common Shares or other capital stock ranking junior to the Series A Preferred Shares with respect to dividend rights and rights to the distribution of assets upon our voluntary or involuntary liquidation, dissolution or winding up, (b) a purchase or exchange offer made on the same terms to holders of all outstanding Series A Preferred Shares or (c) with respect to redemptions, a redemption pursuant to which all Series A Preferred Shares are redeemed).

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Optional Redemption	The Series A Preferred Shares are not redeemable prior to [                ], which is the first anniversary of the initial closing date of this offering, except for the circumstances described under “Special Optional Redemption.” On or after [                ], the Series A Preferred Shares may be redeemed at our option, in whole or in part, from time to time, at a redemption price of $25.00 per Series A Preferred Share, plus all dividends accumulated and unpaid (whether or not declared) on the Series A Preferred Shares up to, but not including, the date of such redemption, upon the giving of notice.
Special Optional Redemption	Upon the occurrence of any Delisting Event, Change of Control, or $8 VWAP Event, whether before or after [                ], we may, at our option, redeem the Series A Preferred Stock, in whole or in part and within 90 days after the date of the Delisting Event, Change of Control or $8 VWAP Event, by paying $25.00 per share of Series A Preferred Stock, plus all dividends accumulated and unpaid (whether or not declared) on the Series A Preferred Stock up to, but not including, the date of such redemption.
	A “Delisting Event” occurs when, after the original issuance of Series A Preferred Stock, both (i) the shares of Series A Preferred Stock are no longer listed on Nasdaq, the New York Stock Exchange (the “NYSE”) or the NYSE American LLC (“NYSE AMER”), or listed or quoted on an exchange or quotation system that is a successor to Nasdaq, the NYSE or the NYSE AMER, and (ii) the Company not subject to the reporting requirements of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), but any Series A Preferred Stock is still outstanding.
	A “Change of Control” occurs when, after the original issuance of the Series A Preferred Stock, the following have occurred and are continuing: (a) any person or persons acting together which would constitute a “group” for purposes of Section 13(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), (other than the Company or any subsidiary of the Company) shall beneficially own (as defined in Rule 13d-3 of the Exchange Act), directly or indirectly, at least 25% of the total voting power of all classes of capital stock of the Company entitled to vote generally in the election of the Board; (b) Current Directors (as herein defined) shall cease for any reason to constitute at least a majority of the members of the Board (for this purpose, a “Current Director” shall mean any member of the Board as of the date hereof and any successor of a Current Director whose election, or nomination for election by the Company’s shareholders, was approved by at least a majority of the Current Directors then on the Board); (c) (i) the complete liquidation of the Company or (ii) the merger or consolidation of the Company, other than a merger or consolidation in which (x) the holders of the common stock of the Company immediately prior to the consolidation or merger have, directly or indirectly, at least a majority of the common stock of the continuing or surviving corporation immediately after such consolidation or merger or (y) the Board immediately prior to the merger or consolidation would, immediately after the merger or consolidation, constitute a majority of the board of directors of the continuing or surviving corporation, which liquidation, merger or consolidation has been approved by the shareholders of the Company; or (d) the sale or other disposition (in one transaction or a series of transactions) of all or substantially all of the assets of the Company pursuant to an agreement (or agreements) which has (have) been approved by the shareholders of the Company.

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	An “$8 VWAP Event” occurs when, after the original issuance of Series A Preferred Stock, the volume weighted average price of the Common Shares on the Nasdaq Capital Market for five consecutive trading days (as reported by Bloomberg L.P. based on a trading day from 9:30 a.m. to 4:02 p.m. (New York City time)) is at least $8.00.
Redemption Upon Request of Holder in Connection with Change of Control:	Upon the occurrence of a Board Approved Change of Control, holders of our Series A Preferred Shares may (i) require us to redeem their shares of our Series A Preferred Shares at a per share redemption price of $25.00, plus declared and unpaid dividends to, but excluding, the effective date of the Change of Control, or (ii) continue to hold our Series A Preferred Shares (subject to the Company’s option to redeem the Series A Preferred Shares as set forth above).
Anti-Dilution Adjustment	If, at any time while the Series A Preferred Shares are outstanding, we sell or grant (or announce any offer, sale or grant) of any Common Shares or Common Share equivalents entitling any person to acquire our Common Shares at an effective price per share that is lower than the original $1.00 conversion price, then the conversion price will be reduced to equal such lower price (though not less than $0.20 or, for so long as the Common Shares are listed on the TSX Venture Exchange, not less than the “Market Price” as that term is defined in the policies of the TSX Venture Exchange). However, no conversion price adjustment will be made in respect of certain identified exempt issuances.
Segregated Dividend Payment Account	The Company shall establish a segregated account that will be funded at closing of the offering with proceeds in an amount equal to nine (9) months of dividends on the maximum number of Series A Preferred Shares. The segregated account may only be used to pay dividends declared on the Series A Preferred Shares, when legally permitted, and may not be used for other corporate purposes.
Listing	We are in the process of applying to have the Series A Preferred Shares listed on Nasdaq under the symbol “MCLDP.” There is no assurance that our listing application will be approved. Our Warrants will trade on the Nasdaq along with the Listed Warrants under the symbol “MCLDW.” Our Common Shares are listed on Nasdaq under the symbol “MCLD” and our Listed Warrants are listed under the symbol “MCLDW.” Our Common Shares are also listed on the TSXV under the symbol “MCLD”.
Best Efforts	We have agreed to issue and sell the Series A Preferred Shares and Warrants offered hereby to the public through the placement agent, and the placement agent has agreed to offer and sell such securities on a “best efforts” basis. The placement agent is not required to sell any specific number or dollar amount of the securities offered hereby, but will use their best efforts to sell such securities. See “Plan of Distribution” on page 129.
Risk Factors	Investing in these securities involves a high degree of risk. As an investor, you should be able to bear a complete loss of your investment. You should carefully consider the information set forth in the “Risk Factors” section of this prospectus before deciding to invest in our Series A Preferred Shares and Warrants.

Summary Financial Data

The following tables summarize our historical financial data. The summary consolidated statements of operation for the years ended December 31, 2019, 2020 and 2021 and the summary consolidated Statements of Financial Position as of December 31, 2019, 2020 and 2021 have been derived from our consolidated financial statements included elsewhere in this prospectus. The following summary financial data should be read in conjunction with the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our consolidated financial statements and related notes included elsewhere in this prospectus. Our historical results are not necessarily indicative of the results that may be expected in the future, and our results for any interim period are not necessarily indicative of the results to be expected for a full fiscal year.

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The following table presents our consolidated statements of operation for the six months ended June 30, 2022 and the years ended December 31, 2021, 2020, and 2019 (unless indicated otherwise, and converted amounts in the following table are expressed in Canadian dollars as set out in “Currency and Exchange Rates.”):

	Six months ended June 30, 2022			2021 Recast (1)			Year ended December 31, 2020 Recast (1)			2019 Recast (1)
Revenue	$	6,698,629		$	25,596,972		$	26,928,439		$	18,340,249
Cost of sales		(3,865,798	)		(9,683,748	)		(10,281,922	)		(7,583,127	)
Gross profit	$	2,832,831		$	15,913,224		$	16,646,517		$	10,757,122
Expenses
Salaries, wages and benefits		10,373,584			21,691,774			20,885,044			10,313,803
Sales and marketing		1,902,215			1,377,255			1,536,420			3,166,788
Research and development		1,100,284			3,179,353			1,078,164			498,099
General and administration		4,617,456			8,538,854			5,741,872			3,294,550
Professional and consulting fees		6,736,389			9,085,436			8,886,341			4,351,812
Share-based compensation		444,461			1,867,915			1,454,235			1,468,361
Depreciation and amortization		3,769,628			8,924,812			6,778,100			4,044,143
Total expenses	$	28,944,017		$	54,665,399		$	46,360,176		$	27,137,556
Operating loss	$	26,111,186		$	38,752,175		$	29,713,659		$	16,380,434
Other expenses (income)
Finance costs		4,088,630			8,618,794			6,033,510			3,217,500
Foreign exchange (gain) loss		(493,543	)		(267,294	)		1,198,372			494,404
Business acquisition costs and other expenses		—			346,420			1,811,682			9,880,170
Impairment		—			—			—			600,657
Fair value (gain) loss on derivatives		(5,031,599	)		6,040,121			—			—
Other income		(662,292	)		(7,126,097	)		(2,932,342	)		(167,913	)
Loss before tax	$	24,012,382		$	46,364,119		$	35,824,881		$	30,405,252
Current tax expense (recovery)		104,682			157,303			(295,709	)		181,895
Deferred tax (recovery)		(1,482,234	)		(1,822,109	)		(668,209	)		(2,692,313	)
Net loss for the period		22,634,830		$	44,699,313		$	34,860,963		$	27,894,834
Other comprehensive (income) loss
Foreign subsidiary translation differences		882,069			69,460			(1,209,006	)		(607,302	)
Comprehensive loss for the period	$	23,516,899		$	44,768,773		$	33,651,957		$	27,287,532
Net loss (income) for the period attributable to:
mCloud Technologies Corp. shareholders		17,829,232			44,762,700			36,447,551			28,484,890
Non-controlling interest		4,805,598			(63,387	)		(1,586,588	)		(590,056	)
	$22,634,830			$44,699,313			$ 34,860,963			$27,894,834
Comprehensive loss (income) for the period attributable to:
mCloud Technologies Corp. shareholders		18,764,690			44,970,815			35,398,294			28,054,299
Non-controlling interest		4,752,209			(202,042	)		(1,746,337	)		(766,767	)
	$23,516,899			$44,768,773			$ 33,651,957			$27,287,532
Loss per share attributable to mCloud shareholders – basic and diluted	$	1.10		$	3.76		$	5.01		$	6.97
Weighted average number of common shares outstanding basic and diluted		16,151,197			11,898,183			7,272,464			4,085,322

(1) See Note 2 of the Consolidated Financial Statements for the Years Ended December 31, 2021, 2020 and 2019.

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The following table presents our summary consolidated balance sheets data as of June 30, 2022, December 31, 2021, 2020 and 2019 (Unless indicated otherwise, and converted amounts in the following table are expressed in Canadian dollars as set out in “Currency and Exchange Rates.”):

	June 30, 2022			December 31, 2021			December 31, 2020			December 31, 2019
				Recast (1)			Recast (1)			Recast (1)
ASSETS
Current assets
Cash and cash equivalents	$	4,405,948		$	4,588,057		$	1,110,889			529,190
Trade and other receivables		12,134,992			14,566,975			12,312,814			9,091,654
Current portion of prepaid expenses and other assets		2,679,472			2,355,350			1,326,319			839,012
Current portion of long-term receivables		390,398			397,060			445,213			378,221
Total current assets	$	19,610,810		$	21,907,442		$	15,195,235		$	10,838,077
Non-current assets
Prepaid expenses and other assets		402,838			622,577			1,011,847			86,913
Long-term receivables		318,360			343,371			2,091,059			1,586,429
Right-of-use assets		7,298,424			916,028			3,660,717			4,206,808
Property and equipment		518,185			649,403			506,387			710,552
Intangible assets		17,429,695			20,585,833			27,766,839			23,671,089
Goodwill		27,119,177			27,081,795			27,086,727			18,758,975
Total non-current assets		53,086,679		$	50,199,007		$	62,123,576			49,020,766
Total assets		72,697,489		$	72,106,449		$	77,318,811			59,858,843
LIABILITIES
Current liabilities
Bank indebtedness		3,679,631		$	3,460,109		$	976,779			1,471,805
Trade payables and accrued liabilities		16,343,347			12,421,309			12,924,256			9,636,405
Deferred revenue		4,813,199			2,811,408			1,771,120			1,138,281
Current portion of loans and borrowings		10,399,574			12,447,939			3,431,251			3,004,717
Current portion of convertible debentures		23,457,500			22,185,170			—			—
Warrant liabilities		3,017,643			8,880,038			710,924			725,086
Current portion of lease liabilities		554,895			410,674			835,472			720,457
Current portion of other liabilities		—			—			6,003,838
Current portion of business
acquisition payable		1,399,580			1,398,972			1,594,297			1,043,314
Total current liabilities		63,665,369		$	64,015,619		$	28,247,937			17,740,065
Non-current liabilities
Convertible debentures		85,901			110,540			19,534,988			17,535,946
Lease liabilities		7,123,723			634,798			3,109,604			3,641,627
Loans and borrowings		19,586,233			767,662			9,721,049			10,968,338
Deferred income tax liabilities		827,672			2,291,057			4,168,905			3,854,614
Other liabilities		—			—			232,577
Business acquisition payable		—			—			845,232			—
Total liabilities		91,288,088		$	67,819,676		$	65,860,292			53,740,590
EQUITY
Share capital		118,327,722			118,195,363			83,120,611			45,368,745
Contributed surplus		11,547,919			11,040,751			8,518,476			7,278,119
Accumulative other comprehensive income		291,811			1,227,269			1,435,384			386,127
Deficit		(146,501,130	)		(128,671,898	)		(83,909,198	)		(47,461,647	)
Total shareholders’ equity (deficit)		(16,333,678	)	$	1,791,485		$	9,165,273			5,571,344
Non-controlling interest		(2,256,921	)		2,495,288			2,293,246			546,909
Total equity (deficit)	$	(18,590,599	)	$	4,286,773		$	11,458,519			6,118,253
Total liabilities and equity	$	72,697,489		$	72,106,449		$	77,318,811			59,858,843

1) See Note 2 of the Consolidated Financial Statements for the Years Ended December 31, 2021, 2020 and 2019.

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RISK FACTORS

Investing in our securities is speculative and involves a high degree of risk. You should consider carefully the following risk factors, as well as the other information in this prospectus, including our consolidated financial statements and notes thereto, before you decide to purchase our securities. If any of the following risks actually occur, our business, financial condition, results of operations and prospects could be materially adversely affected, the value of our securities could decline, and you may lose all or part of your investment. This prospectus also contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those anticipated in the forward-looking statements as a result of a number of factors, including the risks described below. See “Cautionary Note Regarding Forward-Looking Statements.”

Summary Risk Factors

• As a company primarily based outside of the United States, our business is subject to economic, political, regulatory and other risks associated with international operations.

• mCloud may be unable to identify and complete suitable platform acquisitions and acquisitions in its existing vertical markets.

• Potential acquisitions could be difficult to consummate and integrate into mCloud’s operations, and they and investment transactions could disrupt mCloud’s business, dilute stockholder value or impair mCloud’s financial results.

• The loss of one or more of mCloud’s key personnel, or its failure to attract and retain other highly qualified personnel in the future, could harm its business.

• We may acquire contingent liabilities through acquisitions that could adversely affect mCloud’s operating results.

• Acquisitions, investments, joint ventures and other business ventures may negatively affect mCloud’s operating results.

• We may not be able to protect our intellectual property rights, which could make us less competitive and cause us to lose market share. The loss of our rights to use technology currently licensed by third parties could increase operating expenses by forcing us to seek alternative technology and adversely affect our ability to compete.

• If mCloud is not able to maintain and enhance the AssetCare brand, or if events occur that damage the AssetCare reputation and brand, mCloud’s ability to expand its base of users may be impaired, which could adversely affect mCloud’s business and financial results.

• Because we are a corporation incorporated in British Columbia and some of our directors and officers are resident in Canada, it may be difficult for investors in the United States to enforce civil liabilities against us based solely upon the federal securities laws of the United States. Similarly, it may be difficult for Canadian investors to enforce civil liabilities against our directors and officers residing outside of Canada.

Factors Influencing Serviceable Obtainable Market.

The Company’s statements regarding serviceable obtainable market reflect the Company’s estimate of the entire market available to the Company and its competitors. The markets for the Company’s AssetCare offering are subject to substantial competition and mCloud may not capture as much market share as it currently expects to capture. mCloud has direct competitors in these markets who may have credible advantages over the Company in areas such as financial strength, regional presence, and human resources, which could influence the Company’s ability to capture market share. Certain prospective customers in these markets may also have the means to develop and deploy their own solutions. Furthermore, current mCloud customers in these markets may decide not to renew or reduce the scope of their AssetCare subscriptions following the completion of their subscription term based on business need or changes in their strategy. The Company partners with third-parties such as mechanical contractors and engineering service providers to deliver AssetCare, and in the event mCloud captures greater market share, the Company’s ability to successfully deliver to customers depends on either these partnerships or mCloud’s ability to scale its local presence to meet demand. The Company believes that statements about its serviceable obtainable market are reasonable. However, there is no guarantee that mCloud will be able to capture or service any portion of the market, which could adversely affect mCloud’s business and financial results.

Force Majeure Events – COVID-19.

Major health issues and pandemics, such as COVID-19, may adversely affect trade, global and local economies, and the trading prices of our securities. Outbreaks may affect the supply chain of the Company and may restrict the level of economic activity in affected areas, which may adversely affect the price and demand for the Company’s products and services, as well as the Company’s ability to collect outstanding receivables from its customers. Given the ongoing and dynamic nature of the circumstances surrounding COVID-19, the extent to which the coronavirus will impact the Company’s financial results and operations is uncertain. It is possible, however, that the Company’s business operations and financial performance in 2022 and beyond may be materially adversely affected by COVID-19.

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Going Concern Assumption.

The financial statements of mCloud have been prepared in accordance with International Financial Reporting Standards (IFRS) on a going concern basis, which presumes that mCloud will be able to realize its assets and discharge its liabilities in the normal course of business for the foreseeable future. mCloud’s continuation as a “going concern” is uncertain and is dependent upon, amongst other things, attaining a satisfactory revenue level, the support of its customers, its ability to continue profitable operations, the generation of cash from operations, and its ability to obtain financing arrangements and capital in the future. These material uncertainties represent risk to mCloud’s ability to continue as a going concern and realize its assets and pay its liabilities as they become due. If the “going concern” assumption was not appropriate for the financial statements, then adjustments would be necessary to the carrying values of assets and liabilities, the reported expenses and the balance sheet classifications used. Such adjustments could be material.

mCloud may be unable to identify and complete suitable platform acquisitions and acquisitions in its existing vertical markets.

mCloud cannot be certain that it will be able to identify suitable new acquisition candidates that are available for purchase at reasonable prices. Even if mCloud is able to identify such candidates, it may be unable to consummate an acquisition on suitable terms. When evaluating an acquisition opportunity, mCloud cannot assure investors that it will correctly identify the risks and costs inherent in the business that it is acquiring. If mCloud is to proceed with one or more significant future acquisitions in which the consideration consists of cash, a substantial portion of its available cash resources may be used, or it may have to seek additional financing to complete such acquisitions.

Potential acquisitions could be difficult to consummate and integrate into mCloud’s operations, and they and investment transactions could disrupt mCloud’s business, dilute stockholder value or impair mCloud’s financial results.

As part of mCloud’s business strategy, it may continue, from time to time, to seek to grow its business through acquisitions of or investments in new or complementary businesses, technologies or products that it believes can improve its ability to compete in its existing customer markets or allow it to enter new markets. The potential risks associated with acquisitions and investment transactions include, but are not limited to:

• failure to realize anticipated returns on investment, cost savings and synergies;

• difficulty in assimilating the operations, policies, and personnel of the acquired company;

• unanticipated costs associated with acquisitions;

• challenges in combining product offerings and entering into new markets in which we may not have experience;

• distraction of management’s attention from normal business operations;

• potential loss of key employees of the acquired company;

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• difficulty implementing effective internal controls over financial reporting and disclosure controls and procedures;

• impairment of relationships with customers or suppliers;

• possibility of incurring impairment losses related to goodwill and intangible assets; and

• other issues not discovered in due diligence, which may include product quality issues or legal or other contingencies.

Acquisitions and/or investments may also result in potentially dilutive issuances of equity securities, the incurrence of debt and contingent liabilities, the expenditure of available cash, and amortization expenses or write-downs related to intangible assets such as goodwill, any of which could have a material adverse effect on mCloud’s operating results or financial condition. Investments in immature businesses with unproven track records and technologies have an especially high degree of risk, with the possibility that mCloud may lose its entire investment or incur unexpected liabilities. mCloud may experience risks relating to the challenges and costs of closing a business combination or investment transaction and the risk that an announced business combination or investment transaction may not close. There can be no assurance that mCloud will be successful in making additional acquisitions in the future or in integrating or executing on its business plan for existing or future acquisitions.

mCloud may acquire contingent liabilities through acquisitions that could adversely affect mCloud’s operating results.

mCloud may acquire contingent liabilities in connection with acquisitions it has completed, which may be material. Although management uses its best efforts to estimate the risks associated with these contingent liabilities and the likelihood that they will materialize, their estimates could differ materially from the liabilities actually incurred.

Acquisitions, investments, joint ventures, and other business initiatives may negatively affect mCloud’s operating results.

The growth of mCloud through the successful acquisition and integration of complementary businesses is a critical component of its corporate strategy. mCloud continually evaluates acquisition opportunities within its respective marketplace and may be in various stages of discussions with respect to such opportunities. mCloud plans to continue to pursue acquisitions that complement its existing business, represent a strong strategic fit, and are consistent with its overall growth strategy and disciplined financial management. mCloud may also target future acquisitions to expand or add functionality and capabilities to its existing portfolio of solutions, as well as add new solutions to its portfolio. mCloud may also consider opportunities to engage in joint ventures or other business collaborations with third parties to address market segments. These activities create risks such as: (i) the need to integrate and manage the businesses and products acquired with mCloud’s own business and products; (ii) additional demands on its resources, systems, procedures and controls; (iii) disruption of its ongoing business; and (iv) diversion of management’s attention from other business concerns. Moreover, these transactions could involve: (a) substantial investment of funds or financings by issuance of debt or equity or equity-related securities; (b) substantial investment with respect to technology transfers and operational integration; and (c) the acquisition or disposition of product lines or businesses.

Also, such activities could result in charges and expenses and have the potential to either dilute the interests of existing shareholders or result in the issuance or assumption of debt. This could have a negative impact on the credit ratings of mCloud’s outstanding debt securities.

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Such acquisitions, investments, joint ventures, or other business collaborations may involve significant commitments of financial and other resources of mCloud. Any such activity may not be successful in generating revenues, income, or other returns to mCloud, and the resources committed to such activities will not be available to it for other purposes. Moreover, if mCloud is unable to access capital markets on acceptable terms or at all, it may not be able to consummate a specific acquisition, or a series of acquisitions. Alternatively, mCloud may have to complete a transaction on the basis of a less than optimal capital structure. mCloud’s potential inability (i) to take advantage of growth opportunities for its business or for its products and services, or (ii) to address risks associated with acquisitions or investments in businesses, may negatively affect its operating results. Additionally, any impairment of goodwill or other intangible assets acquired in an acquisition or in an investment, or charges associated with any acquisition or investment activity, may materially impact mCloud’s results of operations which, in turn, may have an adverse material effect on the market price of Shares or credit ratings of its outstanding debt securities.

The loss of one or more of mCloud’s key personnel, or its failure to attract and retain other highly qualified personnel in the future, could harm its business.

mCloud currently depends on the continued services and performance of its key personnel, including its executive officers. The loss of key personnel could disrupt mCloud’s operations and have an adverse effect on its business and financial results.

As mCloud continues to grow, it cannot guarantee that it will continue to attract the personnel it needs to maintain its competitive position. As mCloud scales, the total cash and equity compensation structure necessary to retain and attract key personnel may have to change to be in line with market rates for the verticals in which mCloud competes. If mCloud fails in attracting, hiring, and integrating key personnel with industry-specific experience, or retaining and motivating existing personnel, it may be unable to grow effectively.

mCloud cannot be certain that additional financing will be available on reasonable terms when required, or at all.

From time to time, mCloud may need additional financing, including to fund potential acquisitions. Its ability to obtain additional financing, if and when required, will depend on investor demand, mCloud’s operating performance, the condition of the capital markets, and other factors. To the extent mCloud draws on its credit facilities, if any, to fund certain obligations, it may need to raise additional funds, and mCloud cannot provide assurance that additional financing will be available to it on favorable terms when required, or at all. If mCloud raises additional funds through the issuance of equity, equity-linked or debt securities, those securities may have rights, preferences, or privileges senior to the rights of mCloud’s Common Shares or Series A Preferred Shares, and existing shareholders may experience dilution.

mCloud may not be able to protect its intellectual property rights, which could make it less competitive and cause it to lose market share.

mCloud’s software is proprietary. mCloud’s strategy is to rely on a combination of copyright, patent, trademark and trade secret laws in the United States, Canada, and other jurisdictions, and to rely on license and confidentiality agreements and software security measures to further protect its proprietary technology and brand. mCloud has obtained or applied for patent protection with respect to some of its intellectual property, but generally does not rely on patents as a principal means of protecting its intellectual property. mCloud has registered or applied to register some of its trademarks in the United States and in selected other countries. mCloud generally enters into non-disclosure agreements with its employees and customers, and historically has restricted third-party access to its software and source code, which it regards as proprietary information.

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The steps mCloud has taken to protect its proprietary rights may not be adequate to avoid the misappropriation of its technology or independent development by others of technologies that may be considered a competitor. mCloud’s intellectual property rights may expire or be challenged, invalidated, or infringed upon by third parties or it may be unable to maintain, renew or enter into new licenses on commercially reasonable terms. Any misappropriation of mCloud’s technology or development of competitive technologies could harm its business and could diminish or cause it to lose the competitive advantages associated with its proprietary technology and could subject it to substantial costs in protecting and enforcing its intellectual property rights, and/or temporarily or permanently disrupt its sales and marketing of the affected products or services. The laws of some countries in which mCloud’s products are licensed do not protect its intellectual property rights to the same extent as the laws of the United States. Moreover, in some non-U.S. countries, laws affecting intellectual property rights are uncertain in their application, which can affect the scope of enforceability of mCloud’s intellectual property rights.

mCloud’s software research and development initiatives and its customer relationships could be compromised if the security of its information technology is breached as a result of a cyberattack. This could have a material adverse effect on mCloud’s business, operating results, and financial condition, and could harm its competitive position.

mCloud devotes significant resources to continually updating its software and developing new products, and its financial performance is dependent in part upon its ability to bring new products and services to market. mCloud’s customers use its software to monitor their assets and rely on mCloud to provide updates and releases as part of its software maintenance and support services. The security of mCloud’s information technology environment is therefore important to its research and development initiatives, and an important consideration in its customers’ purchasing decisions. If the security of mCloud’s systems is impaired, its development initiatives might be disrupted, and it might be unable to provide service. mCloud’s customer relationships might deteriorate, its reputation in the industry could be harmed, and it could be subject to liability claims. This could reduce mCloud’s revenues, and expose it to significant costs to detect, correct and avoid any breach of security and to defend any claims against it.

The loss of mCloud’s rights to use technology currently licensed by third parties could increase operating expenses by forcing mCloud to seek alternative technology and adversely affect mCloud’s ability to compete.

mCloud occasionally licenses technology, including software and related intellectual property, from third parties for use in its products and may be required to license additional intellectual property. There are no assurances that mCloud will be able to maintain its third-party licenses or obtain new licenses when required on commercially reasonable terms, or at all.

For each of the last three fiscal years, mCloud has had two customers that each comprise greater than 10% of annual revenues.

mCloud may have customers which comprise greater than 10% of annual revenues. There are risks whenever a large percentage of total revenues are concentrated with a limited number of customers. It is not possible for us to predict the level of demand for our products that will be generated by any of these customers in the future. In addition, revenues from these larger customers may fluctuate from time to time based on these customers’ business needs and customer experience, the timing of which may be affected by market conditions or other factors outside of our control.

Information technology systems.

mCloud’s operations depend in part upon IT systems. mCloud’s IT systems are subject to disruption, damage, or failure from many sources, including computer viruses, security breaches, natural disasters, power loss, and defects in design. To date, mCloud has not experienced any material losses relating to IT system disruptions, damage, or failure, but there are no assurances that it will not incur such losses in the future. Any of these and other events could result in IT systems failures, operational delays, production downtimes, destruction or corruption of data, security breaches, or other manipulation or improper use of mCloud’s systems and networks.

mCloud’s products are highly technical, and if they contain undetected errors mCloud’s business and financial results could be adversely affected.

mCloud’s products are highly technical and complex. mCloud’s products may now or in the future contain undetected errors, bugs, or vulnerabilities. Some errors in mCloud’s products may only be discovered after they have been released. Any errors, bugs, or vulnerabilities discovered in mCloud’s products after release could result in damage to mCloud’s reputation, loss of users, loss of revenue, or liability for damages, any of which could adversely affect mCloud’s business and financial results.

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If mCloud’s products are unable to work with devices, platforms, or interfaces to deliver targeted user experiences, this could adversely affect mCloud’s business and financial results.

mCloud is dependent on the interoperability of AssetCare with popular cloud systems that it does not control, such as Google. Any changes in such systems that degrade the functionality of mCloud’s products or give preferential treatment to competitive products could adversely affect mCloud’s business and financial results.

Reliance on third party networks.

mCloud is dependent on third party mobile networks such as those provided by major telecommunications companies to provide services. These third-party networks are controlled by third parties and are subject to compromise or failure. Extended disruptions of such networks could adversely affect mCloud’s business and financial results.

If mCloud is not able to maintain and enhance the AssetCare brand, or if events occur that damage the AssetCare reputation and brand, mCloud’s ability to expand its base of users may be impaired, which could adversely affect mCloud’s business and financial results.

mCloud believes that the AssetCare brand will significantly contribute to the success of its business. mCloud also believes that maintaining and enhancing its own brands, the AssetCare brand, is critical to expanding its base of users. Many of its new users are referred by existing users, and therefore mCloud strives to ensure that users remain favorably inclined towards AssetCare. Maintaining and enhancing the AssetCare brand will depend largely on mCloud’s ability to continue to provide useful, reliable, trustworthy, and innovative products, which it may not do successfully. mCloud may introduce new products or terms of service that users do not like, which could adversely affect mCloud’s business and financial results.

If mCloud fails to increase market awareness of AssetCare and expand sales and marketing operations, mCloud’s business and financial results could be adversely affected.

mCloud believes that the AssetCare brand will continue to significantly contribute to the success of its business. mCloud intends to spend significant resources on increasing the market awareness of the AssetCare brand and expanding its sales and marketing operations. There is no guarantee that mCloud will be successful in its efforts to increase market awareness. Failure to increase market awareness of the AssetCare brand or the failure of customers to adopt the AssetCare brand could adversely affect mCloud’s business and financial results.

If mCloud does not continue to develop technologically advanced products that successfully integrate with the software products and enhancements used by its customers, future revenues and its operating results may be negatively affected.

mCloud’s success depends upon its ability to design, develop, test, market, license and support new software products, services, and enhancements of current products and services on a timely basis in response to both competitive threats and marketplace demands. The software industry is increasingly focused on cloud computing, mobility, social media, and SaaS among other continually evolving shifts. In addition, mCloud’s software products, services, and enhancements must remain compatible with standard platforms and file formats. Often, mCloud must integrate software licensed or acquired from third parties with its proprietary software to create or improve its products. If mCloud is unable to achieve a successful integration with third party software, it may not be successful in developing and marketing its new software products, services, and enhancements. If mCloud is unable to successfully integrate third party software to develop new software products, services, and enhancements to existing software products and services, or to complete the development of new software products and services which it licenses or acquires from third parties, its operating results will materially suffer. In addition, if the integrated or new products or enhancements do not achieve acceptance by the marketplace, mCloud’s operating results will materially suffer. Moreover, if new industry standards emerge that mCloud does not anticipate or adapt to, or with rapid technological change occurring, if alternatives to its services and solutions are developed by its competitors, its software products and services could be rendered obsolete, causing it to lose market share and, as a result, harm its business and operating results and its ability to compete in the marketplace.

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mCloud’s new products and changes to existing products could fail to attract or retain users or generate revenue.

mCloud’s ability to retain, increase, and engage its user base and to increase its revenue will depend heavily on mCloud’s ability to create or acquire successful new products, both independently and in conjunction with software and platform developers or other third parties.

mCloud may introduce significant changes to its existing products or develop and introduce new and unproven products, including using technologies with which it has little or no prior development or operating experience. If new or enhanced products fail to engage users, mCloud may fail to attract or retain users or to generate sufficient revenue, operating margin, or other value to justify certain investments, and the business may be adversely affected. In the future, mCloud may invest in new products and initiatives to generate revenue. There is no guarantee these approaches will be successful. If mCloud is not successful with new approaches to monetization, it may not be able to maintain or grow its revenue as anticipated or recover any associated development costs, which could adversely affect mCloud’s business and financial results.

mCloud may be unable to meet its ESG-related targets and objectives.

As environmental, social and governance (ESG) forms a significant part of mCloud’s overall value proposition, mCloud may, especially in its public disclosure, voluntary or otherwise, set certain targets and goals with respect to its own ESG performance and its efforts to help existing and future users meet their ESG-related goals. Investors may choose to invest in mCloud in partial or total reliance on these ESG targets and goals. In spite of mCloud’s commitment and allocation of resources accordingly, there is no guarantee that such goals will be met.

mCloud may incur liability as a result of information retrieved from or transmitted over or through mCloud products or network.

mCloud may face claims relating to information that is retrieved from or transmitted over the Internet or through mCloud and claims related to mCloud’s products. In particular, the nature of mCloud’s business exposes it to claims related to intellectual property rights, rights of privacy, and personal injury torts.

Changes in worldwide capital spending and continued economic growth may have a material adverse effect on mCloud.

One factor that significantly affects mCloud’s financial results is the impact of economic conditions on the willingness of mCloud’s current and potential customers to make capital investments. Changes in economic growth or the global economy could lead customers to be cautious about capital spending, which places additional pressure on departments to demonstrate acceptable return on investment. Uncertain worldwide economic and political environments, and uncertain policy directives, would make it difficult for mCloud, its customers and suppliers to accurately predict future product demand, which could result in an inability to satisfy demand for mCloud’s products and a loss of market share. mCloud’s revenues may decline in such circumstances and profit margins could be eroded, or mCloud could incur significant losses.

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Moreover, economic conditions worldwide may contribute to slowdowns in the markets in which mCloud operates, resulting in reduced demand for mCloud’s solutions as a result of customers choosing to refrain from capital investments.

Turmoil in the geopolitical environment in many parts of the world, including terrorist activities and military actions, as well as political and economic issues in many regions, may put pressure on global economic conditions. mCloud’s business and financial results and its ability to expand into other international markets may also be affected by changing economic conditions particularly germane to that sector or to particular customer markets within that sector.

mCloud is exposed to fluctuations in currency exchange rates that could negatively impact mCloud’s business and financial result.

Because a portion of mCloud’s business is conducted outside of North America, mCloud faces exposure to adverse movements in foreign currency exchange rates. These exposures may change over time as business practices evolve, which could adversely affect mCloud’s business and financial results.

Any changes to existing accounting pronouncements or taxation rules or practices may affect how mCloud conducts business.

New accounting pronouncements, taxation rules and varying interpretations of accounting pronouncements or taxation rules have occurred in the past and may occur in the future. The change to existing rules, future changes, if any, or the need for mCloud to modify a current tax position may adversely affect the way mCloud conducts business.

mCloud’s business is subject to complex and evolving domestic and foreign laws and regulations. Many of these laws and regulations are subject to change and uncertain interpretation, and could result in claims, changes to mCloud’s business practices, increased cost of operations, or declines in user growth or engagement, or otherwise harm mCloud’s business.

mCloud is subject to a variety of laws and regulations in the United States and abroad that involve matters central to its business, including user privacy, data protection, intellectual property, distribution, contracts and other communications, competition, consumer protection, and taxation. Foreign laws and regulations are often more restrictive than those in the United States. These U.S. federal and state and foreign laws and regulations are constantly evolving and can be subject to significant change. In addition, the application and interpretation of these laws and regulations are often uncertain, particularly in the new and rapidly evolving industry in which mCloud operates. Existing and proposed laws and regulations may be costly to comply with and can delay or impede the development of new products, result in negative publicity, increase mCloud’s operating costs, require significant management time and attention, and subject mCloud to claims or other remedies, including fines or demands that mCloud modify or cease existing business practices.

mCloud’s business is highly competitive. Competition presents an ongoing threat to the success of its business. If mCloud fails to compete successfully against industry peers, mCloud’s ability to increase revenues and achieve profitability will be impaired.

In North American and international markets, mCloud faces competition from various types of technology and remote asset management businesses. mCloud directly competes with global asset care management companies, including: IBM Corporation, AT&T Intellectual Property, Hitachi, Ltd., Verizon Communications, Inc., PTC Inc., SAP GE, Rockwell Automation, Inc., Schneider Electric SE, Infosys Limited, Honeywell International Inc., Siemens AG, and General Electric Company, among others.

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As mCloud introduces new products and as its existing products evolve, or as other companies introduce new products and services, mCloud may become subject to additional competition.

Some of mCloud’s current and potential competitors have significantly greater resources and hold advantageous competitive positions in certain market segments than mCloud currently holds. These factors may allow mCloud’s competitors to respond more effectively than mCloud to new or emerging technologies and changes in market requirements. mCloud’s competitors may develop products that are similar to mCloud’s or that achieve greater market acceptance, may undertake more far-reaching and successful product development efforts or marketing campaigns, or may adopt more aggressive pricing policies. Certain competitors could use strong or dominant positions in one or more markets to gain a competitive advantage against mCloud. As a result, mCloud’s competitors may acquire and engage users of mCloud’s current products at the expense of the growth or engagement of its user base, which could adversely affect mCloud’s business and financial results.

mCloud believes that its ability to compete effectively depends upon many factors both within and beyond mCloud’s control, including:

• the usefulness, ease of use, performance, and reliability of mCloud’s products compared to its competitors;

• the size and composition of mCloud’s user base;

• the engagement of mCloud’s users with its products;

• the timing and market acceptance of mCloud’s products, including developments and enhancements, or similar improvements by its competitors;

• mCloud’s ability to monetize its products, including its ability to successfully monetize AssetCare;

• customer service and support efforts;

• marketing and selling efforts;

• mCloud’s financial condition and results of operations;

• changes mandated by legislation, regulatory authorities, or litigation, including settlements and consent decrees, some of which may have a disproportionate effect on mCloud;

• acquisitions or consolidation within mCloud’s industry, which may result in more formidable competitors;

• mCloud’s ability to attract, retain, and motivate talented employees, particularly computer engineers;

• mCloud’s ability to cost-effectively manage and grow its operations; and

• the mCloud reputation and brand strength relative to competitors.

If mCloud is not able to effectively compete, its user base and level of user engagement may decrease, which could adversely affect mCloud’s business and financial results.

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mCloud’s compensation structure may hinder its efforts to attract and retain vital employees.

A portion of mCloud’s total compensation program for its executive officers and key personnel includes the award of options or restricted stock units to buy Common Shares. If the market price of the Common Shares performs poorly, such performance may adversely affect mCloud’s ability to retain or attract critical personnel. In addition, any changes made to mCloud’s equity incentive award policies, or to any other of its compensation practices, which are made necessary by governmental regulations or competitive pressures, could adversely affect its ability to retain and motivate existing personnel and recruit new personnel. For example, any limit to total compensation which may be prescribed by the government or applicable regulatory authorities or any significant increases in personal income tax levels levied in countries where mCloud has a significant operational presence may hurt its ability to attract or retain its executive officers or other employees whose efforts are vital to its success. Additionally, payments under mCloud’s long-term incentive plan are dependent to a significant extent upon the future performance of mCloud both in absolute terms and in comparison, to similarly situated companies. Any failure to achieve the targets set under mCloud’s long-term incentive plan could significantly reduce or eliminate payments made under this plan, which may, in turn, materially and adversely affect its ability to retain the key personnel who are subject to this plan.

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The price of the securities of mCloud may fluctuate significantly, which may make it difficult for holders of securities of mCloud to sell its securities at a time or price they find attractive.

mCloud’s stock price may fluctuate significantly as a result of a variety of factors, many of which are beyond its control. In addition to those described under “Forward-Looking Statements”, these factors include:

• actual or anticipated quarterly fluctuations in its financial results and financial condition;

• changes in financial estimates or publication of research reports and recommendations by financial analysts with respect to it or other financial institutions;

• reports in the press or investment community generally or relating to mCloud’s reputation or the industry in which it operates;

• strategic actions by mCloud or its competitors, such as acquisitions, restructurings, dispositions, or financings;

• fluctuations in the stock price and financial results of mCloud’s competitors;

• future sales of mCloud’s equity or equity-related securities;

• proposed or adopted regulatory changes or developments;

• domestic and international economic factors unrelated to mCloud’s performance; and

• general market conditions and, in particular, developments related to market conditions for the remote asset management industry.

In addition, in recent years, the stock market in general has experienced extreme price and volume fluctuations. This volatility has had a significant effect on the market price of securities issued by many companies, including for reasons unrelated to their operating performance. These broad market fluctuations may adversely affect mCloud’s stock price, notwithstanding mCloud’s financial results. mCloud expects that the market price of the Common Shares will fluctuate and there can be no assurances about the levels of the market prices for such Common Shares.

mCloud does not know whether an active, liquid and orderly trading market will develop for the securities of mCloud or what the market price of the securities of mCloud will be, and as a result it may be difficult for investors to sell its securities of mCloud.

An active trading market for securities of mCloud may not be sustained. The lack of an active market may impair an investor’s ability to sell its securities of mCloud at the time they wish to sell them or at a price that they consider reasonable. The lack of an active market may also reduce the fair market value of an investor’s securities of mCloud. Further, an inactive market may also impair mCloud’s ability to raise capital by selling securities of mCloud and may impair its ability to enter into collaborations or acquire companies or products by using securities of mCloud as consideration. The market price of securities of mCloud may be volatile, and an investor could lose all or part of their investment.

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mCloud does not intend to pay dividends on the Common Shares for the foreseeable future.

mCloud currently does not plan to declare dividends on the Common Shares in the foreseeable future. Any determination to pay dividends in the future will be at the discretion of the Board. Consequently, an investor’s only opportunity to achieve a return on the investment in mCloud will be if the market price of Common Shares appreciates and the investor sells shares at a profit. There is no guarantee that the trading price of mCloud’s Common Shares in the market will ever exceed the price that an investor paid.

If research analysts do not publish research about mCloud’s business or if they issue unfavorable commentary or downgrade mCloud’s securities, mCloud’s stock price and trading volume could decline.

The trading market for the securities of mCloud may depend in part on the research and reports that research and investment analysts publish about mCloud and its business. If mCloud does not maintain adequate research coverage, or if one or more analysts who covers mCloud downgrades its stock, or publishes inaccurate or unfavorable research about mCloud’s business, the price of mCloud’s securities could decline. If one or more of the research analysts ceases to cover mCloud or fails to publish reports on it regularly, demand for securities of mCloud could decrease, which could cause mCloud’s stock price or trading volume to decline.

The market price of mCloud’s securities may decline due to the large number of outstanding Shares eligible for future sale.

Sales of substantial amounts of mCloud securities in the public market, or the perception that these sales could occur, could cause the market price of the securities to decline. These sales could also make it more difficult for mCloud to sell equity or equity-related securities in the future at a time and price that it deems appropriate.

Certain shares, such as those shares subject to lock-up agreements, will have restrictions on trading.

mCloud may also issue Common Shares or securities convertible into Common Shares from time to time in connection with a financing, acquisition or otherwise. Any such issuance could result in substantial dilution to existing holders of securities and cause the trading price of mCloud’s securities to decline.

mCloud may issue additional equity securities or engage in other transactions that could dilute its book value or affect the priority of Common Shares or Series A Preferred Shares, which may adversely affect the market price of the Common Shares or Series A Preferred Shares.

The Board may determine from time to time that it needs to raise additional capital by issuing additional Common Shares or other securities in connection with its business and strategic plans, particularly with respect to its growing operations. Except as otherwise described in this prospectus, mCloud will not be restricted from issuing additional Common Shares, including securities that are convertible into or exchangeable for, or that represent the right to receive, Common Shares. Because mCloud’s decision to issue securities in any future offering will depend on market conditions and other factors beyond mCloud’s control, it cannot predict or estimate the amount, timing, or nature of any future offerings, or the prices at which such offerings may be affected. There is no assurance that the Company will be successful in obtaining required financing as and when needed on acceptable terms, if at all. Additional equity offerings may dilute the holdings of its existing shareholders thereby reducing the value of their investments, or reduce the market price of its common stock, or both. Holders of Common Shares are not entitled to pre-emptive rights or other protections against dilution. New investors also may have rights, preferences and privileges that are senior to, and that adversely affect, mCloud’s then-current holders of Common Shares. Additionally, if mCloud raises additional capital by making offerings of debt or preference shares, upon liquidation of mCloud, holders of its debt securities and preference shares, and lenders with respect to other borrowings, may receive distributions of its available assets before the holders of Common Shares.

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mCloud is a holding company.

mCloud is a holding company and may have no material non-financial assets other than its direct ownership of its subsidiaries. mCloud will have no independent means of generating revenue. To the extent that mCloud needs funds beyond its own financial resources to pay liabilities or to fund operations, and its subsidiaries are restricted from making distributions to it under applicable laws or regulations or agreements, or do not have sufficient earnings to make these distributions, mCloud may have to borrow or otherwise raise funds sufficient to meet these obligations and operate its business and, thus, its liquidity and financial condition could be materially adversely affected.

mCloud may suffer reduced profitability if it loses foreign private issuer status in the United States.

If, as of the last business day of mCloud’s second fiscal quarter for any year, more than 50% of mCloud’s outstanding voting securities (as defined in the United States Securities Act of 1933) are directly or indirectly held of record by residents of the United States, mCloud will no longer meet the definition of a “Foreign Private Issuer” under the rules of the U.S. Securities and Exchange Commission. If mCloud fails to qualify for Foreign Private Issuer status, it will remain unqualified unless it meets the test as of the last business day of its second fiscal quarter. This change in status could have a significant effect on the Company as it would significantly complicate the raising of capital through the offer and sales of securities and reporting requirements, resulting in increased audit, legal and administration costs. The ability of mCloud to be profitable could be significantly affected.

Asset Location and Legal Proceedings.

mCloud has assets located outside of Canada, and therefore it may be difficult to enforce judgments obtained by mCloud in foreign jurisdictions by Canadian courts. Similarly, to the extent that mCloud’s assets are located outside of Canada, investors may have difficulty collecting from mCloud any judgments obtained in Canadian courts and predicated on the civil liability provisions of applicable securities legislation. Furthermore, mCloud may be subject to legal proceedings and judgments in foreign jurisdictions and it may be difficult for U.S. stockholders to effect service of process against the officers of mCloud.

mCloud is exposed to credit risk.

Credit risk is the risk that a third party might fail to discharge its obligations under the terms of a financial contract. Credit risk is limited to the following instruments and mCloud’s maximum exposure to credit risk is the carrying value of the financial assets.

mCloud is mainly exposed to credit risk from credit sales. Management monitors the creditworthiness of its customers by performing background checks on all new customers. Further, management monitors the frequency of payments from ongoing customers and performs frequent reviews of outstanding balances. mCloud considers that there has been a significant increase in credit risk when contractual payments are more than 90 days past due.

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Provisions for outstanding balances are established based on forward-looking information and revised when there are changes in circumstances that would create doubt over the receipt of funds. Such reviews are conducted on a continued basis through the monitoring of outstanding balances as well as the frequency of payments received. Accounts receivable are completely written off once management determines the probability of collection to be remote.

Trade and other receivables, unbilled revenue and long-term receivables are from individual customers and are not assessed based on external credit rating agencies. mCloud uses a provision matrix to measure the lifetime expected credit loss of these balances. Receivables are grouped based on similar credit risk profiles and days past due. Loss rates are based on actual credit loss experience and reflect the forward-looking conditions over the expected life of the receivable.

If the debenture trustee elects or is instructed to enforce payment under the Indenture and mCloud is unable to pay all amounts owing thereunder, mCloud’s business and results of operations could be adversely affected

mCloud is currently in default under the convertible debenture indenture dated November 14, 2019 (the “Indenture”) governing its 10% convertible unsecured debentures (the “2019 Debentures”) as a result of its failure to pay the outstanding principal and interest owing under the 2019 Debentures, being $23,740,275 in the aggregate (the “Outstanding Amount”), on or before the maturity date of June 30, 2022, and the subsequent 10 business day cure period. As such, pursuant to the terms of the Indenture, the debenture trustee may at any time during the period of default, in its discretion, and shall, upon direction of the holders of not less than 25% in principal amount of the outstanding 2019 Debentures, declare the Outstanding Amount, and interest incurred thereon during the period of default, to be immediately due and payable. If mCloud were to fail to pay such amounts forthwith following such demand, the debenture trustee may, in its discretion, and shall, upon direction of the holders of not less than 25% of the 2019 Debentures (subject to the debenture trustee being funded and indemnified against the costs of such), proceed to obtain or enforce payment of such amounts. Although mCloud intends to repay the Outstanding Amount and all interest incurred thereon during the period of default using a portion of the proceeds of the Offering, there can be no assurance that sufficient proceeds will be raised in the Offering to fully or partially satisfy payment of such amounts. If the debenture trustee elects or is instructed to enforce payment under the Indenture and mCloud is unable to pay all amounts owing thereunder, mCloud’s business and results of operations could be adversely affected. The Indenture does not contain default penalty or interest rate terms.

mCloud is exposed to interest rate risk.

Interest rate risk is the risk that the fair value or future cash flows of mCloud’s financial instruments will fluctuate because of changes in market interest rates. mCloud is exposed to interest rate risk on its credit facility and factoring facility with Nations Interbanc as these instruments have variable rates. Management does not believe interest rate risk is currently material to its business.

Risks Related to Our Securities and this Offering

This offering is being conducted on a “best efforts” basis and is subject to a minimum investment amount.

The placement agent is offering the Series A Preferred Shares and Warrants on a “best efforts” basis, and the placement agent is under no obligation to purchase any Series A Preferred Shares or Warrants for their own account. The placement agent is not required to sell any specific number or dollar amount of securities in this offering but will use their best efforts to sell the securities offered in this prospectus. As a “best efforts” offering, there can be no assurance that the offering contemplated hereby will ultimately be consummated. We do not intend to close this offering unless we sell at least a minimum number of Series A Preferred Shares and Warrants to result in gross proceeds equal to or greater than $15,000,000 (the “Minimum Amount”). Because this is a best efforts offering, the placement agent does not have an obligation to purchase any securities, and, as a result, there is a possibility that we may not be able to sell the minimum offering amount. We expect that the offering will end on the first to occur of (i) the sale of the maximum number of Series A Preferred Shares and Warrants resulting in gross proceeds of $35,000,000 and (ii) the conclusion of the 60 day offering period. Unless the Minimum Amount is subscribed for and accepted by the Company by the conclusion of the offering period, or waived by the Company, the offering will be terminated, and all subscription proceeds will be returned to investors without interest or deduction.

The Series A Preferred Shares represent perpetual equity interests.

The Series A Preferred Shares represent perpetual equity interests in us and, unlike our indebtedness, will not give rise to a claim for payment of a principal amount at a particular date. As a result, holders of the Series A Preferred Shares may be required to bear the financial risks of an investment in the Series A Preferred Shares for an indefinite period of time.

If the Series A Preferred Shares are delisted from Nasdaq, the ability to transfer or sell the Series A Preferred Shares may be limited and the market value of the Series A Preferred Shares will likely be materially adversely affected.

We plan to list the Series A Preferred Shares on Nasdaq and the Series A Preferred Shares do not contain provisions that are intended to protect investors if the Series A Preferred Shares are delisted from Nasdaq. In order to maintain that listing, we must satisfy all of the following continued listing requirements:

(1) Minimum bid price of at least $1 per share;

(2) At least 100 Public Holders;

(3) At least 100,000 Publicly Held Shares;

(4) Market Value of Publicly Held Shares of at least $1 million; and

(5) At least two registered and active Market Makers, one of which may be a Market Maker entering a stabilizing bid.

There can be no assurances that we will be able to comply with the applicable listing standards. If the Series A Preferred Shares are delisted from Nasdaq, investors’ ability to transfer or sell the Series A Preferred Shares will be limited and the market value of the Series A Preferred Shares will likely be materially adversely affected. Moreover, since the Series A Preferred Shares have no stated maturity date, investors may be forced to hold the Series A Preferred Shares indefinitely while receiving stated dividends thereon when, as and if authorized by the Board and paid by us with no assurance as to ever receiving the liquidation value thereof.

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We may incur additional indebtedness and obligations to pay dividends on preferred stock, some of which may be senior to the rights of the Series A Preferred Shares.

We and our subsidiaries may incur additional indebtedness and obligations to pay cumulative dividends on preferred stock, some of which may be senior to the rights of the Series A Preferred Shares. The terms of the Series A Preferred Shares do not prohibit us or our subsidiaries from incurring additional indebtedness or issuing additional series of preferred stock. Any such indebtedness will in all cases be senior to the rights of holders of Series A Preferred Shares. We may also issue additional series of preferred stock that contain dividend rights and liquidation preferences that are senior to the rights of holders of Series A Preferred Shares. Our subsidiaries may also incur indebtedness that is structurally senior to the Series A Preferred Shares, and we and our subsidiaries could incur indebtedness secured by a lien on our assets, entitling the holders of such indebtedness to be paid first from the proceeds of such assets. If we issue any additional preferred stock that ranks senior or pari passu with the Series A Preferred Shares, the holders of those shares will be entitled to a senior or ratable share with the holders of the Series A Preferred Shares in any proceeds distributed in connection with our insolvency, liquidation, reorganization or dissolution. This may have the effect of reducing the amount of proceeds paid to the holders of Series A Preferred Shares.

Market interest rates may adversely affect the value of the Series A Preferred Shares.

One of the factors that continues to influence the price of the Series A Preferred Shares will be the dividend yield on the Series A Preferred Shares (as a percentage of the price of the Series A Preferred Shares) relative to market interest rates. An increase in market interest rates may lead prospective purchasers of the Series A Preferred Shares to expect a higher dividend yield, and higher interest rates would likely increase our borrowing costs and potentially decrease funds available for dividends. Accordingly, higher market interest rates could cause the market price of the Series A Preferred Shares to decrease.

The amount of the liquidation preference on the Series A Preferred Shares is fixed and investors in this Offering that receive Series A Preferred Shares will have no right to receive any greater payment.

The payment due upon liquidation on the Series A Preferred Shares is fixed at the liquidation preference of $25.00 per share, plus an amount equal to all accumulated and unpaid dividends thereon to the date of liquidation, whether or not declared. If, in the case of our liquidation, there are remaining assets to be distributed after payment of this amount, you will have no right to receive or to participate in these amounts. In addition, if the market price of a holder’s Series A Preferred Shares is greater than the liquidation preference, such holder will have no right to receive the market price from us upon our liquidation.

There may be future sales of Series A Preferred Shares or similar securities, which may adversely affect the market price of the Series A Preferred Shares.

Subject to the terms of the Certificate of Designations, our Articles of Incorporation and Canadian law, we are not restricted from issuing additional Series A Preferred Shares or securities similar to the Series A Preferred Shares, including any securities that are convertible into or exchangeable for, or that represent the right to receive, Series A Preferred Shares. Holders of the Series A Preferred Shares have no preemptive rights that entitle holders to purchase their pro rata share of any offering of shares of any class or series. The market price of the Series A Preferred Shares could decline as a result of sales of Series A Preferred Shares, sales of other securities made after this Offering or the Registered Direct Offering, or as a result of the perception that such sales could occur. Because our decision to issue securities in any future offering will depend on market conditions and other factors beyond our control, we cannot predict or estimate the amount, timing or nature of any future offerings. Thus, holders of the Series A Preferred Shares bear the risk of our future offerings reducing the market price of the Series A Preferred Shares and diluting their holdings in the Series A Preferred Shares.

The Series A Preferred Shares may not have an active trading market.

The Series A Preferred Shares are a recent issue of securities and do not have a long-established trading market. Although we plan to list the Series A Preferred Shares on Nasdaq, we cannot assure you that an active market for the Series A Preferred Shares will be sustained or that holders of the Series A Preferred Shares will be able to sell their Series A Preferred Shares at favorable prices or at all. The difference between bid and ask prices in any secondary market for the Series A Preferred Shares could be substantial. Accordingly, no assurance can be given as to the liquidity of, or trading market for, the Series A Preferred Shares, and holders of the Series A Preferred Shares may be required to bear the financial risks of an investment in the Series A Preferred Shares for an indefinite period of time.

The voting rights of holders of the Series A Preferred Shares are limited.

Holders of the Series A Preferred Shares have no voting rights with respect to matters that generally require the approval of voting shareholders. The limited voting rights of holders of the Series A Preferred Shares include the right to vote as a single class on certain matters that may affect the preference or special rights of the Series A Preferred Shares, as described under “Description of the Series A Preferred Shares—Limited Voting Rights”.

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Dividends or other payments with respect to the Series A Preferred Shares may be subject to withholding taxes in circumstances where we are not obliged to make gross up payments, and this could result in holders receiving less than expected in such circumstances.

In the event of certain changes to current tax law that require tax to be withheld from dividends or other payments on the Series A Preferred Shares, we are not required to make gross up payments in respect of such taxes. This would result in holders of Series A Preferred Shares receiving less than expected and could materially adversely affect the return on your investment.

The Warrants are speculative in nature.

The Warrants will be exercisable until November 29, 2026, at an initial exercise price equal of $4.75. There can be no assurance that the market price of the Common Shares will ever equal or exceed the exercise price of the Warrants. In the event that our common share price does not exceed the exercise price of the Warrants during the period when the Warrants are exercisable, a holder of Warrants may be unable to profit from exercising such Warrants before they expire.

Except as otherwise provided in the Warrants, holders of Warrants purchased in this offering will have no rights as shareholders until such holders exercise their Warrants and acquire our common stock.

Except as otherwise provided in the Warrants, until holders of Warrants acquire our Common Shares upon exercise of the Warrants, holders of Warrants will have no rights with respect to our Common Shares underlying such Warrants. Upon exercise of the Warrants, the holders will be entitled to exercise the rights of a holder of our Common Shares only as to matters for which the record date occurs after the exercise date.

Additional stock offerings in the future may dilute then-existing shareholders’ percentage ownership of the Company.

Given our plans and expectations that we will need additional capital and personnel, we anticipate that we will need to issue additional Common Shares or securities convertible or exercisable for Common Shares, including convertible preferred stock, convertible notes, stock options or warrants. The issuance of additional securities in the future will dilute the percentage ownership of then current stockholders.

The requirements of being a public company may strain mCloud’s resources, divert management’s attention and affect its ability to attract and retain executive management and qualified board members.

As a reporting issuer, mCloud is subject to the reporting requirements of applicable securities legislation of the jurisdiction in which it is a reporting issuer, the listing requirements of Nasdaq and the TSXV and other applicable securities rules and regulations. Compliance with these rules and regulations will increase mCloud’s legal and financial compliance costs, make some activities more difficult, time consuming or costly and increase demand on its systems and resources. Applicable securities laws will require mCloud to, among other things, file certain annual and quarterly reports with respect to its business and results of operations. In addition, applicable securities laws require mCloud to, among other things, maintain effective disclosure controls and procedures and internal control over financial reporting.

In order to maintain and, if required, improve its disclosure controls and procedures and internal control over financial reporting to meet this standard, significant resources and management oversight are required. Specifically, due to the increasing complexity of its transactions, it is anticipated that mCloud will improve its disclosure controls and procedures and internal control over financial reporting primarily through the continued development and implementation of formal policies, improved processes and documentation procedures, as well as the continued sourcing of additional finance resources. As a result, management’s attention may be diverted from other business concerns, which could harm mCloud’s business and results of operations. To comply with these requirements, mCloud may need to hire more employees in the future or engage outside consultants, which will increase its costs and expenses.

In addition, changing laws, regulations and standards relating to corporate governance and public disclosure are creating uncertainty for public companies, increasing legal and financial compliance costs and making some activities more time consuming. These laws, regulations and standards are subject to varying interpretations, in many cases due to their lack of specificity, and, as a result, their application in practice may evolve over time as new guidance is provided by regulatory and governing bodies. This could result in continuing uncertainty regarding compliance matters and higher costs necessitated by ongoing revisions to disclosure and governance practices. mCloud intends to continue to invest resources to comply with evolving laws, regulations and standards, and this investment may result in increased general and administrative expenses and a diversion of management’s time and attention from revenue-generating activities to compliance activities. If its efforts to comply with new laws, regulations and standards differ from the activities intended by regulatory or governing bodies due to ambiguities related to their application and practice, regulatory authorities may initiate legal proceedings against mCloud, which could adversely affect mCloud’s business and financial results.

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As a public company subject to these rules and regulations, mCloud may find it more expensive for it to obtain director and officer liability insurance, and it may be required to accept reduced coverage or incur substantially higher costs to obtain coverage. These factors could also make it more difficult for mCloud to attract and retain qualified members of its Board, particularly to serve on its Audit Committee and Compensation Committee, and qualified executive officers.

As a result of disclosure of information in filings required of a public company, mCloud’s business and financial condition will become more visible, which may result in threatened or actual litigation, including by competitors and other third parties. If such claims are successful, mCloud’s business and results of operations could be harmed, and even if the claims do not result in litigation or are resolved in its favor, these claims, and the time and resources necessary to resolve them, could divert the resources of mCloud’s management and harm its business and results of operations. 

We are a “foreign private issuer” and may have disclosure obligations that are different from those of U.S. domestic reporting companies. As a foreign private issuer, we are subject to different U.S. securities laws and rules than a domestic U.S. issuer, which could limit the information publicly available to our shareholders.

As a “foreign private issuer,” we are subject to reporting obligations that, in certain respects, are less detailed and less frequent than those of U.S. domestic reporting companies. For example, we are not required to issue quarterly reports, proxy statements that comply with the requirements applicable to U.S. domestic reporting companies, or individual executive compensation information that is as detailed as that required of U.S. domestic reporting companies. We will also have four months after the end of each fiscal year to file our annual reports with the SEC and will not be required to file current reports as frequently or promptly as U.S. domestic reporting companies. Furthermore, our officers, directors and principal shareholders are exempt from the insider reporting and short-swing profit recovery requirements in Section 16 of the Exchange Act. Accordingly, our shareholders may not know on as timely a basis when our officers, directors and principal shareholders purchase or sell their Common Shares, as the reporting deadlines under the corresponding Canadian insider reporting requirements are not applicable. As a foreign private issuer, we are also exempt from the requirements of Regulation FD (Fair Disclosure) which, generally, are meant to ensure that select groups of investors are not privy to specific information about an issuer before other investors. As a result of such varied reporting obligations, shareholders should not expect to receive the same information at the same time as information provided by U.S. domestic companies.

In addition, as a foreign private issuer, we have the option to follow certain Canadian corporate governance practices rather than those of the United States, except to the extent that such laws would be contrary to U.S. securities laws, provided that we disclose the requirements we are not following and describe the Canadian practices we follow instead. As a result, our shareholders may not have the same protections afforded to shareholders of companies that are subject to all domestic U.S. corporate governance requirements.

We may lose our “foreign private issuer” status in the future, which could result in additional costs and expenses to us.

We are a “foreign private issuer,” as such term is defined in Rule 405 under the Securities Act of 1933, as amended (the “Securities Act”), and are not subject to the same requirements that are imposed upon U.S. domestic issuers by the SEC. We may in the future lose foreign private issuer status if a majority of our Common Shares are held in the United States and we fail to meet the additional requirements necessary to avoid loss of foreign private issuer status, such as if: (i) a majority of our directors or executive officers are U.S. citizens or residents; (ii) a majority of our assets are located in the United States; or (iii) our business is administered principally in the United States. The regulatory and compliance costs to us under U.S. securities laws as a U.S. domestic issuer would be significantly more than the costs incurred as an Canadian foreign private issuer. If we are not a foreign private issuer, we would be required to file periodic and current reports and registration statements on U.S. domestic issuer forms with the SEC, which are generally more detailed and extensive than the forms available to a foreign private issuer. In addition, we may lose the ability to rely upon exemptions from corporate governance requirements that are available to foreign private issuers.

We are an “emerging growth company,” and any decision on our part to comply only with certain reduced reporting and disclosure requirements applicable to emerging growth companies could make our Common Shares less attractive to investors.

We are an “emerging growth company,” as defined in Section 2(a) of the Securities Act. For as long as we continue to be an “emerging growth company,” we may choose to take advantage of exemptions from various reporting requirements applicable to other public companies that are not “emerging growth companies,” including, but not limited to, not being required to have our independent registered public accounting firm audit our internal control over financial reporting under Section 404, reduced disclosure obligations regarding executive compensation in our periodic reports and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. We could be an “emerging growth company” until the fifth anniversary of the fiscal year end date following the completion of this offering, however, our status would change more quickly if we have more than US$1.07 billion in annual revenue, if the market value of our Common Shares held by non-affiliates equals or exceeds US$700 million as of June 30 of any year, or we issue more than US$1.0 billion of non-convertible debt over a three-year period before the end of that period. We have not opted into the extended transition period for emerging growth companies under the JOBS Act for complying with new or revised accounting standards.

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Investors could find our Common Shares less attractive if we choose to rely on these exemptions. If some investors find our Common Shares less attractive as a result of any choices to reduce future disclosure, there may be a less active trading market for our Common Shares and our share price may be more volatile.

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If we fail to maintain an effective system of internal control over financial reporting, we may not be able to accurately report our financial results or prevent fraud. As a result, shareholders could lose confidence in our financial and other public reporting, which would harm our business and the trading price of our securities.

Effective internal controls over financial reporting are necessary for us to provide reliable financial reports and, together with adequate disclosure controls and procedures, are designed to prevent fraud. Any failure to implement required new or improved controls, or difficulties encountered in their implementation could cause us to fail to meet our reporting obligations. In addition, any testing by us conducted in connection with Section 404 or any subsequent testing by our independent registered public accounting firm, may reveal deficiencies in our internal controls over financial reporting that are deemed to be material weaknesses or that may require prospective or retroactive changes to our financial statements or identify other areas for further attention or improvement. Inferior internal controls could also cause investors to lose confidence in our reported financial information, which could have a negative effect on the trading price of our securities.

For as long as we are an “emerging growth company”, our independent registered public accounting firm will not be required to attest to the effectiveness of our internal controls over financial reporting pursuant to Section 404. We could be an “emerging growth company” until the fifth anniversary of the fiscal year end date following the completion of this offering. An independent assessment of the effectiveness of our internal controls could detect problems that our management’s assessment might not. Undetected material weaknesses in our internal controls could lead to financial statement restatements and require us to incur the expense of remediation.

If we identify material weaknesses in our internal control over financial reporting, or if we are unable to comply with the requirements of Section 404 in a timely manner or assert that our internal control over financial reporting is effective, or if our independent registered public accounting firm is unable to express an opinion as to the effectiveness of our internal control over financial reporting when required, investors may lose confidence in the accuracy and completeness of our financial reports and the market price of our securities could be negatively affected, and we could become subject to investigations by the stock exchange on which our securities are listed, the SEC, or other regulatory authorities, which could require additional financial and management resources.

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Our management team will have broad discretion to use the net proceeds from this offering and its investment of these proceeds may not yield a favorable return. They may invest the proceeds of this offering in ways with which investors disagree.

Our management team will have broad discretion in the application of the net proceeds from this offering and could spend or invest the proceeds in ways with which our shareholders disagree. Accordingly, investors will need to rely on our management team’s judgment with respect to the use of these proceeds. We intend to use the proceeds from this offering in the manner described in the section entitled “Use of Proceeds.” The failure by management to apply these funds effectively could negatively affect our ability to operate and grow our business.

We cannot specify with certainty all of the particular uses for the net proceeds to be received upon the closing of this offering. In addition, the amount, allocation and timing of our actual expenditures will depend upon numerous factors. Accordingly, we will have broad discretion in using these proceeds. Until the net proceeds are used, they may be placed in investments that do not produce significant income or that may lose value.

The market price of shares may be subject to wide price fluctuations.

The market price of our securities may be subject to wide fluctuations in response to many factors, including variations in the financial results of mCloud and its subsidiaries, divergence in financial results from analysts’ expectations, changes in earnings estimates by stock market analysts, changes in the business prospects for mCloud and its subsidiaries, general economic conditions, legislative changes, and other events and factors outside of mCloud’s control. In addition, stock markets have from time-to-time experienced extreme price and volume fluctuations, including general economic and political conditions, which could adversely affect the market price for our securities.

If the Company fails to maintain compliance with Nasdaq Listing Rules, the Company may be delisted from Nasdaq, which would result in a limited public market for trading the Company’s Common Shares and make obtaining future debt or equity financing more difficult for the Company.

The issued and outstanding Common Shares of the Company are listed and posted for trading on the TSXV and on the Nasdaq under the symbol “MCLD.” The Listed Warrants of the Company are listed on the Nasdaq under the symbol “MCLDW” and the Warrants will also be traded on the Nasdaq under the symbol “MCLDW”. We are in the process of applying to have the Series A Preferred Shares sold in this offering listed on the Nasdaq Capital Market (“Nasdaq”) under the symbol “MCLDP”. However, there is no assurance that we will be able to continue to maintain our compliance with the Nasdaq continued listing requirements. If we fail to do so, our securities may lose their status on Nasdaq Capital Market and they would likely be traded on the over-the-counter markets, including the Pink Sheets market. As a result, selling our securities could be more difficult because smaller quantities of shares or warrants would likely be bought and sold, transactions could be delayed, and security analysts’ coverage of us may be reduced. In addition, in the event our securities are delisted, broker dealers would bear certain regulatory burdens which may discourage broker dealers from effecting transactions in the securities and further limit the liquidity of the securities. These factors could result in lower prices and larger spreads in the bid and ask prices for the securities. Such delisting from Nasdaq and continued or further declines in the share price of the securities could also greatly impair our ability to raise additional necessary capital through equity or debt financing and could significantly increase the ownership dilution to shareholders caused by our issuing equity in financing or other transactions.

If the Company was delisted from Nasdaq, it may become subject to the trading complications experienced by “Penny Stocks” in the over-the-counter market.

Delisting from Nasdaq may cause the securities of the Company to become subject to the SEC’s “penny stock” rules. The SEC generally defines a penny stock as an equity security that has a market price of less than $5.00 per share or an exercise price of less than $5.00 per share, subject to certain exemptions. One such exemption is to be listed on Nasdaq. Therefore, if we were to be delisted from Nasdaq, the securities of the Company could become subject to the SEC’s “penny stock” rules. These rules require, among other things, that any broker engaging in a purchase or sale of our securities provide its customers with: (i) a risk disclosure document, (ii) disclosure of market quotations, if any, (iii) disclosure of the compensation of the broker and its salespersons in the transaction, and (iv) monthly account statements showing the market values of our securities held in the customer’s accounts. A broker would be required to provide the bid and offer quotations and compensation information before effecting the transaction. This information must be contained on the customer’s confirmation. Generally, brokers are less willing to effect transactions in penny stocks due to these additional delivery requirements. These requirements may make it more difficult for shareholders to purchase or sell the Shares of the Company. Since the broker, not us, prepares this information, we would not be able to assure that such information is accurate, complete or current.

If the Company fails to maintain compliance with Nasdaq Listing Rules, including compliance with the minimum market value of listed securities requirement, the Company may be delisted from Nasdaq, which would result in a limited public market for trading the Company’s Common Shares and make obtaining future debt or equity financing more difficult for the Company.

The issued and outstanding Common Shares of the Company are listed and posted for trading on the TSXV and on the Nasdaq under the symbol “MCLD.” The Listed Warrants of the Company are listed on the Nasdaq under the symbol “MCLDW” and the Warrants will also be traded on the Nasdaq under the symbol “MCLDW”. We are in the process of applying to have the Series A Preferred Shares sold in this offering listed on the Nasdaq Capital Market (“Nasdaq”) under the symbol “MCLDP”. On October 26, 2022, we received a letter from the Listing Qualifications Department of the Nasdaq Stock Market notifying us that, based upon its review for the last 30 consecutive business days, we did not meet the continuing listing requirements of Nasdaq Marketplace Rule 5550(b)(2), which requires that we maintain a minimum market value of listed securities of at least $35 million. Nasdaq also informed us that we did not meet the requirements of Listing Rules 5550(b)(1) and 5550(b)(3). The notification from the Nasdaq Stock Market does not have an immediate effect on the listing of our Common Shares or Warrants and these securities will continue to trade on the Nasdaq under their current symbols. Under Nasdaq’s Listing Rules, we have 180 calendar days from the date of the notification to regain compliance, which will expire on April 24, 2023. If, at any time during this period, the market value of our Common Shares closes at $35 million or more for a minimum of 10 consecutive business days, we will regain compliance with this requirement. If we are unable to regain compliance during the 180-day period, we will receive an additional notification that our Common Shares are subject to delisting. We could, at that time, request a hearing to remain on the Nasdaq, which request will ordinarily suspend such delisting determination until a decision is made by Nasdaq subsequent to the hearing.

There is no assurance that we will be able to continue to maintain our compliance with the Nasdaq continued listing requirements. If we fail to do so, our securities may lose their status on Nasdaq Capital Market and they would likely be traded on the over-the-counter markets, including the Pink Sheets market. As a result, selling our securities could be more difficult because smaller quantities of shares or warrants would likely be bought and sold, transactions could be delayed, and security analysts’ coverage of us may be reduced. In addition, in the event our securities are delisted, broker dealers would bear certain regulatory burdens which may discourage broker dealers from effecting transactions in the securities and further limit the liquidity of the securities. These factors could result in lower prices and larger spreads in the bid and ask prices for the securities. Such delisting from Nasdaq and continued or further declines in the share price of the securities could also greatly impair our ability to raise additional necessary capital through equity or debt financing and could significantly increase the ownership dilution to shareholders caused by our issuing equity in financing or other transactions.

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If securities or industry analysts do not publish research or publish inaccurate or unfavorable research about our business, our share price and trading volume could decline.

The trading market for our shares will depend on the research and reports that securities or industry analysts publish about us or our business. We do not have any control over these analysts. We cannot assure you that analysts will cover us or provide favorable coverage. If one or more of the analysts who cover us downgrade our stock or change their opinion of our securities, our share price would likely decline. If one or more of these analysts cease coverage of the Company or fail to regularly publish reports on us, we could lose visibility in the financial markets, which could cause our share price or trading volume to decline.

FORWARD-LOOKING STATEMENTS

We have made statements in this prospectus, including under “Prospectus Summary,” “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Our Business” and elsewhere that constitute forward-looking statements. Forward-looking statements involve risks and uncertainties, such as statements about our plans, objectives, expectations, assumptions or future events. In some cases, you can identify forward-looking statements by terminology such as “anticipate,” “estimate,” “plan,” “project,” “continuing,” “ongoing,” “expect,” “we believe,” “we intend,” “may,” “should,” “will,” “could” and similar expressions denoting uncertainty or an action that may, will or is expected to occur in the future. These statements involve estimates, assumptions, known and unknown risks, uncertainties and other factors that could cause actual results to differ materially from any future results, performances or achievements expressed or implied by the forward-looking statements.

Examples of forward-looking statements include:

• the timing of the development of future services,

• projections of revenue, earnings, capital structure and other financial items,

• statements regarding the capabilities of our business operations,

• statements of expected future economic performance,

• statements regarding competition in our market, and

• assumptions underlying statements regarding us or our business.

The ultimate correctness of these forward-looking statements depends upon a number of known and unknown risks and events. We discuss our known material risks under the heading “Risk Factors” above. Many factors could cause our actual results to differ materially from those expressed or implied in our forward-looking statements. Consequently, you should not place undue reliance on these forward-looking statements. The forward-looking statements speak only as of the date on which they are made, and, except as required by law, we undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events. In addition, we cannot assess the impact of each factor on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements.

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USE OF PROCEEDS

We estimate that our net proceeds from the minimum offering amount of the sale of our securities, consisting of our Series A Common Shares and Warrants, in this offering will be approximately $13,305,133 USD, after deducting placement agent fees and estimated offering expenses payable by us, and net proceeds from the maximum offering amount of the sale of the Series A Preferred Shares and Warrants in this offering will be approximately $31,905,133 USD, after deducting placement agent fees and estimated offering expenses payable by us.

The principal purposes of this offering are for working capital and general corporate purposes, including paying off convertible debenture debt in the amount of CAD$23,457,500 with an interest rate of 10% per annum due June 30, 2022. The amounts and timing of any expenditures will vary depending on the amount of cash generated by our operations, and the rate of growth, if any, of our business, and our plans and business conditions.

The foregoing represents our intentions as of the date of this prospectus based upon our current plans and business conditions to use and allocate the net proceeds of the offering. However, our management will have significant flexibility and discretion in the timing and application of the net proceeds of the Offerings. Unforeseen events or changed business conditions may result in application of the proceeds of the Offerings in a manner other than as described in this prospectus.

To the extent that the net proceeds we receive from the offering are not immediately applied for the above purposes, we plan to invest the net proceeds in short-term, interest-bearing debt instruments or bank deposits.

Management believes that the proceeds from the offering will be sufficient to satisfy the Company’s cash needs for at least 12 months.

DIVIDEND POLICY

Our Board has never declared a dividend on our Common Shares and does not anticipate declaring a dividend in the foreseeable future.

The holders of our Series A Preferred Shares are entitled to dividends out of funds legally available when and as declared by our Board of Directors subject to the BCBCA. Subject to the preferential rights, if any, of the holders of any class or series of capital stock of the Company ranking senior to the Series A Preferred Shares as to dividends, the holders of the Series A Preferred Shares are entitled to receive, when, as and if declared by the Board of Directors (or a duly authorized committee of the Board), only out of funds legally available for the payment of dividends, cumulative cash dividends at the annual rate of 9.0% of the $25.00 liquidation preference per year (equivalent to $2.25 per year) until the beginning of the fifth year, at which time the annual rate will increases 4.0% per calendar quarter until it reaches a maximum of 25.0%.

Our ability, as a holding company, to pay dividends in the future and meet other obligations depends upon the receipt of dividends or other payments from our operating subsidiary and other holdings and investments. In addition, our operating company may, from time to time, be subject to restrictions on their ability to make distributions to us, including as a result of restrictive covenants in loan agreements, restrictions on the conversion of local currency into U.S. dollars or other hard currency and other regulatory restrictions.

CURRENCY AND EXCHANGE RATES

All dollar amounts in this prospectus are expressed in U.S. dollars unless otherwise indicated. The Company’s accounts are maintained in Canadian dollars and the Company’s financial statements are prepared in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board. All references to “Canadian dollars”, “CAD”, or “CAD$” are to Canadian dollars.

The following table sets forth, for each period indicated, exchange rate for U.S. dollars expressed in Canadian dollars. These rates are based on the noon buying rate certified for custom purposes by the U.S. Federal Reserve Bank of New York set forth in the H.10 statistical release of the Federal Reserve Board. These rates are provided solely for your convenience and are not necessarily the exchange rates that we used in preparation of our consolidated financial statements or elsewhere in this prospectus or will use in the preparation of our periodic reports or any other information to be provided to you. We make no representation that any Canadian dollar or U.S. dollar amounts referred to in this prospectus could have been or could be converted into U.S. dollars or Canadian dollars, as the case may be, at any particular rate or at all.

Year Ended	Period End
December 31, 2019	$	1.2988
December 31, 2020	$	1.2732
December 31, 2021	$	1.2678
June 30, 2022	$	1.2871

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We make no representation that any Canadian dollar or U.S. dollar amounts could have been, or could be, converted into U.S. dollars., as the case may be, at any particular rate, or at all. We do not currently engage in currency hedging transactions.

CAPITALIZATION

The following table sets forth our cash and our capitalization as of June 30, 2022:

• On an actual basis, as determined in accordance with IFRS; and

• On an as adjusted basis to give effect to (i) the issuance and sale of 600,000 Series A Preferred Shares and accompanying 15,000,000 Warrants at the Minimum Offering Amount, (ii) 1,400,000 Series A Preferred Shares and accompanying 35,000,000 Warrants at the Maximum Offering Amount, and (iii) total expenses of each offering amount, which include registration, filing and listing fees, printing fees and legal and accounting expenses amounting to $673,460 and the Placement Agent fee of 7% of the aggregate gross cash proceeds at each offering amount, assuming no exercise of the Warrants.

You should read this capitalization table together with our consolidated financial statements and the related notes appearing elsewhere in this prospectus, the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” section, the Unaudited Pro Forma Financial Information section and other financial information included elsewhere in this prospectus. The table and footnotes below reflect an assumed raise of $15,000,000 in the Minimum Offering Amount and $35,000,000 in the Maximum Offering Amount and an assumed share price of $25.00 per share net of transaction related fees and converted into Canadian dollars as set out in “Currency and Exchange Rates”.

	June 30, 2022 (unaudited)			Pro Forma As of June 30 2022 (unaudited)			As adjusted (unaudited minimum offering)			As adjusted (unaudited maximum offering)
Cash and cash equivalents	$	4,405,948		$	12,029,256		$	12,029,256		$	19,648,352
Current portion of loans and borrowings		10,399,574			6,991,524			6,991,524			6,991,524
Current portion of convertible debentures		23,457,500			23,457,500			10,980,904			—
Warrant liabilities		3,017,643			2,866,753			2,866,753			2,866,753
Long term convertible debentures		85,091			85,091			85,091			85,091
Loans and borrowings		19,586,233			19,387,228			19,387,228			19,387,228
Equity
Common shares, no par value; unlimited number of shares authorized shares issued and outstanding, actual unlimited number of shares authorized, 16,151,500 shares issued and outstanding,
9.0% Series A Cumulative Perpetual Preferred Shares of the Company, without par value; 1,400,000 shares issued and outstanding
Equity share capital		118,327,722			118,327,722			131,604,262			150,204,262
Contributed surplus		11,547,919			11,547,919			11,547,919			11,547,919
Accumulated other comprehensive income		291,811			461,504			461,504			461,504
Deficit		(146,501,130	)		(143,126,641	)		(143,926,585	)		(143,926,585	)
Total Shareholders (Deficit)/Equity		(16,333,678	)		(12,789,496	)		(312,900	)		18,287,100
Non-controlling interest		(2,256,921	)		—			—			—
Total (Deficit)/Equity		(18,590,599	)		(12,789,496	)		(312,900	)		18,287,100

(1) The pro forma adjustment to cash and cash equivalents reflects the increase in cash after payment of the principal value of the convertible debenture and the related accrued interest at June 30, 2022.

(2) The amount to be attributed to the warrants has not yet been determined and has been included in the amount attributed to Share capital. Upon issuance of the Series A Preferred Shares and Warrants, the total net proceeds will be allocated to Share Capital and Warrant Liabilities.

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(3) Assumes adoption of the Rights and Restrictions for 9.0% Cumulative Series A Preferred Shares, which was adopted prior to June 30, 2022.

The above discussion and table is based on 16,155,654 Common Shares outstanding as of June 30, 2022, and do not include, as of that date:

• 3,551,132 Common Shares issuable upon exercise of Listed Warrants;

• 5,094,965 Common Shares issuable upon exercise of Non-Listed Warrants;

• 856,314 Common Shares issuable upon exercise of Options

• 253,613 Common Shares issuable upon exercise of Restricted Share Units;

• 15,750 Common Shares issuable upon exercise of Convertible Debt; and

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UNAUDITED PRO FORMA COMBINED FINANCIAL INFORMATION

UNAUDITED PRO FORMA FINANCIAL INFORMATION

(In thousands, except share information)

On July 29, 2022, the Company and Agnity Global Inc. (“Agnity”) entered into a technology continuation agreement (the “Technology Continuation Agreement”), which served to extinguish the Amended and Restated Royalty Agreement (“the Royalty Agreement”) with Agnity and provide the Company with ongoing access to Agnity’s licensed software, Communication Application Server (“CAS”) which mCloud’s AssetCare communication protocol is reliant on. Concurrent with the signing of the Technology Continuation Agreement, a third party acquired all of the outstanding shares in Agnity from its shareholders. These events (together referred to as the “Transaction”) resulted in mCloud losing control of Agnity for accounting purposes and no longer being consolidated in the financial statements of the Company as of July 29, 2022.

Before the Company assumed control of Agnity, mCloud accessed CAS for AssetCare via a Master Service and License Agreement (“MLSA”). On April 22, 2019, the Company signed the Royalty Agreement with Agnity and formed the Operating Committee at Agnity. This resulted in mCloud obtaining control of Agnity for accounting purposes and the consolidation of Agnity’s financial results. The Royalty Agreement also provided mCloud the ability to use the Agnity brand, which made mCloud credible to target customers in the telecom vertical. Verticals are defined as those markets where mCloud offers solutions to a specific industry, built on a single core technology platform called AssetCare.

The arrangement with Agnity, also allowed mCloud access to the development resources that enabled the Company to embed CAS in its AssetCare solution. The Agnity CAS technology enables communication between AssetCare users, namely end users in field maintenance and operations roles needing to communicate with subject matter end users in the back office. These communication capabilities facilitate AssetCare’s ability to coordinate actions that drive the creation of customer value. CAS is integrated into every AssetCare solution delivered to customers and is integrated with various other AssetCare technologies to enable this communication.

As a result of entering into the Transaction, the Company received total cash of $5.954 million. This consisted of:

• a one-time payment of $5.68 million equal to the fair value of mCloud’s consideration receivable under the termination provisions of the Amended and Restated Royalty Agreement with Agnity, and

• the settlement of $0.27 million in other net receivables due from Agnity.

Subsequent to losing control, rights to CAS existing under the MLSA are ensured to continue under the Technology Continuation Agreement. mCloud retains access to Agnity’s CAS technology and Agnity development resources, with transactions being conducted at arm’s length, whereby mCloud is required to make license payments to Agnity based on the number of Active Users. An Active User is defined as a unique individual person who uses or accesses the Licensed Software at any point during the 24-hour day. mCloud retains the ability to market to the telecom vertical, however Agnity is prohibited from directly or indirectly competing with our AssetCare business. Should mCloud consider targeting the telecom vertical, it will do so under a non-Agnity brand in the future.

All payables and receivables due between mCloud and Agnity have been settled up to July 29, 2022.

The following unaudited pro forma condensed consolidated financial statements are presented to show how the Transaction might have affected the historical financial statements of the Company had the transactions been completed at an earlier time as indicated herein. The unaudited pro forma condensed consolidated financial statements have been prepared in accordance with Article 11 of Regulation S-X, were derived from the Company’s historical condensed consolidated (for interim periods) or consolidated (for annual periods) financial statements and are being presented to give effect to the Transaction.

The unaudited pro forma condensed consolidated financial statements should be read with:

i. The accompanying notes to the unaudited pro forma condensed consolidated financial statements

ii. The audited consolidated financial statements of the Company and its subsidiaries and the accompanying notes included in the Company’s Annual Report on Form 20-F/A filed with the SEC on August 22, 2022.

iii. The unaudited condensed consolidated interim financial statements of the Company for the six months ended June 30, 2022, included in Form 6-K furnished with the SEC on August 16, 2022.

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The unaudited pro forma condensed consolidated financial statements are based on available information and assumptions that the Company’s management believes are reasonable as of the date of this filing. The unaudited pro forma condensed consolidated statements of operations for the year ended December 31, 2021, and the six months ended June 30, 2022, present the Company’s results as if the Transaction had occurred on Jan 1, 2019, the beginning of the earliest period presented. The unaudited pro forma condensed consolidated balance sheet as of June 30, 2022, reflects the Company’s assets, liabilities and equity as if the Transaction had occurred on June 30, 2022.

The unaudited pro forma condensed consolidated financial statements are not necessarily indicative of what the Company’s actual results of operations would have been had the transaction been consummated on the dates assumed nor does it purport to represent the Company’s results of operations or financial condition for any future period. Actual amounts could differ materially from these estimates.

The accounting adjustments to reflect the Transaction in the unaudited pro forma condensed consolidated financial statements include:

• The loss of control of Agnity’s and associated derecognition of Agnity’s assets and liabilities.

• Impact of the cash proceeds received in connection with the Transaction.

• The elimination of Agnity’s royalty payment obligations to mCloud under the extinguished Amended and Restated Royalty Agreement and the inclusion of license payments from mCloud to Agnity in accordance with the Technology Continuation Agreement.

• The recognition of transactions between mCloud and Agnity related to other intercompany sales activities, which were previously eliminated on consolidation for each period presented.

The pro forma financial statements, presented in Canadian dollars, do not include management adjustments to reflect synergies or dis-synergies because we do not believe presenting such adjustments would enhance an understanding of the pro forma effects of the Transaction.

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mCloud Technologies Corp.

Pro Forma Condensed Consolidated Statement of Financial Position

As of June 30, 2022

(In thousands, except per share amounts)

(Unaudited-In CAD$)

	Historical Financial Statements as Reported			Deconsolidation (a)			Transaction (b)			Pro Forma
Assets
Current Assets:
Cash and cash equivalents	$	4,406		$	(16	)	$	7,640		$	12,030
Trade and other receivables		12,135			(8,602	)		—			3,533
Other current assets		3,070			(306	)		—			2,764
Total Current Assets	$	19,611		$	(8,924	)	$	7,640		$	18,327
Intangible assets		17,430			(3,709	)		—			13,721
Goodwill		27,119			—			—			27,119
Other assets		8,853			3,724			(4,266	)		7,996
Total assets	$	72,698		$	(8,909	)	$	3,374		$	67,163
Liabilities
Current Liabilities:
Trade payables and accrued liabilities	$	16,343		$	(5,319	)					11,024
Deferred revenue		4,813			(2,264	)		—			2,549
Loans and borrowings		10,400			(3,408	)		—			6,992
Warrant Liabilities		3,018			(151	)		—			2,867
Convertible debentures		23,458			—			—			23,458
Other current liabilities		5,633						—			5,633
Total current liabilities	$	63,665		$	(11,142	)	$			$	52,523
Non-current liabilities:
Lease liabilities		7,124			—			—			7,124
Loans and borrowings		19,586			(199	)		—			19,387
Other liabilities		913			5			—			918
Total liabilities	$	91,288		$	(11,336	)	$			$	79,952
Equity (Deficit)
Share capital	$	118,328		$	—		$	—		$	118,328
Contributed surplus		11,548			—			—			11,548
Accumulated other comprehensive income		292			170			—			462
Deficit		(146,501	)		—			3,374			(143,127	)
Non-controlling interest		(2,257	)		2,257			—			—
Total shareholders’ equity	$	(18,590	)	$	2,427		$	3,374		$	(12,789	)
Total liabilities and equity	$	72,698		$	(8,909	)	$	3,374		$	67,163

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mCloud Technologies Corp.

Pro Forma Condensed Consolidated Statement of Loss and Comprehensive Loss

For the six months ended June 30, 2022

(In thousands, except per share amounts)

(Unaudited - In CAD$)

	Historical Financial Statements as Reported			Deconsolidation (c)			Transaction (c) (d)			Pro Forma
Revenue	$	6,699		$	(1,685	)	$	—			5,013
Cost of sales		3,866			(1,218	)		336			2,984
Gross Profit	$	2,833		$	(468	)	$	(336	)		2,029
Expenses
Salaries, wages and benefits	$	10,374		$	(1,344	)	$	—			9,030
General and administration		4,617			(141	)		—			4,477
Professional and consulting fees		6,736			(2,903	)		—			3,833
Depreciation and amortization		3,770			(1,039	)		—			2,731
Other		3,447			(106	)		—			3,341
Total expenses		28,944			(5,532	)		—			23,412
Operating Loss	$	(26,111	)	$	5,064		$	—			(21,135	)
Other expense (income)
Finance costs (income)	$	4,089		$	(368	)	$	—			3,721
FV loss on derivatives		(5,032	)		—			—			(5,032	)
Other income		(1,156	)		0			(295	)		(1,451	)
Gain (Loss) before tax	$	(24,012	)	$	5,432		$	(40	)	$	(18,621	)
Current tax expense		105			—			—			105
Deferred tax (recovery) expense		(1,482	)		626			—			(856	)
Net loss for the period	$	(22,635	)	$	4,806		$	(40	)		(17,869	)
Foreign subsidiary translation differences		882			(54	)		—			828
Comprehensive loss for the period	$	(23,517	)	$	4,752		$	(40	)		(18,697	)
Net loss (income) for the period attributable to:
mCloud Technologies Corp. Shareholders		(17,829	)		—			(40	)		(17,869	)
Non-controlling interest		(4,806	)		4,806			—			—
	$	(22,635	)	$	4,806		$	(40	)		(17,869	)
Comprehensive loss (income) for the period attributable to:
mCloud Technologies Corp. Shareholders		(18,765	)		—			(40	)		(18,805	)
Non-controlling interest		(4,752	)		4,752			—			—
	$	(23,517	)		4,752			(40	)		(18,805	)
Net Loss per common and potential common share:
Loss per share attributed to mCloud shareholders - basic and diluted	$	(1.10	)							$	(1.11	)
Weighted average number of common shares outstanding - basic and diluted		16,151,197									16,151,197

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mCloud Technologies Corp.

Pro Forma Condensed Consolidated Statement of Loss and Comprehensive Loss

For the year ended December 31, 2021

(CAD$ - In thousands, except per share amounts)

(Unaudited)

	Historical Financial Statements as Reported			Deconsolidation (a)			Transaction (c)(d)			Pro Forma
Revenue	$	25,597		$	(11,816	)	$	—		$	13,781
Cost of sales		9,684			(2,611	)		550			7,623
Gross Profit	$	15,913		$	(9,205	)	$	(550	)	$	6,158
Expenses
Salaries, wages and benefits	$	21,692		$	(2,050	)				$	19,642
General and administration		8,539			(810	)					7,729
Professional and consulting fees		9,085			(4,175	)					4,910
Depreciation and amortization		8,925			(2,172	)					6,753
Other		6,424			(133	)					6,291
Total expenses	$	54,665		$	(9,340	)	$	—		$	45,325
Operating Loss	$	(38,752	)	$	135		$	(550	)	$	(39,167	)
Other expense (income)
Finance costs (income)	$	8,619		$	(337	)	$	—		$	8,281
FV loss on derivatives		6,040			—			—			6,040
Other (income)/loss		(7,126	)		402			(150	)		(6,874	)
Other expenses (income)		79			(116	)		—			(37	)
Loss before tax	$	(46,364	)	$	186		$	(400	)	$	(46,578	)
Current tax expense		157			(372	)		—			(215	)
Deferred tax expense (recovery)		(1,822	)		621			—			(1,201	)
Net loss for the period	$	(44,699	)	$	(63	)	$	(400	)	$	(45,162	)
Foreign subsidiary translation differences		69			139						208
Comprehensive loss for the period	$	(44,768	)	$	(202	)	$	(400	)	$	(45,370	)
Net loss (income) for the period attributable to:
mCloud Technologies Corp. Shareholders		(44,762	)		—			(400	)		(45,162	)
Non-controlling interest		63			(63	)		—			—
	$	(44,699	)	$	(63	)	$	(400	)	$	(45,162	)
Comprehensive loss (income) for the period attributable to:
mCloud Technologies Corp. Shareholders		(44,970	)					(400	)		(45,370	)
Non-controlling interest		202			(202	)		—			0
	$	(44,768	)	$	(202	)	$	(400	)	$	(45,370	)
Net Loss per common and potential common share:
Loss per share attributed to mCloud shareholders - basic and diluted	$	(3.76	)							$	(3.80	)
Weighted average number of common shares outstanding - basic and diluted		11,898,183									11,898,183

Footnotes:

a. To recognize the loss of control of Agnity and associated deconsolidation of Agnity’s assets and liabilities.

b. To recognize the receipt of $5.95 million (CAD$7.7 million) of cash as a result of the Transaction, the resulting extinguishment of the amounts receivable from and payable to Agnity and the $3.451 million gain from the changes to the carrying amounts of the receivable balances.

c. To recognize the loss of control of Agnity and associated removal of Agnity’s operating results from the Statement of Loss and Comprehensive Loss, together with the recognition of intercompany revenue and expenses previously eliminated on consolidation.

d. To eliminate income previously recognized by mCloud under the Amended Royalty Agreement and to recognize the license payments from mCloud to Agnity for ongoing access to CAS under the terms of the Technology Continuation Agreement.

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL

CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis should be read in conjunction with our financial statements and related notes included elsewhere in this prospectus. This discussion and other parts of this prospectus contain forward-looking statements based upon current expectations that involve risks and uncertainties. Our actual results and the timing of selected events could differ materially from those anticipated in these forward-looking statements as a result of several factors, including those set forth under “Risk Factors” and elsewhere in this prospectus.

The preparation of financial statements in conformity with these accounting principles requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent liabilities at the financial statement date and reported amounts of revenue and expenses during the reporting period. On an on-going basis, we review our estimates and assumptions. The estimates were based on historical experience and other assumptions that we believe to be reasonable under the circumstances. Actual results are likely to differ from those estimates or other forward-looking statements under different assumptions or conditions, but we do not believe such differences will materially affect our financial position or results of operations. Our actual results may differ materially as a result of many factors, including those set forth under the headings entitled “Forward-Looking Statements” and “Risk Factors”.

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Recent Developments

Significant Business Contracts and Partnerships

On February 2, 2021, the Company announced it had signed a memorandum of understanding with Invest Alberta Corporation (“Invest Alberta”), an Alberta crown corporation. The goal of the memorandum was for the Company to leverage its technology to help Canadian and global energy companies reduce carbon emissions and act on ESG issues. The Company believes the move may accelerate the development and adoption of its offerings through increased engagement with key customers and local industry in Alberta.

On February 16, 2021, the Company announced that it had signed a memorandum of understanding with Fidus Global, LLC (“Fidus”) to commence sales, implementation, and ongoing field services for the Company’s AssetCare segment for connected buildings in the United States.

On April 21, 2021, the Company announced that it would be offering its AssetCare solutions for HVAC and IAQ to small business customers of three major North American energy utility providers, two in the continental United States and one in Canada. Based on information provided by the three utilities, the Company estimated that these utility partnerships will make AssetCare HVAC and IAQ solutions available to approximately one million commercial buildings in the United States and Canada.

On May 18, 2021, the Company announced that it had successfully implemented AssetCare to customers associated with these utility program partnerships. Among these customers are two prominent car dealership properties in the State of New York.

On May 3, 2021, the Company announced that it had equipped the head office of Cadence Financial Group, located in Vancouver, Canada, with a combination of IoT-enabled 24/7 air quality monitoring and AI-driven connected air purification capable of outperforming standard HEPA filtration by continuously eliminating up to 95% of harmful particulates and contaminants smaller than one micron in size.

On June 15, 2021, the Company announced that pursuant to its partnership with Fidus, the Company’s AssetCare solution was now being offered at various government buildings operated by the State of Arkansas, as the state seeks to improve indoor air safety across government properties, including office buildings, schools, and other state-run facilities in the wake of COVID-19.

On June 23, 2021, the Company announced its partnership with Prosaris Solutions Ltd., through which the Company began its rollout of a new AssetCare solution targeting fugitive gas emissions for operators in the oil and gas sector in Alberta and enabling such operators to continuously inspect and correct such gas leaks at their facilities.

On July 13, 2021, mCloud announced it had signed a memorandum of understanding to partner with URBSOFT, a strategic provider of advanced ground and aerial inspection technology solutions in the Kingdom of Saudi Arabia. This partnership paved the way for mCloud to take AssetCare to support the digitalization and ESG objectives of Saudi Vision 2030, the Kingdom of Saudi Arabia’s national economic plan.

On July 20, 2021, mCloud announced it had begun to offer its AssetCare solutions for HVAC and IAQ to small business customers of Con Edison, the energy company that serves New York City and Westchester County, N.Y. The Company is a solutions provider in Con Edison’s Business Energy Pro program, which offers energy saving incentives to businesses located on Staten Island and in Westchester County. Business Energy Pro is one of the first “pay-for-performance” incentive programs in the country. Small businesses that participate earn payments for measured energy savings over a multi-year period. Through mCloud’s partnership with Con Edison, AssetCare customers in New York state can earn payments for measured energy savings achieved through AssetCare over a multi-year period.

On October 13, 2021, mCloud announced it received approval and a license to conduct business activities from the Ministry of Investment of Saudi Arabia (“MISA”). The MISA license marks a major milestone in mCloud’s activities in the Middle East and North Africa (“MENA”) region, enabling mCloud to provide AssetCare solutions to the Kingdom of Saudi Arabia and other countries in the MENA region.

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On September 27, 2021, the Company executed a 12-year lease for its office in Calgary, Alberta. The lease term commences on December 1, 2022, preceded by a fixturing period which the Company will use to build out the office space to their specifications.

On November 9, 2021, the Company announced it had equipped two initial locations in Saudi Arabia—Casa Pasta and CHICK “N” DIP restaurants—with its AssetCare solution for HVAC and IAQ, to optimize the indoor air quality and energy efficiency in the restaurants. This was facilitated through the Company’s partnership with URBSOFT, previously announced on July 13, 2021.

On November 30, 2021, the Company announced a three-year agreement with Colliers Macaulay Nicolls Inc., an appointed agent of Slate Asset Management, to deploy mCloud’s AssetCare solution for HVAC and IAQ at Life Plaza, one of Slate Asset Management’s premier office towers in downtown Calgary, Alberta, and the Company’s largest IAQ deployment to date. The initial subscription term for this agreement would become effective at the completion of AssetCare installation and is set to renew in November 2025.

On December 15, 2021, the Company announced it had signed an agreement with Virtual Vision (the “V2 Agreement”), a local provider of cloud computing services within Saudi Arabia, to host the Company’s AssetCare solutions on the V2 Public Cloud for use in the Kingdom. The V2 Agreement enables mCloud to complete the onboarding of several new Saudi customers and immediately take these customers live with AssetCare. The V2 Agreement also ensures mCloud is ready for scalable deployment within Saudi Arabia and in a manner compliant with Saudi legal requirements by geo-locating AssetCare data within the Kingdom.

On January 20, 2022, the Company announced a partnership with the Mercedes-EQ Formula E Team as an official team partner, through which the use of mCloud’s AssetCare portfolio of solutions to drive the ESG performance of the Formula E business would be explored. This announcement was made just ahead of the official opening of Season 8 of the ABB FIA Formula E World Championship – the world’s only all- electric FIA World Championship and the only sport certified net zero carbon since inception. The Mercedes-EQ Formula E Team is collaborating with the Company to explore the use of the Company’s AssetCare portfolio of solutions to drive the ESG performance of their business, including technologies to reduce harmful emissions, the carbon footprint of their facilities, and further enhancing the safety and comfort of the work environment.

On January 25, 2022, the Company announced it had signed a memorandum of understanding with Saudi Arabian Oil Company (“Aramco”) to explore the co-development of a digital technology hub for delivering ESG solutions in the Kingdom of Saudi Arabia. The hub would enable the Company and Aramco to jointly develop new AI-powered innovations to facilitate the carbon reduction of complex energy-intensive assets throughout the Kingdom and abroad. Additionally, the Company announced that it planned to develop a center of excellence that will serve as a home base for a dedicated team of ESG and digital transformation experts based in Saudi Arabia, particularly to leverage Virtual Vision’s high-performance infrastructure in accordance with the V2 Agreement.

On January 26, 2022, the Company announced the creation of a new “ESG-Digital Hub” based in Houston Texas, to serve as an additional focal point for local mCloud teams driving the ongoing technological development and customer delivery of AssetCare solutions. The new Houston-based location joins other Company hubs in Calgary, Alberta, established in collaboration with Invest Alberta, and the hub based in Saudi Arabia, in collaboration with Aramco.

On March 21, 2022, the Company announced it had signed an agreement on March 17, 2022 to deliver its AssetCare for Connected Buildings solution to manage the energy efficiency of the Vail Buick Dealership in Bedford Hills, New York, the first of 15 planned installations for auto dealerships in New York state to help control rising energy costs in the electric vehicle (“EV”) era. mCloud will deploy an innovative combination of AI in the cloud, solar power generation, and battery storage to continuously manage the energy cost and carbon footprint of the entire dealership, including the substantial increased energy consumption from EV charging now being implemented onsite. The Vail Buick Dealership agreement covers a 17-year term commencing on or before June 2022.

On March 30, 2022, the Company announced it had signed an agreement on March 28, 2022, with Carbon Royalty Corp to proceed with closing and funding the first 30 AssetCare solutions to optimize Electric Vehicle (“EV”) charging efficiency at auto dealerships in the states of New York and California. The agreement partners mCloud with Carbon Royalty Corp, enabling the implementation of these AssetCare contracts to be fully funded via Carbon Royalty Corp. As a benefit of this partnership, Carbon Royalty Corp receives 50% of the tax incentives, carbon credits, and other accretive financial benefits mCloud would be eligible to receive in the United States resulting from the implementation of these solutions. These benefits would be split between mCloud and Carbon Royalty Corp over the expected 20-year contract terms of AssetCare arrangements.

On July 29, 2022, the Company entered into a technology continuation agreement with Agnity Global, Inc. (“Agnity”), which replaced the royalty agreement between the parties. Agnity will pay the Company a one-time royalty payment of approximately US$6.0 million as a result of the termination of the royalty agreement, pursuant to the terms of the royalty agreement, and under the terms of the technology continuation agreement, the parties will continue delivering and supporting Agnity’s technology and build on the Company’s existing license and use of Agnity technology across all of the Company’s AssetCare offerings going forward. As a result of this new arrangement, the Company will no longer consolidate the financial results of Agnity as of July 29, 2022.

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Financing

The Company completed the issuance of six tranches of a convertible debenture financing pursuant to which it has issued an aggregate of US$7.043 million convertible debentures (“2021 Convertible Debentures”). On July 12, 2021, the Company entered into debt conversion and exchange agreements with the holders of more than 99.2% of the outstanding principal amount of the 2021 Convertible Debentures, pursuant to which the Company issued an aggregate of 2,107,787 common shares and 2,107,787 warrants in consideration for the extinguishment of 99.2% of the principal and accrued interest owing under the 2021 Convertible Debentures.

On April 15, 2021, the Company issued a total of 2,300,000 units of the Company at an issue price of $6.30 per unit for aggregate gross proceeds of CAD$14.490 million (the “Brokered Offering”). Each unit consisted of one common share and one warrant of the Company. Each warrant is exercisable for one common share at an exercise price of $8.55 per common share, subject to adjustment in certain events. The Brokered Offering was led by ATB Capital Markets Inc. (the “Agent”). The Agent was paid a cash fee equal to 7% of the gross proceeds raised under the Brokered Offering.

On May 17, 2021, the Company announced it had entered into a secured credit facility with ATB, which is a $5 million margined, demand operating loan facility (the “ATB Facility”). The proceeds of the ATB Facility were used in part, to repay in full all indebtedness and liability owing by the Company to HSBC Bank of Canada and for general corporate purposes. The ATB Facility is a demand operating line bearing interest at a floating rate equal to the prime rate per annum established by ATB from time to time for commercial loans denominated in Canadian dollars made by ATB in Canada, plus an applicable margin rate based on the senior debt to EBITDA ratio of the Company at the time of determination. Repayments under the ATB Facility will be made on a monthly interest-only basis until demand. The ATB Facility is secured against certain assets of the Company and its principal subsidiaries.

On June 24, 2021, $2.5 million was drawn from the ATB Facility, in accordance with the maximum amount permitted under the Company’s intercreditor agreement with Fiera Private Debt Fund VI LP (“Fiera”).

On November 8, 2021, the ATB Facility was amended. As part of the amendment, ATB provided an additional $5 million in available funding to the Company via an accordion, subject to lender consent. In consideration of ATB making available to the Company additional advances under the ATB Facility, the Company granted to ATB non-transferable warrants to acquire up to 183,486 common shares at an exercise price of $5.45 per common share for a term not exceeding one year.

On November 9, 2021, the Company amended its term loan and amended the associated intercreditor agreement between Fiera, ATB and the Company. The intercreditor agreement determines the priority of security interests in the case of default, with Fiera having first priority on all assets other than accounts receivable. The amendments to the term loan include: increase in interest rate from 6.85% to 7.5% per annum; certain changes to financial covenants which are applicable for the period from July 1, 2021 to December 31, 2022; and, the addition of two mCloud subsidiaries as additional guarantors.

On August 13, 2021, the Company completed a non-brokered private placement, pursuant to a subscription agreement dated July 12, 2021, offering of 75,676 units of the Company at a unit price of $5.55 for gross proceeds of $0.420 million. Each unit consists of one common share and one share purchase warrant at an exercise price of $8.55 per common share with warrants expiring April 2024.

On November 24, 2021, the Company announced that its common shares had begun trading on the Nasdaq Capital Market (“Nasdaq”) under the symbol “MCLD” in connection with the completion of a 3:1 share consolidation (the “2021 Share Consolidation”). On November 29, 2021, the Company announced the completion of an underwritten public offering of 2,100,000 units at a price to the public of US$4.50 per unit. Each unit issued in the offering consisted of one common share and one warrant to purchase one common share at an exercise price of USD$4.75. The common shares began trading on the NASDAQ on November 24, 2021 under the symbol “MCLD”. The Company received gross proceeds of approximately US$9.5 million, before deducting underwriting discounts and commissions and other estimated offering expenses.

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The Company had also granted the underwriters, Maxim Group LLC, to purchase up to an additional 315,000 common shares and an additional 315,000 warrants (each on a post-consolidation basis) at the public offering price to cover over-allotments. On November 29, 2021, the Company announced that Maxim Group LLC had purchased the 315,000 warrants in accordance with the over-allotment option, and on December 6, 2021 announced that Maxim Group LLC had exercised the over-allotment option in full to purchase an additional 315,000 common shares at the Offering Price. The proceeds from the over- allotment option were US$1.417 million. The aggregate gross proceeds of the offering, including the over- allotment option, were US$10.867 million. In conjunction with the USD equity offering described above, the Company agreed to list the warrants issued as part of the unit offering on the Nasdaq. On February 15, 2022, these warrants commenced trading in USD under the symbol “MCLDW”. The Warrants will be trading under the symbol “MCLDW” along with the Listed Warrants.

In conjunction with the Company’s agreements to provide AssetCare solutions to optimize Electric Vehicle (“EV”) charging efficiency at auto dealerships in the states of New York and California (the “EV Dealership Projects”), on March 28, 2022, a subsidiary of the Company executed a promissory note in the aggregate principal amount of US$15.000 million (the “Note”) with Carbon Royalty Corp. (“Carbon”). EV Dealership Projects are the design, installation and operation of integrated power systems consisting of solar panels, batteries and EV charging power stations for auto dealerships.

The initial principal amount under the Note of US$5.000 million was funded on April 1, 2022, and an additional US$10.000 million was funded on May 5, 2022 (the “Loans”). The Loans mature on March 31, 2025, with 10% per annum interest payable monthly in arrears in USD. In addition to the interest payments, the Note requires certain income-based payments, including tax incentives, be made from the borrower to the lender based on income resulting from the EV dealership projects over their 20-year term. The Loan may not be prepaid unless authorized by the lender. The Loans contain representations, warranties and covenants which must be complied with to avoid an event of default which will allow the lender to demand repayment and increase the interest rate to 18%, amongst other implications. The Company, Carbon and Fiera executed an agreement specifying the security held by Carbon, in May 2022.

On May 5, 2022, the Company, Carbon and Fiera Private Debt Fund VI LP (“Fiera”) executed a Subordination and Postponement Agreement (the “Subordination Agreement”), whereby the parties agreed that the security previously held by Fiera would be subordinate to the security to be granted to Carbon commencing on the date of the agreement. The security granted to Carbon means the EV Dealership Projects and to the extent related to the EV Dealership projects, all accounts receivable, equipment and machinery, contracts and contract rights, including contracts with auto dealerships, inventory, cash and proceeds, rent and profits for each of the preceding. Execution of the Subordination Agreement was required for the additional funding under the Note to be released. A total of US$15.000 million was funded.

On May 5, 2022, the Company and Fiera executed an Accommodation Agreement (the “Accommodation Agreement”) and the parties agreed that a portion of the outstanding principal amount under the term loan would be paid in addition to a prepayment penalty and accommodation fee. The Company paid a total of $2.044 million on May 6, 2022. The parties also agreed that the remainder of the principal and interest due under the loan would be paid on or before October 31, 2022 (the “Repayment Date”). The term loan was amended to increase the interest rate charged from 6.85% to 9.5% effectively immediately and clarified that the Company is not required to maintain the financial covenants set out in the November 9, 2021 amending agreement. The Company may be required to repay the loan before the Repayment Date if the Company is in default or breach of the Accommodation Agreement. As part of the Accommodation Agreement, Fiera signed an agreement, whereby Fiera’s security is subordinate to certain security granted to Carbon.

Subsequent event

In April 2022, the Company agreed to cancel a multi-year customer contract for which services had been performed in prior periods, resulting in a contract modification. As a result, revenue totalling $2.571 million which was recorded in prior periods was reversed during the six months ended June 30, 2022. Of this amount, $2.037 million is associated with the AssetCare Initialization service line and $0.534 million is associated with the AssetCare Solutions service line.

Since the beginning of 2020, governments around the world have been forced to enact emergency measures in response to the World Health Organization’s declaration of the COVID-19 pandemic. Businesses around the world have suffered material disruption resulting in economic slowdown and uncertainty and significant volatility in the financial markets. To date, the impacts to the Company’s operations and financial matters associated with COVID-19 have included (i) a slow-down in technical services due to the in-person nature of these activities and the restrictions placed such as lock-downs and social distancing by governments around the world with many of the most restrictive measures in the most recent quarter being in our core geographic markets, (ii) a delay in the collection of receivables closely associated with business who were most widely impacted by shut-downs and restrictions, and (iii) a delay in certain projects. The long-term impact on the Company’s financial results and cash flows is unknown. While the Company has been negatively impacted by COVID-19, given the nature of the Company’s operations, COVID-19 has increased customer demand and created new opportunities for mCloud to engage with new and existing customers using the remote connectivity offered by AssetCare™.

ANNUAL RESULTS FOR THE THREE YEARS ENDED DECEMBER 31, 2021, 2020 AND 2019

COVID Government Support

The Company received government assistance in both Canada the United States and Australia to help temper the financial impact of the crisis. During the three and twelve months ended December 31, 2021, government assistance of $0.472 million and $4.202 million, respectively, was recorded in Other Income on the consolidated statements of loss and comprehensive loss (three months and year ended December 31, 2020, $0.821 and $2.776 million, respectively).

Impact on Strategic Plan and Growth

The Company continues to assess the economic impacts of COVID-19 pandemic on its future operations, including the liquidity forecast and valuation of the Company’s intangible and goodwill assets related to recent acquisitions. As at December 31, 2021, the Company’s senior management team has determined that the value of the Company’s assets is not materially impacted. In making this judgment, management has assessed various criteria including, but not limited to, existing laws, regulations, orders, disruptions, and potential disruptions in commodity prices and capital markets.

Overview

Basis of Presentation and Accounting Policies

The Company’s 2021 Financial Statements have been prepared in accordance with IFRS as issued by the IASB. IFRS comprises IFRSs, International Accounting Standards (“IASs”), and interpretations issued by the IFRS Interpretations Committee (“IFRICs”) and the former Standing Interpretations Committee (“SICs”). Note 33 of the Company’s financial statements for the year ended December 31, 2021, provides details of the significant accounting policies. There were no changes in accounting policy in the year that had a material impact on the Company’s financial statements.

Critical Accounting Policies and Estimates

Management is required to make judgments, estimates and assumptions that affect the carrying amounts of assets and liabilities and disclosure of contingent liabilities at the dates of the consolidated financial statements, and the reported amounts of revenues and expenses during each reporting period.

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The estimates and associated assumptions are limited by the relevance of historical data and uncertainty of future events. Actual results could differ from those estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the year in which the estimate is revised if the revision affects only that year or in the year of the revision and future years if the revision affects both current and future years.

Determination of control of subsidiaries

Judgement is required to determine when the Company has control of subsidiaries. This requires an assessment of the relevant activities of the investee, being those activities that significantly affect the investee’s returns. Despite owning no shares, or having any voting rights, the Company determined that it exercises control over Agnity as the Company has the right to nominate a majority of the members of Agnity’s Operations Committee and therefore the right and ability to direct the relevant activities of Agnity and to significantly affect its returns through the use of its rights. The Company has the right to receive royalty collectability from Agnity on a monthly basis in perpetuity and the Company has credit risk with respect to the collectability of these royalty payments.

Assessment of indicators of impairment of goodwill, long-lived assets and intangible assets

Management reviews, goodwill, depreciable long-lived assets and intangible assets for impairment triggers to determine if any events or changes in circumstances exist that would indicate that the carrying amount of an asset may not be recoverable over time. If impairment indicators exist, impairment assessments are conducted as the asset level or level of cash generating units (“CGUs”) as appropriate.

Leases

In measuring the Company’s leases judgement is required to determine the lease term of the contract including whether the Company is reasonably certain to exercise extension options where it is the lessee. A longer lease term results in a larger lease liability and right-of-use asset to be recognized by the Company and future changes in this lease term will result in modifications. In addition, estimates and assumptions are required to determine the incremental borrowing rate used to measure lease liabilities on adoption and at inception of a lease.

Contingent consideration

Management uses judgement to assess the existence of contingencies. By their nature, contingencies will only be resolved when one or more future events occur or fail to occur. Management also uses judgement to assess the likelihood of the occurrence of one or more future events which impacts the fair value of the contingent consideration at the end for the Reporting Period.

Value of components for convertible debt and equity offerings

Management makes judgements related to the measurement of the fair value of the convertible debentures and equity offerings issued in the period, including the determination of the allocation of the proceeds between the components of the instrument. At inception of an instrument, the Company determines the value of each piece of the instrument and judgement is required in determining the inputs used in the fair value calculations and in determining the probability of certain outcomes.

Determination of stand-alone selling price

The total transaction price of certain revenue contacts is allocated to each performance obligation on a relative stand-alone selling price (“SSP”) basis, representing the selling price as if it was sold separately. This is a formal process involving judgement which could impact the timing of recognized revenue. In most cases, the SSP is based on observable data. If the SSP is not directly observable, the amount is estimated using either the expected cost plus a margin or residual approach. The SSP for perpetual software licenses is highly variable and therefore the Company applies the residual approach.

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Expected credit loss allowance and provision

The Company recognizes an amount equal to the lifetime expected credit loss (“ECL”) on trade and long term receivables, other receivables, unbilled revenue and amounts due from related parties for which there has been a significant increase in credit risk since initial recognition. Loss allowances are measured based on historical experience and forecasted economic conditions. The amount of ECL is sensitive to changes in circumstances of forecast economic conditions.

Impairment of goodwill and other non-financial assets

Goodwill is reviewed annually on December 31 of each financial year, or more frequently if changes in circumstances indicate that the carrying value may be impaired. The Company completed its annual impairment testing as at December 31, 2021 and determined there was no impairment. Determining whether an impairment has occurred requires the valuation of the respective assets or CGUs, which the Company estimate the recoverable amount using a discounted cash flow method. The key estimates and assumptions used are revenue growth, gross margin, and discount rate. These estimates are based on past experience and management’s expectations of future changes in the market and forecasted growth initiatives.

Share-based payments

The Company uses the Black-Scholes option-pricing model to determine the fair value of stock options and other equity instruments where the goods and services cannot be valued. In estimating the fair value, management is required to make certain assumptions and estimates such as the expected life of options, volatility of the Company’s future share price, risk-free rate, future dividend yields and estimated forfeitures at the initial grant measurement date. Changes in assumptions used to estimate fair value could result in different outcomes.

Business combinations—purchase price allocation

The consideration transferred and acquired assets and assumed liabilities are recognized at fair value on the date the Company effectively obtains control. The measurement of each business combination is based on the information available on the acquisition date. The estimate of fair value of the consideration transferred and acquired intangible assets (including goodwill), property and equipment, other assets and the liabilities assumed are based on estimates and assumptions. The measurement is largely based on projected cash flows, discount rates and market conditions at the date of acquisition. See “Fair Market Value” in this MD&A for further discussion.

Taxation

Calculations for current and deferred taxes require management’s interpretation of tax regulations and legislation in the various tax jurisdictions in which the Company operates, which are subject to change. The measurement of deferred tax assets and liabilities requires estimates of the timing of the reversal of temporary differences identified and management’s assessment of the Company’s ability to utilize the underlying future tax deductions against future taxable income before they expire, which involves estimating future taxable income.

The Company is subject to assessments by various taxation authorities in the tax jurisdictions in which it operates, and these taxation authorities may interpret the tax legislation and regulations differently. In addition, the calculation of income taxes involves many complex factors. As such, income taxes are subject to measurement uncertainty and actual amounts of taxes may vary from the estimates made by management.

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CONTROLS AND PROCEDURES

Prior to 2022, the Company was not required to establish and maintain DC&P and ICFR pursuant to National Instrument (“NI”) 52-107. The Company is listed on the TSX-V and on November 24, 2021, also listed and commenced trading its shares on NASDAQ. As a result of the NASDAQ listing, the Company is no longer a venture issuer. Accordingly, commencing in 2022, mCloud is required to establish and maintain DC&P and ICFR.

In light of these new requirements for 2022, the following discussion provides preliminary commentary about the Company’s D&CP and ICFR.

Disclosures Controls and Procedures

The Company’s disclosure controls and procedures (“DC&P”), as defined in National Instrument 52-109 Certification of Disclosure in Issuer’s Annual Filings (“NI 52-109”) are designed to provide reasonable assurance that information required to be disclosed in our filings under securities legislation is recorded, processed, summarized and reported within the time periods specified in securities legislation. They are also designed to provide reasonable assurance that all information required to be disclosed in these filings is accounted for, accumulated and communicated to the Company’s senior management team including the CEO and Chief Financial Officer (“CFO”) as appropriate. This is meant to allow for timely decisions regarding public disclosure.

The Company cannot provide absolute assurance that all information required to be disclosed in its filings is reported within the time periods specified in securities legislation because of the limitations in control systems to prevent or detect all misstatements due to error or fraud. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues, if any, within the Company have been detected.

Internal Controls over Financial Reporting

The Company’s senior management team is responsible for establishing and maintaining adequate internal controls over financial reporting (“ICFR”), as defined in NI 52-109. ICFR means a process designed by or under the supervision of the CEO and CFO, and effected by the Company’s board of directors, management and other personnel to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with IFRS, and includes those policies and procedures that: (1) pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the Company; (2) are designed to provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with IFRS, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and (3) are designed to provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. In addition, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions and that the degree of compliance with the policies or procedures may deteriorate.

A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the Company’s annual or interim financial statements will not be prevented or detected on a timely basis.

Commencing the first quarter of 2022, the Company will be required to report any material weaknesses in the design of ICFR. Any such material weaknesses would also impact DC&P. Although we have not completed a full evaluation as of this date, we are aware of material weaknesses.

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Management has identified the following material weaknesses:

• An ineffective control environment resulting from an insufficient number of trained financial reporting and accounting, information technology (IT) and operational personnel with the appropriate skills and knowledge and with assigned responsibility and accountability related to the design, implementation and operating effectiveness of internal control over financial reporting.

• The insufficient number of personnel described above contributed to an ineffective risk assessment process necessary to identify all relevant risks of material misstatement and to evaluate the implications of relevant risks on its internal control over financial reporting.

• An ineffective information and communication process resulting from (i) insufficient communication of internal control information, including objectives and responsibilities, such as delegation of authority; and (ii) ineffective general IT controls and ineffective controls related to spreadsheets, resulting in insufficient controls to ensure the relevance, timeliness and quality of information used in control activities.

• As a consequence of the above and as a result of inadequate segregation of duties and secondary review, the Company had ineffective control activities related to the design, implementation and operating effectiveness of process level and financial reporting controls which had a pervasive impact on the Company’s internal control over financial reporting.

• An ineffective monitoring process resulting from the evaluation and communication of internal control deficiencies, including monitoring corrective actions, not being performed in a timely manner.

These material weaknesses resulted in material misstatements, which were corrected prior to the release of the consolidated financial statements as of and for the year ended December 31, 2021, and also in immaterial misstatements, some of which were corrected prior to the release of the consolidated financial statements as of and for the year ended December 31, 2021. These material weaknesses create a reasonable possibility that a material misstatement to the consolidated financial statements will not be prevented or detected on a timely basis.

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Remediation

The Company is still considering the full extent of the procedures to implement in order to remediate the material weaknesses described above, however the current remediation plan includes:

• Identifying key positions necessary to support the Company’s initiatives related to internal controls over financial reporting and expanding its hiring efforts accordingly.

• Hiring consultants to assist with process improvements and control remediation efforts in targeted accounting, IT and operations processes.

• Formalizing its entity-wide risk assessment process and documenting internal ownership of risk monitoring and mitigation efforts, with improved risk monitoring activities and regular reporting to those charged with governance at an appropriate frequency.

• Finalize a delegation of authority matrix to enforce desired limits of authority for key transactions, events, and commitments, and communicating these limits of authority to relevant personnel throughout the Company.

• Further simplify and streamline its spreadsheet models to reduce the risk of errors in mathematical formulas and improve the ability to verify the logic of spreadsheets.

• Hiring a consultant to assist management with process improvements and control remediation for general IT controls.

• Continuing to perform scoping exercises and planning for an ERP implementation to streamline the number of applications used for financial reporting activities.

FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT

A description of the Company’s financial instruments and the financial risks that the Company is exposed to and management of these risks can be found in Notes 26 and 27, respectively, of the Company’s 2021 Financial Statements.

Fair Values

The carrying values of cash and cash equivalents, trades and other receivables, bank indebtedness, trade payables and accrued liabilities, other liabilities, business acquisition payable, and due to related parties approximate their fair values due to the immediate or short-term nature of these instruments. The fair values of long-term receivables, loans and borrowings, and convertible debentures approximate their carrying values as they were either recently issued by the Company or fair valued as part of the acquisition purchase price allocations or their interest rate approximates market rate. There has been no significant change in credit and market interest rates since the date of their issuance. The derivative asset is carried at fair value and revalued at each reporting date.

Fair value estimates are made at a specific point in time, based on relevant market information and information about the financial instruments. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and, therefore, cannot be determined with precision. Changes in assumptions could significantly affect the estimates.

Risk Management

The Company’s board of directors has overall responsibility for determining the Company’s capital and risk management objectives and policies, while retaining ultimate responsibility for ensuring the successful execution of such objectives and policies. The Company’s overall capital and risk management program has not changed throughout the year. This program focuses on the unpredictability of financial markets and seeks to minimize potential adverse effects on financial performance. Risk management is carried out by the Company’s finance department under policies approved by the Company’s board of directors. The finance department identifies and evaluates financial risks in close cooperation with the Company’s senior management team.

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Credit Risk

Credit risk is the risk that a third party might fail to discharge its obligations under the terms of a financial contract. Credit risk is limited to the following instruments and the Company’s maximum exposure to credit risk is the carrying value of the financial assets.

The Company is mainly exposed to credit risk from credit sales. Management of the Company monitors the creditworthiness of its customers by performing background checks on all new customers. Further, management monitors the frequency of payments from ongoing customers and performs frequent reviews of outstanding balances. The Company considers that there has been a significant increase in credit risk when contractual payments are more than 90 days past due.

Provisions for outstanding balances are established based on forward-looking information and revised when there are changes in circumstances that would create doubt over the receipt of funds. Such reviews are conducted on a continued basis through the monitoring of outstanding balances as well as the frequency of payments received. Accounts receivables are completely written off once management determines the probability of collection to be remote.

Trade and other receivables, unbilled revenue and long-term receivables are from individual customers and are not assessed based on external credit rating agencies. The Company uses a provision matrix to measure the lifetime expected credit loss (“ECL”) of these balances. Receivables are grouped based on similar credit risk profiles and days past due. Loss rates are based on actual credit loss experience and reflect the forward-looking conditions over the expected life of the receivable.

Market risk

This is the risk that changes in market prices such as interest rates or foreign exchange rates will affect the Company’s results or value as a result of holding these financial instruments. The object of market risk management is to manage and control market risk exposures within acceptable parameters given the nature of the business.

Interest Rate Risk

Interest rate risk is the risk that the fair value or future cash flows of the Company’s financial instruments will fluctuate because of changes in market interest rates. The Company is exposed to interest rate risk on its credit facility. Management does not believe interest rate risk is currently material to its business.

Foreign Currency Risk

Currency risk is the risk that the fair values or future cash flows of the Company’s financial instruments will fluctuate because of changes in foreign currency rates and the degree of volatility of these rates. The Company conducts its business in Canada, Asia-Pacific, the United States and Europe, the Middle East and Africa, which gives rise to exposure to markets from changes in foreign currency rates. Currently, the Company does not use derivative instruments or other measures to reduce its exposure to foreign currency risk.

At December 31, 2021, the C$ equivalent carrying amount of the Company’s US$ denominated monetary assets and liabilities was C$14.554 million (December 31, 2020 - C$8.291 million) and C$11.685 million (December 31, 2020 - C$16.399 million), respectively. Assuming all other variables remain constant, a fluctuation of +/- 5.0% in the exchange rate between C$ and US$ would impact the net loss for the period by approximately C$0.143 million (December 31, 2020 - C$0.405 million).

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SELECTED ANNUAL FINANCIAL INFORMATION

The information in the tables below is derived from the Company’s audited consolidated financial statements for each of the three most recently completed financial years. These have been prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”) and are presented in Canadian dollars which is the functional and presentation currency of the Company. All figures reported in the MD&A are reported in millions, except for per share, stock option, common share, percentages and unit amounts. The information below is not necessarily indicative of results for any future financial year.

Years ended December 31	2021		2020		2019
Revenues	$	25.597	$	26.928	$	18.340
Gross profit		15.913		16.647	$	10.757
Total expenses		54.665		46.360	$	27.138
Other expenses (income)		5.947		5.148	$	11.514
Net loss		44.699		34.861	$	27.895
Loss per share attributable to mCloud shareholders – basic and diluted(1)		3.76	$	5.01	$	6.97
Total assets		72.106	$	77.319	$	59.859
Total non-current financial liabilities		1.513	$	33.443	$	32.146

(1) The Company has corrected loss per share attributable to mCloud shareholders basic and diluted. See Basis of Presentation in Note 2 to the Annual 2021 Financial Statements for further information.

Review of Annual Financial Results

The table below provides key financial performance metrics of the Company for the years ended December 31, 2021, December 31, 2020 and December 31, 2019. This information should be read in conjunction with the Annual 2021 and 2020 Financial Statements.

Years ended December 31,

	2021			2020			2019			2021 vs 2020 Change $			2021 vs 2020 Change %			2020 vs 2019 Change $			2020 vs 2019 Change %
Revenue	$	25.597		$	26.928		$	18.340		$	(1.331	)		(5	)%	$	8.588			47	%
Cost of Sales		(9.684	)		(10.282	)		(7.583	)		0.598			(6	)%		(2.699	)		36	%
Gross Profit	$	15.913		$	16.647		$	10.757		$	(0.733	)		(4	)%	$	5.890			55	%
Expenses
Salaries, wages and benefits	$	21.692		$	20.885		$	10.314		$	0.807			4	%	$	10.571			102	%
Sales and marketing		1.377			1.536			3.167			(0.159	)		(10	)%		(1.631	)		(51	)%
Research and development		3.179			1.078			0.498			2.101			195	%		0.580			116	%
General and administrative		8.539			5.742			3.295			2.797			49	%		2.447			74	%
Professional and consulting fees		9.085			8.886			4.352			0.199			2	%		4.534			104	%
Share-based compensation		1.868			1.454			1.468			0.414			28	%		(0.014	)		(1	)%
Depreciation and amortization		8.925			6.778			4.044			2.147			32	%		2.734			68	%
Total expenses	$	54.665		$	46.360		$	27.138		$	8.305			18	%	$	19.222			71	%
Operating loss	$	38.752		$	29.714		$	16.380		$	9.039			30	%	$	13.334			81	%
Other Expenses (income)
Finance costs	$	8.619		$	6.034		$	3.218		$	2.585			43	%	$	2.816			88	%
Foreign exchange loss (gain)		(0.267	)		1.198			0.494			(1.466	)		(122	)%		0.704			143	%
Impairment		—			—			0.601									(0.601	)		(100	)%
Business acquisition costs and other expenses		0.346			1.812			9.880			(1.465	)		(81	)%		(8.068	)		(82	)%
Fair value loss on derivatives		6.040			—			—			6.040			100	%		—			—	%
Other income		(7.126	)		(2.932	)		(0.168	)		(4.194	)		143	%		(2.764	)		1645	%
Loss before tax	$	46.364		$	35.825		$	30.405		$	10.539			29	%	$	5.420			18	%
Current tax expense (recovery)	$	0.157		$	(0.296	)	$	(0.182	)	$	0.453			(153	)%	$	(0.114	)		63	%
Deferred tax (recovery) expense		(1.822	)		(0.668	)		2.692			(1.154	)		173	%		(3.360	)		(125	)%
Net loss for the period	$	44.699		$	34.861		$	27.895		$	9.838			28	%	$	6.966			25	%

53

Revenue

In the following tables, revenue is disaggregated by nature and timing of revenue recognition. See Segment Reporting Information in Note 4 to the Annual 2021 and 2020 Financial Statements for further information on revenue by location.

Years ended December 31,

Major Service Line	2021		2020		2019		2021 vs 2020 Change $			2021 vs 2020 %			2020 vs 2019 Change $			2020 vs 2019 %
AssetCare Initialization	$	1.250	$	7.689	$	5.965	$	(6.439	)		(84	)%	$	1.724			29	%
AssetCare Solutions		23.462		12.809		2.940		10.653			83	%		9.869			336	%
Engineering Services		0.885		6.430		9.436		(5.545	)		(86	)%		(3.005	)		(32	)%
Total	$	25.597	$	26.928	$	18.340	$	(1.331	)		(5	)%	$	8.588			47	%

The material factors driving the Company’s 83% increase in AssetCare Solutions revenues from 2020 to 2021 are the increase in subscription and post-contract support and maintenance revenues related to AssetCare solutions that were initialized in 2019 and 2020 and new customer contracts to provide engineering services involving the use of AssetCare. These solutions contributed to AssetCare Solutions revenues as the Company provided ongoing service in 2021.

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Timing of revenue recognition	2021		2020		2019		2021 vs 2020 Change $			2021 vs 2020 %			2020 vs 2019 Change $		2020 vs 2019 %
Revenue recognized over time	$	24.423	$	18.551	$	12.375	$	5.872			32	%	$	6.176		50	%
Revenue recognized at point in time upon completion		1.174		8.377		5.965		(7.202	)		(86	)%		2.412		40	%
Total	$	25.597	$	26.928	$	18.340	$	(1.331	)		(5	)%	$	8.588		47	%

Revenues for the year ended December 31, 2021, were $25.597 million, compared to $26.928 million for the same period in 2020, a decrease of $1.331 million, or 5%, primarily due to $6.439 million lower AssetCare Initialization and $5.545 million lower Engineering Services, partially offset by $10.653 million higher sales from AssetCare Solutions. Restrictions associated with COVID-19 prevented the delivery of the planned AssetCare Initialization at commercial sites and a reduction in Engineering Services. In particular, restrictions in the province of Alberta where the Company has significant business precluded in-person access to sites where assets were expected to be connected, and reduced operations at some commercial sites meant AssetCare benefits were not fully realized while restrictions were in place.

For the year ended December 31, 2020, revenues increased by $8.588 million, to $26.928 million from $18.340 million for the same period in 2019. The increase was due to an increase of $9.869 million in AssetCare Solutions, and higher AssetCare Initialization of $1.724 million due to an increase of customers onboarded during 2020, partially offset by lower Engineering Services of $3.005 million attributable to COVID-19 delays performing in-person engineering services.

The Company operates in one operating segment. For the purpose of segment reporting, the Company’s Chief Executive Officer (“CEO”) is the Chief Operating Decision Maker. The determination of the Company’s operating segment is based on its organizational structure and how the information is reported to the CEO on a regular basis. The Company’s revenue is generated from its customers in Canada, the United States of America, Asia-Pacific, Europe, and the Middle East and Africa. The Company’s assets primarily reside in North America and Australia. See “Risk Factors” in the Company’s Annual Information Form for further discussion on the risks and uncertainties that the Company believes may materially affect the Company’s future performance, including total revenue.

The Company’s revenue by location of the ultimate customer or consumer of product solution are as follows:

	Year ended December 31,
	2021		2020		2019
Canada	$	10.734	$	13.833	$	10.890
United States		6.564		5.691		7.451
Japan		5.850		6.447		—
Australia		0.994		0.152		—
Other		1.455		0.805		—
Total revenue	$	25.597	$	26.928	$	18.341

The change in revenues in Canada was due to the impacts of the COVID-19 pandemic. Restrictions associated with COVID-19 prevented the delivery of the planned AssetCare Initialization at commercial sites and a reduction in the associated Engineering Services required to prepare commercial sites for the delivery of services in Canada. In particular, restrictions in the province of Alberta where the Company has significant business precluded in-person access to sites where assets were expected to be connected, and reduced operations at some commercial sites meant AssetCare benefits were not fully realized while restrictions were in place. We do not believe that the changes in year over year revenue in the other countries had significant impact other than the timing associated with certain contracts.

Modest changes in revenue in countries outside of Canada were driven largely by timing of certain renewals and new contracts signed with customers located in Japan during 2020.

55

The table below presents significant customers who accounted for greater than 10% of total revenues for the years ended December 31, 2021, 2020 and 2019:

	2021			2020			2019
Customer A		Less than 10	%		13.6	%		n/a
Customer B		Less than 10	%		13.1	%		11.0	%
Customer C		11.3	%		Less than 10	%		20.0	%
Customer D		10.7	%		Less than 10	%		n/a

Cost of Sales, Gross Profit, Gross Margin %

Years ended December 31,

	2021			2020			2019			2021 vs 2020 Change $			2021 vs 2020 %			2020 vs 2019 Change $		2020 vs 2019 %
Cost of Sales	$	9.684		$	10.282		$	7.583		$	(0.598	)		(6	)%	$	2.699		36	%
Gross Profit		15.913			16.647			10.757			(0.733	)		(4	)%		5.890		55	%
Gross Margin %		62.2	%		61.8	%		58.6	%					1	%				3	%

Cost of sales for the year ended December 31, 2021, were $9.684 million, a decrease of 6% from the same period in 2020 of $10.282 million, in line with the overall decrease in revenue of 5%. Gross margin % was relatively flat year over year.

Cost of sales for the year ended December 31, 2020, increased to $10.282 million from $7.583 million for the year ended December 31, 2019. Gross profit for the year ended December 31, 2020, increased to $16.647 million from $10.757 million for the year ended December 31, 2019 due to a change in revenue types and significantly higher revenues.

Expenses

Years ended December 31,

Expenses	2021		2020		2019		2021 vs 2020 Change $			2021 vs 2020 %			2020 vs 2019 Change $			2020 vs 2019 %
Salaries, wages and benefits	$	21.692	$	20.885	$	10.314	$	0.807			4	%	$	10.571			102	%
Sales and marketing		1.377		1.536		3.167		(0.159	)		(10	)%		(1.631	)		(51	)%
Research and development		3.179		1.078		0.498		2.101			195	%		0.580			116	%
General and administration		8.539		5.742		3.295		2.797			49	%		2.447			74	%
Professional and consulting fees		9.085		8.886		4.352		0.199			2	%		4.534			104	%
Share-based compensation		1.868		1.454		1.468		0.414			28	%		(0.014	)		—	%
Depreciation and amortization		8.925		6.778		4.044		2.147			32	%		2.734			68	%
Total	$	54.665	$	46.360	$	27.138	$	8.305			18	%	$	19.222			71	%

56

Total expenses for the year ended December 31, 2021, increased by 18% or $8.305 million compared with the same period in 2020. For the year ended December 31, 2020, total expenses increased 71% or $19.222 million, compared to the same period in 2019. The most significant changes for the periods presented are as follows:

• General and administration expenses, which typically consist of public company fees, bad debt expense, rent expense, and recruitment costs, increased by 49% or $2.797 million in 2021 compared to 2020, primarily due to an increase in the loss allowance of $1.162 million related to uncollectible receivables, and $1.000 million associated with the Company’s NASDAQ listing, combined with costs associated with a full year of the Company’s ownership of its kanepi subsidiary that were not present in the year ended December 31, 2020. General and administration expenses increased by 74% or $2.447 million for the year ended December 31, 2020, compared to the year ended December 31, 2019, primarily due to facilities and overhead costs associated with a full year of ownership of its subsidiaries including mCloud Technologies Services (“MTS”), acquired in Q3 2019, Construction Systems Associates, Inc. USA (“CSA”), acquired in Q1 2020, and kanepi, acquired in Q4 2020.

• Depreciation and amortization expenses increased by 32% or $2.147 million in 2021 compared to 2020, attributable to a full year of amortization of intangibles acquired through business and asset acquisitions in Fiscal 2020. Depreciation and amortization expenses increased by 68% or $2.734 million in 2020 compared to 2019, due to amortization of intangibles assets acquired through acquisitions of Agnity, MTS and CSA.

• The Company’s customers use its software to monitor their assets and rely on the Company to provide updates and releases as part of its software maintenance and support services. While the Company has not developed a formal research and development policy, the Company is and has been engaged with a number of research and development initiatives as a part of its ongoing effort to continually update its software and develop new products. Research and development expenses increased by $2.101 million in 2021 compared to 2020, due to ongoing development and investments in AssetCare Mobile, IAQ Badge and 3D technologies. Research and development expenses increased by $0.580 million in 2020 compared to 2019, due to the development of AssetCare project investments.

• Professional and consulting expenses increased by $0.199 million in 2021 compared to 2020, due to the Company retaining more consultants for various accounting and professional service functions that were previously performed by employees in 2020, combined with the costs associated with a full year of the Company’s ownership of its kanepi subsidiary. Professional and consulting expenses increased by $4.534 million in 2020 compared to 2019, attributable to professional legal and advisory, as well as accounting and valuation services related to business acquisitions and financings completed during the year.

• For the year ended December 31, 2021, salaries, wages and benefits were flat year over year, compared to the same period in 2020. Salaries, wages and benefits increased by 102% or $10.571 million in 2020 compared to 2019, due to higher headcount attributable to acquisitions of CSA and kanepi, combined with added personnel in the asset purchase of AirFusion.

• The above noted increases were partially offset by a decrease in the Company’s sales and marketing costs by 10% or $0.159 million due to lower marketing spending early in 2021, as the pandemic curtailed industry activity and the Company elected to spend less. This decrease in spending was partially offset by the mCloud Connect event that took place in 2021. For the year ended December 31, 2020, sales and marketing decreased by 51% or $1.631 million compared to the same period in 2019, due to the curtailment of activities attributable to ongoing COVID-19 restrictions.

57

Other Expenses (Income)

Years ended December 31,

Other expenses (income)	2021			2020			2019			2021 vs 2020 Change $			2021 vs 2020 %			2020 vs 2019 Change $			2020 vs 2019 %
Finance costs	$	8.619		$	6.034		$	3.218		$	2.585			43	%	$	2.816			88	%
Foreign exchange loss (gain)		(0.267	)		1.198			0.494			(1.465	)		(122	)%	$	0.704			143	%
Impairment of intangible asset		—			—			0.601			—			—	%	$	(0.601	)		(100	)%
Business acquisition costs and other expenses		0.346			1.812			9.880			(1.466	)		(81	)%	$	(8.068	)		(82	)%
Fair value loss on derivatives		6.040			—			—			6.040			—	%	$	—			—	%
Other income		(7.126	)		(2.932	)		(0.168	)		(4.194	)		143	%	$	(2.764	)		1645	%
Total	$	7.612		$	6.111		$	14.025		$	1.500			25	%	$	(7.914	)		4713	%

Other expenses (income) increased by $1.500 million during the year ended December 31, 2021, compared to the same period in 2020. For the year ended December 31, 2020, Other expenses (income) decreased $7.914 million, compared to the same period in 2019. The primary driver for these changes are as follows:

• Finance costs increased by $2.585 million during the year ended December 31, 2021, compared to the same period in 2020, due to increased interest and transaction costs associated with the 2021 Convertible Debentures, which were converted in Q3 2021, along with interest and fees on new borrowings, partially offset by lower interest on repaid borrowings. Finance costs increased by $2.816 million for the year ended December 31, 2020, compared with the same period in 2019, due to higher interest expense on the 2019 Convertible Debentures, with the funds used for business acquisitions.

• Foreign exchange was a gain of $0.267 million for the year ended December 31, 2021, compared to a loss of $1.198 million for the same period in 2020, due to an increase in US denominated financings in 2021. For the year ended December 31, 2020, the foreign exchange loss increased by $0.704 million to $1.198 million from $0.494 million for the same period in 2019, as a result of the timing of cash receipts and payments.

• During the year ended December 31, 2021, the Company determined that the amount of the contingent consideration recognized at the date of acquisition of CSA would not be payable as the operational performance metrics were not achieved. In addition, the fair value of the contingent consideration recognized at the date of acquisition for kanepi remeasured based on management’s estimate of the likelihood the performance metrics would be met by October 2022, resulting in a decrease in fair value and an offsetting amount recognized as other income, presented as business acquisition costs and other expenses. For the year ended December 31, 2019, business acquisition costs included $9.870 million incurred as transaction costs in connection with acquisitions including consulting fees, legal and professional fees and fair value of $8.880 million for 800,000 common shares issued for brokering and due diligence services.

• Fair value changes in derivatives were a loss of $6.040 million for the year ended December 31, 2021. These are non-cash losses as a result of the conversion of the 2021 Convertible Debenture into common shares and warrants. The initial fair value loss on the convertible debentures along with losses on modification and remeasurement of the financial liability, partially offset by gains on the remeasurement of the warrant liability from date of issuance on August 13, 2021 to December 31, 2021 are the primary drivers of this amount. The additional element of these fair value changes in derivatives relates to the remeasurement of warrant liabilities issued in November 2021, at December 31, 2021.

58

• Other Income increased by $4.194 million for the year ended December 31, 2021, to $7.126 million from $2.932 million for the same period in 2020. The majority of Other Income includes wage and rent subsidies received from the Canadian government and low-interest loans from the US government, which were partially forgiven in 2021 and 2020. Also during the year ended December 31, 2021, contingent consideration associated with the acquisition of CSA and kanepi was determined not to be payable and as such, $1.010 million was recognized in Other Income. For the year ended December 31, 2020, Other Income increase by $2.764 million compared to the same period in 2019, primarily due to wage subsidies and benefits from low-interest loans received from US and Canadian government COVID-19 relief programs.

Current and Deferred Income Taxes

Years ended December 31,

Expenses	2021			2020			2019			2021 vs 2020 Change $			2021 vs 2020 %			2020 vs 2019 Change $			2020 vs 2019 %
Current tax expense (recovery)	$	0.157		$	(0.296	)	$	0.182		$	0.453			(153	)%	$	(0.478	)		(262	)%
Deferred tax expense (recovery)	$	(1.822	)	$	(0.668	)	$	(2.692	)	$	(1.154	)		173	%	$	2.024			(75	)%

For the year ended December 31, 2021, current tax expense was $0.157 million compared to a current tax recovery of $0.296 million, compared to the same period in 2020. The increase in current tax expense of $0.453 million was due to taxes owing attributable to taxable income in the US operations. For the year ended December 31, 2020, current taxes decreased by $0.478 million from a current tax expense of $0.182 million for the same period in 2019, attributable to the carry back of 2020 tax losses for refunds of past taxes paid.

For the year ended December 31, 2021, the Company recorded a deferred tax recovery of $1.822 million compared with a deferred tax recovery of $0.668 million, for the same period in 2020. The increase in the deferred tax recovery was primarily due to foreign tax rate and other foreign tax differences. For the year ended December 31, 2020, the deferred tax recovery decreased by $2.024 million, to $2.692 million for the same period in 2019. The decrease was due to the recognition of deferred tax assets, recognized through profit and loss to offset deferred tax liabilities recognized in equity on the issuance of convertible debentures.

The Company has net operating losses of approximately USD$60.9 million and non-capital losses of C$70.2 million (December 31, 2020 – USD$44.1 million and C$49.6 million) which are available to reduce future year’s taxable income in the United States and Canada, respectively. The net operating losses will commence to expire in 2029 while the non-capital losses will commence to expire in 2027 if not utilized.

The Company has foreign tax losses in various jurisdictions of C$2.3 million (December 31, 2020—C$1.2 million) which are available to reduce future year’s taxable income in their respective countries. The losses vary in expiry from five years to indefinite life.

The investment tax credit balance is C$0.5 million (December 31, 2020 – C$0.5 million) which is available to reduce future year’s taxes payable in Canada. The investment tax credits begin to expire in 2022 if not utilized.

59

REVIEW OF QUARTER FINANCIAL RESULTS FOR THE THREE MONTHS ENDED DECEMBER 31, 2021 AND 2020

Revenue

In the following tables, revenue is disaggregated by nature and timing of revenue recognition.

Three months ended December 31,

Major Service Line	2021		2020		Change $			Change %
AssetCare Initialization	$	0.173	$	2.672	$	(2.499	)		(94	)%
AssetCare Solutions		3.886		5.546		(1.660	)		(30	)%
Engineering Services		0.111		1.005		(0.894	)		(89	)%
Total	$	4.170	$	9.223	$	(5.053	)		(55	)%

Timing of revenue recognition	2021		2020		Change $			Change %
Revenue recognized over time	$	4.073	$	4.757	$	(0.684	)		(14	)%
Revenue recognized at point in time upon completion		0.097		4.466		(4.369	)		(98	)%
Total	$	4.170	$	9.223	$	(5.053	)		(55	)%

For the three months ended December 31, 2021, total revenue was $4.170 million, a decrease of $5.053 million, compared to $9.223 million for the same period in 2020. This decrease is attributable the resurgence of the “Omicron” COVID-19 variant and the return of stricter COVID-19 restrictions, which led to a decrease of $2.499 million and $1.660 million, respectively, in revenues generated from the AssetCare Initialization and AssetCare Solutions categories, combined with a decrease of $0.894 million in revenues generated from Engineering Services. These revenue streams are dependent on performing in-person services and have been impacted by the COVID-19 restrictions.

Cost of Sales, Gross Profit, Gross Margin %

Three months ended December 31,

	2021			2020			Change $			Change %
Cost of Sales	$	1.507		$	3.579		$	(2.072	)		(58	)%
Gross Profit		2.664			5.644			(2.981	)		(53	)%
Gross margin %		63.9	%		61.2	%					4	%

Cost of sales for the three months ended December 31, 2021, were $1.507 million, a decrease of 58% from $3.579 million for the same period in 2020, primarily due to a decrease of in-person services related to tighter COVID-19 restrictions in the last quarter of the year. For the three months ended December 31, 2021, gross profit decreased by $2.981 million to $2.664 million from $5.644 million for the same period in 2020, primarily due to a decrease in revenues of $5.053 million, partially offset by a decrease in cost of sales by $2.072 for the reasons noted above.

Expenses

Three months ended December 31,

Expenses	2021		2020		Change $		Change %
Salaries, wages and benefits	$	5.608	$	4.486	$	1.122		25	%
Sales and marketing		0.400		0.304		0.096		32	%
Research and development		1.105		0.323		0.782		242	%
General and administration		4.187		1.924		2.263		118	%
Professional and consulting fees		2.446		2.090		0.356		17	%
Share-based compensation		0.684		0.427		0.257		60	%
Depreciation and amortization		2.146		1.917		0.229		12	%
Total	$	16.576	$	11.471	$	5.105		45	%

60

Total expenses for the three months ended December 31, 2021, increased by 45% or $5.105 million compared with the same period in 2020. The most significant changes between 2021 and 2020 are as follows:

• General and administration expenses increased by 118% or $2.263 million primarily as the result of costs associated with the Company’s NASDAQ listing, which occurred in November 2021, combined with a bad debts provision.

• Research and development expenses increased by $0.782 million in Q4 2021 compared with 2020, related specifically to the ongoing development of AssetCare Mobile, “IAQ” Badge and 3D technologies. Spending in prior year was curtailed as a means of conserving cash.

• Professional and consulting expenses increased by 17% or $0.356 million, primarily related to increased costs for professional services associated with the general efforts to raise capital to explore current and future acquisition opportunities, perform technical accounting and advisory fees and prepare and file the Company’s prospectus supplements. Consultants filled positions in 2021 that were previously held by employees in 2020.

• Salaries, wages and benefits costs increased by 25% or $1.122 million, primarily due to a full year of the costs associated with a full year of the Company’s ownership of its kanepi subsidiary, as compared with the prior year when kanepi was acquired in October 2020. This was partially offset by the use of consultants in 2021 for tasks previously performed by employees in 2020.

• Depreciation and amortization non-cash costs increased by 12% or $0.229 million for Q4 2021. These changes were related to intangible assets which were acquired as part of business and assets acquisitions completed throughout Fiscal 2020 acquired from CSA, and the intangible assets acquired as part of the Company’s acquisition of kanepi.

• Sales and marketing costs increased by 32% mainly as a result of investments by the Company to explore opportunities in the AssetCare solutions across all industries and in particular, in the IAQ space.

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Other Expenses (Income)

Three months ended December 31,

Other expenses (income)	2021			2020			Change $			Change %
Finance costs	$	2.724		$	1.694		$	1.030			61	%
Foreign exchange loss (gain)		(0.041	)		1.583			(1.624	)		(103	)%
Business acquisition costs and other expenses		0.023			0.501			(0.478	)		(95	)%
Fair value gain on derivatives		(3.075	)		—			(3.075	)		—	%
Other income		(1.654	)		(0.971	)		(0.683	)		70	%
Total	$	(2.023	)	$	2.807		$	(4.830	)		(172	)%

Total other expenses (income) decreased by $4.830 million in the three months ended December 31, 2021. The primary drivers are as follows:

• Finance costs increased by $1.030 million for the three months ended December 31, 2021, due to higher interest and fees on new borrowings.

• Foreign exchange changed from a loss of $1.583 million for the comparative period in 2020 to a gain of $0.041 million in Q4 2021. These movements were the result of the timing of cash receipts and payments, combined with the USD public offering that closed in the last quarter of 2021.

• Fair value changes in derivatives constituted a gain of $3.075 million for the three months ended December 31, 2021. These non-cash changes relate to the fair value adjustment for the warrants and was partially offset by the remeasurement of warrant liabilities, issued in November 2021, being revalued at December 31, 2021.

• Other Income increased by $0.683 million for the three months ended December 31, 2021. The majority of Other Income includes wage and rent subsidies received from the Canadian government and low-interest loans from the US government which have been partially forgiven in the periods.

Current and Deferred Income Taxes

Three months ended December 31,

Expenses	2021			2020			Change $			Change %
Current tax expense (recovery)	$	(0.704	)	$	(0.397	)	$	(0.307	)		77	%
Deferred tax expense (recovery)	$	(0.854	)	$	0.682		$	(1.535	)		(225	)%

For the three months ended December 31, 2021, the Company recorded a current tax recovery of $0.704 million, an increase of $0.307 million, compared to $0.397 million for the same period in 2020.

Deferred tax recovery was $0.854 million for the three months ended December 31, 2020, a decrease of $1.535 million from a deferred tax expense $0.682 million, for the same period in 2019.

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SUMMARY OF QUARTERLY RESULTS

The Company’s selected financial information for the eight completed fiscal quarters ending December 31, 2021 is shown in the table below. Accounting policies under IFRS were consistently applied across all periods. Unless indicated otherwise, converted amounts in this section are expressed in Canadian dollars as set out in “Currency and Exchange Rates.”

For the quarter ended:	Q4 2021 (2)		Q3 2021 (1)		Q2 2021 (1)		Q1 2021 (1)		Q4 2020 (2)		Q3 2020		Q2 2020		Q1 2020
Total revenue	$	4.171	$	7.434	$	6.556	$	7.436	$	9.223	$	6.137	$	5.010	$	6.558
Net loss		10.331		15.616		9.000		9.752		8.918		8.713		9.353		7.878
Net loss - mCloud shareholders		10.095		15.466		8.930		10.271		9.302		9.417		9.707		8.021
Basic and diluted loss per share	$	0.73	$	1.22	$	0.88	$	1.12	$	1.02	$	1.15	$	1.53	$	1.47
Total assets	$	72.106	$	73.818	$	79.868	$	75.803	$	77.319	$	68.113	$	64.349	$	67.869
Total non- current financial liabilities	$	1.513	$	12.978	$	24.565	$	43.440	$	33.443	$	33.319	$	37.223	$	32.795

(1) The results for each of the quarters ended March 31, June 30 and September 30, 2021 have been corrected, which impacted revenue, current and non-current long-term accounts receivables; deferred revenue, and correspondingly, impacted net loss and net loss attributable to mCloud shareholders and related loss per share attributable to mCloud shareholders - basic and diluted. During the quarters ended:

• March 31, 2021, decreased revenue and increased net loss, net loss attributable to mCloud shareholders and loss per share attributable to mCloud shareholders - basic and diluted by $0.945 million ($0.10 per share);

• June 30, 2021, decreased revenue and increased net loss, net loss attributable to mCloud shareholders and loss per share attributable to mCloud shareholders - basic and diluted by $0.652 million ($0.13 per share);

• September 30, 2021, increased revenue and decreased net loss, net loss attributable to mCloud shareholders and loss per share attributable to mCloud shareholders - basic and diluted by $0.098 million ($0.01 per share).

(2) The Company has corrected net loss and other comprehensive loss attributable to mCloud shareholders and non-controlling interest for the years ended, 2020 and 2021. This resulted in a reclassification between net loss attributable to mCloud shareholders and non-controlling interest, other comprehensive loss attributable to mCloud shareholders and non-controlling interest and impacted basic and diluted loss per share for the quarters ended December 31, 2020 and December 31, 2021. During the quarters ended:

• December 31, 2020, net loss attributable to mCloud shareholders increased by $0.423 million, net income attributable to noncontrolling interest increased by $0.423 million, and loss per share attributable to mCloud shareholders - basic and diluted increased by $0.05 per share.

• December 31, 2021, net loss attributable to mCloud shareholders increased by $0.433 million, net loss attributable to non-controlling interest decreased by $0.433 million and loss per share attributable to mCloud shareholders - basic and diluted increased by $0.03 per share.

See Basis of Presentation in Note 2 to the Annual 2021 Financial Statements for further information.

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Total revenue was $4.171 million in Q4 2021, a decrease of $5.053 million, compared to $9.223 million in Q4 2020. This decrease is attributable to lower revenues as a result of COVID-19 restrictions.

Net losses in Q4 2021 increased to $10.331 million compared to a net loss of $8.918 million in Q4 2020, resulting in a change of $1.413 million quarter over quarter, primarily attributable to a decrease of $5.053 million of revenue due to COVID-19 restrictions and delays. These were partially offset by a change in other expenses (income) of $4.830 million primarily related to fair value gain on derivatives. Net losses in Q4 2021 decreased to $10.331 million compared to a net loss of $15.616 million in Q3 2021, primarily due to a non-cash derivative loss on the 2021 Convertible Debentures, partially offset by higher revenues in Q3 2021.

Basic and diluted net loss per share of $0.73/share in Q4 2021, was a decrease of $0.29/share, from $1.02/share in Q4 2020. This decrease was primarily attributable to the lower net loss as described above, combined with the increase in share count as a result of the conversion of the 2021 Convertible Debentures in Q3 2021. See “Year in Review – Financing” for further discussion on the 2021 Convertible Debentures and the Company’s listing and public offering on the NASDAQ.

CAPITAL RESOURCES

The Company’s objective and polices for managing capital are to safeguard its ability to continue as a going concern in order to provide returns for shareholders and benefits for other stakeholders and to maintain an optimal capital structure to reduce the cost of capital. The Company manages its capital structure and makes changes based on economic conditions including the impact of the ongoing pandemic, risks that impact the consolidated operations and future significant capital investment opportunities. In order to maintain or adjust its capital structure, the Company may issue new equity instruments or raise additional debt financing.

Analysis of Cash Flows

On December 31, 2021, the Company had $4.588 million in cash ($1.111 million as at December 31, 2020; $0.529 million as at December 31, 2019). All cash was held in bank accounts, primarily with Canadian and US banks.

The following table summarizes cash inflows and outflows for the periods shown.

Cash provided by (used in):	2021			2020			2019
Operating activities	$	(28.330	)	$	(24.856	)	$	(14.516	)
Investing activities		(1.064	)		(6.395	)		(20.732	)
Financing activities		32.927			31.857			34.465
Increase in cash, before effect of exchange rate fluctuation	$	3.533		$	0.606		$	(0.784	)

Cash flows used in operating activities increased to $28.330 million in 2021 compared with $24.856 million in 2020, primarily as a result of a higher net loss in 2021. This was partially offset by increased Other Income and more non-cash charges in 2021 compared with 2020. Cash flow from operations can vary significantly from period to period as a result of the Company’s working capital requirements which are dependent on operations and increased spending to grow the Company and expand its presence in the market. Cash flows used in operating activities for the year ended December 31, 2020, increased to $24.856 million, from $14.516 million for the same period in 2019, due to increased spending to expand the Company’s presence in markets.

Cash flows used in investing activities decreased in 2021 to $1.064 million compared with $6.395 million in 2020, as there were no acquisitions in 2021 compared to 2020, during which time kanepi was acquired along with assets from AirFusion. This was partially offset by higher spending in 2021 on the acquisition of property and equipment and the development of intangible assets compared with 2020. This spending was focused on furthering development of new AssetCare products. Cash used in investing activities was $6.395 million for the year ended December 31, 2020, as compared $20.732 million for the same period in 2019, a net decrease of $14.337 million, due to the acquisitions of CSA, AirFusion, kanepi and ongoing development of the Company’s technology. For the same period in 2019, the cash used in investing activities primarily related to the acquisition of MTS.

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Cash flows provided by financing activities increased to $32.927 million for the year ended December 31, 2021 compared with $31.857 million for the year ended December 31, 2020. The net increase was primarily attributable to the brokered public offering of $12.281 million, net of transaction costs, in conjunction with the Company’s NASDAQ listing, combined with an increase in net proceeds received from bank indebtedness, partially offset by net proceeds received, after transaction costs, for warrants issued in 2020. For the year ended December 31, 2020, the Company had net cash received of $31.857 million compared with net cash received of $34.465 million for the same period in 2019, a net decrease of $2.608 million. The decrease is primarily due to the issuance of the 2019 Convertible Debentures, partially offset by cash flows received from public offerings, debentures and special warrants during the year ended December 31, 2020.

Factoring and Security Agreement with Nations Interbanc

Under a factoring and security agreement with Nations Interbanc (“Nations”), Agnity Communications Inc. (“Agnity”), an entity controlled by the Company, receives advances up to a maximum of US$2 million from Nations for providing them the right to collect cash flows from factored accounts receivable and charges a fee for this service. This is a financing agreement and the accounts receivables factored still carry credit risk, are not sold, and are not derecognized from Agnity’s statement of financial position. Nations charges a factoring fee of 1.5% of the gross face invoice amount for the first 30 days and a daily proration of 0.06% per day thereafter. The amount of funds advanced varies and is dependent on the cash requirements of Agnity.

The MasterCard Facility

The Company’s credit facility with MasterCard (the “MasterCard Facility”) with a total limit of $0.425 million provides cash security to MasterCard held on deposit for expenses outstanding on the Company issued credit cards. As at December 31, 2021, the MasterCard Facility was drawn to $0.297 million (December 31, 2020—$0.601 million).

Short-Form Base Shelf Prospectus

On April 28, 2020, the Company filed a final short form base shelf prospectus which allows the Company to offer, from time to time, over a 25-month period, common shares, preferred shares of any series, senior or subordinated secured or unsecured debt securities, subscription receipts, warrants, and units comprised of one or more of the aforementioned securities, with an aggregate value of up to $200 million. Securities may be offered separately or together, in amounts, at prices, and on terms to be determined based on market conditions at the time of sale and set forth in an accompanying prospectus supplement. This final short form base shelf prospectus was updated and refiled with the British Columbia Securities Commission on November 18, 2021, and with the US Securities and Exchange Commission on Form F-10/ A on November 19, 2021 in connection with the Company’s listing to the NASDAQ.

On November 26, 2021, a supplement was filed in connection with the November 18, 2021, prospectus through which the Company offered 2,100,000 units at a price of US$4.50 per unit. Each unit consisted of one common share in the capital of the Company and one transferable common share purchase warrant. Each warrant is exercisable to purchase one common share at a price of US$4.75 per share up to November 29, 2026, being five years after the closing date of November 29, 2021.

LIQUIDITY

The principal liquidity needs of the Company are for working capital requirements, debt servicing and repayment obligations, and costs associated with the growth of the business. The Company is exposed to liquidity risk which is the risk that the Company will not have sufficient cash resources to meet its financial obligations as they come due in the normal course of business. The Company manages its liquidity risk by monitoring its operating requirements, reducing costs were possible given the status of the COVID-19 pandemic, and applying for any available government funding to support its business. The Company generally relies on funds generated from operations and external financing to provide sufficient liquidity to meet budgeted operating requirements. The Company assesses its liquidity on an ongoing basis based on current market factors and cannot make any statements regarding any known trends or fluctuations likely to affect the Company’s liquidity beyond standard market conditions. See Note 26 of the Financial Statements for further discussion on the Company’s liquidity risk.

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The Company’s ability to fund current and future operations is dependent on its ability to generate sources of cash through positive cash flows from operations combined with equity and/or debt financing as needed, including, but not limited to the ATB Facility.

Based on its current business plan and the impacts of COVID-19, the Company has identified near-term capital needs. The Company’s near-term cash requirements relate primarily to the repayment of the 2019 Convertible Debentures, operations, working capital and general corporate purposes. The Company updates its forecast regularly and considers additional financial resources as appropriate. Additionally, the shares in the capital of the Company became dually listed and began trading on the NASDAQ on November 24, 2021. See “Year in Review – Financing” for further discussion on the Company’s NASDAQ listing. The Company has created aggressive marketing and sales plans and increased headcount related to sales and business development, while balancing this with the re-opening from pandemic restrictions, which is expected to increase revenues and operating cash flows.

To date, the Company received wage subsidies totaling $5.817 million and rent subsidies of $1.120 from the Canadian Government. During the year ended December 31, 2021, wage and rental subsidies of $4.202 million were included in Other Income in the 2021 Financial Statements. To date, the Company received low-interest government loans totaling $1.961 million under the Paycheck Protection Program (the “PPP”) with the US Government, which ceased on May 31, 2021, to help alleviate the negative economic impacts on COVID-19 to its business. During the year ended December 31, 2021, other income of $1.825 million was recognized associated with these loans as they represent government grants.

The outbreak of the COVID-19 pandemic and the measures adopted by governments in countries worldwide to mitigate the pandemic’s spread have impacted the Company. These measures required the Company to restrict deployment of technical services due to the in-person nature of these activities and delay the start of certain projects for a duration of the year. This negatively impacted the Company’s financial performance and liquidity position.

During the year ended December 31, 2021, the Company generated a net loss of $44.699 million and negative cash flows from operating activities of $28.330 million. At December 31, 2021, the Company had a working capital deficiency of $42.108 million. Working capital deficiency is a non-IFRS measure which is calculated as current assets less current liabilities.

Current liquidity levels and available sources of capital are not adequate to fund the working capital deficiency. The most significant cash outflows included in current liabilities include the repayment of the 2019 Convertible Debentures of $23.458 million; loans and borrowings of $11.764 million including principal and interest payments; payment of trade and other payables of $12.421 million and payments associated with leases of approximately $1 million.

Based on the Company’s liquidity position at the date of authorization of this annual MD&A and considering the uncertainty surrounding the impact of the pandemic, management estimates that it will need additional financing to meet is financial obligations. The Company is currently working with stakeholders and others to address the working capital deficiency. In the long-term, the ability of the Company to operate as a going concern is dependent on its ability to achieve and maintain profitable operations and positive cash flow from operations, and, as necessary, to obtain the necessary equity or debt financing to continue with expand its operations. To date, the Company has funded its operations through debt and equity financing. While the Company has been successful in raising capital in the past and anticipates the lenders will not accelerate repayment of loans with covenant breaches as of December 31, 2021, March 31, 2022, and June 30, 2022 and potential breaches forecasted over the coming year, there is no assurance that it will be successful in closing further financings in the future or obtaining waivers of the covenant breaches.

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As a result, these factors are indicators that material uncertainties exist that raises significant doubt about the Company’s ability to continue as a going concern and, therefore, its ability to realize assets and discharge liabilities in the normal course of business.

In making their assessment, management considered all available information, together with forecasts and other mitigating strategies, about the future which is at least, but not limited to, 12 months from the end of Q2 2022. Management has considered the following in its assessment that the going concern assumption remains appropriate:

• the plan for the repayment of the 2019 Convertible Debentures;

• the repayment of the term loan in full on or before October 31, 2022;

• the likelihood that undrawn funds under the revolving operating facility will be available and will not be required to be repaid;

• the required cash principal and interest payments on indebtedness;

• the likelihood of payments required under contingent consideration arrangements;

• cash inflows from current operations, expected government assistance in the form of wage and rent subsidies, and expected increases in revenues and cash flows resulting from new revenue contracts expected over the next 12 months due to the anticipated reduction of COVID-19 related restrictions; and

• future debt and equity raises.

Management also considered cash inflows from current operations, expected government assistance in the form of wage and rent subsidies, and expected increases in revenues and cash flows resulting from new revenue contracts expected over the next twelve months due to the anticipated reduction of COVID-19 related restrictions in determining that the going concern assumption remains appropriate.

Contractual Obligations and Commitments

Below is a summary of the Company’s contractual obligations and commitments as at December 31, 2021.

At December 31, 2021	Undiscounted Contractual Cash Flows
Contractual Obligations	< 1 year		1 – 2 years		> 2 years		Total
Bank indebtedness 1	$	3.460	$	—	$	—	$	3.460
Trade payables and accrued liabilities		12.421		—		—		12.421
Loans and borrowings 2		11.764		0.786		—		12.550
Lease liabilities 3		0.522		0.534		0.179		1.235
2019 Convertible Debentures		24.630		—		—		24.630
2021 Convertible Debentures		0.008		0.103		—		0.111
Warrant liabilities 4		0.710		—		—		0.710
Business acquisition payable		1.399		—		—		1.399
Contractual obligations	$	54.913	$	1.423	$	0.179	$	56.516

At December 31, 2021	Undiscounted Contractual Cash Flows
Commitments	< 1 year		2 – 3 years		4 – 5 years		More than 5 years		Total
Variable lease payments 5		0.397		0.478		0.125		0.013		1.013
Lease payments related to leases which have not yet commenced 6		0.105		2.589		2.763		12.636		18.093
Commitments	$	0.501	$	3.067	$	2.888	$	12.649	$	19.106

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1  No contractual maturity, due on demand. Excludes interest charged on facility.

2  Includes term loan with a carrying value of $9.276 classified as current due to covenant breach. Assuming term loan is repaid in accordance with agreement to maturity, the undiscounted contractual cash flows for loans and borrowings would be $2.934 million, $5.472 million, and $4.144 million, respectively for the periods presented above.

3  Variable costs payable under lease agreements are not included in this amount. Minimum payment related to leases which have not yet commenced are not included in this amount.

4  Majority of liability will be settled by issuing common shares when warrants are exercised during the year. The remaining amount may be settled in cash or common shares of Agnity.

5  Variable lease payments associated with lease liabilities.

6  In October 2021, the Company executed a 12-year lease for office space in Calgary, Alberta. Base rent and estimated common expense payments commence in December 2022, preceded by a fixturing period which the Company will use to build out the space. The Company will receive a tenant improvement allowance which is expected to cover the majority of the costs.

TRANSACTIONS BETWEEN RELATED PARTIES

The Company’s related parties include its subsidiaries, its non-controlling interest, an entity related to its non-controlling interest and key management personnel. The Company’s related party transactions are in the normal course of operations and have been valued at the exchange amount, which is the amount of consideration established and agreed to by the related parties.

Key Management Personnel Compensation

Key management personnel include those persons having authority and responsibility for planning, directing, and controlling the activities of the Company as a whole. The Company defines key management personnel as key officers, executives and directors of the Company. For the three months and years ended December 31, 2021, and 2020, the contractual and discretionary compensation awarded to key management personnel, including director fees, is as follows:

	Three months ended December 31				Year ended December 31
		2021		2020		2021		2020		2019
Salaries, fees and short-term benefits	$	0.564	$	0.404	$	1.614	$	1.683	$	1.460
Share-based compensation		0.181		0.096		0.432		0.628		0.388
	$	0.745	$	0.500	$	2.046	$	2.311	$	1.849

As at December 31, 2021, amounts due to key management personnel for salaries, director fees, and short-term benefits was $0.122 million (December 31, 2020 - $0.116 million; December 31, 2019 - $Nil). In addition, at December 31, 2021, the Company owed $0.031 million (December 31, 2020 - $0.033 million; December 31, 2019 - $Nil) to an officer of the Company for an unsecured, non-interest-bearing amount as reimbursement for expenses incurred during the normal course of business.

Other Transactions and Balances

As at December 31, 2021, the Company had $0.234 million (December 31, 2020 - $0.813 million) due to an entity controlled by the principal owner of Agnity for the purchase of assets. The amount is unsecured, non-interest bearing and due on demand.

The Company engaged an entity partially owned by the principal owner of Agnity to perform consulting services in the amount of $3.765 million during the year ended December 31, 2021 (year ended December 31, 2020 - $2.533 million; December 31, 2019 - $1.630 million). As at December 31, 2021, the Company owed the entity $1.112 million (December 31, 2020 - $1.139 million; December 31, 2019 - $1.533 million)

Management’s Discussion and Analysis for the Three and Six Months ended June 30, 2022 and 2021

The Company’s selected financial information for the last eight completed fiscal quarters is shown in the table below. Accounting policies under International Financial Reporting Standards (“IFRS”) were consistently applied across all periods.

For the quarter ended:	Q2 2022		Q1 2022		Q4 2021 (2)		Q3 2021 (1)		Q2 2021 (1)		Q1 2021 (1)		Q4 2020 (2)		Q3 2020
Total Revenue		2.269		4.430		4.171		7.434		6.556		7.436		9.223		6.137
Net loss		11.612		11.023		10.331		15.616		9.000		9.752		8.918		8.713
Net Loss - mCloud shareholders		8.052		9.778		10.095		15.466		8.930		10.271		9.302		9.417
Basic and diluted loss per share	$	0.50	$	0.61	$	0.73	$	1.22	$	0.88	$	1.12	$	1.02	$	1.15
Total assets		72.697		73.091		72.106		73.818		79.868		75.803		77.319		68.113
Total non-current financial liabilities		26.795		7.532		1.513		12.978		24.565		43.440		33.443		33.319

(1) The results for each of the quarters ended March 31, June 30 and September 30, 2021 have been corrected, which impacted revenue, current and non-current long-term accounts receivables; deferred revenue, and correspondingly, impacted net loss and net loss attributable to mCloud shareholders and related loss per share attributable to mCloud shareholders - basic and diluted. During the quarters ended:

• March 31, 2021, decreased revenue and increased net loss, net loss attributable to mCloud shareholders and loss per share attributable to mCloud shareholders - basic and diluted by $0.945 million ($0.10 per share);

• June 30, 2021, decreased revenue and increased net loss, net loss attributable to mCloud shareholders and loss per share attributable to mCloud shareholders - basic and diluted by $0.652 million ($0.13 per share);

• September 30, 2021, increased revenue and decreased net loss, net loss attributable to mCloud shareholders and loss per share attributable to mCloud shareholders - basic and diluted by $0.098 million ($0.01 per share).

(2) The Company has corrected net loss and other comprehensive loss attributable to mCloud shareholders and non-controlling interest for the years ended, 2020 and 2021. This resulted in a reclassification between net loss attributable to mCloud shareholders and non-controlling interest, other comprehensive loss attributable to mCloud shareholders and non-controlling interest and impacted basic and diluted loss per share for the quarters ended December 31, 2020 and December 31, 2021. During the quarters ended:

• December 31, 2020, net loss attributable to mCloud shareholders decreased by $0.423 million, net loss attributable to non-controlling interest increased by $0.423 million, and loss per share attributable to mCloud shareholders - basic and diluted decreased by $0.05 per share.

• December 31, 2021, net loss attributable to mCloud shareholders increased by $0.433 million, net loss attributable to non-controlling interest decreased by $0.433 million and loss per share attributable to mCloud shareholders - basic and diluted increased by $0.03 per share.

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Total revenue was $2.269 million in Q2 2022, compared to $6.556 million in Q2 2021, a decrease of $4.287 million, due to a one-time adjustment to revenue of $2.572 million related to Agnity’s business in prior periods, combined with the residual effect of the challenges associated with the COVID-19 restrictions experienced in 2021 and bleeding in to the first half of fiscal 2022. During Q2 2022, the Company continued to execute on strategic marketing activities and expects to see a gradual return to pre-pandemic levels in the second half of 2022. Net loss in Q2 2022 increased to $11.612 million compared to a net loss of $9.000 million in Q2 2021, a change of $2.612 million, primarily attributable to the higher operating loss which increased by $4.798 million as a result of the decrease in revenue, partially offset by an increase of $1.280 million from foreign exchange gains and $1.425 million from fair value gains on derivatives. Net losses in Q2 2022 increased to $11.612 million compared to a net loss of $11.023 million in Q1 2022, primarily due the reversal of revenue in Q2 2022, partially offset by higher foreign exchange gains. Basic and diluted net loss per share of $0.50/share in Q2 2022, was a decrease of $0.38/share, from $0.88/share in Q2 2021 due to lower net loss attributable to mCloud shareholders, and an increase in the number of shares outstanding.

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Review of Quarterly Financial and Operational Results

The table below provides key financial performance metrics of the Company for Q2 2022, compared with Q2 2021. This information should be read in conjunction with the annual consolidated financial statements for the year ended December 31, 2021 (the “2021 Annual Financial Statements”).

	Three months ended June 30,						Six months ended June 30,						Q2 to Q2			Q2 to Q2			YTD			YTD
	2022			2021			2022			2021			Change $			Change %			Change $			Change %
Revenue	$	2.269		$	6.556		$	6.699		$	13.992		$	(4.287	)		(65	)%	$	(7.293	)		(52	)%
Cost of Sales		(1.933	)		(2.061	)		(3.866	)		(5.320	)		0.128			(6	)%		1.454			(27	)%
Gross Profit	$	0.336		$	4.496		$	2.833		$	8.672		$	(4.160	)		(93	)%	$	(5.839	)		(67	)%
Expenses
Salaries, wages and benefits	$	5.059		$	6.333		$	10.374		$	11.204		$	(1.274	)		(20	)%	$	(0.830	)		(7	)%
Sales and marketing		1.140			0.328			1.902			0.513			0.812			248	%		1.389			271	%
Research and development		0.568			0.712			1.100			1.461			(0.144	)		(20	)%		(0.361	)		(25	)%
General and administrative		2.065			1.556			4.617			2.893			0.509			33	%		1.724			60	%
Professional and consulting fees		3.560			2.491			6.736			4.230			1.069			43	%		2.506			59	%
Share-based compensation		0.192			0.361			0.444			0.736			(0.169	)		(47	)%		(0.292	)		(40	)%
Depreciation and amortization		1.826			1.993			3.770			3.964			(0.167	)		(8	)%		(0.194	)		(5	)%
Total expenses	$	14.410		$	13.774		$	28.943		$	25.001		$	0.636			5	%	$	3.942			16	%
Operating loss	$	(14.074	)	$	(9.278	)	$	(26.110	)	$	(16.329	)	$	(4.796	)		52	%	$	(9.781	)		60	%
Other Expenses (income)
Finance costs	$	2.230		$	1.947		$	4.089		$	4.183		$	0.283			15	%	$	(0.094	)		(2	)%
Foreign exchange loss (gain)		(1.116	)		0.164			(0.494	)		0.532			(1.280	)		(780	)%		(1.026	)		(193	)%
Business acquisition costs and other expenses		—			0.012			—			0.336			(0.012	)		(100	)%		(0.336	)		(100	)%
Fair value (gain) loss on derivatives		(2.538	)		(1.113	)		(5.032	)		0.451			(1.425	)		128	%		(5.483	)		(1216	)%
Other income		(0.264	)		(1.155	)		(0.662	)		(3.065	)		0.891			(77	)%		2.403			(78	)%
Loss before tax	$	(12.386	)	$	(9.133	)	$	(24.011	)	$	(18.766	)	$	(3.253	)		36	%	$	(5.245	)		28	%
Current tax expense	$	(0.184	)	$	0.241		$	0.105		$	0.479		$	(0.425	)		(176	)%	$	(0.374	)		(78	)%
Deferred tax recovery		(0.591	)		(0.373	)		(1.482	)		(0.492	)		(0.218	)		58	%		(0.990	)		201	%
Net loss for the period	$	(11.611	)	$	(9.001	)	$	(22.634	)	$	(18.753	)	$	(2.610	)		29	%	$	(3.881	)		21	%

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Revenue

In the following tables, revenue is disaggregated by nature and timing of revenue recognition.

Six months ended June 30,

Major Service Line	2022			2021		Change $			Change %
AssetCare Initialization	$	0.443		$	0.819	$	(0.375	)		(46	)%
AssetCare Solutions		8.684			12.514		(3.830	)		(31	)%
Engineering Services		0.143			0.659		(0.516	)		(78	)%
Contract modification revenue reversal		(2.572	)		—		(2.572	)		(100	)%
Total	$	6.699		$	13.992	$	(7.293	)		(52	)%

Timing of Revenue Recognition	2022			2021		Change $			Change %
Revenue recognized over time	$	7.646		$	11.702	$	(4.056	)		(35	)%
Revenue recognized at point in time upon completion	$	(0.947	)	$	2.290		(3.237	)		(141	)%
Total	$	6.699		$	13.992	$	(7.293	)		(52	)%

For the six months ended June 30, 2022, total revenue was $6.699 million, a decrease of $7.293 million, compared to $13.992 million for the same period in 2021.

Several factors contributed to the decrease in revenues. From January to April 2022, local and national policies to contain COVID-19 led certain mCloud customers to restrict vendor access to their sites, which impeded the Company’s ability to deliver AssetCare and related services. mCloud also undertook a transition of its royalty agreement with Agnity into a technology continuation agreement during Q2 2022.

As part of this transition, mCloud received a US$5.954 million one-time payment from Agnity on July 29, 2022, which as a result of timing and the negotiation process, prevented mCloud from including certain revenues in the AssetCare Initialization and AssetCare Solutions categories. The net resulting impact was the recording of negligible revenues from newly connected assets for the period. The one-time payment will be recorded as a non-revenue item in Q3 2022.

Also due to this transition, mCloud recorded a one-time adjustment related to Agnity’s business in prior periods. This resulted in the Company making certain required balance sheet adjustments culminating in a $2.572 million decrease to revenues as a standalone adjustment in Q2 2022 and representing the full required adjustment across these prior periods.

Starting in May 2022, the Company began to see an increase in customer activities and the retraction of many COVID-19 restrictions. These factors are expected to have a sustained positive impact on revenue growth in future periods.

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Cost of Sales, Gross Profit, Gross Margin %

Six months ended June 30,

	2022			2021			Change $			Change %
Cost of Sales	$	3.866		$	5.320		$	(1.454	)		(27	)%
Gross Profit	$	2.833		$	8.672		$	(5.839	)		(67	)%
Gross margin %		42.3	%		62.0	%		(19.7	)%		(32	)%

Cost of sales for the six months ended June 30, 2022 were $3.866 million, a decrease of 27% from $5.320 million for the same period in 2021. This decrease is primarily attributable to the decrease in revenue including the one-time adjustment of $2.572 million, partially offset by increased costs associated with a shift in the mix of revenue generating projects. For the six months ended June 30, 2022, gross profit decreased by $5.839 million to $2.833 million from $8.672 million for the same period in 2021, primarily due to the decrease in revenues of $7.293 million, partially offset by a decrease in cost of sales by $1.454 million for the reasons noted above.

Expenses

Six months ended June 30,

Expenses	2022		2021		Change $			Change %
Salaries, wages and benefits	$	10.374	$	11.204	$	(0.830	)		(7	)%
Sales and marketing		1.902		0.513		1.389			271	%
Research and development		1.100		1.461		(0.361	)		(25	)%
General and administration		4.617		2.893		1.724			60	%
Professional and consulting fees		6.736		4.230		2.506			59	%
Share-based compensation		0.444		0.736		(0.292	)		(40	)%
Depreciation and amortization		3.770		3.964		(0.194	)		(5	)%
Total	$	28.943	$	25.001	$	3.942			16	%

Total expenses for the six months ended June 30, 2022 increased by 16% or $3.942 million compared with the same period in 2021. The most significant changes between 2022 and 2021 are as follows:

• Professional and consulting expenses increased by 59% or $2.506 million, primarily related to increased costs for professional services in the six months ended June 30, 2022, associated with Company’s NASDAQ listing and financing activities undertaken during the period.

• General and administration expenses increased by 60% or $1.724 million due to increased insurance premiums following the Company’s NASDAQ listing in Q4 2021, increased IT subscription costs as the Company ramps up to return its resources to pre-COVID-19 levels.

• Sales and marketing costs increased by 271% or $1.389 million, due to the execution of a strategic marketing plan with an increase in marketing activities, including travel and mCloud’s participation in conferences, high-visibility activities and hosting customer events specific to advancing the Company’s presence in Houston and growing customer engagement with mCloud’s Digital Oil & Gas offerings in the six months ended June 30, 2022.

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• Salaries, wages and benefits costs decreased by 7% or $0.830 million, primarily attributed to a level-setting of overall headcount.

• Research and development expenses decreased by $0.361 million in the first six months of 2022 compared with the same period in 2021, the result of careful management and targeted deployment of these activities in 2022. Research and development relates to the ongoing development of technologies across the AssetCare portfolio.

• Depreciation and amortization non-cash costs decreased by 5% or $0.194 million for the six months ended June 30, 2022, due to fewer additions of property and equipment assets, combined with fully depreciated assets at or nearing the end of their useful life.

Other Expenses (Income)

Six months ended June 30,

Other expenses (income)	2022			2021			Change $			Change %
Finance costs	$	4.089		$	4.183		$	(0.094	)		(2	)%
Foreign exchange loss (gain)		(0.494	)		0.532			(1.026	)		(193	)%
Business acquisition costs and other expenses		—			0.336			(0.336	)		(100	)%
Fair value (gain) loss on derivatives		(5.032	)		0.451			(5.483	)		(1216	)%
Other income		(0.662	)		(3.065	)		2.403			(78	)%
Total	$	(2.099	)	$	2.436		$	(4.536	)		(186	)%

Other expenses (income) was $4.536 million higher during the six months ended June 30, 2022, compared to the same period in 2021.

• Finance costs decreased by $0.094 million during the six months ended June 30, 2022, compared to the same period in 2021, primarily due to transaction costs on the issuance of convertible debentures expensed in the six months ended June 30, 2021, partially offset by the increased loans and borrowings.

• Foreign exchange was a gain of $0.494 million for the six months ended June 30, 2022, compared to a loss of $0.532 million for the same period in 2021, due to a weakening Canadian dollar.

• Fair value changes on derivatives were a gain of $5.032 million for the six months ended June 30, 2022. These are non-cash gains resulting from the remeasurement of the warrant liabilities at June 30, 2022. These liabilities include the warrants issued on conversion of the convertible unsecured subordinated debentures issued between December 7, 2020 and May 25, 2021 (“2021 Convertible Debentures”) and the warrants issued in November 2021.

• Other income decreased by $2.403 million for the six months ended June 30, 2022, to $0.662 million from $3.065 million for the same period in 2021. Other income consists primarily of wage and rent subsidies for COVID-19 programs received from the Canadian government and low-interest loans from the US government. The majority of these programs have now ended.

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Revenue

In the following tables, revenue is disaggregated by nature and timing of revenue recognition.

Three months ended June 30,

Major Service Line	2022			2021		Change $			Change %
AssetCare Initialization	$	0.029		$	0.303	$	(0.274	)		(90	)%
AssetCare Solutions		4.695			6.080		(1.385	)		(23	)%
Engineering Services		0.117			0.173		(0.056	)		(32	)%
Contract modification revenue reversal		(2.572	)		—		(2.572	)		(100	)%
Total	$	2.269		$	6.556	$	(4.287	)		(65	)%

Timing of Revenue Recognition	2022			2021		Change $			Change %
Revenue recognized over time	$	3.783		$	6.253	$	(2.470	)		(39	)%
Revenue recognized at point in time upon completion	$	(1.514	)		0.303		(1.817	)		(599	)%
Total	$	2.269		$	6.556	$	(4.287	)		(65	)%

For the three months ended June 30, 2022, total revenue was $2.269 million, a decrease of $4.287 million, compared to $6.556 million for the same period in 2021.

When the impacts as described in the YTD discussion are considered, the decline in quarterly revenue was primarily attributable to the related impact to the AssetCare Initialization and AssetCare Solutions categories, which resulted in negligible revenues from newly connected asset for the period. The Company also received a one-time US$5.954 million payment from Agnity on July 29, 2022 and recorded a one-time adjustment of $2.572 million to revenues related to Agnity’s business in prior periods as at June 30, 2022.

Starting in May 2022, the Company began to see an increase in customer activities and the retraction of many COVID-19 restrictions. These factors are expected to have a sustained positive impact on revenue growth in future periods.

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Cost of Sales, Gross Profit, Gross Margin %

Three months ended June 30,

	2022			2021			Change $			Change %
Cost of Sales	$	1.933		$	2.061		$	(0.127	)		(6	)%
Gross Profit		0.336			4.496			(4.160	)		(93	)%
Gross margin %		14.8	%		68.6	%					(78	)%

Cost of sales for the three months ended June 30, 2022 were $1.933 million, an decrease of 6% from $2.061 million for the same period in 2021. This decrease was attributable to the reduction in revenue, offset by changes in revenue mix in the period, with the projects in 2022 requiring higher costs to complete. For the three months ended June 30, 2022, gross profit decreased by $4.160 million to $0.336 million from $4.496 million for the same period in 2021, primarily due to the decrease in revenues of $4.287 million.

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Expenses

Three months ended June 30,

Expenses	2022		2021		Change $			Change %
Salaries, wages and benefits	$	5.059	$	6.333	$	(1.274	)		(20	)%
Sales and marketing		1.140		0.328		0.812			248	%
Research and development		0.568		0.712		(0.144	)		(20	)%
General and administration		2.065		1.556		0.509			33	%
Professional and consulting fees		3.560		2.491		1.069			43	%
Share-based compensation		0.192		0.361		(0.169	)		(47	)%
Depreciation and amortization		1.826		1.993		(0.167	)		(8	)%
Total	$	14.411	$	13.774	$	0.636			5	%

Total expenses for the three months ended June 30, 2022 increased by 5% or $0.636 million compared with the same period in 2021. The most significant changes between 2022 and 2021 are as follows:

• General and administration expenses increased by 33% or $0.509 million due to increased insurance premiums following the Company’s NASDAQ listing in Q4 2021, and increased IT subscriptions as the Company ramps up to return its resources to pre-COVID-19 levels.

• Professional and consulting expenses increased by 43% or $1.069 million, primarily related to increased costs for professional services in Q2 2022 associated with the financing activities undertaken in 2022, as well as the ongoing costs associated with the Company’s NASDAQ listing. Additionally, consultants also filled positions in Q2 2022 that were previously held by employees, correlating with a 20% decrease in salaries, wages and benefits costs described below.

• Sales and marketing costs increased by 248% or $0.812 million, due to the execution of increased marketing to build awareness and pipeline growth, along with initiatives to drive AssetCare sales and business development in Q2 2022.

• Salaries, wages and benefits costs decreased by 20% or $1.274 million, as a number of roles that were previously held by employees were filled by consultants.

• Research and development expenses decreased by $0.144 million in Q2 2022 compared with the same period in 2021, resulting from careful and targeted management of these activities. Research and development relates to the ongoing development of technologies across the AssetCare portfolio.

• Depreciation and amortization non-cash costs decreased by 8% or $0.167 million for Q2 2022, due to fewer additions of property and equipment assets, combined with fully depreciated assets at or nearing the end of their useful life.

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Other Expenses (Income)

Three months ended June 30,

Other expenses (income)	2022			2021			Change $			Change %
Finance costs	$	2.230		$	1.947		$	0.283			15	%
Foreign exchange loss (gain)		(1.116	)		0.164			(1.280	)		(780	)%
Business acquisition costs and other expenses		—			0.012			(0.012	)		(100	)%
Fair value (gain) loss on derivatives		(2.538	)		(1.113	)		(1.425	)		128	%
Other income		(0.264	)		(1.155	)		0.891			(77	)%
Total	$	(1.688	)	$	(0.146	)	$	(1.543	)		1057	%

Other expenses (income) increased by $1.543 million during the three months ended June 30, 2022, compared to the same period in 2021.

• Finance costs increased by $0.283 million during the three months ended June 30, 2022, compared to the same period in 2021, primarily due to a $0.162 million loss on debt modification recorded on the term loan as a result of the Accommodation Agreement signed with Fiera in Q2 2022, as well as increased loans and borrowings.

• Foreign exchange was a gain of $1.116 million for the three months ended June 30, 2022, compared to a loss of $0.164 million for the same period in 2021, due to a weakening Canadian dollar.

• Fair value changes in derivatives were a gain of $2.538 million for the three months ended June 30, 2022, which was an increase of $1.425 million compared to the same period in 2021. These are non-cash gains resulting from the remeasurement of the warrant liabilities at June 30, 2022.

• Other income decreased by $0.891 million for the three months ended June 30, 2022, to $0.264 million from $1.155 million for the same period in 2021. The majority of Other income includes wage and rent subsidies for COVID-19 programs received from the Canadian government and low-interest loans from the US government. These programs have now ended.

CAPITAL RESOURCES

The Company’s objective and polices for managing capital are to safeguard its ability to continue as a going concern in order to provide returns for shareholders and benefits for other stakeholders and to maintain an optimal capital structure to reduce the cost of capital. The Company manages its capital structure and makes changes based on economic conditions, risks that impact the consolidated operations and future significant capital investment opportunities. In order to maintain or adjust its capital structure, the Company may issue new equity instruments or raise additional debt financing.

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The Company assesses its capital resources on an ongoing basis based on current market factors, and has not identified any trends or fluctuations likely to affect the Company’s capital resources beyond standard market conditions.

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Analysis of Cash Flows

As at June 30, 2022, the Company had $4.406 million in cash (December 31, 2021 - $4.588 million). All cash was held in bank accounts, primarily with Canadian and US banks. The following table summarizes cash inflows and outflows.

Six months ended June 30,

Cash provided by (used in):	2022			2021
Operating activities	$	(16.150	)	$	(12.955	)
Investing activities		(0.036	)		(0.774	)
Financing activities		16.027			19.169
Net increase (decrease) in cash, before effect of exchange rate fluctuation	$	(0.159	)	$	5.440

Cash flows used in operating activities increased to $16.150 million in the six months ended June 30, 2022 compared with $12.955 million in the same period of 2021, primarily as a result of a higher net loss in Q2 2022, partially offset by an increase in working capital in 2022 compared with 2021. Cash flow from operations can vary significantly from period to period as a result of the Company’s working capital requirements, which are dependent on operations and increased spending to grow the Company and expand its presence in the market.

Cash flows used in investing activities decreased in the six months ended June 30, 2022, to $0.036 million compared with $0.774 million in the same period of 2021, as the Company has reduced spending on the acquisition of property and equipment as a means of conserving cash.

Cash flows provided by financing activities decreased to $16.027 million for the six months ended June 30, 2022, compared with $19.169 million for the same period in 2021. In the six months ended June 30, 2022, mCloud received net proceeds from loans and bank indebtedness of $25.377 million and made repayments of $8.224 million. In the same period of 2021, the Company received net proceeds from loans and indebtedness of $8.761 million, from issuance of shares of $12.396 million and from convertible debentures of $5.527 million and made repayments of $7.009 million.

Financing Arrangements and Credit Facilities

2019 Convertible Debentures

The Company’s convertible unsecured subordinated debentures issued in July 2019 (“2019 Convertible Debentures”) are described in Note 14 of the 2021 Annual Financial Statements. The 2019 Convertible Debentures matured on June 30, 2022. The Company is actively exploring financing options to repay the principal amount of $23,458 million and continues to accrue interest until such time as they are repaid.

Term Loan

The Company’s term loan facility with Fiera (the “Term Loan”) is described in Note 12 of the 2021 Annual Financial Statements. The Term Loan was classified as current at December 31, 2021 as the Company did not meet certain minimum covenants and therefore the term loan was due on demand (“Fiera Covenant Breach”).

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On May 5, 2022, in order to enable the execution of the Loan with Carbon, the Company and Fiera executed an Accommodation Agreement (the “Accommodation Agreement”) and the parties agreed that a portion of the outstanding principal amount under the Term Loan would be paid in addition to a prepayment penalty and accommodation fee. The Company paid a total of $2.044 million on May 6, 2022. The parties also agreed that the remainder of the principal and interest due under the Term Loan would be paid on or before October 31, 2022 (the “Repayment Date”). The Term Loan was amended to increase the interest rate charged from 6.85% to 9.5% effectively immediately. There are no financial covenants under the Accommodation Agreement and the Company is no longer required to maintain the previous financial covenants. The Company may be required to repay the Term Loan before the Repayment Date if the Company is in default or breach of the Accommodation Agreement. As part of the Accommodation Agreement, Fiera signed an agreement whereby Fiera’s security is subordinate to certain security granted to Carbon.

ATB Financial Facility

The Company’s secured revolving operating facility (“ATB Facility”) with ATB Financial (“ATB”) is described in Note 13 to the 2021 Annual Financial Statements. During the six months ended June 30, 2022, additional draws of $1.077 million were made and $0.864 million was repaid in accordance with the agreement.

The ATB Facility is subject to certain reporting and financial covenants. The Company was not in compliance with these covenants at June 30, 2022.

The MasterCard Facility

The Company’s credit facility with MasterCard (the “MasterCard Facility”) with a total limit of $0.750 million provides cash security to MasterCard held on deposit for expenses outstanding on the Company issued credit cards. As at June 30, 2022, the MasterCard Facility was drawn to $0.372 million (December 31, 2021 - $0.297 million).

Financing of Electrical Vehicle Development Projects

In conjunction with the EV Dealership Projects, on March 28, 2022, mCloud Technologies (USA) Inc, a subsidiary of the Company executed the Note with Carbon.

The initial principal amount under the Note of US$5.000 million was funded on April 1, 2022 and an additional US$10.000 million was funded on May 5, 2022. The Loans mature on March 31, 2025, with 10% per annum interest payable monthly in arrears in USD. In addition to the interest payments, the Note requires certain income-based payments, including tax incentives, are required to be made from the borrower to the lender based on income resulting from the EV Dealership Projects over their 20-year term. The Loans may not be prepaid unless authorized by the lender. The Loans contain representations, warranties and covenants which must be complied with to avoid an event of default which will allow the lender to demand repayment and increase the interest rate to 18%, amongst other implications.

On May 5, 2022, the Company, Carbon and Fiera executed a Subordination and Postponement Agreement (the “Subordination Agreement”), whereby the parties agreed that the security against certain assets of the Company previously held by Fiera would be subordinate to the security granted to Carbon commencing on the date of the agreement. The security granted to Carbon includes, to the extent related to the EV Dealership Projects, all accounts, equipment and machinery, contracts and contract rights, including contracts with auto dealerships, inventory, cash and proceeds, rent and profits.

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LIQUIDITY

The principal liquidity needs of the Company are for working capital requirements, debt servicing and repayment obligations, and costs associated with the growth of the business. The Company is exposed to liquidity risk which is the risk that the Company will not have sufficient cash resources to meet its financial obligations as they come due in the normal course of business. The Company manages its liquidity risk by monitoring its operating requirements, reducing costs where possible given the status of the COVID-19 pandemic, and applying for any available government funding to support its business. The Company generally relies on funds generated from operations and external financing to provide sufficient liquidity to meet budgeted operating requirements. The Company assesses its liquidity on an ongoing basis based on current market factors, and has not identified any trends or fluctuations likely to affect the Company’s liquidity beyond standard market conditions. See Note 26 of the 2021 Annual Financial Statements for further discussion on the Company’s liquidity risk.

The COVID-19 pandemic and the measures adopted by governments in countries worldwide to mitigate the pandemic’s spread have negatively impacted the Company. These measures required the Company to restrict deployment of technical services due to the in-person nature of these activities and delayed the start of certain projects throughout 2021 and into 2022. This negatively impacted the Company’s financial performance and liquidity position. While restrictions continue to ease there have been increased cases of COVID-19 and there is still uncertainty over how COVID-19 will impact the Company’s business and the timing of future revenues.

During the three and six months ended June 30, 2022, the Company generated a net loss of $11.612 million and $22.635 million, respectively, and negative cash flows from operating activities of $16.150 million for the six months ended June 30, 2022. At June 30, 2022, the Company had a working capital deficiency of $44.055 million. Working capital deficiency is a non-IFRS measure which is calculated as current assets less current liabilities. Current liquidity levels and available sources of capital are not adequate to fund the working capital deficiency.

The most significant expected cash outflows in current liabilities at June 30, 2022 include the 2019 Convertible Debentures of $23.653 million; loans and borrowings of $12.721 million including principal and interest payments; payment of trade and other payables of $16.343 million; and payments associated with leases of approximately $1.408 million.

Based on the Company’s liquidity position at the date of authorization of this annual MD&A and considering the uncertainty surrounding the impact of the pandemic, management estimates that it will need additional financing to meet its financial obligations. The Company is currently working with stakeholders and others to address the working capital deficiency. In the long-term, the ability of the Company to operate as a going concern is dependent on its ability to achieve and maintain profitable operations and positive cash flow from operations, and, as necessary, to obtain the necessary equity or debt financing to continue with operations. To date, the Company has funded its operations through debt and equity financing. While the Company has been successful in raising capital in the past and anticipates the lenders will not accelerate repayment of loans with covenant breaches as of June 30, 2022, and potential breaches forecasted over the coming year, there is no assurance that it will be successful in closing further financings in the future or obtaining waivers of the covenant breaches.

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As a result, these factors are indicators that material uncertainties exist that raises significant doubt about the Company’s ability to continue as a going concern and, therefore, its ability to realize assets and discharge liabilities in the normal course of business.

In making their assessment, management considered all available information, together with forecasts and other mitigating strategies, about the future which is at least, but not limited to, 12 months from the end of Q2 2022. Management has considered the following in its assessment that the going concern assumption remains appropriate:

• the plan for the repayment of the 2019 Convertible Debentures;

• the repayment of the term loan in full on or before October 31, 2022;

• the likelihood that undrawn funds under the revolving operating facility will be available and will not be required to be repaid;

• the required cash principal and interest payments on indebtedness;

• the likelihood of payments required under contingent consideration arrangements;

• cash inflows from current operations, expected government assistance in the form of wage and rent subsidies, and expected increases in revenues and cash flows resulting from new revenue contracts expected over the next 12 months due to the anticipated reduction of COVID-19 related restrictions; and

• future debt and equity raises.

In the preparation of the condensed consolidated interim financial statements and the application of the Company’s accounting policies, management is required to make judgments, estimates and assumptions that affect the carrying amounts of assets and liabilities and disclosure of contingent liabilities at the dates of the consolidated financial statements, and the reported amounts of revenues and expenses during each reporting period. The estimates and associated assumptions are limited by the relevance of historical data and uncertainty of future events. Actual results could differ from those estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to estimates are recognized in the period in which the estimates are revised and in any future period. See Note 3 of the 2021 Annual Financial Statements for more detailed information on the critical judgments and estimates, including significant areas of estimation uncertainty in applying policies, applied by the Company.

FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT

A description of the Company’s financial instruments and financial risks that the Company is exposed to and management of these risks can be found in Notes 25 and 26, respectively, of the Company’s 2021 Financial Statements. Except for those noted below, there were no significant changes to the Company’s exposures to those risks during Q2 2022.

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Contractual Obligations

During the six months ended June 30, 2022, the most significant changes in contractual obligations were: (a) the addition of a new 12-year lease obligation of approximately $10.200 million for Calgary office space and variable lease payments of approximately $8.600 million; (b) new financing of US$15.000 million; and (c) an increase in trade payables and accrued liabilities, which includes the cash payment for the settlement of a previous warrant liability. Contractual obligations at December 31, 2021, have been reduced by normal course payments made during the six months ended June 30, 2022.

Foreign Currency Risk

At June 30, 2022, the C$ equivalent carrying amount of the Company’s USD denominated monetary assets and liabilities was $12.016 million and $32.282 million, respectively (December 31, 2021 - $14.554 million and $11.685 million) with the majority of the change associated with the Carbon promissory note denominated in USD. Assuming all other variables remain constant, a fluctuation of +/- 5.0% in the exchange rate between the C$ and USD would impact the net loss for the period by approximately $1.013 million (December 31, 2021 - $0.143 million).

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Transactions Between Related Parties

The Company’s related parties include its subsidiaries, its non-controlling interest and key management personnel. The related party transactions are in the normal course of operations and have been valued at the exchange amount, which is the amount of consideration established and agreed to by the related parties.

Key Management Personnel Compensation

Key management personnel include those persons having authority and responsibility for planning, directing, and controlling the activities of the Company as a whole. The Company defines key management personnel as key officers and executives of the Company and directors. For the six months ended June 30, 2022, the contractual and discretionary compensation awarded to key management personnel including director fees is as follows:

Six months ended June 30, 2022 and 2021

	2022		2021		Change %
Salaries, fees and short-term benefits	$	0.950	$	0.791		20	%
Share-based compensation	$	0.279	$	0.155		80	%
	$	1.229	$	0.946		30	%

As at June 30, 2022, the Company had $0.185 million (December 31, 2021 - $0.234 million) due to an entity controlled by the principal owner of Agnity for the purchase of assets. The amount is unsecured, non-interest bearing and due on demand.

The Company engaged an entity partially owned by the principal owner of Agnity to perform consulting services in the amount of $2.322 million during six months ended June 30, 2022, (three and six months ended June 30, 2021 - $1.539 million). As at June 30, 2022, the Company owed the entity $1.344 million (December 31, 2021 - $1.112 million).

ACCOUNTING MATTERS

Basis of Presentation and Accounting Policies

The condensed consolidated interim financial statements include the accounts of mCloud, the ultimate parent company of the consolidated group, and its subsidiaries and are prepared in accordance with International Accounting Standard 34 – Interim Financial Reporting as issued by the International Accounting Standards Board (“IASB”). Certain disclosures included in the Company’s annual financial statements prepared under IFRS as issued by the IASB have been condensed or omitted. Accordingly, the Company’s condensed consolidated interim financial statements should be read in conjunction with the 2021 Annual Financial Statements.

The accounting policies applied in the preparation of the Q2 2022 Financial Statements are consistent with those applied and disclosed in Note 33 of the 2021 Annual Financial Statements.

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The Company has reclassified certain expenses during the three and six months ended June 30, 2021 in the condensed consolidated interim statements of loss and comprehensive loss. These adjustments impacted previously reported amounts for the three and six months ended June 30, 2021 by decreasing cost of sales by $0.539 million, increasing salaries, wages and benefits by $0.749 million and decreasing professional and consulting fees by $0.209 million.

Critical Accounting Estimates and Judgements

Management is required to make judgments, estimates and assumptions that affect the carrying amounts of assets and liabilities and disclosure of contingent liabilities at the dates of the consolidated financial statements, and the reported amounts of revenues and expenses during each reporting period. The estimates and associated assumptions are limited by the relevance of historical data and uncertainty of future events. Actual results could differ from those estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to estimates are recognized prospectively.

The Company applied critical judgements and estimates, including significant areas of estimation uncertainty in applying policies, as described in Note 3 of the 2021 Annual Financial Statements. The Company has not adopted any other accounting policies, nor does it expect to adopt any other accounting policies subsequent to the end of the most recently completed financial year.

Off-Balance Sheet Arrangements

Various forms of security have been granted by the Company and certain of its subsidiaries in favour of arm’s length lenders. The security granted gives the lenders a comprehensive level of protection against a default by the borrower in the performance of its obligations including the repayment of the indebtedness and interest thereon.

CONTROLS AND PROCEDURES

Prior to 2022, the Company was not required to establish and maintain disclosure controls and procedures (“DC&P”) and internal controls over financial reporting (“ICFR”) pursuant to National Instrument (“NI”) 52-107. The Company is listed on the TSX Venture Exchange and on November 24, 2021 also listed and commenced trading its shares on the NASDAQ. As a result of the NASDAQ listing, the Company is no longer a venture issuer. Accordingly, commencing in 2022, mCloud is required to establish and maintain DC&P and ICFR.

In light of these new requirements for 2022, the following discussion provides commentary about the Company’s D&CP and ICFR.

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Disclosures Controls and Procedures

The Company’s DC&P, as defined in National Instrument 52-109 Certification of Disclosure in Issuer’s Annual and Interim Filings (“NI 52-109”) are designed to provide reasonable assurance that information required to be disclosed in the Company’s filings under securities legislation is recorded, processed, summarized and reported within the time periods specified in securities legislation. They are also designed to provide reasonable assurance that all information required to be disclosed in these filings is accounted for, accumulated and communicated to the Company’s senior management team including the Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”) as appropriate. This is meant to allow for timely decisions regarding public disclosure.

The Company cannot provide absolute assurance that all information required to be disclosed in its filings is reported within the time periods specified in securities legislation because of the limitations in control systems to prevent or detect all misstatements due to error or fraud. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues, if any, within the Company have been detected.

Internal Controls over Financial Reporting

The Company’s senior management team is responsible for establishing and maintaining adequate ICFR, as defined in NI 52-109. ICFR means a process designed by or under the supervision of the CEO and CFO, and effected by the Company’s board of directors, management and other personnel to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with IFRS, and includes those policies and procedures that: (1) pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the Company; (2) are designed to provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with IFRS, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and (3) are designed to provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal controls over financial reporting may not prevent or detect misstatements. In addition, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions and that the degree of compliance with the policies or procedures may deteriorate.

Management’s Evaluation of Disclosure Controls and Procedures and Internal Controls over Financial Reporting

The Company’s management, under the supervision and with the participation of its CEO and CFO, will conduct an evaluation of the effectiveness of the Company’s ICFR as of December 31, 2022, using the criteria set forth by the COSO 2013 Framework. Commencing the first quarter of 2022, the Company is required to report any material weaknesses in the design of ICFR. Any such material weaknesses would also impact DC&P. Although the Company has not completed a full evaluation as of June 30, 2022, the Company is aware of material weaknesses in the design of ICFR at June 30, 2022 as described below. Management have concluded that the Company’s ICFR were not designed effectively as of June 30, 2022.

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A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the Company’s annual or interim financial statements will not be prevented or detected on a timely basis. Management identified the following material weaknesses:

• An ineffective control environment resulting from an insufficient number of trained financial reporting and accounting, information technology (IT) and operational personnel with the appropriate skills and knowledge and with assigned responsibility and accountability related to the design, implementation and operating effectiveness of internal control over financial reporting.

• The insufficient number of personnel described above contributed to an ineffective risk assessment process necessary to identify all relevant risks of material misstatement and to evaluate the implications of relevant risks on its internal control over financial reporting.

• An ineffective information and communication process resulting from (i) insufficient communication of internal control information, including objectives and responsibilities, such as delegation of authority; and (ii) ineffective general IT controls and ineffective controls related to spreadsheets, resulting in insufficient controls to ensure the relevance, timeliness and quality of information used in control activities.

• As a consequence of the above and as a result of inadequate segregation of duties and secondary review, the Company had ineffective control activities related to the design, implementation and operating effectiveness of process level and financial reporting controls which had a pervasive impact on the Company’s internal control over financial reporting.

• An ineffective monitoring process resulting from the evaluation and communication of internal control deficiencies, including monitoring corrective actions, not being performed in a timely manner.

Remediation

During Q2 2022, the Company continued to consider the full extent of the procedures to implement in order to remediate the material weaknesses described above. As at the MD&A date, the current remediation plan includes:

• Identifying key positions necessary to support the Company’s initiatives related to internal controls over financial reporting and expanding its hiring efforts accordingly.

• Hiring consultants to assist with process improvements and control remediation efforts in targeted accounting, IT and operations processes.

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• Formalizing its entity-wide risk assessment process and documenting internal ownership of risk monitoring and mitigation efforts, with improved risk monitoring activities and regular reporting to those charged with governance at an appropriate frequency.

• Finalize a delegation of authority matrix to enforce desired limits of authority for key transactions, events, and commitments, and communicating these limits of authority to relevant personnel throughout the Company.

• Further simplify and streamline its spreadsheet models to reduce the risk of errors in mathematical formulas and improve the ability to verify the logic of spreadsheets.

• Hiring a consultant to assist management with process improvements and control remediation for general IT controls.

• Continuing to perform scoping exercises and planning for an Enterprise Resource Planning implementation to streamline the number of applications used for financial reporting activities.

Material Changes to the Control Environment

There have been no changes to the Company’s ICFR during the three months ended June 30, 2022 that have materially affected, or are likely to materially affect, the Company’s ICFR.

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Outstanding share data

The Company’s authorized capital includes an unlimited number of common shares. As at October 31, 2022, the following common shares, share purchase warrants, stock options, restricted share units and convertible debt conversion options were outstanding:

	Securities Outstanding
Shares issued and outstanding		16,224,788
Share purchase warrants (1)		8,120,708
Stock options		851,234
Restricted share units		410,737
2021 Convertible Debentures (2)		15,750
Total		25,623,217

(1)  Share purchase warrants offer the holder the right to purchase a common share of the Company at a specified price by a specific date. Share purchase warrants outstanding have exercise prices ranging from Canadian dollar equivalent at date of issuance between $4.12 - $22.50 and a weighted average remaining contractual life of 2.6 years.

(2) Debentures are convertible at the option of the holder and have a conversion price of $6.02 which has been converted to Canadian dollars at August 31, 2022. The Debentures have a remaining life to maturity of 1.3 years.

OUR BUSINESS

Name and Address

The Company is a publicly-traded technology solutions provider that combines the Internet of Things (“IoT”), the cloud, and AI to create new efficiencies for energy assets including heating, ventilation, and air conditioning (“HVAC”) units, wind turbines, and oil and gas controls. The Company’s head office is located at 550-510 Burrard Street, Vancouver, British Columbia, Canada, V6C 3A8. The Company also has technology and operations centers in Edmonton, Alberta; San Francisco, California; Atlanta, Georgia; Houston, Texas; Perth, Australia; Singapore; Beijing, China; London, United Kingdom; and Trnava, Slovakia. The Company’s telephone number is (604) 669- 9973.

Incorporation

The Company (formerly UVI) was incorporated on December 21, 2010 pursuant to the Business Corporations Act (British Columbia) (“BCBCA”). The Company’s British Columbia incorporation number is BC0898477. The Articles do not contain a description of the Company’s objects and purposes.

On April 21, 2017, UVI entered into a merger agreement (“Merger Agreement”) with its wholly-owned subsidiary, UVI Subco, a corporation incorporated pursuant to the Delaware General Corporation Law (“DGCL”), and mCloud Corp., a corporation incorporated pursuant to the DGCL. Pursuant to the Merger Agreement, UVI acquired all of the issued and outstanding securities of mCloud Corp. by way of a reverse triangular merger of UVI Subco into mCloud Corp. (“Merger”). The amalgamated company, a new private company named “Universal mCloud USA Corp.”, continued as a wholly-owned subsidiary of the Company.

On October 13, 2017, the Company changed its name from “Universal Ventures Inc.” to “Universal mCloud Corp.”, and on October 18, 2017, the Company began trading on the TSXV as a Tier 2 Technology Issuer (as defined in TSXV Policy 2.1 – Initial Listing Requirements) under the new symbol “MCLD”. On May 18, 2018, the Company also began trading on the OTCQB under the symbol “MCLDF”. The Company subsequently changed its name in October of 2019 to “mCloud Technologies Corp.”. On December 13, 2019, the Company announced a change in the trading symbol of its Shares on the OTCQB from “MCLDF” to “MCLDD”. On November 24, 2021, the Shares began trading on the NASDAQ under the symbol “MCLD”.

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Directors

Under the Articles, a director or senior officer who holds a disclosable interest (as such term is defined in the BCBCA) in a contract or a transaction into which the Company has entered or proposes to enter is liable to account to the Company for any profit that accrues to the director or senior officer under or as a result of the contract or transaction only and if to the extent provided under the BCBCA.

A director with a disclosable interest in a contract or a transaction into which the Company has entered or proposes to enter is not entitled to vote on any directors’ resolution approving the contract or transaction, unless all directors have a disclosable interest in the contract or transaction, in which case any or all of those directors may vote on such a resolution.

A director with a disclosable interest in a contract or a transaction into which the Company has entered or proposes to enter and who is present at the meeting of the directors at which the contract or transaction is considered for approval may be counted in the quorum at the meeting whether or not the director votes on any or all of the resolutions considered at the meeting.

A director or senior officer who holds any office or possesses any property, right, or interest that could result, directly or indirectly, in the creation of a duty or interest that materially conflicts with that individual’s duty or interest as a director or senior officer, must disclose the nature and extent of the conflict as required by the BCBCA.

The Articles, by-laws, or charter documents of the Company do not specify a retirement age for directors. Directors are not required to hold a Share of the Company as qualification for his or her office but must be qualified as required by the BCBCA to become, act or continue to act as a director.

Shareholders’ Meetings

The Company’s Articles provide that (a) the Company must hold an annual general meeting at least once in each calendar year and not more than 15 months after the last annual reference date at such time and place as may be determined by the directors; (b) the directors may, at any time, call a meeting of shareholders to be held at such time and place as may be determined by the directors; (c) the quorum for the transaction of business at any meeting of shareholders is two persons who are, or who represent by proxy, shareholders who, in the aggregate, hold at least 5% of the issued shares entitled to be voted at the meeting; and (d) in addition to those persons who are entitled to vote at a meeting of shareholders, the only other persons entitled to be present at the meeting are the directors, the president (if any), the secretary (if any), the assistant secretary (if any), any lawyer for the Company, the auditor of the Company, any other persons invited to be present at the meeting by the directors or by the chair of the meeting and any persons entitled or required under the BCBCA or the Articles to be present at the meeting.

Limitations on Ownership of Securities

Except as provided in the Investment Canada Act, there are no limitations specific to the rights of non-Canadians to hold or vote the Shares under the laws of Canada or British Columbia or in the Company’s Articles, by-laws, or charter documents.

Change in Control

There are no provisions in the Articles, charter documents, or by-laws that would have the effect of delaying, deferring or preventing a change in the control of the Company, or that would operate with respect to any proposed merger, acquisition or corporate restructuring involving the Company or any of its subsidiaries.

Ownership Threshold

The Articles do not require disclosure of Share ownership. Securities legislation in Canada, however, requires that shareholder ownership (as well as ownership of an interest in, or right or obligation associated with, a related financial instrument of a security of the Company) must be disclosed once a person beneficially owns or has control or direction over, directly or indirectly, securities of a reporting issuer carrying more than 10% of the voting rights attached to all the reporting issuer’s outstanding voting securities. Share ownership of director nominees must also be reported annually in proxy materials sent to the Company’s shareholders. Additionally, as the Company is listed on the NASDAQ, it must comply with United States federal securities laws, which requires it to disclose in its annual report, or Form 20-F, holders who own 5% or more of its issued and outstanding shares.

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Intercorporate Relationships

The Company has four material, wholly-owned subsidiaries in which it has a direct or indirect material interest: mCloud USA, a corporation incorporated pursuant to the DGCL; mCloud Services, a corporation incorporated pursuant to the Business Corporations Act (Alberta) (“ABBCA”); NGRAIN, a corporation incorporated pursuant to the Canada Business Corporations Act; and kanepi, a corporation incorporated pursuant to the laws of Australia.

mCloud Technologies (USA) Inc., (“M-USA”)

M-USA is an operating company that carries on its business and operations in the United States. mCloud USA has three wholly owned subsidiaries: mCloud Technologies (Canada) Inc., a corporation incorporated pursuant to the BCBCA; FDSI, a corporation organized pursuant to the DGCL; and CSA, a corporation organized pursuant to the laws of the State of Georgia. mCloud Technologies (Canada) Inc., is an operating company with business and operations in Canada. FDSI provides advanced enterprise software, handheld energy efficiency diagnostic tools and related training, and project management services that enable more rapid and accurate servicing of HVAC equipment, which decreases energy and operational costs. FDSI provides expertise in HVAC diagnostics and building data energy analytics and testing tools, analysis outcomes and programmatic solutions for national and restaurant chains. FDSI’s diagnostics technology is embedded in energy management systems and HVAC units. CSA, which was acquired by the Company on January 27, 2020, is an Atlanta-based 3D technology company. Its operatings were immediately amalgamated with M-USA and the legal entity was formally wound- up effective December 31, 2021.

mCloud Technolgies (Canada) Holdings, Inc., (“MTCH”)

MTCH is a holding company with one direct subsidiary, mCloud Technologies Services Inc., (“MTS”) a professional engineering and integration firm specializing in the design and implementation of high-value industrial automation solutions to the oil and gas industry in Alberta, Canada. On July 11, 2019, the Company indirectly acquired MTCH, a corporation incorporated pursuant to the ABBCA, by way of an amalgamation between one of the Company’s subsidiaries, 2199027, and Fulcrum, which had acquired MTCH and its subsidiary immediately prior to its acquisition by the Company. The acquisition of MTCH, by Fulcrum, was pursuant to a share purchase agreement dated June 12, 2019 between Mike Lane, Bob Beattie, Fulcrum, MTCH and the Company. The amalgamation of 2199027 and Fulcrum was completed pursuant to the terms of an amalgamation agreement dated June 12, 2019 between the Company, Fulcrum and 2199027 (“Amalgamation Agreement”). The amalgamated company, renamed “Autopro Automation Ltd.”, continued as a wholly-owned subsidiary of the Company, and was later renamed mCloud Technologies (Canada) Holdings, Inc., with MTS being a wholly-owned subsidiary.

NGRAIN (Canada) Corp.

NGRAIN is an operating company carrying on business and operations in Canada. NGRAIN contributes its AI and 3D technology to the Company’s AssetCare solutions. The Company acquired NGRAIN pursuant to the terms of a share purchase agreement dated January 2, 2018. NGRAIN owns all of the issued and outstanding shares of NGrain (US) Corp., a corporation incorporated pursuant to the laws of the State of Nevada.

mCloud Technologies Australia Holdings Pty Ltd.

On October 8, 2020, the company acquired, via its wholly-owned subsidiary mCloud Technologies Australia Pty Ltd., kanepi Group Pty. Ltd. Both kanepi Services Pty Ltd., and mCloud Technologies Singapore (previously kanepi PTE Ltd) are operating companies carrying on operations in Australia and Singapore. kanpei contributes advanced visual analytics solutions and its technologies are incorporated into the AssetCare platform. The Company also provides the Company with a strategic base in which the Company can increase its product offerings in the southern hemisphere.

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The following chart identifies each of the Company’s wholly owned subsidiaries as of the date of this prospectus (including jurisdiction of formation, incorporation or continuance of the various entities)*:

* Despite owning no shares, or having any voting right, the Company determined that it exercised control over Agnity Global, Inc. (“Agnity”) as the Company had the right to nominate a majority of the members of Agnity’s Operations Committee and therefore the right and ability to direct the relevant activities of Agnity and to significantly affect its returns through the use of its rights. As a result, the financial results of Agnity were consolidated into the Company’s financial statements. On July 29, 2022, the Company entered into a technology continuation agreement with Agnity which replaced the royalty agreement between the parties. As a result of this new arrangement, the Company will no longer consolidate the financial results of Agnity as of July 29, 2022.

Ownership of the above noted entities is 100% unless otherwise indicated.

The Company delivers solutions combining IoT, AI, and the cloud to unlock the untapped potential of energy- intensive assets such as:

• HVAC units and refrigerators in commercial buildings;

• control systems, heat exchangers, and compressors at process industry facilities; and

• wind turbines generating renewable energy at onshore wind farms.

IoT enables inexpensive, readily scalable connectivity to these and other under-served assets. Data from these IoT sensors are taken into the cloud, where digital twins of these assets are created, and AI is applied to identify opportunities to optimize asset performance. Asset operators and maintainers who manage these assets in the field are guided through a portfolio of mobile, connected applications that enable these teams to take asset management actions that ensure optimal performance.

Through the Company’s proprietary AssetCare platform, AI is used to identify opportunities to improve asset performance and enable asset operators and maintainers to take direct action creating these measurable improvements. Some key applications of the Company’s AssetCare technology at work include:

• curbing wasted energy while improving occupant comfort in commercial facilities through AI-powered adaptive control;

• maximizing asset availability and production yields of renewable energy sources through continuous performance assessment and predictive maintenance; and

• optimizing the uptime and manage the operational risk of industrial process plants, including oil and gas facilities, through continuous AI-powered advisory and assistance to process operators in the field.

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In all markets, the Company uses a commercial Software-as-a-Service (“SaaS”) business model to distribute its AssetCare solution. Customers pay a simple, subscription-based price that is determined by number of assets, asset size or complexity, and the expected efficiency gains to be created using AI and analytics. Set up as multi- year, recurring subscriptions, customers pay no fees upfront to onboard an AssetCare solution; any upfront costs are leveraged across the lifetime of the initial subscription period. Certain software and technologies used in AssetCare solutions are also offered to some customers on a perpetual basis.

The Company serves five key market segments:

1) Connected Buildings, which includes AI and analytics to automate and remotely manage commercial buildings, driving improvements in energy efficiency, occupant health and safety through IAQ optimization and food safety and inventory protection;

2) Connected Workers, which includes cloud software connected to third party hands-free, head- mounted “smart glasses” combined with AI capabilities to help workers in the field stay connected to experts remotely, facilitate repairs, and provide workers with an AI-powered “digital assistant”;

3) Connected Energy, which includes inspection of wind turbine blades using AI-powered computer vision and the deployment of analytics to improve wind farm energy production yield and availability;

4) Connected Industry, which includes process assets and control endpoint monitoring, equipment health, and asset inventory management capabilities, driving lower cost of operation for field assets and access to high-precision 3D digital twins enabling remote management of change operations across distributed teams; and

5) Connected Health, which includes remote health monitoring and connectivity to caregivers using mobile apps and wireless sensors that enable 24/7 care without the need for in-person visits, including at elder care facilities, age-in-place situations and medical clinics which also have strict requirements for IAQ and greenhouse gas standards.

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All of the target market segments are powered by common technology unique to the Company, enabling it to create and scale asset energy solutions using IoT, AI and cloud capabilities, with real-time information contextualized to each asset, and secure communications and 3D digital twin technologies.

The Company serves customers globally with a local presence in North America, the United Kingdom and Continental Europe, the Middle East, Southeast Asia, and Greater China. As of March 31, 2022, December 31, 2021 and December 31, 2020, we had an aggregate of , 111, 144, and 119 customers globally.

Recent Events

On October 26, 2022, Company entered into unsecured non-convertible loans with investors. The Company will borrow approximately $2 million, or such larger amount as may be agreed by the parties (the “Loan”). The Loan will bear interest of 15% per annum and the maturity date of the Loan will be the date that is 8 months following the date that the lenders provide the Loan to the Company. The Company will issue up to an aggregate of 2,127,660 share purchase warrants to the lenders as inducement for the Loans (the “Loan Bonus Warrants”). Each Loan Bonus Warrant will entitle the holder to purchase one common share of the Company at an exercise price of US$0.94 until the date that is five years following the date that the Company issues the Loan Bonus Warrants to the Lenders. Any securities issued in connection with the Loan will be subject to a statutory four month hold period.

On October 27, 2022, the Company entered into a strategic partnership with Google LLC (“Google”) to launch three AI-powered sustainability applications combining the Company’s AssetCare platform with the power and reach of Google Cloud and additional services such as Google Earth Engine. Google will display and make the AI-powered sustainability applications available on their store for customers to access. On or before the last business day of each calendar month during the Term of this Agreement, Google will pay the Company 50% of the revenues for the previous calendar month.

On November 1, 2022, the Company entered into securities purchase agreements with a consortium of strategic investors, largely industrial organizations based in Saudi Arabia aligned with Saudi Vision 2030, for the purposes of completing a non-brokered common share financing for gross proceeds of up to USD$12,500,000 (the “Offering”). The Company intends to issue up to 10,964,913 common shares at a price of USD$1.14 per share. The Offering is subject to receipt of all required approvals, including the approval of the TSXV. The securities issued under the Offering will be subject to a four-month hold period in accordance with applicable securities legislation.

Production and Services

The Company’s principal method of production is software development associated with the evolution of the AssetCare platform. Actual delivery and ongoing asset management is provided using AI and analytics supported by an internal team of asset management experts, with experience in all of the defined asset classes that mCloud serves in market. Certain aspects of AssetCare onboarding, such as the installation of IoT hardware, may involve third party service providers who partner with mCloud in all of the markets where mCloud does business.

Specialized Skill and Knowledge

The Company retains specialized skills and knowledge within each of its lines of business. In its “Connected Buildings” business, mCloud possesses talent and experience in building energy management, specifically energy efficient management of HVAC units and lighting. Within its “Connected Energy” business, mCloud has a team of experts in wind turbine engineering and turbine operations and maintenance. In its Connected Industry segment, the Company possesses talent and experience related to the management of process assets used in the refinement of oil and gas products.

From a core technology perspective, the team also retains specialized skills and expertise in specific areas of software development, namely the development of artificial intelligence capabilities, such as neural networks and deep learning. Team members also possess backgrounds in data science and statistics. To support the delivery of AssetCare capabilities that support mobile workers, the mCloud team has special knowledge and experience in the development of advanced mobile applications, and 3D capabilities including augmented and virtual reality (collectively known as “mixed reality”).

Competitive Conditions

In the principal markets that mCloud operates, there are numerous incumbent solution providers including Honeywell International Inc., Siemens AG, and General Electric Company, which also operate commercial offerings that overlap or compete with AssetCare. mCloud’s competitive advantage lies in its combined use of IoT, AI, and the cloud to make enterprise-grade asset management capabilities available to an entire underserved market of assets that have traditionally gone unmanaged because conventional solutions have been too expensive to be economical.

The Company also competes with emerging technology ventures that overlap with target market segments for AssetCare solutions. These include ventures such as C3.ai and Cognite who offer technologies to heavy industries and BrainBox and Airthings, who provide connected HVAC energy efficiency and IAQ technologies to commercial buildings.

The Company observes that in the principal markets it serves, most incumbent asset management solutions place a heavy focus on acquiring data, storing it, then reporting it to make it available to end customers. mCloud differentiates itself from the competition by using AI and analytics to create actionable insight that help customers decide what actions are the best ones to take to get the most out of their assets — instead of simply reporting on data, mCloud’s AssetCare platform helps customers take action based on data, which ultimately creates customer benefit.

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Marketing Channels

The Company maintains a robust presence in seven countries: Canada, the United States, the United Kingdom, the Kingdom of Bahrain as the gateway to markets in the Middle East, China, Singapore and Australia, supplemented by a growing international network of channel and delivery partners around the world.

The Company employs sales team members in these countries charged with direct sales efforts of AssetCare solutions. Global marketing efforts to support these sales efforts include virtual campaigns and events to attract new customers, strengthen relationships with existing customers, and build brand presence and visibility. The Company also hosts an annual user conference called mCloud Connect, which includes head-liners from well- known industry leaders, panels, and interactive sessions to gather “voice of the customer” feedback, which is used to improve the Company’s portfolio of AssetCare offerings.

The Company has conducted extensive research to size the markets and opportunities it can access through its AssetCare platform. The Company estimates that, with its current capabilities, it has the capability of serving over 7.3 million commercial buildings and over 34,000 industrial sites in 20 different locales worldwide, with each building or site representing multiple potential connectable assets, workers, or 3D digital twins. These statements refer to the serviceable obtainable market, that is, the market the Company believes it can address with its current capabilities. This estimate assumes and considers only asset types that can currently be connected and served by the Company’s AssetCare offering, namely commercial building types with standalone rooftop HVAC units, onshore wind turbines, and industrial facilities that depend on the use of process control systems. The estimate also only considers assets that can be found in key geographies where the Company currently has the ability to deliver AssetCare, namely the United States, Canada, the United Kingdom, China, Germany, Italy, Singapore, Australia, and Saudi Arabia.

Serviceable commercial buildings include restaurants, mid-size retail (including retail finance sites such as bank branches), and long-term care facilities. In these buildings, the Company connects to assets such as HVAC, lighting, and refrigeration units. Connectable workers include people involved in the day-to-day operation or maintenance of these commercial buildings, including mechanical service workers and facility managers.

Industrial sites include oil and gas, liquefied natural gas, and floating production storage and offloading facilities, as well as wind farms, mining processing plants, and pulp and paper facilities. In these locations, connectable assets include process control systems, heat exchangers, pumps, and gas compressors. Connectable workers include field operators, maintainers, engineers, asset managers, and plant managers. The Company’s experience in delivering digital 3D models from entire multi-billion-dollar assets the size of a FPSO vessel down to asset subcomponents such as wind turbine blades creates large obtainable market opportunities.

Based on the average monthly fee currently generated per connection or 3D digital twin, the Company estimates the current obtainable market opportunity to be approximately $24 billion in recurring revenue per annum including all potential targeted assets, workers, and 3D digital twins that the Company can currently address.

Intangible Properties

mCloud’s success depends in part on its ability to create unique intellectual property that improves the Company’s ability to create and deliver customer value in the principal markets where it does business. The Company relies on the use of intellectual property rights, including patents, copyrights, registered trademarks, and trade secrets in Canada, the United States and the European Union.

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The Company retains a portfolio of 15 technology patents in the areas of HVAC energy efficiency, 3D, and asset management, a global customer base in industries including retail, healthcare, heavy industry, oil and gas, nuclear power generation, and renewable energy, and a portfolio of 12 registered trademarks, including marks related to mCloud and AssetCare:

Patent	Patent No. / App. Serial No.	Jurisdiction	Date Issued / Date Filed	Status	Registered Owner
Apparatus and method for detecting faults and providing diagnostics in vapor compression cycle equipment	6,658,373	US Patent	12/2/2003	Live	Field Diagnostic Services, Inc.
Estimating operating parameters of vapor compression cycle equipment	6,701,725	US Patent	3/9/2004	Live	Field Diagnostic Services, Inc.
Estimating evaporator airflow in vapor compression cycle cooling equipment	6,973,793	US Patent	12/13/2005	Live	Field Diagnostic Services, Inc.
Apparatus and method for detecting faults and providing diagnostics in vapor compression cycle equipment	7,079,967	US Patent	7/18/2006	Live	Field Diagnostic Services, Inc.
Method for Determining Evaporator Airflow Verification	8,024,938	US Patent	9/27/2011	Live	Field Diagnostic Services, Inc.
Method and Apparatus for Transforming Polygon Data to Voxel Data for General Purpose Applications	6,867,774	US Patent	3/15/2005	Live	NGRAIN (Canada) Corporation
Method and System for Rendering Voxel Data while Addressing Multiple Voxel Set Interpenetration	7,218,323	US Patent	5/15/2007	Live	NGRAIN (Canada) Corporation
Method and Apparatus for Transforming Point Cloud Data to Volumetric Data	7,317,456	US Patent	1/8/2008	Live	NGRAIN (Canada) Corporation
Method, System and Data Structure for Progressive Loading and Processing of a 3D Dataset	7,965,290	US Patent	6/21/2011	Live	NGRAIN (Canada) Corporation

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Method and System for Calculating Visually Improved Edge Voxel Normals when Converting Polygon Data to Voxel Data	8,217,939	US Patent	7/16/2012	Live	NGRAIN (Canada) Corporation
System and Method for Optimal Geometry Configuration Based on Parts Exclusion	9,159,170	US Patent	10/13/2015	Live	NGRAIN (Canada) Corporation
Method and System for Emulating Kinematics	9,342,913	US Patent	5/17/2016	Live	NGRAIN (Canada) Corporation
System, Computer- Readable Medium and Method for 3D Differencing of 3D Voxel Models	9,600,929	US Patent	3/21/2017	Live	NGRAIN (Canada) Corporation
System, Method and Computer-Readable Medium for Organizing and Rendering 3D Voxel Models in a Tree Structure	9,754,405	US Patent	9/10/2015	Live	NGRAIN (Canada) Corporation
Portable apparatus and method for decision support for real time automated multisensor data fusion and analysis	10,346,725 072239.0004 / BR BR 11 2017 024598 1 072239.0005 / MX MX/a/2017/014648 072239.0006 / EU EP16797087.0 072239.0007 / IN 201747045184 072239.0008 / CN 2016800413571 072239.0009 / CA 072239.0010 / ZA 2018/01638	US Patent National Stage Filings in BR / MX / EU / IN / CN / CA / ZA	7/9/2019	Live	mCloud Corp.

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(ii) Trademarks

Trademark	App. Serial No. / Reg. No.	Date Issued / Date Filed	Status	Registered Owner
ACRx	75281276/ 2492872	9/25/2001	Live	Field Diagnostic Services, Inc.
MCLOUD CORP (standard mark)	87327278/ 5333557	14/11/2017	Live	mCloud Corp.
mCloud Corp (design mark)	87327435/ 5333558	14/11/2017	Live	mCloud Corp.
Asset Circle of Care (standard mark)	87327483/ 5333559	14/11/2017	Live	mCloud Corp.
AssetCare (standard mark)	87327512/ 5333560	11/14/2017	Live	mCloud Corp.
3KO	77398780/ 3796217	11/11/2008	Live	NGRAIN (Canada) Corporation
NGRAIN (design mark)	77912373/ 3840652	6/15/2010	Live	NGRAIN (Canada) Corporation
NGRAIN (design mark)	009245101 (EU)	12/27/2010	Live	NGRAIN (Canada) Corporation
PRODUCER	009327412 (EU)	2/3/2011	Live	NGRAIN (Canada) Corporation
NGRAIN (standard mark)	78199527/ 2881383	9/7/2004	Live	NGRAIN (Canada) Corporation
mCloud Connect (standard mark)	5756945	5/21/2019	Live	mCloud Corp.
mCloud (design mark)	88/907693		In Application (Approved)
mCloud (design mark)	88/907606		In Application (Approved)
AssetCare (design mark)	88/907679		In Application (Approved)
PanoMap (standard mark)	88/916707 6,444,185	8/10/2021	Live	mCloud Corp.
Newton Engine (standard mark)	88/907682		In Application (Approved)
Kanepi	40201608870Y / SG	June 1 2016	Live	Kanepi Pte Ltd
	40201608871T / SG	June 1 2016	Live	Kanepi Pte Ltd
SEE YOUR BUSINESS	2024268 / AUS	March 11 2020	Live	Kanepi Pte Ltd
MY LDAR (standard mark)	97264404	February 11, 2020	In Application	mCloud Corp.
	97264407	February 11, 2020	In Application	mCloud Corp.

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The Company also uses key domain names, including acrx.com, fdsi.site, fdsi.us, fielddiagnostics.com, fmdiagnosticscoe.com, mysamobile.com, peatanalytics.com, mcloudcorp.com, assetcare.io, assetcare.net, myldar.com, ngrain.com, ngrain.ca, ngrain.net, ngrain.org and i3dimensions.com.

The Company further protects its proprietary source code and algorithms as trade secrets, limiting access to these to employees who have a need to know such information.

Environmental Protection

The Company does not see any financial or operational effects from environmental protection requirements on capital expenditures, profit or loss, and competitive position in this financial year. In the future, the Company may see enhanced demand for AssetCare in businesses who have a mandate to become more energy efficient or demonstrate they have instituted effective methane emission reduction and mitigation programs in response to new government regulations.

Employees

As of the year ended December 31, 2021 and as of the date of this prospectus, the Company and its subsidiaries have 216 employees employed in 14 offices in Canada, the United States, Greater China, the Middle East, Southeast Asia, and Australia. As of the year ended December 31, 2020, the Company and its subsidiaries had 227 employees employed in 14 offices in Canada, the United States, Greater China, the Middle East, and Southeast Asia. As of the year ended December 31, 2019, the Company and its subsidiaries had over 216 employees employed in twelve offices in Canada, the United States, Greater China, the Middle East, and Southeast Asia. The fluctuation in the Company’s number of employees is not significant, and none of the Company’s employees belong to any labour unions. Furthermore, all of the Company’s employees are employed on a full-time basis.

Incentive stock options may be granted only to employees of the Company or a “parent corporation” or “subsidiary corporation” thereof (as such terms are defined in Sections 424(e) and 424(f) of the Code). Stock awards other than incentive stock options (including non-statutory stock options, stock appreciation rights, restricted stock awards, restricted stock unit awards, and other stock awards, collectively “Stock Awards”) may be granted to employees, directors and consultants; provided, however, that Stock Awards may not be granted to employees, directors and consultants who are providing Continuous Service only to any “parent” of the

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Company, as such term is defined in Rule 405, subject to certain exceptions set out in the Company’s Incentive Stock Option Plan.

Foreign Operations

The Company operates in multiple geographies around the world, including North America (the United States and Canada), Europe (the United Kingdom and continental Europe), Southeast Asia (primarily Greater China), the Middle East (primarily Saudi Arabia), and Australia with most of its business taking place outside of Canada. mCloud is not dependent on business in any one region for its success.

Research and Development

The Company’s customers use its software to monitor their assets and rely on the Company to provide updates and releases as part of its software maintenance and support services. Consequently, while the Company has not implemented a formal research and development policy for the past three years, the Company is and has been (including, but not limited to, the past three years) engaged with a number of research and development initiatives as a part of its ongoing effort to continually update its software and develop new products.

Fixed Assets

On September 27, 2021, the Company executed a 12-year lease for its office in Calgary, Alberta located at 8 Avenue SW, Stephen Avenue Place, Calgary, Alberta, Canada. In total, the Company has leased 33,000 square feet of the property, situated on the 3rd and 33rd floor of the building located at the aforementioned address. The lease term commences on December 1, 2022, preceded by a fixturing period which the Company will use to build out the office space to their specifications. The Company is currently in the design and scoping stage, and has not yet finalized its plans for the precise use of the property, and does not yet have any plans to construct, expand, or improve the facilities. No environmental issues have currently been identified that will affect the Company’s utilization of the asset.

Material Effects

Certain government regulations have a material impact on the Company’s business. The Company has implemented certain measures to address and conform to all the frameworks noted below, and others as required, and conducts an annual review to ensure compliance with such frameworks and regulations.

The Company is required to adhere to such frameworks as the EU’s General Data Protection Regulations, the EU’s ePrivacy Regulation, Brazil’s General Data Protection Law, the California Consumer Privacy Act, the California Online Privacy Protection Act, and various other regulations in effect in other U.S. states, which require the Company, among other things, to have a valid privacy policy, block cookies before the user provides consent, allow users to opt-in or opt-out of receiving communications from the Company, show a notice of collection, and keep records of consent and processing. While the Company does not yet do business in Brazil, and has not reached the required number of users in California for the applicable regulations noted above to have effect, the Company has implemented measures to ensure that it remains compliant with these frameworks in advance of such compliance being legally required.

Data security practices are monitored and regulated by the Federal Trade Commission in the U.S., the Office of the Privacy Commissioner in Canada, and the European Data Protection Board of the EU. Canada, in particular, has several privacy law statutes that the Company is required to adhere to, such as the Personal Information Protection and Electronic Documents Act, the Personal Information Protection Act (Alberta), the Personal Information Protection Act (British Columbia), and An Act Respecting the Protection of Personal Information in the Private Sector (Quebec).

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Generally speaking, the Company is also required to comply with and respect the competition, consumer protection, and taxation laws, and intellectual property laws and regulations handed down by standard copyright and trademark laws in each of the jurisdictions it operates in. For confidential government contracts that require specific approvals to examine, possess, or transfer intellectual property, the Company is required to adhere to the International Traffic in Arms Regulations in the US, and the Canadian Controlled Goods Program in Canada. Additionally, the Company also follows and adheres to the best practices set out in the various National Institute of Standards and Technology frameworks, the Information Technology Infrastructure Library framework, and the Certified Information Systems Security Professional framework.

MANAGEMENT

The following table sets forth our executive officers and directors, their ages and the positions held by them:

Name	Age		Position	Appointed
Russel H. McMeekin		57	Chief Executive Officer, President, Director	October 2017
Michael Allman		61	Director	October 2017
Costantino Lanza		68	Chief Growth Officer, Corporate Secretary, Director	October 2017
Elizabeth MacLean		57	Director	October 2018
Ian Russell		73	Director	September 2019
Chantal Schutz		49	Chief Financial Officer	May 2019

MANAGEMENT BIOGRAPHIES

Russel H. McMeekin: Director, President and Chief Executive Officer

Mr. McMeekin was previously a founding partner of Energy Knowledge, Inc., which was acquired by Yokogawa Electric Corporation. Mr. McMeekin went on to serve as Executive Chairman of Yokogawa Venture Group, leading the acquisitions of Industrial Evolution and KBC Advanced Technologies, an energy software and consulting company publicly listed in the United Kingdom. Mr. McMeekin was the founding Chief Executive Officer of SCI Energy Inc., a Silicon Valley cloud-based energy-efficiency company now based in Dallas, Texas. Previously, Mr. McMeekin was the President and Chief Executive Officer of Nasdaq-listed Progressive Gaming International for six years, a company that led the use of RFID technologies for critical item tracking., Mr. McMeekin spent more than 10 years at Honeywell International Inc., including serving as President of Honeywell International Inc.’s Digital and Software Business Units. At Honeywell International Inc., he led joint ventures with Microsoft Corporation, United Technologies Corporation and i2 Technologies. Mr. McMeekin started his career at SACDA Inc., a University of Western Ontario Computer Aided Design Venture which was later acquired by Honeywell International Inc. Mr. McMeekin graduated in Engineering Technology from Sault College of Applied Technology, continued his studies at the University of Waterloo. and he completed a Honeywell International Inc. Sponsored Executive Leadership Program through the Harvard Business School. He also completed the Stanford School of Law Executive Director Program. Mr. McMeekin is also a director of GoodGamer Inc. a TSXV listed company Ticker (GOOD).

Michael Allman: Director

Mr. Allman is a highly accomplished Chief Executive Officer and Chairman, with extensive experience in growing, restructuring and optimizing business strategies and operations for Fortune 300 companies and top-tier consulting firms around the world. He recently was the Chief Operating Officer of Bitstew, Inc. a leading IoT cloud company acquired by GE Digital. Mr. Allman previously served as President and Chief Executive Officer of Southern California Gas Company. Mr. Allman has a master’s degree in business administration from the University of Chicago Graduate School of Business and a bachelor’s degree in chemical engineering from Michigan State University. He is a Certified Management Accountant and a Certified Internal Auditor.

Costantino Lanza: Director, Chief Growth Officer, and Corporate Secretary

Mr. Lanza, a former partner of Energy Knowledge, Inc., is versed in applying advanced technologies to traditional asset intensive industries with many years of direct experience, most recently with Yokogawa Venture Group, where he led the integration of KBC Advanced Technologies, Yokogawa’s largest ever acquisition. Mr. Lanza has served in leadership roles at Honeywell International Inc. and ExxonMobil Corporation before becoming Chief Executive Officer of INOVx Solutions, Inc. from 2006 to 2015, where 3D technologies were used to improve asset performance management. Mr. Lanza holds a BS and MS degree in Chemical Engineering from Columbia University.

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Elizabeth MacLean: Director

Ms. MacLean is Chief Financial Officer for Newgioco Group, Inc. (OTCQB:NWGI), a vertically integrated leisure- gaming technology company headquartered in Toronto, Canada. Ms. MacLean has more than 20 years of experience leading finance teams in various industries in both the United States and the United Kingdom. Since September 2016, Ms. MacLean has served as the Treasurer of H. MacLean Realty Company, Inc. Since August 2018, Ms. MacLean has served as an adjunct faculty member at Ottawa University. Ms. MacLean received an MBA in global finance from Stanford University’s Graduate School of Business and a Bachelor of Arts in biology from the University of Chicago.

Ian Russell: Director

Mr. Russell has long held prominent positions in the investment industry, both on a domestic and global level. He is the President and Chief Executive Officer of IIAC, a position he has held since the inauguration of the IIAC in April 2006. Prior to his appointment at the IIAC, Mr. Russell was Senior Vice-President with the Investment Dealers Association of Canada, a national self-regulatory organization. Mr. Russell worked as an executive at the highly respected international publication, “The Bank Credit Analyst”, and spent nearly a decade at the Bank of Canada. His experience has given him a unique and deep knowledge of the investment business, including underwriting, debt and equity trading and financial advice, as well as an understanding of the market and economic trends that drive the decisions of investors and issuers. He is active in the international investment community: Chair of the International Council of Securities Associations from 2014 to 2017; designated leader of the Canadian mission to the Asia Financial Forum; and invited guest and regular participant at Cumberland Lodge Financial Summit in the U.K., a roundtable of European and international leaders to discuss future policy and regulation in European capital markets. Mr. Russell is a prolific writer and columnist, both in industry publications and newspapers. He is also a frequent commentator in the media, and a sought-after presenter and speaker. Mr. Russell has a postgraduate degree (MSc Economics) from the London School of Economics and Political Science, and an Honours degree in Economics and Business from the University of Western Ontario. He has completed the Partners, Directors and Seniors Officers Qualifying Examination and is a Fellow of the Canadian Securities Institute.

Chantal Schutz: Chief Financial Officer

Ms. Schutz is a Chartered Professional Accountant (CPA,CA) with over 20 years of experience as a financial leader and entrepreneur. Prior to joining mCloud, Ms. Schutz was the Chief Executive Officer of NYCE Sensors. Ms. Schutz has extensive expertise in both private and publicly traded markets, having held Chief Financial Officer roles in businesses of varying size prior to joining NYCE Sensors Inc. As the Chief Financial Officer and member of the Executive Team at Back In Motion Rehab, Inc., she helped secure financing and developed and implemented systems and procedures which saw the doubling of revenue and headcount, as well as a corporate restructuring. Formerly, Ms. Schutz worked as an independent, contracted Chief Financial Officer for small and medium sized, owner-managed businesses, assisting in the development and implementation of strategic plans and financial reorganizations, as well as implementation of Sarbanes-Oxley and Bill 198. Ms. Schutz has also been an instructor of Financial Management at the B.C. Institute of Technology and facilitated for over 10 years in the Chartered Accountant School of Business. Ms. Schutz articled with both KPMG and PwC and earned her Bachelor of Commerce in Entrepreneurial Management from Royal Roads University. Ms. Schutz is passionate about ensuring that business owners, teens and young adults understand the need for strong financial literacy, and she is a sought-after speaker and advisor at business events and conferences around North America.

Board of Directors and Board Committees

Corporate Governance

We intend to comply with the rules generally applicable to U.S. domestic companies listed on the Nasdaq. We may in the future decide to use other foreign private issuer exemptions with respect to some of the other Nasdaq listing requirements. Following our home country governance practices, as opposed to the requirements that would otherwise apply to a company listed on the Nasdaq, may provide less protection than is accorded to investors under the Nasdaq Rules applicable to U.S. domestic issuers.

The Canadian securities regulatory authorities have issued corporate governance guidelines pursuant to National Policy 58-201—Corporate Governance Guidelines, or the Corporate Governance Guidelines, together with certain related disclosure requirements pursuant to NI 58-101. The Corporate Governance Guidelines are recommended as “best practices” for issuers to follow. We recognize that good corporate governance plays an important role in our overall success and in enhancing shareholder value and, accordingly, we have adopted, or in connection with the closing of this offering will adopt, certain corporate governance policies and practices which reflect our consideration of the recommended Corporate Governance Guidelines.

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The disclosure set out below includes disclosure required by NI 58-101 describing our approach to corporate governance in relation to the Corporate Governance Guidelines.

Board Composition and Election of Directors

Our board of directors currently consists of five directors. Our board of directors will facilitate its exercise of independent supervision over management by ensuring that a majority of its members are “independent” following this offering. Under our organizational documents, at each annual general meeting one-third of the directors, other than the Managing Director, or if their number is not a multiple of three, then the number nearest to one-third (rounded upwards in case of doubt) of the directors must retire. The term of office for each director of the Company expires immediately before each annual meeting of the shareholders of the Company.

Notwithstanding the above, no director, other than the Managing Director, shall hold office for a period in excess of 3 years, or until the third annual general meeting following his or her appointment, whichever is the longer, without submitting himself for re-election.

A retiring director remains in office until the relevant shareholder meeting and will be eligible for re-election at that meeting.

A director who has a material interest in a matter before our board of directors or any committee on which he or she serves is required to disclose such interest as soon as the director becomes aware of it. In situations where a director has a material interest in a matter to be considered by our board of directors or any committee on which he or she serves, such director may be required to remove himself or herself from the meeting while discussions and voting with respect to the matter are taking place.

Meetings of Directors

Our board of directors will hold regularly-scheduled quarterly meetings as well as ad hoc meetings from time to time. The independent members of our board of directors will also meet, as required, without the non-independent directors and members of management before or after each regularly scheduled board meeting.

A director who has a material interest in a matter before our board of directors or any committee on which he or she serves is required to disclose such interest as soon as the director becomes aware of it. In situations where a director has a material interest in a matter to be considered by our board of directors or any committee on which he or she serves, such director may be required to absent himself or herself from the meeting while discussions and voting with respect to the matter are taking place. Directors will also be required to comply with the relevant provisions of the BCBCA regarding conflicts of interest.

Remuneration and Borrowing

The directors may receive such remuneration as our Board of Directors may determine from time to time. Each director is entitled to be repaid or prepaid for all traveling, hotel and incidental expenses reasonably incurred or expected to be incurred in attending meetings of our Board of Directors or committees of our Board of Directors or shareholder meetings or otherwise in connection with the discharge of his or her duties as a director. The compensation committee will assist the directors in reviewing and approving the compensation structure for the directors. Our Board of Directors may exercise all the powers of the company to borrow money and to mortgage or charge our undertakings and property or any part thereof, to issue debentures, debenture stock and other securities whenever money is borrowed or as security for any debt, liability or obligation of the company or of any third party.

Foreign Private Issuer Status

We are a “foreign private issuer” under SEC and Nasdaq rules, which also exempts us, as well as our directors, executive officers and 10% shareholders, from certain requirements that apply to U.S. public companies and their directors, executive officers and 10% shareholders. See “Risk Factors — We are a “foreign private issuer” and may have disclosure obligations that are different from those of U.S. domestic reporting companies. As a foreign private issuer, we are subject to different U.S. securities laws and rules than a domestic U.S. issuer, which could limit the information publicly available to our shareholders.”

Board Committees

We currently have an audit committee, a compensation committee, a nominating and corporate governance committee and a technology oversight committee, with each committee having a written charter.

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Audit Committee

The members of the Audit Committee are Ms. MacLean, as Chairperson, Mr. Allman and Mr. Russell. Each of the members of the Audit Committee are “independent” for the purposes of NI 52-110. All members of the Audit Committee are “financially literate” for the purposes of NI 52-110.

All three members of the Audit Committee have been senior officers and/or directors of publicly traded companies or have been business executives, in each case with the responsibility of performing financial functions, for a number of years. In these positions, each such director has been responsible for receiving financial information relating to the entities of which they were directors, officers or executives. They have, or have developed, an understanding of financial statements generally and of how statements are used to assess the financial position of a company and its operating results. Each member of the Audit Committee also has a significant understanding of the business in which the Company is engaged and has an appreciation for the relevant accounting principles used in the Company`s business.

Further, each member has the requisite education and experience that has provided the member with:

• an understanding of the accounting principles used by the Company to prepare the Company’s financial statements;

• the ability to assess the general application of the above-noted principles in connection with estimates, accruals and reserves;

• experience preparing, auditing, analyzing or evaluating financial statements that present a breadth and level of complexity of accounting issues that are generally comparable to the breadth and complexity of issues that can reasonably be expected to be raised by the Company’s financial statements, or experience actively supervising individuals engaged in such activities; and

• an understanding of internal controls and procedures for financial reporting.

The Audit Committee’s primary responsibility is to assist the Board in discharging its oversight responsibilities with respect to financial matters and compliance with laws and regulations. The Audit Committee’s specific responsibilities with respect to its oversight of financial matters include, among other things: to select, evaluate, monitor the independence of, and recommend an auditor to the Board for appointment or reappointment, as the case may be, by the Company`s shareholders and make recommendations with respect to the auditor’s compensation; to review and determine the auditor’s fee and the terms of the auditor’s engagement and inform the Board thereof; where the Audit Committee may deem it appropriate, to recommend to the Board that the auditor be terminated; to meet with senior management without the auditor present to discuss the performance of the auditor; to pre-approve any audit services, and any non-audit services permitted under applicable law, to be performed by the auditor; to review and approve the audit plan; to review with senior management and the auditor the annual audited consolidated financial statements, together with the auditor’s report thereon and the interim financial statements, before recommending them to the Board, and review with senior management and the auditor the relevant management’s discussion and analysis relating thereto; to review other financial reporting and disclosures, including earnings press releases and other press releases disclosing financial information and all other financial statements of the Company that require approval by the Board before they are released to the public; to oversee the integrity of the Company`s financial reporting processes and disclosures, including its internal controls, disclosure controls and procedures and compliance with legal and regulatory requirements, and to report regularly to the Board on such matters; to oversee the Company’s risk management function; to review with senior management the status of taxation matters; and to review and oversee the Company`s investment strategies and policies.

The Audit Committee reviews and pre-approves all audit and non-audit services to be provided to the Company by its external auditors on an annual basis. Before the appointment of the external auditor for any non-audit service, the Audit Committee considers the compatibility of the service with the auditor’s independence.

Audit Committee Charter

The responsibilities and duties of the Audit Committee are set out in the committee’s charter.

Audit Committee Oversight

At no time has a recommendation of the Audit Committee to nominate or compensate an external auditor not been adopted by the Board.

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Principal Accountant’s Fees

Aggregate fees billed by KPMG LLP, our independent auditor, in the fiscal years ended December 31, 2021 and 2020 were approximately CAD$2,248,147 and CAD$1,129,749, respectively, as detailed below.

	Fees billed for the fiscal year ended December 31,
Service Retained	2021		2020
Audit fees(1)	CAD$	1,799,383	CAD$	769,826
Audit-related fees(2)	CAD$	6,420	CAD$	—
Tax fees(3)	CAD$	339,624	CAD$	321,050
All other fees(4)	CAD$	102,720	CAD$	38,873
Total	CAD$	2,248,147	CAD$	1,129,749

1. Includes fees necessary to perform the annual audit of our consolidated financial statements, reviews of the interim financial statements, and services related to prospectus filings.

2. Includes other audit related services that are performed by the auditor.

3. Includes fees for tax compliance, tax planning and tax advice. These services include preparing tax returns and corresponding with government tax authorities.

4. Includes French translation services related to prospectus filings and historical financial statements and management’s discussion and analysis.

Compensation Committee

The administration of the Corporation’s compensation practices is handled by the Compensation Committee.

Among other things, the Compensation Committee’s role is to ensure that the total compensation paid to the Corporation’s executive officers, including the Named Executive Officers, is fair, reasonable and competitive. In the course of reviewing and recommending to the Board the compensation of executive officers other than the Chief Executive Officer, the Compensation Committee annually reviews the performance of the executive officers with the Chief Executive Officer, and the Chief Executive Officer makes recommendations to the Compensation Committee regarding their compensation.

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The Compensation Committee will evaluate the performance of the Chief Executive Officer, based on its evaluation, review and make recommendations to the Board with respect to all direct and indirect compensation, benefits and perquisites (cash and non-cash) for the Chief Executive Officer based on such evaluation. The Compensation Committee will also review and make recommendations to the Board with respect to compensation, benefits and perquisites for all other senior executive officers of the Corporation, incentive-compensation plans and equity-based plans, and policies regarding management benefits and perquisites.

Neither the Board nor any committee of the Board has formally established a mechanism to consider the implications of the risks associated with the Corporation’s compensation policies and practices. However, the Board and the Compensation Committee inherently consider these risks. The Compensation Committee reviews and manages the policies and practices of the Corporation and ensures that they are aligned with the interests of the shareholders. The Compensation Committee reviews, among other things, the overall compensation and the annual salary increases of the executive officers of the Corporation while keeping as a reference both the financial performance of the Corporation and the turnover risk for the Corporation. The Board also addresses risk related to compensation policies in the context of compensation mechanisms that are linked to the achievement of certain goals or targets (e.g. short term and long-term objectives), both financial and otherwise. The Board is involved in the supervision of key projects and initiatives of the Corporation and the manner in which they are being carried out. Consequently, the Board is in a position where it can control significant risks that may be taken by the Corporation’s management and ensures that those risks remain appropriate and that members of management do not expose the Corporation to excessive risks.

Each member of the Compensation Committee has direct experience relevant to compensation matters resulting from their respective current and past backgrounds and/or roles. The members of the Compensation Committee have experience dealing with compensation matters in large and small organizations, including public companies. The Corporation does not have a policy in place that limits the ability for directors or Named Executive Officers to hedge the shares of the Corporation that they own. However, none of the current directors or Named Executive Officers of the Corporation are hedging any of the shares of the Corporation that they own.

Compensation Process

The Corporation has no formal or informal policy or target for allocating compensation between long-term and short-term compensation, between cash and non-cash compensation, or among the different forms of non-cash compensation. Instead, the Board determines subjectively what it believes to be the appropriate level and mix of the various compensation components based on the recommendations of the Compensation Committee.

Compensation Objectives

The Corporation’s compensation philosophy for Named Executive Officers is designed to attract well-qualified individuals by paying modest base salaries plus short and long-term incentive compensation in the form of equity-based or other suitable long-term incentives. In making its determinations regarding the various elements of executive compensation, the Board has utilized published studies of compensation paid in comparable businesses, specifically the 2016 study conducted by Culpepper and Associates. These studies have been used to ensure that the compensation received by the Board will be in line with industry standards.

The duties and responsibilities of the Chief Executive Officer are typical of those of a business entity of the Corporation’s size in a similar business and include direct reporting responsibility to the Chairman of the Board, overseeing the activities of all other executives of the Corporation, representing the Corporation, providing leadership and responsibility for achieving corporate goals and implementing corporate policies and initiatives.

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The objectives of the Corporation’s executive compensation program are as follows:

• to attract, retain and motivate talented executives who create and sustain the Corporation’s continued success;

• to align the interests of the Corporation’s executives with the interests of the Corporation’s shareholders; and

• to provide total compensation to executives that is competitive with that paid by other companies of comparable size engaged in similar businesses in appropriate regions.

The Corporation believes that its current compensation programs are structured to support the achievement of the foregoing strategic objectives. Overall, the executive compensation program aims to design executive compensation packages that meet executive compensation packages for executives with similar talents, qualifications and responsibilities at companies with similar financial, operating and industrial characteristics. The Corporation expects to undergo significant growth and is committed to retaining its key executives for the next several critical years, but at the same time ensuring that executive compensation is tied to specific corporate goals and objectives. The Corporation’s executive compensation program has been designed to reward executives for reinforcing the Corporation’s business objectives and values, for achieving the Corporation’s performance objectives and for their individual performances.

Elements of Compensation

The Company seeks to achieve the compensation objectives described earlier through different elements of compensation, including salary and both short-term and long-term incentive plans, with the incentives having both equity and non-equity components. The Company believes that these various elements are important to effectively achieve the objectives of its executive compensation philosophy.

The elements of the Named Executive Officers’ compensation are:

(a) base salaries;

(b) performance bonuses; and

(b) equity incentive grants.

There is no regulatory oversight of the Company’s compensation process for the Named Executive Officers.

Base Salary

The Company pays its executive officers a base salary to compensate them for services rendered during a fiscal year. Base salaries are determined for each executive officer based on an evaluation of such officer’s experience, skills, knowledge, scope of responsibility and performance. Base salary levels are reviewed and considered annually, and from time to time adjustments may be made to base salary levels based upon promotions or other changes in job responsibility or merit-based increases based on assessments of individual performance.

The base salary review of any executive officer will take into consideration the current competitive market conditions, experience, proven or expected performance, and the particular skills of the executive officer. Base salary is not evaluated against a formal “peer group”.

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Performance Bonuses

In addition to a base salary, the Named Executive Officers are eligible to receive performance-based bonuses meant to motivate the Named Executive Officers to achieve shorter-term goals. The pre-established, quantitative target(s) used to determine performance bonuses will be set by the Board or a committee thereof each fiscal year. Awards under the plan will be made by way of cash payments only, which payments will be made at the end of the relevant fiscal year. Each Named Executive Officer will be measured against the financial targets within his or her control and, while overall company performance is part of the plan, individual targets will represent the highest percentage of the plan payout. The cash bonuses are primarily designed to align the financial interests of the Corporation’s executives with the interests of the Corporation’s shareholders.

Equity-Based Compensation

The executive officers are eligible to receive option, restricted stock or other equity and equity-linked awards under the Equity Incentive Plan. The Company intends for equity awards to be an integral part of its overall compensation program as the Company believes that the long-term performance of the Company will be enhanced through the use of equity-based awards that reward executive officers for increasing long-term shareholder value. The Company also believes that such awards will promote an ownership perspective among its executive officers and encourage executive retention. Equity based compensation awarded to executive officers (including Named Executive Officers) will typically be subject to time-based vesting provisions. The Company does not have any formal policy regarding when equity-based compensation is to be granted or the size of any given grant. In determining the number of awards to be granted to executive officers, the Compensation Committee takes into account the individual’s position, scope of responsibility, ability to affect profits and shareholder value and the value of the awards in relation to other elements of the individual executive officer’s total compensation, including base salary and cash bonuses. When considering equity or equity-linked awards to an executive officer, consideration of the number of awards previously granted to the executive may be taken into account, however, the extent to which such prior awards remain subject to resale restrictions will generally not be a factor.

Broad-Based Benefits Programs

All full-time employees, including the Company’s Named Executive Officers, may participate in the Company’s health and welfare benefit programs, including medical, dental and vision care coverage, disability insurance and life insurance. The Company does not intend to provide perquisites or personal benefits to its Named Executive Officers that are not otherwise available to other employees generally.

Pension Plan Benefits

The Company does not have a defined benefits pension plan, a defined contribution plan or a deferred compensation plan.

Nominating and Corporate Governance Committee

Corporate governance and nominating committees are not mandatory in Canada. However, NP 58-201 recommends that a board appoint a corporate governance committee composed entirely of independent directors with responsibility for overseeing the process for nominating directors for election by shareholders. The members of the corporate governance committee are not required to be independent or to have any particular expertise.

Our corporate governance and nominating committee is appointed by the Board to assist in fulfilling its corporate governance responsibilities under applicable laws. Our corporate governance and nominating committee is responsible for, among other things, developing our approach to governance issues and establishing sound corporate governance practices that are in the interests of our shareholders and that contribute to effective and efficient decision-making.

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Our corporate governance and nominating committee is currently comprised of Mr. Russell, Mr. Allman and Ms. MacLean, and chaired by Mr. Allman.

The corporate governance and nominating committee’s principal responsibilities include:

• developing and recommending to the Board criteria for selecting board and committee members;

• establishing procedures for identifying and evaluating director candidates, including nominees recommended by shareholders;

• identifying individuals qualified to become board members;

• recommending to the Board the persons to be nominated for election as directors and to each of the Board’s committees;

• reviewing and making recommendations to the Board regarding the appointment and succession of our directors and officers;

• developing and recommending to the Board a code of business conduct and ethics and a set of corporate governance guidelines; and

• overseeing the evaluation of the Board, its committees and our management.

The corporate governance and nominating committee regularly reviews the current profile of the Board, including the representation of various areas of expertise, experience and diversity, to ensure that the Board has a sufficient range of skills, expertise and experience to enable it to carry out its duties and responsibilities effectively.

Technology Oversight Committee

The members of the technology oversight committee are Mr. Lanza, as Chairperson, Mr. McMeekin and Ms. MacLean. Of the members of the technology oversight committee, only Ms. MacLean is independent.

The technology oversight committee will oversee our overall technology strategy. The technology oversight committee’s responsibilities shall include:

• meeting with our technical management team at least once per calendar quarter;

• assessing whether the product delivery schedule is being met and whether it needs to be adjusted;

• ensuring that all third-party software we use is properly licensed;

• making recommendations to the Board concerning our technology strategy, roadmap and investment plans;

• assessing the health and oversight of the execution of our technology strategies; including architecture, use of open source software, development best practices and third-party dependencies;

• ensuring that best practice Q&A policies and procedures are in place and are adhered to;

• assessing the scope and quality of our intellectual property, including its support of our approved business plan;

• providing guidance on technology as it may pertain to market entry and exit, investments, mergers, acquisitions and divestitures, research and development investments, and key competitor and partnership strategies;

• performing such other duties and responsibilities as are enumerated in and consistent with its charter

Exculpation, Insurance and Indemnification of Directors and Officers

Under the BCBCA, a company may indemnify: (i) a current or former director or officer of that company; (ii) a current or former director or officer of another corporation if, at the time such individual held such office, the corporation was an affiliate of the company, or if such individual held such office at the company’s request; or (iii) an individual who, at the request of the company, held, or holds, an equivalent position in another entity (an “indemnifiable person”) against all costs, charges and expenses, including an amount paid to settle an action or satisfy a judgment, reasonably incurred by him or her in respect of any civil, criminal, administrative or other legal proceeding or investigative action (whether current, threatened, pending or completed) in which he or she is involved because of that person’s position as an indemnifiable person, unless: (i) the individual did not act honestly and in good faith with a view to the best interests of such company or the other entity, as the case may be; or (ii) in the case of a proceeding other than a civil proceeding, the individual did not have reasonable grounds for believing that the individual’s conduct was lawful. A company cannot indemnify an indemnifiable person if it is prohibited from doing so under its articles or by applicable law. A company may pay, as they are incurred in advance of the final disposition of an eligible proceeding, the expenses actually and reasonably incurred by an indemnifiable person in respect of that proceeding only if the indemnifiable person has provided an undertaking that, if it is ultimately determined that the payment of expenses was prohibited, the indemnifiable person will repay any amounts advanced. Subject to the aforementioned prohibitions on indemnification, a company must, after the final disposition of an eligible proceeding, pay the expenses actually and reasonably incurred by an indemnifiable person in respect of such eligible proceeding if such indemnifiable person has not been reimbursed for such expenses, and was wholly successful, on the merits or otherwise, in the outcome of such eligible proceeding or was substantially successful on the merits in the outcome of such eligible proceeding. On application from an indemnifiable person, a court may make any order the court considers appropriate in respect of an eligible proceeding, including the indemnification of penalties imposed or expenses incurred in any such proceedings and the enforcement of an indemnification agreement. As permitted by the BCBCA, under Article 21.1, we are required to indemnify our directors and former directors (and such individual’s respective heirs and legal representatives) and permit us to indemnify any person to the extent permitted by the BCBCA.

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The BCBCA provides certain protections under Part 5 – Management, Division 5—Indemnification of Directors and Officers and Payment of Expenses, to our current and former directors and officers, as well as other eligible parties defined in Section 159 of the BCBCA (the “Eligible Parties”, each an “Eligible Party”). The Company will indemnify the Eligible Parties, to the fullest extent permitted by law and subject to certain limitations listed in Section 163 of the BCBCA, against any proceeding in which an Eligible Party or any of the heirs and personal or other legal representatives of the Eligible Party, by reason of the Eligible Party being or having been a director or officer of, or holding or having held a position equivalent to that of a director or officer of, the Company or an associated corporation (a) is or may be joined as a party, or (b) is or may be liable for or in respect of a judgment, penalty or fine in, or expenses related tom, the proceeding.

We maintain insurance policies relating to certain liabilities that our directors and officers may incur in such capacity.

Code of Conduct

We have adopted a Code of Conduct applicable to all of our directors, officers and employees. We post on our website all disclosures that are required by law or the listing standards of Nasdaq concerning any amendments to, or waivers from, any provision of the Code of Conduct. The reference to our website address does not constitute incorporation by reference of the information contained at or available through our website, and you should not consider it to be a part of, this prospectus.

Monitoring Compliance with the Code of Business Conduct and Ethics

Our board of directors is responsible for reviewing and evaluating the Code of Conduct periodically and will make any necessary changes thereto. Our board of directors is also charged with the monitoring of compliance with the Code of Conduct and will be responsible for considering any waivers of the Code of Conduct.

Interests of Directors

In accordance with the BCBCA, each director and officer must disclose the nature and extent of any interest that he or she has in a material contract or material transaction whether made or proposed with us, if the director or officer is a party to the contract or transaction, is a director or an officer or an individual acting in a similar capacity of a party to the contract or transaction, or has a material interest in a party to the contract or transaction. Subject to certain limited exceptions under the BCBCA, no director may vote on a resolution to approve a material contract or material transaction which is subject to such disclosure requirement.

As of the date hereof, except as otherwise disclosed in this prospectus, to the knowledge of the Board or the management of the Company, there are no material interests, whether direct or indirect, of any informed person of the Company, any proposed director of the Company, or any associate or affiliate of any informed person or proposed director, in any transaction since the commencement of the Company’s most recently completed financial year or in any proposed transaction which has materially affected or would materially affect the Company of any of its subsidiaries.

Complaint Reporting and Whistleblower Policy

In order to foster a climate of openness and honesty in which any concern or complaint pertaining to a suspected violation of the law, our Code of Conduct or any of our policies or any unethical or questionable act or behavior, the board of directors will adopt a whistleblower policy that requires that our employees promptly report such violation or suspected violation. In order to ensure that violations or suspected violations can be reported without fear of retaliation, harassment or an adverse employment consequence, our whistleblower policy will contain procedures that are aimed to facilitate confidential, anonymous submissions by our employees.

Family Relationships

None of our directors or executive officers has a family relationship as defined in Item 401 of Regulation S-K.

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Involvement in Certain Legal Proceedings

To the best of our knowledge, none of our directors or executive officers has, during the past 10 years, been involved in any legal proceedings described in subparagraph (f) of Item 401 of Regulation S-K.

EXECUTIVE COMPENSATION

As of December 31, 2021, the Corporation had three Named Executive Officers: Russel H. McMeekin, Chantal Schutz and Costantino Lanza.

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The following table sets out the compensation paid or payable to the Named Executive Officers of the Company for the fiscal year ended December 31, 2021:

Name and Principal Position

Year

Salary ($)

Bonus ($)

Committee or meeting fees ($)

Value of perquisites ($)

All other compensation ($)

Total compensation ($)

Russel H. McMeekin(1) Director, President and Chief Executive Officer

2021

$

249,999.84 USD

Nil

Nil

Nil

$

93,500 USD

$

343,499.84 USD

Costantino Lanza(2) Director and Chief Growth Officer

2021

$

249,999.84 USD

Nil

Nil

Nil

$

42,358 USD

$

292,357 USD

Chantal Schutz Chief Financial Officer

2021

$

262,000 CAD

Nil

Nil

Nil

Nil

$

262,000 CAD

Michael Allman Director

2021

Nil

Nil

$

48,000 USD

Nil

Nil

$

48,000 USD

Elizabeth MacLean Director

2021

Nil

Nil

$

48,000 USD

Nil

Nil

$

48,000 USD

Ian Russell Director

2021

Nil

Nil

$

48,000 USD

Nil

Nil

$

48,000 USD

Michael A. Sicuro(3)

2021

Nil

Nil

$

20,000 USD

Nil

Nil

$

20,000 USD

NOTES:

(1) Inclusive of the total compensation, Mr. McMeekin received no compensation for his role as director of the Company.

(2) Inclusive of the total compensation, Mr. Lanza received no compensation for his role as director of the Company.

(3) Mr. Sicuro resigned effective as of May 31, 2021.

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Stock Options and Other Compensation Securities

On December 17, 2016, we established an equity incentive plan, or Equity Incentive Plan, which provides for the granting of incentive share options, non-statutory share options, share appreciation rights, restricted share awards, restricted share unit awards, and other share awards, collectively the Share Awards, to selected directors, employees and consultants for a period of 10 years from the establishment of the Equity Incentive Plan. The Equity Incentive Plan is intended to help us secure and retain the services and provide incentives for increased efforts for our success.

The Board of Directors grants Share Awards from time to time based on its assessment of the appropriateness of doing so in light of our long-term strategic objectives, our current stage of development, our need to retain or attract particular key personnel, the number of Share Awards already outstanding and overall market conditions.

The following table provides a summary of all compensation securities granted or issued to each director, officer and senior management as of December 31, 2021:

Name and Principal Position	Type of Security	Number of Compensation Securities, Number of Underlying Securities, and Percentage of Class(1)		Date of Issue or Grant	Issue, Conversion or Exercise Price ($)	Closing Price of Security or Underlying Security on Date of Grant ($)		Closing Price of Security or Underlying Security at Year End ($)		Expiry Date
Russel H. McMeekin	Stock Options		25,000	October 24, 2019	Exercise price $12.90	$	12.30 CAD	$	6.10 CAD	October 24, 2029
Russel H. McMeekin	RSU’s		50,000	April 12, 2018	$9.75 CAD	$	9.75 CAD	$	6.10 CAD	No expiry
Russel H. McMeekin	RSU’s		25,000	October 24, 2019	$12.30 CAD	$	12.30 CAD	$	6.10 CAD	No expiry
Costantino Lanza	Stock Option		12,500	October 24, 2019	Exercise price $12.90	$	12.30 CAD	$	6.10 CAD	October 24, 2029
Costantino Lanza	RSU’s		3,333	April 12, 2018	$9.75 CAD	$	9.75 CAD	$	6.10 CAD	No expiry
Costantino Lanza	RSU’s		12,500	October 24, 2019	$12.30 CAD	$	12.30 CAD	$	6.10 CAD	No expiry
Michael A. Sicuro	RSU’s		6,667	April 12, 2018	$9.75 CAD	$	9.75 CAD	$	6.10 CAD	No expiry
Ian Russel	Stock Option		5,000	October 24, 2019	Exercise price $11.85	$	12.30 CAD	$	6.10 CAD	October 24, 2029
Chantal Schutz	Stock Option		8,333	October 24, 2019	Exercise Price $11.70	$	12.30 CAD	$	6.10 CAD	October 24, 2029
Chantal Schutz	Stock Option		8,333	July 31, 2021	Exercise Price $7.65	$	7.65 CAD	$	6.10 CAD	July 31, 2031
Chantal Schutz	Stock Option		28,800	October 22, 2021	Exercise Price $6.99	$	6.99 CAD	$	6.10 CAD	October 22, 2031
Chantal Schutz	Stock Option		733	Jan 1, 2022	Exercise Price $6.99	$	6.32 CAD	$	6.10 CAD	Jan 1, 2032
Chantal Schutz	RSU’s		8,333	October 24, 2019	$12.30 CAD	$	12.30 CAD	$	6.10 CAD	No Expiry
Chantal Schutz	RSU’s		8,333	July 31, 2021	$7.65 CAD	$	7.65 CAD	$	6.10 CAD	No Expiry

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Oversight and Description of Compensation

Compensation Objectives

Our compensation philosophy for named executive officers is designed to attract well- qualified individuals by paying modest base salaries plus short and long-term incentive compensation in the form of equity-based or other suitable long-term incentives. In making its determinations regarding the various elements of executive compensation, the Board has utilized published studies of compensation paid in comparable businesses, specifically the 2016 study conducted by Culpepper and Associates. These studies have been used to ensure that the compensation received by the Board will be in line with industry standards.

The duties and responsibilities of our chief executive officer are typical of those of a business entity of our size in a similar business and include direct reporting responsibility to the chairman of the Board, overseeing the activities of all of our other executives, representing us, providing leadership and responsibility for achieving corporate goals and implementing corporate policies and initiatives.

The objectives of our executive compensation program are as follows:

• to attract, retain and motivate talented executives who create and sustain our continued success;

• to align our interests with the interests of our shareholders; and

• to provide total compensation to executives that is competitive with that paid by other companies of comparable size engaged in similar businesses in appropriate regions.

We believe that our current compensation programs are structured to support the achievement of the foregoing strategic objectives.

Overall, the executive compensation program aims to design executive compensation packages that meet executive compensation packages for executives with similar talents, qualifications and responsibilities at companies with similar financial, operating and industrial characteristics. We expect to undergo significant growth and are committed to retaining our key executives for the next several critical years, but at the same time ensuring that executive compensation is tied to specific corporate goals and objectives. Our executive compensation program has been designed to reward executives for reinforcing our business objectives and values, for achieving our performance objectives and for their individual performances.

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Compensation Process

We have no formal or informal policy or target for allocating compensation between long-term and short-term compensation, between cash and non-cash compensation, or among the different forms of non-cash compensation. Instead, the Board determines subjectively what it believes to be the appropriate level and mix of the various compensation components based on the recommendations of our compensation committee.

Elements of Compensation

We seek to achieve the compensation objectives described earlier through different elements of compensation, including salary and both short-term and long-term incentive plans, with the incentives having both equity and non-equity components. We believe that these various elements are important to effectively achieve the objectives of our executive compensation philosophy.

The elements of the named executive officers’ compensation are:

a) base salaries;

b) performance bonuses; and

c) equity incentive grants.

There is no regulatory oversight of our compensation process for our named executive officers.

Base Salary

We pay our executive officers a base salary to compensate them for services rendered during a fiscal year. Base salaries are determined for each executive officer based on an evaluation of such officer’s experience, skills, knowledge, scope of responsibility and performance. Base salary levels are reviewed and considered annually, and from time to time adjustments may be made to base salary levels based upon promotions or other changes in job responsibility or merit-based increases based on assessments of individual performance.

The base salary review of any executive officer will take into consideration the current competitive market conditions, experience, proven or expected performance, and the particular skills of the executive officer. Base salary is not evaluated against a formal “peer group”.

Performance Bonuses

In addition to a base salary, the named executive officers are eligible to receive performance-based bonuses meant to motivate the named executive officers to achieve shorter-term goals. The pre-established, quantitative target(s) used to determine performance bonuses will be set by the Board or a committee thereof each fiscal year. Awards will be made by way of cash payments only, which payments will be made at the end of the relevant fiscal year. Each named executive officer will be measured against the financial targets within his or her control and, while our overall performance is part of the plan, individual targets will represent the highest percentage of the plan payout. The cash bonuses are primarily designed to align our financial interests with the interests of our shareholders.

Equity Based Compensation

Our executive officers are eligible to receive option awards under the Equity Incentive Plan. We intend for equity awards to be an integral part of our overall compensation program as we believe that our long-term performance will be enhanced through the use of equity based awards that reward executive officers for increasing long-term shareholder value. We also believe that such awards will promote an ownership perspective among our executive officers and encourage executive retention. Equity based compensation awarded to executive officers (including named executive officers) will typically be subject to time-based vesting provisions. We do not have any formal policy regarding when equity based compensation is to be granted or the size of any given grant. In determining the number of awards to be granted to executive officers, our compensation committee takes into account the individual’s position, scope of responsibility, ability to affect profits and shareholder value and the value of the awards in relation to other elements of the individual executive officer’s total compensation, including base salary and cash bonuses. When considering equity or equity-linked awards to an executive officer, consideration of the number of awards previously granted to the executive may be taken into account, however, the extent to which such prior awards remain subject to resale restrictions will generally not be a factor.

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Broad-Based Benefits Programs

All full-time employees, including our named executive officers, may participate in our health and welfare benefit programs, including medical, dental and vision care coverage, disability insurance and life insurance. We do not intend to provide perquisites or personal benefits to our named executive officers that are not otherwise available to other employees generally.

Pension Plan Benefits

We do not have a defined benefits pension plan, a defined contribution plan or a deferred compensation plan.

Employment Agreements with Executive Officers and Significant Employees

Name	Position
Russel H. McMeekin	Chief Executive Officer, President, Director
Michael Allman	Director
Costantino Lanza	Chief Growth Officer, Corporate Secretary, Director
Elizabeth MacLean	Director
Ian Russell	Director
Chantal Schutz	Chief Financial Officer

Employment Agreement with Russel McMeekin

On May 1, 2017, we entered into an employment agreement, or the McMeekin Agreement, with Russel McMeekin, or McMeekin, to serve as our Chief Executive Officer. The base salary for McMeekin under the McMeekin Agreement is $250,000 per annum. The McMeekin Agreement had an initial term of two years and it automatically renews for successive one year terms unless either party delivers written notice not to renew at least 90 days prior to the end of the current term. Pursuant to the McMeekin Agreement, McMeekin received 3,167 common shares upon execution and is entitled to receive additional equity compensation in the discretion of the board of directors.

Pursuant to the McMeekin Agreement, if we terminate McMeekin’s employment without Cause (as defined in the McMeekin Agreement) or McMeekin resigns for Good Reason (as defined in the McMeekin Agreement), McMeekin is entitled to the following payments and benefits: (1) McMeekin fully earned but unpaid base salary through the date of termination at the rate then in effect; (2) a lump sum cash payment in an amount equal to 12 months of McMeekin base salary as in effect immediately prior to the date of termination; (3) monthly payment of health benefits for McMeekin and McMeekin eligible dependents for a period of 12 months following the date of termination; and (4) the automatic acceleration of the vesting and exercisability of outstanding unvested stock awards. In the event McMeekin is terminated in connection with a change of control event, then he is entitled to all the above benefits, except that the lump sum cash payment will be in an amount equal to 24 months of McMeekin base salary as in effect immediately prior to the date of termination.

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Employment Agreement with Chantal Schutz

On May 24, 2019, we entered into an employment agreement, as amended on October 1, 2019, the Schutz Agreement, with Chantal Schutz, or Schutz, to serve as our Chief Financial Officer. The base salary for Schutz under the Schutz Agreement is $250,000 per annum. The Schutz Agreement has an indefinite term, subject to termination by either party. Pursuant to the Schutz Agreement, Schutz received 8,333 shares of restricted stock and options to purchase 8,333 common shares and is entitled to receive additional equity compensation in the discretion of the board of directors.

Pursuant to the Schutz Agreement, if we terminate Schutz’s employment without Cause (as defined in the Schutz Agreement) or Schutz resigns for Good Reason (as defined in the Schutz Agreement), Schutz is entitled to the following payments and benefits: (1) Schutz’s fully earned but unpaid base salary and accrued vacation through the date of termination at the rate then in effect; (2) a lump sum cash payment in an amount equal to nine months of Schutz’s base salary as in effect immediately prior to the date of termination; and (3) continuation of benefits for Schutz for a period of nine months following the date of termination.

Employment Agreement with Constantino Lanza

On May 1, 2017, we entered into an employment agreement, or the Lanza Agreement, with Constantino Lanza, or Lanza, to serve as our Chief Growth Officer. The base salary for Lanza under the Lanza Agreement is $250,000 per annum. The Lanza Agreement had an initial term of two years and it automatically renews for successive one year terms unless either party delivers written notice not to renew at least 90 days prior to the end of the current term. Pursuant to the Lanza Agreement, Lanza received 3,167 common shares upon execution and is entitled to receive additional equity compensation in the discretion of the board of directors.

Pursuant to the Lanza Agreement, if we terminate Lanza’s employment without Cause (as defined in the Lanza Agreement) or Lanza resigns for Good Reason (as defined in the Lanza Agreement), Lanza is entitled to the following payments and benefits: (1) Lanza’s fully earned but unpaid base salary through the date of termination at the rate then in effect; (2) a lump sum cash payment in an amount equal to 12 months of Lanza’s base salary as in effect immediately prior to the date of termination; (3) monthly payment of health benefits for Lanza and Lanza’s eligible dependents for a period of 12 months following the date of termination; and (4) the automatic acceleration of the vesting and exercisability of outstanding unvested stock awards. In the event Lanza is terminated in connection with a change of control event, then he is entitled to all the above benefits, except that the lump sum cash payment will be in an amount equal to 24 months of Lanza’s base salary as in effect immediately prior to the date of termination.

CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS

There have been no material transactions, or series of related material transactions to which we are a party and in which the other parties include our directors, executive officers, holders of more than 5% of our voting securities, or any member of the immediate family of any of the foregoing persons.

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PRINCIPAL SHAREHOLDERS

The following tables set forth certain information with respect to the beneficial ownership of our Common Shares for:

• each shareholder known by us to be the beneficial owner of more than 5% of our outstanding Common Shares,

• each of our directors,

• each of our named executive officers, and

• all of our directors and executive officers as a group.

We have determined beneficial ownership in accordance with the rules of the SEC. Under such rules, beneficial ownership includes any Common Shares over which the individual has sole or shared voting power or investment power as well as any Common Shares that the individual has the right to subscribe for within 60 days of September 6, 2022, through the exercise of any warrants or other rights. Except as indicated by the footnotes below, we believe, based on the information furnished to us, that the persons and entities named in the table below have sole voting and investment power or the power to receive the economic benefit with respect to all Common Shares that they beneficially own, subject to applicable community property laws. None of the shareholders listed in the table are a broker-dealer or an affiliate of a broker dealer.

Applicable percentage ownership prior to the offering is based on 16,224,788 Common Shares outstanding at November 1, 2022. Unless otherwise indicated, the address of each beneficial owner listed in the table below is C/O mCloud Technologies, Corp., 550-510 Burrard Street, Vancouver, British Columbia, Canada, V6C 3A8.

	Beneficial Ownership
	Prior to Offering					Following Offering(1)
Name of Beneficial Owner	Common Shares		Percentage			Common Shares		Percentage
Russel H. McMeekin		229,538		1.42	%		229,538		*	%
Michael Allman		135,157		*	%		135,157		*	%
Costantino Lanza		182,845		1.13	%		182,845		*	%
Elizabeth MacLean		0		0	%		0		0	%
Ian Russell		18,702		*	%		18,702		*	%
Chantal Schutz		8,808		*	%		8.808		*	%
All officers and directors as a group

* Less than 1%

(1) Calculated assuming full conversion of all Series A Preferred Shares into Common Shares

As of November 1, 2022, there were 160 holders of record entered in our share register. The number of individual holders of record is based exclusively upon our share register and does not address whether a common share or Common Shares may be held by the holder of record on behalf of more than one person or institution who may be deemed to be the beneficial owner of a common share or Common Shares in our company.

DESCRIPTION OF SECURITIES

Common Shares

The authorized capital of the Company consists of an unlimited number of Common Shares, no par value. As of November 1, 2022, there were 16,224,788 Common Shares outstanding. As of November 1, 2022, there were 112 U.S. shareholders holding 5,362,039 Common Shares, or approximately 33.04% of the total number of Common Shares issued and outstanding. The holders of Common Shares are entitled to one vote per Common Share at all meetings of the shareholders of the Company either in person or by proxy. The holders of Shares are also entitled to dividends, if and when declared by the directors of the Company, and the distribution of the residual assets of the Company in the event of a liquidation, dissolution or winding up of the Company.

All Common Shares rank equally as to all benefits which might accrue to the holders thereof, including the right to receive dividends, voting powers, and participation in assets and in all other respects, on liquidation, dissolution or winding-up of the Company, whether voluntary or involuntary, or any other disposition of the assets of the Company among its shareholders for the purpose of winding up its affairs after the Company has paid out its liabilities. The Shares are not subject to any call or assessment rights, any pre-emptive rights, any conversion or any exchange rights. The Common Shares are not subject to any redemption, retraction, purchase for cancellation, surrender, sinking or purchase fund provisions. Additionally, the Common Shares are not subject to any provisions permitting or restricting the issuance of additional securities and any other material restrictions or any provisions requiring a securityholder to contribute additional capital to the Company. Subject to the BCBCA, the Company may by special resolution make alterations to the authorized Common Share structure and special rights or restrictions to change the rights of the shareholders. The majority of votes required for the Company to pass a special resolution at a meeting of shareholders is two-thirds of the votes cast on the resolution.

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Blank Check Preferred Stock

Under the terms of our Articles of Incorporation, our Board of Directors has authority, without any further vote or action by our shareholders, to issue an unlimited number of “blank check” preferred shares issuable in series, with such rights, privileges, restrictions and conditions as the Board may determine from time to time

Series A Preferred Shares

The following is a summary of some general terms and provisions of our Series A Preferred Shares. Because it is a summary, it does not contain all of the information that may be important to you. If you want more information, you should read our Articles of Incorporation and Bylaws, copies of which have been filed with the SEC. See “Where You Can Find More Information.”

Ranking. The Series A Preferred Shares will rank, as to dividend rights and rights upon our liquidation, dissolution or winding up:

(1) Senior to all classes or series of our common shares and to all other equity securities issued by us other than any equity securities issued with terms specifically providing that those equity securities rank on a parity with the Series A Preferred Shares;

(2) Junior to any future equity securities issued by us with terms specifically providing that those equity securities rank senior to the Series A Preferred Shares with respect to the payment of dividends and the distribution of assets upon our liquidation, dissolution or winding up; and

(3) Effectively junior to all our existing and future indebtedness (including indebtedness convertible into our common shares or preferred shares) and to the indebtedness and other liabilities of (as well as any preferred equity interests held by others in) our existing or future subsidiaries.

Voting Rights. In any matter in which the Series A Preferred Shares may vote, as described below, each Series A Preferred Share shall be entitled to one vote per $25.00 of liquidation preference; provided that if the Series A Preferred Shares and any other stock ranking on parity to the Series A Preferred Shares as to dividend rights and rights as to the distribution of assets upon the Corporation’s liquidation, dissolution or winding up are entitled to vote together as a single class on any matter, the holders of each will vote in proportion to their respective liquidation preferences.

So long as any Series A Preferred Shares remain outstanding, the Company will not, without the consent or the affirmative vote of the holders of at least two-thirds of the outstanding Series A Preferred Shares and each other class or series of preferred stock entitled to vote thereon (voting together as a single class), given in person or by proxy, either in writing without a meeting or by vote at any meeting called by the Company for the purpose:

(i) authorize, create or issue, or increase the number of authorized or issued number of shares of, any class or series of capital stock ranking senior to the Series A Preferred Shares with respect to payment of dividends or the distribution of assets upon the liquidation, dissolution or winding up of the Company or reclassify any authorized capital stock of the Company into any such shares, or create, authorize or issue any obligation or security convertible into or evidencing the right to purchase any such shares; or

(ii) amend, alter or repeal the provisions of the Articles of Incorporation, as amended, including the terms of the Series A Preferred Shares, whether by merger, consolidation, transfer or conveyance of all or substantially all of the Company’s assets or otherwise, so as to materially and adversely affect the rights, preferences, privileges or voting powers of the Series A Preferred Shares, taken as a whole.

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If any event described in paragraph (ii) above would materially and adversely affect the rights, preferences, privileges or voting powers of the Series A Preferred Shares, taken as a whole, disproportionately relative to any other class or series of voting preferred stock (as defined below), the affirmative vote of the holders of at least two-thirds of the outstanding shares of the Series A Preferred Shares, voting as a separate class, will also be required. Furthermore, if holders of shares of the Series A Preferred Shares receive the $25.00 per share of the Series A Preferred Shares liquidation preference plus all declared and unpaid dividends thereon or greater amounts pursuant to the occurrence of any of the events described in paragraph (ii) above, then such holders shall not have any voting rights with respect to the events described in such paragraph. As used herein, “voting preferred stock” means any other class or series of the Company’s preferred stock ranking equally with the Series A Preferred Shares as to dividends (whether cumulative or non-cumulative) and the distribution of the Company’s assets upon liquidation, dissolution or winding up and upon which like voting rights to the Series A Preferred Shares have been conferred and are exercisable.

Dividends. Subject to the preferential rights, if any, of the holders of any class or series of capital stock of the Company ranking senior to the Series A Preferred Shares as to dividends, the holders of the Series A Preferred Shares will be entitled to receive, when, as and if declared by the Board (or a duly authorized committee of the Board), only out of funds legally available for the payment of dividends, cumulative cash dividends at the annual rate of 9.0% of the $25.00 liquidation preference per year (equivalent to $2.25 per year) until the beginning of the fifth year, at which time the annual rate will increases 4.0% per calendar quarter until it reaches a maximum of 25.0%. Dividends on the Series A Preferred Shares will accumulate and be cumulative from, and including, the date of original issue by us of the Series A Preferred Shares. However, the Company will be entitled to defer the payment of any declared dividends on the Series A Preferred Shares until the occurrence of a liquidation or Board Approved Change of Control of the Company.

Segregated Payment Account. The Company shall establish a segregated account that will be funded at closing of the offering with proceeds in an amount equal to nine (9) months of dividends on the maximum number of Series A Preferred Shares. The segregated account may only be used to pay declared dividends on the Series A Preferred Shares, when legally permitted, and may not be used for other corporate purposes. Excess funds are returned to Company treasury.

Liquidation. In the event of the voluntary or involuntary liquidation, dissolution or winding up of the affairs of the Company, holders of Series A Preferred Shares will be entitled to be paid out of the assets of the Company legally available for distribution to its stockholders (i.e., after satisfaction of all the Company’s liabilities to creditors, if any) and, subject to the rights of holders of any shares of each other class or series of capital stock ranking, as to rights to the distribution of assets upon the Company’s voluntary or involuntary liquidation, dissolution or winding up, senior to the Series A Preferred Shares, a liquidation preference of $25.00 per share, plus an amount equal to any accumulated and unpaid dividends to the date of payment (whether or not declared), before any distribution or payment may be made to holders of shares of the Common Shares or any other class or series of the Company’s capital stock ranking, as to rights to the distribution of assets upon any voluntary or involuntary liquidation, dissolution or winding up, junior to the Series A Preferred Shares (the “liquidation preference”).

If, upon such voluntary or involuntary liquidation, dissolution or winding up of the Company’s affairs, the assets of the Company legally available for distribution to the Company’s stockholders are insufficient to pay the full amount of the liquidation preference on all outstanding Series A Preferred Shares and the corresponding amounts payable on all shares of each other class or series of capital stock of the Company ranking, as to rights to the distribution of assets upon any voluntary or involuntary liquidation, dissolution or winding up, on parity with the Series A Preferred Shares, then the holders of the Series A Preferred Shares and each such other class or series of capital stock of the Company ranking, as to rights to the distribution of assets upon the Company’s voluntary or involuntary liquidation, dissolution or winding up, on parity with the Series A Preferred Shares will share ratably in any distribution of assets in proportion to the full liquidation preference to which they would otherwise be respectively entitled.

Preemptive Rights. No holders of Series A Preferred Shares will, as holders of Series A Preferred Shares, have any preemptive rights to purchase or subscribe for the Common Shares or any other security.

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Optional Redemption. The Series A Preferred Shares is not redeemable prior to the twelve (12) month anniversary of the effective date of this Offering, except for the circumstances described under “Special Optional Redemption.”

On or after the twelve (12) month anniversary of the date of issuance,, the Series A Preferred Shares may be redeemed at our option, in whole or in part, from time to time, at a redemption price of $25.00 per Series A Preferred Share, plus all dividends accumulated and unpaid (whether or not declared) on the Series A Preferred Shares up to, but not including, the date of such redemption, upon the giving of notice.

Special Optional Redemption. Upon the occurrence of any Delisting Event, Change of Control, or $8 VWAP Event, whether before or after the twelve (12) month anniversary of the date of issuance of the Series A Preferred Shares, we may, at our option, redeem the Series A Preferred Shares, in whole or in part and within 90 days after the date of the Delisting Event, Change of Control or $8 VWAP Event, by paying $25.00 per share of Series A Preferred Shares, plus all dividends accumulated and unpaid (whether or not declared) on the Series A Preferred Stock up to, but not including, the date of such redemption.

A “Delisting Event” occurs when, after the original issuance of Series A Preferred Shares, both (i) the shares of Series A Preferred Shares are no longer listed on Nasdaq, the New York Stock Exchange (the “NYSE”) or the NYSE American LLC (“NYSE AMER”), or listed or quoted on an exchange or quotation system that is a successor to Nasdaq, the NYSE or the NYSE AMER, and (ii) the Company not subject to the reporting requirements of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), but any Series A Preferred Shares is still outstanding.

A “Change of Control” occurs when, after the original issuance of the Series A Preferred Shares, the following have occurred and are continuing: (a) any person or persons acting together which would constitute a “group” for purposes of Section 13(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), (other than the Company or any subsidiary of the Company) shall beneficially own (as defined in Rule 13d-3 of the Exchange Act), directly or indirectly, at least 25% of the total voting power of all classes of capital stock of the Company entitled to vote generally in the election of the Board; (b) Current Directors (as herein defined) shall cease for any reason to constitute at least a majority of the members of the Board (for this purpose, a “Current Director” shall mean any member of the Board as of the date hereof and any successor of a Current Director whose election, or nomination for election by the Company’s shareholders, was approved by at least a majority of the Current Directors then on the Board); (c) (i) the complete liquidation of the Company or (ii) the merger or consolidation of the Company, other than a merger or consolidation in which (x) the holders of the common stock of the Company immediately prior to the consolidation or merger have, directly or indirectly, at least a majority of the common stock of the continuing or surviving corporation immediately after such consolidation or merger or (y) the Board immediately prior to the merger or consolidation would, immediately after the merger or consolidation, constitute a majority of the board of directors of the continuing or surviving corporation, which liquidation, merger or consolidation has been approved by the shareholders of the Company; or (d) the sale or other disposition (in one transaction or a series of transactions) of all or substantially all of the assets of the Company pursuant to an agreement (or agreements) which has (have) been approved by the shareholders of the Company.

An “$8 VWAP Event” occurs when, after the original issuance of Series A Preferred Shares, the volume weighted average price of the Common Shares on the Nasdaq Capital Market for five consecutive trading days (as reported by Bloomberg L.P. based on a trading day from 9:30 a.m. to 4:02 p.m. (New York City time)) is at least $8.00.

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Restrictions on Dividends, Redemptions and Repurchases. So long as any Series A Preferred Share remains outstanding, unless we also have either paid or declared and set apart for payment full cumulative dividends on the Series A Preferred Shares for all past completed dividend periods, we will not during any dividend period:

(1) pay or declare and set apart for payment any dividends or declare or make any distribution of cash or other property on Common Shares or other capital stock that ranks junior to or on parity with the Series A Preferred Shares with respect to dividend rights and rights to the distribution of assets upon our voluntary or involuntary liquidation, dissolution or winding up (other than, in each case, (a) a dividend paid in Common Shares or other stock ranking junior to the Series A Preferred Shares with respect to dividend rights and rights to the distribution of assets upon our voluntary or involuntary liquidation, dissolution or winding up or (b) any declaration of a Common Share dividend in connection with any stockholders’ rights plan, or the issuance of rights, stock or other property under any stockholders’ rights plan, or the redemption or repurchase of rights pursuant to such plan);

(2) redeem, purchase or otherwise acquire Common Shares or other capital stock that ranks junior to or on parity with the Series A Preferred Shares (other than the Series A Preferred Shares) with respect to dividend rights and rights to the distribution of assets upon our voluntary or involuntary liquidation, dissolution or winding up (other than (a) by conversion into or exchange for Common Shares or other capital stock ranking junior to the Series A Preferred Shares with respect to dividend rights and rights to the distribution of assets upon our voluntary or involuntary liquidation, dissolution or winding up, (b) the redemption of shares of capital stock pursuant to the provisions of our memorandum of articles, as amended, relating to the restrictions upon ownership and transfer of our capital stock, (c) a purchase or exchange offer made on the same terms to holders of all outstanding Series A Preferred Shares and any other capital stock that ranks on parity with the Series A Preferred Shares with respect to dividend rights and rights to the distribution of assets upon our voluntary or involuntary liquidation, dissolution or winding up, (d) purchases, redemptions or other acquisitions of shares of our capital stock ranking junior to the Series A Preferred Shares with respect to dividend rights and rights to the distribution of assets upon our voluntary or involuntary liquidation, dissolution or winding up pursuant to any employment contract, dividend reinvestment and stock purchase plan, benefit plan or other similar arrangement with or for the benefit of employees, officers, directors, consultants or advisors, (e) through the use of the proceeds of a substantially contemporaneous sale of stock ranking junior to the Series A Preferred Shares with respect to dividend rights and rights to the distribution of assets upon our voluntary or involuntary liquidation, dissolution or winding up, or (f) purchases or other acquisitions of shares of our capital stock pursuant to a contractually binding stock repurchase plan existing prior to the preceding Dividend Payment Date on which dividends were not paid in full); or

(3) redeem, purchase or otherwise acquire Series A Preferred Shares (other than (a) by conversion into or exchange for Common Shares or other capital stock ranking junior to the Series A Preferred Shares with respect to dividend rights and rights to the distribution of assets upon our voluntary or involuntary liquidation, dissolution or winding up, (b) a purchase or exchange offer made on the same terms to holders of all outstanding Series A Preferred Shares or (c) with respect to redemptions, a redemption pursuant to which all Series A Preferred Shares are redeemed).

Conversion Rights. The Series A Preferred Shares will be convertible into common Shares based on a conversion ratio of (i) the $25.00 per share liquidation preference divided by (ii) $1.00 (the denominator of such conversion ratio, the “Conversion Price”). Therefore, each Series A Preferred Share is initially convertible into 25 Common Shares. Upon such a conversion, any declared but unpaid dividends shall be paid to the holder of Series A Preferred Shares in cash. In the event that the conversion would result in the issuance of fractional Common Shares, we will pay the holder the cash value of such fractional shares in lieu of such fractional shares based on a price per Common Share equal to the Conversion Price then in effect.

If, at any time while the Series A Preferred Shares are outstanding, we sell or grant (or announce any offer, sale or grant) of any Common Shares or Common Share equivalents entitling any person to acquire our Common Shares at an effective price per share that is lower than the then Conversion Price (such lower price, the “Base Conversion Price”), then the Conversion Price will be reduced to equal the Base Conversion Price. The Base Conversion Price may not be less than $0.20 or, if the Common Shares are then traded on the TSX Venture Exchange, less than the “Market Price” as defined in the policies of the TSX Venture Exchange. In addition, no Conversion Price adjustment will be made in respect of the following exempt issuances (each, an “Exempt Issuance”): (i) Common Shares or options or other equity awards issued to employees or directors of our company pursuant to a plan, agreement or arrangement approved by the Board; (ii) securities exercisable or exchangeable for or convertible into Common Shares issued and outstanding on the original issue date of the Series A Preferred Shares (the “Original Issue Date”), provided that such securities have not been amended since the Original Issue Date to increase the number of such securities or to decrease the exercise price, exchange price or conversion price of such securities (other than in connection with stock splits or combinations) or to extend the term of such securities; (iii) Common Shares, options or convertible securities issued as acquisition consideration pursuant to the acquisition of another entity by the Company by merger, purchase of substantially all of the assets or other reorganization or to a joint venture agreement, provided that such issuances are approved by the Board and that such securities are issued as “restricted securities” (as defined in Rule 144) and carry no registration rights that require or permit the filing of any registration statement in connection therewith until the 180th day after the Original Issue Date, and provided further that any such issuance shall only be to a party (or to the equity holders of a party) which is, itself or through its subsidiaries, an operating company or an owner of an asset in a business synergistic with the business of the Company and shall provide to the Company additional benefits in addition to the investment of funds, but shall not include a transaction in which the Company is issuing securities primarily for the purpose of raising capital or to an entity whose primary business is investing in securities; (iv) Common Shares, options or convertible securities issued in connection with sponsored research, collaboration, technology license, development, OEM, marketing or other similar agreements or strategic partnerships approved by the Board, provided that such securities are issued as “restricted securities” (as defined in Rule 144) and carry no registration rights that require or permit the filing of any registration statement in connection therewith until the 180th day after the Original Issue Date, and provided that any such issuance shall not include a transaction in which the Company is issuing securities primarily for the purpose of raising capital or to an entity whose primary business is investing in securities; and (v) Common Shares issued in connection with the issuance of bona fide commercial bank debt or equipment lease transactions, provided that such issuances are approved by the Board and that such securities are issued as “restricted securities” (as defined in Rule 144) and carry no registration rights that require or permit the filing of any registration statement in connection therewith until the 180th day after the Original Issue Date.

Nonassessability. All outstanding shares of our Series A Preferred Shares are fully paid and nonassessable.

Warrants

The following sets forth certain general terms and provisions of the Warrants.

Terms of the Warrants

Overview. The Warrants offered hereby will be issued pursuant to a Warrant Agent Agreement, dated as of the effective date of this Offering (the “Warrant Agent Agreement”), between us and American Stock Transfer & Trust Company LLC, as the warrant agent (the “Warrant Agent”). Certain provisions of the Warrants are set forth herein but are only a summary and are qualified in their entirety by the relevant provisions of the Warrant Agent Agreement and the form of Warrant.

The Warrants issued in this Offering entitle the registered holder to purchase one Common Share at a price equal to $4.75 per share, subject to adjustment as discussed below, immediately following the issuance of such Warrant and terminating at 5:00 p.m., New York City time, on November 29, 2026.

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Exercisability. The Warrants are exercisable at any time after their original issuance until November 29, 2026. The Warrants may be exercised by delivering a duly executed exercise notice on or prior to the expiration date at the offices of the Warrant Agent, accompanied by full payment of the exercise price, by certified or official bank check payable to the Warrant Agent, for the number of Warrants being exercised. Under the terms of the Warrant Agreement, we must use our best efforts to maintain the effectiveness of the registration statement and current prospectus relating to Common Shares issuable upon exercise of the Warrants until the expiration of the Warrants.

Exercise Limitation. A holder may not exercise any portion of a Warrant to the extent that the holder, together with its affiliates and any other person or entity acting as a group, would own more than 4.99% of the outstanding Common Shares after exercise, as such percentage ownership is determined in accordance with the terms of the Warrant, except that the holder may waive such limitation up to a percentage not in excess of 9.99%.

Exercise Price. The exercise price per Common Shares purchasable upon exercise of the Warrants is $4.75. The exercise price is subject to appropriate adjustment in the event of certain stock dividends and distributions, stock splits, stock combinations, reclassifications or similar events affecting our Common Stock and also upon any distributions of assets, including cash, stock or other property to our stockholders. However, the Warrants will not be adjusted for issuances of Common Shares at prices below its exercise price.

Fractional Shares. No fractional Common Shares Stock will be issued upon exercise of the Warrants. If, upon exercise of the Warrant, a holder would be entitled to receive a fractional interest in a share, we will, upon exercise, pay a cash adjustment in respect of such fraction in an amount equal to such fraction multiplied by the exercise price. If multiple Warrants are exercised by the holder at the same time, we shall pay a cash adjustment in respect of such final fraction in an amount equal to such fraction multiplied by the exercise price.

Transferability. Subject to applicable laws, the Warrants may be offered for sale, sold, transferred, or assigned without our consent.

Exchange Listing. The Warrants will be listed on a national securities exchange along with the Listed Warrants, which are listed on Nasdaq under the symbol “MCLDW.”

Warrant Agent; Global Certificate. The Warrants will be issued in registered form under the Warrant Agent Agreement. The Warrants shall initially be represented only by one or more global warrants deposited with the Warrant Agent, as custodian on behalf of The Depository Trust Company (DTC) and registered in the name of Cede & Co., a nominee of DTC, or as otherwise directed by DTC.

Fundamental Transactions. In the event of a fundamental transaction, as described in the Warrants and generally including any reorganization, recapitalization or reclassification of our Common Shares, the sale, transfer or other disposition of all or substantially all of our properties or assets, our consolidation or merger with or into another person, the acquisition of more than 50% of our outstanding Common Shares, or any person or group becoming the beneficial owner of 50% of the voting power represented by our outstanding Common Shares, upon any subsequent exercise of the Warrants, the holders of the Warrants will be entitled to receive the kind and amount of securities, cash or other property that the holders would have received had they exercised the Warrants immediately prior to such fundamental transaction.

Rights as a Stockholder. The warrant holders do not have the rights or privileges of holders of Common Shares or any voting rights until they exercise their Warrants and receive Common Shares. After the issuance of shares of Common Shares upon exercise of the Warrants, each holder will be entitled to one vote for each share held of record on all matters to be voted on by stockholders.

Governing Law. The Warrants and the Warrant Agent Agreement are governed by New York law.

Warrant certificates, if issued in registered form, will be exchangeable for new warrant certificates of different denominations. No charge will be made to the holder for any such exchange or transfer except for any tax or government charge incidental thereto. Prior to the exercise of their Warrants, holders of Warrants will not have any of the rights of holders of the Securities subject to the Warrants.

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Modifications

We may amend any warrant agreement and the Warrants without the consent of the holders of the Warrants in certain circumstances including to cure any ambiguity, to cure, correct or supplement any defective or inconsistent provision, or in any other manner that will not materially and adversely affect the interests of holders of outstanding Warrants.

Enforceability

The warrant agent will act solely as our agent. The warrant agent will not have any duty or responsibility if we default under the warrant agreements or the warrant certificates. A Warrant holder may, without the consent of the warrant agent, enforce, by appropriate legal action on its own behalf, the holder’s right to exercise the holder’s Warrants

Listing

The Company will apply to list the Series A Preferred Shares on Nasdaq under the symbol MCLDP. Our shares of Common Shares and Listed Warrants are listed on Nasdaq under the symbols “MCLD” and “MCLDW”, respectively. The Warrants will be listed Nasdaq along with the Listed Warrants under the symbol “MCLDW”. Our Common Shares are also listed on the TSXV under the symbol “MCLD”. On November 2, 2022 the last reported sale price of our Common Shares on the TSXV was CAD$1.46 per share.

Transfer Agent, Warrant Agent and Registrar

The transfer agent and registrar for our Common Shares and Series A Preferred Shares is American Stock Transfer & Trust Company (“Transfer Agent”). The Transfer Agent’s address is 6201 15th Ave, Brooklyn, NY 11219. The warrant agent for the Warrants is also American Stock Transfer & Trust Company.

CERTAIN INCOME TAX CONSIDERATIONS

Certain Material U.S. Federal Income Tax Considerations

The following discussion is a summary of U.S. federal income tax considerations generally applicable to the ownership and disposition by U.S. Holders (as defined below) of the Series A Preferred Shares offered under this prospectus (the “Offered Shares”) and/or Warrants acquired pursuant to this prospectus. This summary does not address tax consequences to investors who are not U.S. Holders. This discussion does not address all potentially relevant U.S. federal income tax considerations applicable to the ownership or disposition by U.S. Holders of the Offered Shares and/or Warrants acquired pursuant to this Prospectus, and unless otherwise specifically provided, it does not address any state, local or non-U.S. tax considerations, or any aspect of U.S. federal tax law other than income taxation (e.g., alternative minimum tax, net investment income tax, estate tax or gift tax). Except as specifically set forth below, this summary does not discuss applicable income tax reporting requirements.

As used herein, the term “U.S. Holder” means a beneficial owner of Offered Shares and/or Warrants that, for U.S. federal income tax purposes, is: (1) a citizen or individual resident of the United States; (2) a corporation (or other entity classified as a corporation for U.S. federal tax purposes) organized under the laws of the United States, any state thereof, or the District of Columbia, (3) an estate whose income is subject to U.S. federal income taxation regardless of its source, or (4) a trust (A) if a U.S. court is able to exercise primary supervision over the administration of the trust and one or more U.S. persons have the authority to control all substantial decisions of the trust, or (B) that has elected to be treated as a U.S. person under applicable U.S. Treasury regulations.

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If a partnership (or other entity or arrangement treated as a partnership for U.S. federal tax purposes) holds the Offered Shares and/or Warrants, the tax treatment of a partner in the partnership or other entity or arrangement will generally depend upon the status of the partner and the activities of the partnership. Prospective investors who are partners in partnerships (or other entities or arrangements treated as partnerships for U.S. federal tax purposes) that are beneficial owners of the Offered Shares and/or Warrants are urged to consult their tax advisors regarding the tax consequences of the ownership and disposition of the Offered Shares and/or Warrants acquired pursuant to this Prospectus.

No legal opinion from U.S. legal counsel or ruling from the Internal Revenue Service (IRS) has been requested, or will be obtained, regarding the U.S. federal income tax consequences of the acquisition, ownership, and disposition of the Offered Shares and/or Warrants. This summary is based on the U.S. Internal Revenue Code of 1986, as amended (the “Code”), administrative pronouncements, judicial decisions and existing and proposed U.S. Treasury regulations, all of which are subject to differing interpretations and changes to any of which subsequent to the date of this Prospectus may affect the tax consequences described herein, possibly on a retroactive basis. This summary is not binding on the U.S. Internal Revenue Service (the “IRS”), and the IRS is not precluded from taking a position that is different from, and contrary to, the discussion set forth in this summary. In addition, because the authorities on which this summary is based are subject to various interpretations, the IRS and U.S. courts could disagree with one or more of the positions taken in this summary.

This summary assumes that the Offered Shares and Warrants are held as capital assets within the meaning of Section 1221 of the Code (generally, property held for investment), in the hands of a U.S. Holder at all relevant times. This summary does not purport to address all U.S. federal income tax consequences that may be relevant to a U.S. Holder as a result of the ownership and disposition of the Offered Shares and/or Warrants acquired pursuant to this Prospectus, nor does it take into account the specific circumstances of any particular holder, some of which may be subject to special tax rules, including, but not limited to, tax-exempt organizations, partnerships and other pass through entities and their owners, banks or other financial institutions, insurance companies, qualified retirement plans, individual retirement accounts or other tax-deferred accounts, persons that hold the Offered Shares as part of a straddle, conversion transaction, constructive sale or other similar arrangements, dealers or traders subject to mark-to-market taxation for the Offered Shares, U.S. persons whose functional currency (as defined in the Code) is not the U.S. dollar, U.S. expatriates, persons that acquire their common shares as part of a compensation arrangement, persons that hold the Offered Shares and/or Warrants other than as a capital asset within the meaning of the Code, or persons that own directly, indirectly or by application of the constructive ownership rules of the Code 10% or more of our shares by voting power or by value.

THIS SUMMARY IS OF A GENERAL NATURE ONLY AND IS NOT INTENDED TO BE TAX ADVICE TO ANY PROSPECTIVE INVESTOR, AND NO REPRESENTATION WITH RESPECT TO THE TAX CONSEQUENCES TO ANY PARTICULAR INVESTOR IS MADE. PROSPECTIVE INVESTORS ARE URGED TO CONSULT THEIR TAX ADVISORS WITH RESPECT TO THE U.S. FEDERAL, STATE, LOCAL AND NON-U.S. INCOME AND OTHER TAX CONSIDERATIONS RELEVANT TO THEM, IN ORDER TO TAKE INTO ACCOUNT THEIR PARTICULAR FINANCIAL AND TAX CIRCUMSTANCES.

Treatment of the Company as a Domestic Corporation for U.S. Federal Income Tax Purposes

For U.S. federal income tax purposes, a corporation is generally considered to be a tax resident in the jurisdiction of its organization or incorporation. Accordingly, under the generally applicable U.S. federal income tax rules, the Company, which is incorporated under the laws of Canada, would be classified as a non-U.S. corporation (and, therefore, not a U.S. tax resident) for U.S. federal income tax purposes. However, Section 7874 of the Code, provides an exception to this general rule, under which a non-U.S. incorporated entity may, in certain circumstances, be treated as a U.S. corporation for U.S. federal income tax purposes. These rules are complex and there is limited guidance regarding their application. A number of significant and complicated U.S. federal income tax consequences may result from such classification, and this summary does not attempt to describe all such U.S. federal income tax consequences. Section 7874 of the Code and the Treasury Regulations promulgated thereunder do not address all the possible tax consequences that arise from the Company being treated as a U.S. domestic corporation for U.S. federal income tax purposes. Accordingly, there may be additional or unforeseen U.S. federal income tax consequences to the Company that are not discussed in this summary.

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Under such rules, even though the Company is organized as a Canadian corporation, it will be treated as a U.S. domestic corporation for U.S. federal income tax purposes as a result of the Company’s prior acquisition of a United States target corporation and application of the so-called “inversion” rules under Section 7874 of the Code. As such, the Company will be subject to U.S. federal income tax as if it were organized under the laws of the United States or a state thereof. Generally, the Company will be required to file a U.S. federal income tax return annually with the IRS. The Company is also subject to tax in Canada. It is unclear how the foreign tax credit rules under the Code will operate in certain circumstances, given the treatment of the Company as a U.S. domestic corporation for U.S. federal income tax purposes and the taxation of the Company in Canada. Accordingly, it is possible that the Company will be subject to double taxation with respect to all or part of its taxable income. It is anticipated that such U.S. and Canadian tax treatment will continue indefinitely and that the Offered Shares will be treated indefinitely as shares in a U.S. domestic corporation for U.S. federal income tax purposes. The Company’s status as a domestic corporation for U.S. federal income tax purposes has implications for all shareholders, although only the application to U.S. Holders is discussed in this summary. The remaining discussion contained in this “Certain Material U.S. Federal Income Tax Considerations” assumes that the Company will be treated as a domestic corporation pursuant to Section 7874 of the Code.

Allocation of Purchase Price

U.S. Holders will generally allocate the amount paid for Offered Shares and Warrants based on their respective relative fair market values when computing the holder’s basis in the Offered Shares and Warrants for U.S. federal income tax purposes.

Distributions

The Company may pay a dividend on the Series A Preferred Shares. A U.S. Holder that receives a distribution with respect to the securities of the Company generally will be required to include the gross amount of such distribution (before reduction for any Canadian withholding taxes) in gross income as a dividend when actually or constructively received to the extent of the U.S. Holder’s pro rata share of our current and/or accumulated earnings and profits (as determined under U.S. federal income tax principles). To the extent a distribution received by a U.S. Holder is not a dividend because it exceeds the U.S. Holder’s pro rata share of our current and accumulated earnings and profits, it will be treated first as a tax-free return of capital and reduce (but not below zero) the adjusted tax basis of the U.S. Holder’s Offered Shares. To the extent the distribution exceeds the adjusted tax basis of the U.S. Holder’s Offered Shares, the remainder will be taxed as capital gain. However, we cannot provide any assurance that we will maintain or provide earnings and profits determinations in accordance with U.S. federal income tax principles. Therefore, U.S. Holders should expect that a distribution will generally be treated as a dividend even if that distribution would otherwise be treated as a non-taxable return of capital or as capital gain under the rules described above.

The U.S. dollar value of any distribution on securities of the Company made in Canadian dollars generally should be calculated by reference to the exchange rate between the U.S. dollar and the Canadian dollar in effect on the date of receipt (or deemed receipt) of such distribution by the U.S. Holder regardless of whether the Canadian dollars so received are in fact converted into U.S. dollars at that time. If the Canadian dollars received are converted into U.S. dollars on the date of receipt (or deemed receipt), a U.S. Holder generally should not recognize currency gain or loss on such conversion. If the Canadian dollars received are not converted into U.S. dollars on the date of receipt (or deemed receipt), a U.S. Holder generally will have a basis in such Canadian dollars equal to the U.S. dollar value of such Canadian dollars on the date of receipt (or deemed receipt). Any gain or loss on a subsequent conversion or other disposition of such Canadian dollars by such U.S. Holder generally will be treated as ordinary income or loss and generally will be income or loss from sources within the United States for U.S. foreign tax credit purposes. Different rules apply to U.S. Holders who use the accrual method of tax accounting. Each U.S. Holder should consult its own U.S. tax advisors regarding the U.S. federal income tax consequences of receiving, owning, and disposing of foreign currency.

Distributions made by the Company in respect of its securities to U.S. Holders will be treated as U.S.-source dividends includible in the gross income of a U.S. Holder as ordinary income to the extent of the Company’s current and accumulated earnings and profits, as described above. Subject to applicable limitations and requirements, dividends received on the securities generally should be eligible for the “dividends received deduction” available to corporate shareholders. A dividend paid by the Company to a non-corporate U.S. Holder generally will be eligible for preferential rates if certain holding period requirements are met. If a U.S. Holder is subject to Canadian withholding tax on dividends paid on the holder’s securities to the U.S. Holder, the dividends will be considered U.S. source income, which could limit the ability of a U.S. Holder to claim a foreign tax credit for the Canadian withholding taxes imposed in respect of such a dividend. See “Foreign Tax Credit Limitations” below.

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Sale, Exchange or Other Disposition of Offered Share and/or Warrants

Upon a sale, exchange or other taxable disposition of a security, a U.S. Holder will generally recognize a capital gain or loss equal to the difference between the amount realized (i.e., the amount of cash plus the fair market value of any property received) on such sale, exchange or other taxable disposition (or, if the amount realized is denominated in Canadian dollars, its U.S. dollar equivalent, determined by reference to the spot rate of exchange on the date of the sale, exchange or disposition) and the U.S. Holder’s adjusted tax basis of such security. Such gain or loss will be a long-term capital gain or loss if the U.S. Holder’s holding period in such security exceeds one year. Such gain or loss generally will be considered U.S. source gain or loss for U.S. foreign tax credit purposes, except as otherwise provided in an applicable income tax treaty and if an election is properly made under the Code. Long-term capital gains of certain non-corporate taxpayers are eligible for reduced rates of taxation. For both corporate and non-corporate taxpayers, limitations apply to the deductibility of capital losses. To the extent a U.S. Holder pays any Canadian tax on a sale, exchange or disposition of Offered Shares or Warrants, a U.S. foreign tax credit may not be available. See “Foreign Tax Credit Limitations” below.

Exercise, Expiration and Disposition of Warrants

A U.S. Holder will not recognize gain or loss upon exercise of a Warrant (except with respect to any cash received in lieu of a fractional Common Share). A U.S. Holder will have a tax basis in the Common Shares received upon the exercise of a Warrant equal to the sum of its tax basis in the Warrant and the aggregate cash exercise price paid in respect of such exercise, less any amount attributable to any fractional Common Share. The holding period of the Common Shares received upon the exercise of a Warrant will commence on the day after the Warrant is exercised, except in the situation where a Warrant is exercised pursuant to a “cashless exercise” feature in which case the holding period of the Common Share may include the period in which the Warrant was held, under certain reporting positions taken by investors under the Code. If a Warrant expires without being exercised, a U.S. Holder will recognize a capital loss in an amount equal to its tax basis in the Warrant.

Upon the sale, exchange or redemption of a Warrant that is not exercised, a U.S. Holder will recognize a gain or loss equal to the difference between the amount realized on the sale, exchange or redemption of the Warrant and the U.S. Holder’s tax basis in such Warrant. Such gain or loss will be long-term capital gain or loss if, at the time of such sale, exchange, or redemption, the Warrant has been held for more than one year. Long term capital gains of individuals (as well as certain trusts and estates) are subject to U.S. federal income tax at preferential rates. The deductibility of capital losses is subject to significant limitations. A U.S. Holder’s gain or loss on the sale, exchange, or redemption of a Warrant will be treated as U.S. source income or loss for U.S. foreign tax credit limitation purposes.

Foreign Tax Credit Limitations

Because the Company is subject to tax both as a U.S. domestic corporation and as a Canadian corporation, a U.S. Holder may pay, through withholding, Canadian tax, as well as U.S. federal income tax, with respect to dividends paid on its securities. For U.S. federal income tax purposes, a U.S. Holder may elect for any taxable year to receive either a credit or a deduction for all foreign income taxes paid by the holder during the year. Complex limitations apply to the foreign tax credit, including a general limitation that the credit cannot exceed the proportionate share of a taxpayer’s U.S. federal income tax that the taxpayer’s foreign source taxable income bears to the taxpayer’s worldwide taxable income. In applying this limitation, items of income and deduction must be classified, under complex rules, as either foreign source or U.S. source.

The status of the Company as a U.S. domestic corporation for U.S. federal income tax purposes will cause dividends paid by the Company to be treated as U.S. source rather than foreign source income for this purpose. As a result, a foreign tax credit may be unavailable for any Canadian tax paid on dividends received from the Company. Similarly, to the extent a sale or disposition securities by a U.S. Holder results in Canadian tax payable by the U.S. Holder (for example, because the Series A Preferred Shares and Warrants constitute taxable Canadian property within the meaning of the Canadian Tax Act), a U.S. foreign tax credit may be unavailable to the U.S. Holder for such Canadian tax. In each case, however, the U.S. Holder may be able to take a deduction for the U.S. Holder’s Canadian tax paid, provided that the U.S. Holder has not elected to credit other foreign taxes during the same taxable year. The foreign tax credit rules are complex, and each U.S. Holder should consult its own tax advisor regarding these rules.

127

Information Reporting and Backup Withholding

Dividends on and proceeds from the sale or other disposition of securities may be reported to the IRS unless the U.S. Holder establishes a basis for exemption. Backup withholding may apply to amounts subject to reporting if (1) the U.S. holder fails to provide an accurate taxpayer identification number or otherwise establish a basis for exemption, (2) the U.S. Holder is notified by the IRS that backup withholding applies, or (3) the payment is described in certain other categories of persons.

Backup withholding is not an additional tax. Any amounts withheld under the backup withholding rules generally will be allowed as a refund or a credit against a U.S. Holder’s U.S. federal income tax liability if the required information is furnished by the U.S. Holder on a timely basis to the IRS.

The discussion of reporting requirements set forth above is not intended to constitute a complete description of all reporting requirements that may apply to a U.S. Holder. U.S. Holders should consult with their own tax advisors regarding their reporting obligations, if any, as a result of their acquisition, ownership, or disposition of our Series A Preferred Shares and Warrants.

THE U.S. FEDERAL INCOME TAX CONSEQUENCES SUMMARIZED ABOVE ARE FOR GENERAL INFORMATION ONLY. EACH U.S. HOLDER OF OFFERED SHARES OR WARRANTS SHOULD CONSULT ITS TAX ADVISOR AS TO THE CONSEQUENCES OF AN INVESTMENT IN THE COMPANY IN LIGHT OF ITS PARTICULAR CIRCUMSTANCES.

ENFORCEABILITY OF CIVIL

LIABILITIES

mCloud has assets located outside of Canada, and therefore it may be difficult to enforce judgments obtained by mCloud in foreign jurisdictions by Canadian courts. Similarly, to the extent that mCloud’s assets are located outside of Canada, investors may have difficulty collecting from mCloud any judgments obtained in Canadian courts and predicated on the civil liability provisions of applicable securities legislation. Furthermore, mCloud may be subject to legal proceedings and judgments in foreign jurisdictions and it may be difficult for U.S. stockholders to effect service of process against the officers of mCloud.

DETERMINATION OF OFFERING PRICE

The public offering price for our Series A Preferred Shares and Warrants will be determined through negotiations between us and the investors in the offering. Among the factors to be considered in these negotiations will be prevailing market conditions, our financial information, market valuations of other companies that we and the placement agent believe to be comparable to us, estimates of our business potential, the present state of our development and other factors deemed relevant. We offer no assurances that the initial public offering price will correspond to the price at which our securities will trade in the public market subsequent to this offering or that an active trading market for our securities will develop and continue after this offering.

PLAN OF DISTRIBUTION

128

We are offering no less than 600,000 Series A Preferred Shares (each being sold with 25 Warrants) and up to 1,400,000 Series A Preferred Shares (each being sold with 25 Warrants), for gross proceeds of up to $35,000,000, before deduction of placement agent commissions and offering expenses, in a best efforts offering. The offering will not proceed unless at least $15,000,000 of gross proceeds are raised. As a result, the actual amount of gross proceeds, if any, in this offering could vary substantially from the gross proceeds from the sale of the maximum amount of securities being offered in this prospectus.

Pursuant to a placement agency agreement, dated as of [●], 2022, we have engaged Maxim Group LLC to act as our exclusive placement agent to solicit offers to purchase the securities offered by this prospectus. The Placement Agent is not purchasing or selling any securities, nor is it required to arrange for the purchase and sale of any specific number or dollar amount of securities, other than to use its “reasonable best efforts” to arrange for the sale of the securities by us. Therefore, we may not sell the entire amount of securities being offered. We will enter into a securities purchase agreement directly with the institutional investors, at the investor’s option, who purchase our securities in this offering. Investors who do not enter into a securities purchase agreement shall rely solely on this prospectus in connection with the purchase of our securities in this offering. The Placement Agent may engage one or more subagents or selected dealers in connection with this offering.

The placement agency agreement provides that the Placement Agent’s obligations are subject to conditions contained in the placement agency agreement.

We expect that the offering will end on the first to occur of (i) the sale of the maximum number of Series A Preferred Shares and Warrants resulting in gross proceeds of $35,000,000 and (ii) the conclusion of the 60 day offering period. Accordingly, we and the Placement Agent have made arrangements to place investor funds in a separate bank account to be held until the closing. Unless the minimum amount is subscribed for and accepted by the Company by the conclusion of the offering period, or waived by the Company, the offering will be terminated and all subscription proceeds will be returned to investors without interest or deduction.

Placement Agent Fees and Expenses

Upon the closing of this offering, we will pay the Placement Agent a cash transaction fee equal to 7.0% of the aggregate gross proceeds to us from the sale of securities in this offering.

The following table shows the per Series A Preferred Share or Warrant and total placement agent fees the Company will pay to the Placement Agent:

Underwriter	Per Series A Preferred Share		Per Related 25 Warrants
Public offering price:	$	24.75	$	0.25
Placement Agent fees payable by us:	$	1.7325	$	0.175
Proceeds, before expenses, to us:	$	23.0175	$	0.2325

129

We estimate that the total expenses of the Offering payable by us, not including the Placement Agent fees, will be approximately USD$673,460. We have agreed to be responsible and pay for all expenses related to the offering including all filing fees, legal fees and communication expenses relating to the registration of the securities to be sold in the offering. In connection with our engagement of Maxim, we paid Maxim a USD$25,000 advance toward certain offering expenses, which amount will be refunded to us (or offset against the placement agent fees owed to Maxim) at the closing of the offering.

Lock-Up Agreements

Our officers, directors and holders or 3% or more of our outstanding common shares have entered into customary “lock up” agreements in favor of Maxim pursuant to which such persons and entities have agreed, for a period of six months after the offering is completed, that they shall neither offer, issue, sell, contract to sell, encumber, grant any option for the sale of or otherwise dispose of any our securities without Maxim’s prior written consent.

Indemnification

We have agreed to indemnify Maxim against certain liabilities, including liabilities under Securities Act, and liabilities arising from breaches of representations and warranties contained in the placement agent agreement and to contribute to payments that the Placement Agent may be required to make for these liabilities.

130

Right of First Refusal

Subject to the closing of this offering and certain conditions set forth in the placement agent agreement, for a period of nine (9) months after the closing of the offering, Maxim shall have a right of first refusal to act as lead managing placement agent and book-runner or minimally as a co-lead manager and co-book-runner and/or co-lead placement agent for any and all future public or private equity, equity-linked or debt (excluding commercial bank debt) offerings undertaken during such period by us, or any of our successors or subsidiaries.

Tail Financing Payments

If we terminate our engagement agreement with Maxim, other than for cause, and we subsequently complete any public or private financing any time during the twelve (12) months after such termination with any investors contacted by Maxim in connection with this offering, then Maxim shall be entitled to receive the same compensation for such offering as it would have been entitled to in connection with this offering.

Other Relationships

From time to time, the Placement Agent and/or its affiliates may in the future engage in investment banking and other commercial dealings in the ordinary course of business with us for which they would expect to receive customary fees and commissions.

131

In addition, in the ordinary course of its business activities, the Placement Agent and its affiliates may make or hold a broad array of investments and actively trade debt and equity securities (or related derivative securities) and financial instruments (including bank loans) for their own account and for the accounts of their customers. Such investments and securities activities may involve securities and/or instruments of ours or our affiliates. The Placement Agent and its affiliates may also make investment recommendations and/or publish or express independent research views in respect of such securities or financial instruments and may hold, or recommend to clients that they acquire, long and/or short positions in such securities and instruments.

International Selling Restrictions

Other than in the United States, no action has been taken by us or the Placement Agent that would permit a public offering of the securities offered by this prospectus in any jurisdiction where action for that purpose is required. The securities offered by this prospectus may not be offered or sold, directly or indirectly, nor may this prospectus or any other offering material or advertisements in connection with the offer and sale of any such securities be distributed or published in any jurisdiction, except under circumstances that will result in compliance with the applicable rules and regulations of that jurisdiction. Persons into whose possession this prospectus comes are advised to inform themselves about and to observe any restrictions relating to the offering and the distribution of this prospectus. This prospectus does not constitute an offer to sell or a solicitation of an offer to buy any securities offered by this prospectus in any jurisdiction in which such an offer or a solicitation is unlawful.

Saudi Arabia. This prospectus may not be distributed in the Kingdom of Saudi Arabia except to such persons as are permitted under the Offers of Securities Regulations issued by the Capital Market Authority. The Capital Market Authority does not make any representation as to the accuracy or completeness of this prospectus, and expressly disclaims any liability whatsoever for any loss arising from, or incurred in reliance upon, any part of this prospectus. Prospective purchasers of the securities offered hereby should conduct their own due diligence on the accuracy of the information relating to the securities. If you do not understand the contents of this prospectus you should consult an authorized financial adviser.

Regulation M

The Placement Agent may be deemed to be an underwriter within the meaning of Section 2(a)(11) of the Securities Act, and any commissions received by it and any profit realized on the resale of the securities sold by it while acting as principal might be deemed to be underwriting discounts or commissions under the Securities Act. As an underwriter, the Placement Agent would be required to comply with the requirements of the Securities Act and the Exchange Act, including, without limitation, Rule 10b-5 and Regulation M under the Exchange Act. These rules and regulations may limit the timing of purchases and sales of our securities by the Placement Agent acting as principal. Under these rules and regulations, the Placement Agent (i) may not engage in any stabilization activity in connection with our securities and (ii) may not bid for or purchase any of our securities or attempt to induce any person to purchase any of our securities, other than as permitted under the Exchange Act, until it has completed its participation in the distribution.

Electronic Distribution

A prospectus in electronic format may be made available on a website maintained by the Placement Agent. In connection with the offering, the Placement Agent or selected dealers may distribute prospectuses electronically. No forms of electronic prospectus other than prospectuses that are printable as Adobe® PDF will be used in connection with this offering.

Other than the prospectus in electronic format, the information on the Placement Agent’s website and any information contained in any other website maintained by the Placement Agent is not part of the prospectus or the registration statement of which this prospectus forms a part, has not been approved and/or endorsed by us or the Placement Agent in its capacity as placement agent and should not be relied upon by investors.

Item 13. Other Expenses of Issuance and Distribution

The estimated expenses payable by us in connection with the offering described in this registration statement (other than the placement discounts and commissions) will be as follows. With the exception of the filing fees for the U.S. Securities Exchange Commission, FINRA and Nasdaq, all amounts are estimates.

U.S. Securities and Exchange Commission registration fee	$	20,555.5
FINRA filing fee		13,905
Nasdaq listing fee		5,000
Legal fees and expenses		239,000
Accounting fees and expenses		250,000
Transfer agent fees and expenses		5,000
Printing fees and expenses		90,000
Miscellaneous		50,000
Total	$	673,460

132

LEGAL MATTERS

The validity of the Series A Preferred Shares and certain legal matters relating to the offering as to Canadian law will be passed upon for us by Morton Law LLP. Certain matters as to U.S. federal law in connection with this offering will be passed upon for us by Sichenzia Ross Ference LLP, New York, New York. Fox Rothschild LLP, Minneapolis, Minnesota has acted as counsel for the Placement Agent with respect to this offering.

EXPERTS

The consolidated financial statements of mCloud Technologies Corp. as of December 31, 2021 and 2020, and for each of the years in the three-year period ended December 31, 2021, have been included herein and in the registration statement in reliance upon the report of KPMG LLP, independent registered public accounting firm, appearing elsewhere herein, and upon the authority of said firm as experts in accounting and auditing.

The audit report covering the December 31, 2021 consolidated financial statements contains an explanatory paragraph that states that the Company’s recurring losses from operations and net working capital deficiency raise substantial doubt about the entity’s ability to continue as a going concern. The consolidated financial statements do not include any adjustments that might result from the outcome of that uncertainty.

WHERE YOU CAN FIND MORE INFORMATION

We have filed with the SEC a registration statement on Form F-1 under the Securities Act with respect to the Series A Preferred Shares and Warrants offered hereby. This prospectus, which constitutes a part of the registration statement, does not contain all of the information set forth in the registration statement or the exhibits filed therewith. For further information about us and the Series A Preferred Shares and Warrants offered hereby, reference is made to the registration statement and the exhibits filed therewith. Statements contained in this prospectus regarding the contents of any contract or any other document that is filed as an exhibit to the registration statement are not necessarily complete, and in each instance, we refer you to the copy of such contract or other document filed as an exhibit to the registration statement.

We are subject to the information and periodic reporting requirements of the Exchange Act, and we file periodic reports, proxy statements and other information with the SEC. These periodic reports, and other information are available for inspection and copying at the website of the SEC referred to above. You may access our annual reports on Form 20-F, reports on Form 6-K and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act with the SEC free of charge at our website as soon as reasonably practicable after such material is electronically filed with, or furnished to, the SEC. The information contained in, or that can be accessed through, our website is not incorporated by reference in, and is not part of, this prospectus. A copy of the registration statement and the exhibits filed therewith may be inspected without charge at the public reference room maintained by the SEC, located at 100 F Street, NE, Washington, DC 20549, and copies of all or any part of the registration statement may be obtained from that office. Please call the SEC at 1-800-SEC-0330 for further information about the public reference room. The SEC also maintains a website that contains reports, proxy and information statements and other information regarding registrants that file electronically with the SEC. The address of the website is www.sec.gov.

133

mCloud Technologies Corp.

INDEX TO FINANCIAL STATEMENTS

TABLE OF CONTENTS

	Page
Report of Independent Registered Public Accounting Firm		F-2
Consolidated Statements of Financial Position as of December 31, 2021 and 2020		F-4
Consolidated Statements of Loss and Comprehensive Loss for the Years Ended December 31, 2021, 2020 and 2019		F-5
Consolidated Statements of Changes in Equity for the Years Ended December 31, 2021, 2020 and 2019		F-6
Consolidated Statements of Cash Flows for the Years Ended December 31, 2021, 2020 and 2019		F-9
Notes to the Consolidated Financial Statements for the Years Ended December 31, 2021, 2020 and 2019		F-10
Consolidated Statements of Financial Position as of June 30, 2022 and December 31, 2021		F-64
Consolidated Statements of Comprehensive Income for the Three and Six Months Ended June 30, 2022 and 2021		F-65
Consolidated Statements of Changes in Equity for the Six Months Ended June 30, 2022 and 2021		F-66
Statements of Cash Flows for the Six Months Ended June 30, 2022 and 2021		F-67
Notes to the Condensed Consolidated Interim Financial Statements for the Three and Six Months Ended June 30, 2022 and 2021		F-68

F-1

KPMG LLP

205 5th Avenue SW

Suite 3100

Calgary AB T2P 4B9

Tel (403) 691-8000

Fax (403) 691-8008

www.kpmg.ca

Report of Independent Registered Public Accounting Firm

To the Shareholders and Board of Directors of mCloud Technologies Corp.:

Opinion on the Consolidated Financial Statements

We have audited the accompanying consolidated statements of financial position of mCloud Technologies Corp., (the “Company”) as of December 31, 2021 and 2020, the related consolidated statements of loss and comprehensive loss, changes in equity, and cash flows for each of the years in the three-year period ended December 31, 2021 and the related notes (collectively, the consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2021 and 2020, and its financial performance and its cash flows for the each of the years in the three-year period ended December 31, 2021, in conformity with International Financial Reporting Standards as issued by the International Accounting Standards Board.

Going Concern

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 2 to the consolidated financial statements, the Company has had recurring net losses and cash used in operating activities, covenant violations and a net working capital deficiency as of December 31, 2021 that raise substantial doubt about the Company’s ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 2. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Basis for Opinion

These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

2

F-2

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.

We have served as the Company’s auditor since 2019.

/s/ KPMG LLP

Chartered Professional Accountants

Calgary, Canada

August 22, 2022

3

F-3

mCloud Technologies Corp.

Consolidated Statements of Financial Position

Expressed in Canadian Dollars

	Notes		December 31, 2021			December 31, 2020
				Recast (Note 2)			Recast (Note 2)
ASSETS
Current assets
Cash and cash equivalents			$	4,588,057		$	1,110,889
Trade and other receivables		6		14,566,975			12,312,814
Current portion of prepaid expenses and other assets		7		2,355,350			1,326,319
Current portion of long-term receivables		6		397,060			445,213
Total current assets			$	21,907,442		$	15,195,235
Non-current assets
Prepaid expenses and other assets		7		622,577			1,011,847
Long-term receivables		6		343,371			2,091,059
Right-of-use assets		8		916,028			3,660,717
Property and equipment		9		649,403			506,387
Intangible assets		10		20,585,833			27,766,839
Goodwill		10		27,081,795			27,086,727
Total non-current assets			$	50,199,007		$	62,123,576
Total assets			$	72,106,449		$	77,318,811
LIABILITIES
Current liabilities
Bank indebtedness		13	$	3,460,109		$	976,779
Trade payables and accrued liabilities		11		12,421,309			12,924,256
Deferred revenue		5		2,811,408			1,771,120
Current portion of loans and borrowings		12		12,447,939			3,431,251
Current portion of convertible debentures		14		22,185,170			–
Warrant liabilities		15		8,880,038			710,924
Current portion of lease liabilities		8		410,674			835,472
Current portion of other liabilities		16		–			6,003,838
Current portion of business acquisition payable		18		1,398,972			1,594,297
Total current liabilities			$	64,015,619		$	28,247,937
Non-current liabilities
Convertible debentures		14		110,540			19,534,988
Lease liabilities		8		634,798			3,109,604
Loans and borrowings		12		767,662			9,721,049
Deferred income tax liabilities		25		2,291,057			4,168,905
Other liabilities		16		–			232,577
Business acquisition payable		18		–			845,232
Total liabilities			$	67,819,676		$	65,860,292
EQUITY
Share capital		19		118,195,363			83,120,611
Contributed surplus				11,040,751			8,518,476
Accumulated other comprehensive income				1,227,269			1,435,384
Deficit				(128,671,898	)		(83,909,198	)
Total shareholders’ equity			$	1,791,485		$	9,165,273
Non-controlling interest		21		2,495,288			2,293,246
Total equity			$	4,286,773		$	11,458,519
Total liabilities and equity			$	72,106,449		$	77,318,811

Going concern (Note 2); Events after the reporting period (Note 31); Commitments and contingencies (Note 29)

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

Approved on behalf of the Board of Directors on August 22, 2022

“Russ McMeekin”	“Michael Allman”
Director	Director

1  |  Consolidated Financial Statements

F-4

mCloud Technologies Corp.

Consolidated Statements of Loss and Comprehensive Loss

(Expressed in Canadian dollars except number of shares)

	Year ended December 31,
	Notes		2021			2020			2019
				Recast (Note 2)			Recast (Note 2)			Recast (Note 2)
Revenue		4, 5	$	25,596,972		$	26,928,439		$	18,340,249
Cost of sales				(9,683,748	)		(10,281,922	)		(7,583,127	)
Gross profit			$	15,913,224		$	16,646,517		$	10,757,122
Expenses
Salaries, wages and benefits				21,691,774			20,885,044			10,313,803
Sales and marketing				1,377,255			1,536,420			3,166,788
Research and development				3,179,353			1,078,164			498,099
General and administration				8,538,854			5,741,872			3,294,550
Professional and consulting fees				9,085,436			8,886,341			4,351,812
Share-based compensation		20		1,867,915			1,454,235			1,468,361
Depreciation and amortization		8-10		8,924,812			6,778,100			4,044,143
Total expenses			$	54,665,399		$	46,360,176		$	27,137,556
Operating loss			$	38,752,175		$	29,713,659		$	16,380,434
Other expenses (income)
Finance costs		22		8,618,794			6,033,510			3,217,500
Foreign exchange loss (gain)				(267,294	)		1,198,372			494,404
Business acquisition costs and other expenses		17		346,420			1,811,682			9,880,170
Impairment		9,10(a)		–			–			600,657
Fair value loss on derivatives		23		6,040,121			–			–
Other income		24		(7,126,097	)		(2,932,342	)		(167,913	)
Loss before tax			$	46,364,119		$	35,824,881		$	30,405,252
Current tax expense (recovery)		25		157,303			(295,709	)		181,895
Deferred tax (recovery) expense		25		(1,822,109	)		(668,209	)		(2,692,313	)
Net loss for the year			$	44,699,313		$	34,860,963		$	27,894,834
Other comprehensive (income) loss
Foreign subsidiary translation differences				69,460			(1,209,006	)		(607,302	)
Comprehensive loss for the year			$	44,768,773		$	33,651,957		$	27,287,532
Net loss (income) for the year attributable to:
mCloud Technologies Corp. shareholders				44,762,700			36,447,551			28,484,890
Non-controlling interest				(63,387	)		(1,586,588	)		(590,056	)
			$	44,699,313		$	34,860,963		$	27,894,834
Comprehensive loss (income) for the year attributable to:
mCloud Technologies Corp. shareholders				44,970,815			35,398,294			28,054,299
Non-controlling interest				(202,042	)		(1,746,337	)		(766,767	)
			$	44,768,773		$	33,651,957		$	27,287,532
Loss per share attributable to mCloud shareholders – basic and diluted			$	3.76		$	5.01		$	6.97
Weighted average number of common shares outstanding - basic and diluted				11,898,183			7,272,464			4,085,322

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

2  |  Consolidated Financial Statements

F-5

mCloud Technologies Corp.

Consolidated Statements of Changes in Equity

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except number of shares)

	Notes		Number of Shares		Share Capital		Contributed Surplus			Accumulated Other Comprehensive Income			Deficit			Total Shareholder’s Equity			Non- controlling Interest		Total Equity
Balance, December 31, 2020 – Recast (Note 2)				9,168,416	$	83,120,611	$	8,518,476		$	1,435,384		$	(83,909,198	)	$	9,165,273		$	2,293,246	$	11,458,519
Share-based payments		20		–		–		1,867,915			–			–			1,867,915			–		1,867,915
RSUs exercised		20		71,190		337,104		(423,277	)		–			–			(86,173	)		–		(86,173)
Broker warrants issued		19(b)		–		–		294,894			–			–			294,894			–		294,894
Shares issued in public offering, net of costs		19(a)		2,300,000		12,395,918		–			–			–			12,395,918			–		12,395,918
Warrants issued in public offering, net of costs		19(a)		–		–		619,796			–			–			619,796			–		619,796
Shares issued in private placement		19(a)		75,676		420,000		–			–			–			420,000			–		420,000
Shares issued on 2021 Debentures conversion, net		19(a)		2,107,787		14,436,728		–			–			–			14,436,728			–		14,436,728
Shares issued in USD public offering, net of costs		19(a)		2,415,000		7,485,002		–			–			–			7,485,002			–		7,485,002
Underwriter warrants issued in USD public offering		19(a)		–		–		162,947			–			–			162,947			–		162,947
Net (loss) income for the year				–		–		–			–			(44,762,700	)		(44,762,700	)		63,387		(44,699,313)
Other comprehensive (loss) income for the year				–		–		–			(208,115	)		–			(208,115	)		138,655		(69,460)
Balance, December 31, 2021 – Recast (Note 2)				16,138,069	$	118,195,363	$	11,040,751		$	1,227,269		$	(128,671,898	)	$	1,791,485		$	2,495,288	$	4,286,773

3  |  Consolidated Financial Statements

F-6

mCloud Technologies Corp.

Consolidated Statements of Changes in Equity

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except number of shares)

	Notes		Number of Shares		Share Capital		Contributed Surplus			Accumulated Other Comprehensive Income		Deficit			Total Shareholder’s Equity			Non- controlling Interest		Total Equity
Balance, December 31, 2019 – Recast (Note 2)				5,282,904	$	45,368,745	$	7,278,119		$	386,127	$	(47,461,647	)	$	5,571,344		$	546,909	$	6,118,253
Share-based payments		20		–		–		1,454,235			–		–			1,454,235			–		1,454,235
RSUs exercised		20(b)		35,877		384,613		(529,006	)		–		–			(144,393	)		–		(144,393)
Stock options exercised		20(a)		7,639		166,400		(96,400	)		–		–			70,000			–		70,000
Warrants exercised				117,977		1,923,118		(427,426	)		–		–			1,495,692			–		1,495,692
Shares issued in business combination - CSA		17(d)		126,737		2,304,073		–			–		–			2,304,073			–		2,304,073
Shares issued in business combination - kanepi		17(e)		867,631		5,882,547		–			–		–			5,882,547			–		5,882,547
Shares issued for transaction costs - kanepi		17(e)		22,064		149,596		–			–		–			149,596			–		149,596
Shares issued for asset acquisition - AirFusion				66,667		820,000		–			–		–			820,000			–		820,000
Shares issued on conversion of 2019 debentures		19(b)		3,333		50,000		24,000			–		–			74,000			–		74,000
Issue of special warrants, net				–		–		12,217,171			–		–			12,217,171			–		12,217,171
Conversion of special warrants				1,222,063		12,217,171		(12,217,171	)		–		–			–			–		–
Settlement of debt with RSUs				–		–		143,002			–		–			143,002			–		143,002
Shares issued in public offering, net of costs				1,415,526		13,854,348		671,952			–		–			14,526,300			–		14,526,300
Net (loss) income for the year				–		–		–			–		(36,447,551	)		(36,447,551	)		1,586,588		(34,860,963)
Other comprehensive income for the year				–		–		–			1,049,257		–			1,049,257			159,749		1,209,006
Balance, December 31, 2020 – Recast (Note 2)				9,168,416	$	83,120,611	$	8,518,476		$	1,435,384	$	(83,909,198	)	$	9,165,273		$	2,293,246	$	11,458,519

4  |  Consolidated Financial Statements

F-7

mCloud Technologies Corp.

Consolidated Statements of Changes in Equity

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except number of shares)

	Notes		Number of Shares		Share Capital			Contributed Surplus			Accumulated Other Comprehensive Income			Deficit			Total Shareholder’s Equity			Non- controlling Interest			Total Equity
Balance, December 31, 2018				3,030,021	$	19,815,174		$	1,759,217			$    (44,464	)		$  (18,976,757	)	$	2,553,170		$	–		$	2,553,170
Share-based payments		20		–		–			1,468,361			–			–			1,468,361			–			1,468,361
RSUs exercised		20(b)		11,905		142,277			(142,277	)		–			–			–			–			–
Stock options exercised		20(a)		50,838		658,074			(114,825	)		–			–			543,249			–			543,249
Share purchase warrants exercised		18(b)		133,176		1,865,773			(138,571	)		–			–			1,727,202			–			1,727,202
Shares issued on business combination		17(c)		1,200,000		13,320,000			–			–			–			13,320,000			–			13,320,000
Transaction costs on business combination		17(c)		800,000		8,880,000			–			–			–			8,880,000			–			8,880,000
Shares issued to extinguish the loan from Flow Capital		17(a)		50,000		606,495			–			–			–			606,495			–			606,495
Shares issued to settle liabilities		19(a)		6,964		84,252			–			–			–			84,252			–			84,252
Share issuance costs				–		(3,300	)					–			–			(3,300	)		–			(3,300)
Warrants issued				–		–			61,000			–			–			61,000			–			61,000
Equity component of convertible debentures				–		–			3,673,214			–			–			3,673,214			–			3,673,214
Contingent shares issuable to Flow Capital		17(a)		–		–			712,000			–			–			712,000			–			712,000
Non-controlling interest recognized in business combination				–		–			–			–			–			–			(219,858	)		(219,858)
Net (loss) income for the year				–		–			–			–			(28,484,890	)		(28,484,890	)		590,056			(27,894,834)
Other comprehensive income for the year				–		–			–			430,591			–			430,591			176,711			607,302
Balance, December 31, 2019 - Recast (Note 2)				5,282,904	$	45,368,745		$	7,278,119			$   386,127			$  (47,461,647)		$	5,571,344		$	546,909		$	6,118,253

5  |  Consolidated Financial Statements

F-8

mCloud Technologies Corp.

Consolidated Statements of Cash Flows

(Expressed in Canadian Dollars) 

			Year ended December 31,
	Notes		2021			2020			2019
Operating activities
Net loss			$	(44,699,313	)	$	(34,860,963	)	$	(27,894,834	)
Items not affecting cash:
Depreciation and amortization		8-10		8,924,812			6,778,100			4,044,143
Share-based compensation		20		1,867,915			1,454,235			1,468,361
Finance costs		22		8,618,794			6,020,636			3,217,500
Fair value loss on derivatives		23		6,040,121			–			–
Impairment				–			–			600,657
Other income		24		(2,675,671	)		(92,535	)		(167,913	)
Provision for expected credit loss		26		1,159,742			223,129			432,073
Unrealized foreign currency exchange gain				(534,993	)		1,034,501			542,016
Business acquisition costs				–			149,596			8,880,000
Current tax expense (recovery)		25		157,303			(295,709	)		181,895
Deferred income tax recovery		25		(1,822,109	)		(668,209	)		(2,692,313	)
Gain on settlement of lease liability				–			–			(99,979	)
Decrease in working capital		30		(1,988,521	)		(904,212	)		(2,131,240	)
Interest paid				(3,377,851	)		(3,535,805	)		(1,992,496	)
Taxes paid				–			(158,564	)		(376,093	)
Net cash used in operating activities			$	(28,329,771	)	$	(24,855,800	)	$	(15,988,223	)
Investing activities
Acquisition of property and equipment		9	$	(625,202	)	$	(127,688	)	$	(138,123	)
Acquisition of and expenditure on intangible assets		10		(438,725	)		(809,764	)		–
Acquisition of royalty agreement		17(a)		–			–			(204,604	)
Acquisition of assets of AirFusion				–			(835,302	)		–
Acquisition of business, net of cash acquired		17		–			(4,622,400	)		(20,389,426	)
Net cash used in investing activities			$	(1,063,927	)	$	(6,395,154	)	$	(20,732,153	)
Financing activities
Payment of lease liabilities		8	$	(1,095,327	)	$	(814,072	)	$	(422,783	)
Repayment of loans		12		(9,781,554	)		(9,011,638	)		(6,787,528	)
Proceeds from loans and bank indebtedness, net of transaction costs		12, 13		13,752,698			8,726,766			16,539,700
Net (repayments) advances of bank indebtedness		13		(1,004,211	)		(495,026	)		1,471,805
Proceeds from issuance of shares, net of issuance costs		19(a)		20,300,920			14,526,300			–
Proceeds from issuance of convertible debentures, net of costs		14		5,424,661			5,285,997			22,865,049
Proceeds from issuance of warrants, net of issuance costs		19(a)		5,415,864			12,217,171			1,727,202
Proceeds from the exercise of stock options, net of issuance costs				–			70,000			543,249
Proceeds from exercise of warrants, net				–			1,495,692			–
Income tax withholding on RSUs				(86,173	)		(144,393	)		–
Net cash provided by financing activities			$	32,926,878		$	31,856,797		$	35,936,694
Increase in cash and cash equivalents			$	3,533,180		$	605,843		$	(783,682	)
Effect of exchange rate fluctuations on cash held				(56,012	)		(24,144	)		(12,922	)
Cash and cash equivalents, beginning of year				1,110,889			529,190			1,325,794
Cash and cash equivalents, end of year			$	4,588,057		$	1,110,889		$	529,190

Supplemental cash flow information (Note 30)

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

6  |  Consolidated Financial Statements

F-9

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 1 – NATURE OF OPERATIONS

mCloud Technologies Corp. (“mCloud” or the “Company”), is a provider of proprietary technology solutions, AssetCare. Customers use AssetCare software-as-a-service (“SaaS”) and data solutions to ensure assets continuously operate at peak performance. AssetCare is an asset management platform combining IoT, AI and the cloud to drive next-level performance and efficiency. mCloud offers foundational enterprise technology solutions enabling capabilities such as secure communications, connected work, and remote monitoring.

The Company is domiciled in Vancouver, Canada with its head office in Calgary, Alberta and its registered offices located at 550-510 Burrard Street, Vancouver, British Columbia, V6C 3A8.

The Company met the listing requirements of the Nasdaq Stock Market LLC (“NASDAQ”) and received approval to be listed on November 23, 2021. On November 24, 2021, the Company’s shares began trading on the NASDAQ under the stock symbol MCLD in U.S. dollars (Note 31). The Company’s shares also trade on the TSX.V trading in Canadian dollars under the symbol MCLD and on the OTCQB Venture Market under the symbol MCLDF.

NOTE 2 – BASIS OF ACCOUNTING

The consolidated financial statements include the accounts of mCloud, the ultimate parent of the consolidated group, and its subsidiaries and are prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”), effective as of December 31, 2021.

These consolidated financial statements of the Company were approved by the Company’s Board of Directors and authorized for issue on August 22, 2022.

Basis of preparation

These consolidated financial statements were prepared on a going-concern basis, under the historical cost convention except for derivative financial instruments classified as at fair value through profit or loss. The Company’s accounting policies are described in Note 32 and these policies are consistently applied to all the periods presented.

The Company’s presentation currency is Canadian dollars, and all amounts are presented in Canadian dollars unless otherwise stated. The consolidated financial statements include the accounts of the Company and those of its subsidiaries which are entities over which the Company has control (Note 32(A)). In addition to the Canadian dollar presentation, certain disclosures include the use of U.S. Dollars (“USD” or “US$”) in describing certain financing transactions.

The Company has reclassified certain comparative figures in the consolidated financial statements to conform to the current year presentation.

The Company has corrected net income (loss) and other comprehensive income (loss) attributable to mCloud shareholders and non-controlling interest for the years ended December 31, 2019, 2020 and 2021. This resulted in a reclassification between non-controlling interest, accumulated other comprehensive income, and accumulated deficit in the consolidated statements of financial position at December 31, 2019, December 31, 2020, and December 31, 2021. At December 31, 2019, on the consolidated statement of financial position, accumulated other comprehensive income increased by $22,877, deficit decreased by $1,354,452, and non-controlling interest decreased by $1,377,329. At December 31, 2020, on the consolidated statement of financial position, accumulated other comprehensive income decreased by $234,212, deficit decreased by $1,777,168, and non-controlling interest decreased by $1,542,956 taking into consideration the cumulative impacts of prior period adjustments. At December 31, 2021, on the consolidated statement of financial position, accumulated other comprehensive income decreased by $344,729, deficit decreased by $1,344,175, and non-controlling interest decreased by $999,446 taking into consideration the cumulative impacts of prior period adjustments.

In addition this resulted in a reclassification between net loss attributable to mCloud shareholders and non-controlling interest, other comprehensive loss attributable to mCloud shareholders and non-controlling interest and impacted basic and diluted loss per share for the years ended December 31, 2019, 2020 and 2021. During the years ended:

• December 31, 2019, net loss attributable to mCloud shareholders decreased by $1,354,452, net income attributable to noncontrolling interest decreased by $1,354,452, and loss per share attributable to mCloud shareholders - basic and diluted decreased by $0.33 per share.

• December 31, 2020, net loss attributable to mCloud shareholders increased by $422,716, net income attributable to noncontrolling interest decreased by $422,716, and loss per share attributable to mCloud shareholders - basic and diluted increased by $0.06 per share.

• December 31, 2021, net loss attributable to mCloud shareholders increased by $432,993, net loss attributable to non-controlling interest decreased by $432,993 and loss per share attributable to mCloud shareholders - basic and diluted increased by $0.03 per share.

In addition, the comparative disclosures as at December 31, 2021, 2020 and 2019 in Note 21, Non-controlling interest, reflect the corrected balances for non-current assets, current liabilities and non-current liabilities of the non-controlling interest arising from the above noted attribution of net income (loss) and other comprehensive income (loss) errors as well as certain other disclosure errors.

Share consolidation

On November 19, 2021, the Company initiated a 3-to-1 consolidation of the Company’s issued and outstanding common shares which took effect at market opening on November 24, 2021. This share consolidation was approved by the Company’s shareholders in connection with the Company’s NASDAQ listing. The Company’s issued and outstanding convertible debentures, stock options, warrants and restricted share units were also subject to this share consolidation. The par value of the common shares was not adjusted as a result of this share consolidation. Accordingly, all share and per share amounts for the periods presented in these consolidated financial statements and notes thereto have been adjusted retrospectively to reflect this share consolidation.

Going Concern

The outbreak of the COVID-19 pandemic and the measures adopted by governments in countries worldwide to mitigate the pandemic’s spread have impacted the Company. These measures required the Company to restrict deployment of technical services due to the in-person nature of these activities and delay the start of certain projects for a duration of the year. This negatively impacted the Company’s financial performance and liquidity position.

During the year ended December 31, 2021, the Company generated a net loss of $44,699,313 and negative cash flows from operating activities of $28,329,771. At December 31, 2021, the Company had a working capital deficiency of $42,108,177. Working capital deficiency is a non-IFRS measure which is calculated as current assets less current liabilities. Current liquidity levels and available sources of capital are not adequate to fund the working capital deficiency.

7  |  Notes to the Consolidated Financial Statements

F-10

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 2 – BASIS OF ACCOUNTING (continued)

Going Concern (continued)

The most significant cash outflows included in current liabilities include the repayment of the 2019 Convertible Debentures of $23,457,500 together with interest payable (Note 14(a)); loans and borrowings of $11,763,697 including principal and interest payments; payment of trade and other payables of $12,421,309; and payments associated with leases of approximately $1,000,000.

While restrictions started to ease in the three months ended December 31, 2021, there is still uncertainly over how COVID-19 will impact the Company’s business and the timing of future revenues. Based on the Company’s liquidity position at the date of authorization of these consolidated financial statements and considering the uncertainty surrounding the impact of the pandemic, management estimates that it will need additional financing to meet its financial obligations. The Company is currently working with stakeholders and others to address the working capital deficiency. In the long-term, the ability of the Company to operate as a going concern is dependent on its ability to achieve and maintain profitable operations and positive cash flow from operations, and, as necessary, to obtain the necessary equity or debt financing to continue with operations. To date, the Company has funded its operations through debt and equity financing. While the Company has been successful in raising capital in the past and anticipates the lenders will not accelerate repayment of loans with covenant breaches as of December 31, 2021, March 31, 2022, and June 30, 2022 and potential breaches forecasted over the coming year, there is no assurance that it will be successful in closing further financings in the future or obtaining waivers of the covenant breaches.

As a result, these factors are indicators that material uncertainties exist that raises significant doubt about the Company’s ability to continue as a going concern and, therefore, its ability to realize assets and discharge liabilities in the normal course of business.

In making their assessment, management considered all available information, together with forecasts and other mitigating strategies, about the future which is at least, but not limited to, 12 months from the end of the reporting period. Management has considered the following in its assessment that the going concern assumption remains appropriate:

• the plan for the repayment of the 2019 Convertible Debentures;

• the repayment of the term loan in full on or before October 31, 2022 (Note 31);

• the likelihood that undrawn funds under the revolving operating facility will be available and will not be required to be repaid (Note 13);

• the required cash principal and interest payments on indebtedness;

• the likelihood of payments required under contingent consideration arrangements;

• cash inflows from current operations and expected increases in revenues and cash flows resulting from new revenue contracts expected over the next 12 months due to the anticipated reduction of COVID-19 related restrictions; and future debt and equity raises.

These consolidated financial statements have been prepared on a going concern basis, which contemplates that the Company will continue in operation and be able to realize its assets and discharge its liabilities and commitments in the normal course of business for the foreseeable future. These consolidated financial statements do not include any adjustments to the carrying amounts and classifications of assets, liabilities and reported expenses that may otherwise be required if the going concern basis was not appropriate.

NOTE 3 – CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS

In the preparation of the consolidated financial statements and the application of the Company’s accounting policies, management is required to make judgements, estimates and assumptions that affect the carrying amounts of assets and liabilities and disclosure of contingent liabilities at the dates of the consolidated financial statements, and the reported amounts of revenues and expenses during each reporting period. The estimates and associated assumptions are limited by the relevance of historical data and uncertainty of future events. Actual results could differ from those estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to estimates are recognized in the period in which the estimates are revised and in any future period.

8  |  Notes to the Consolidated Financial Statements

F-11

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 3 – CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS (continued)

Beginning in March 2020, the COVID-19 pandemic has had a substantial impact on economies around the world. As a result of the uncertainty associated with the unprecedented nature of the pandemic, certain of the Company’s significant assumptions may be impacted. Uncertain environments make estimating several items in the consolidated financial statements more challenging and are likely to result in more frequent changes in management’s expectations about the future. The long-term impact on the Company’s financial results and cash flows is unknown at this time. The Company has received government assistance in Canada, the United States and Australia to help temper the financial impact of COVID-19 (Note 24).

(a) Critical judgements in applying accounting policies

Judgement is used in situations when there is a choice and/or assessment required by management. Information about judgements made in applying accounting policies that have the most significant effect on the amounts recognized in the consolidated financial statements, are as follows:

Determination of control of subsidiaries

Judgement is required to determine when the Company has control of subsidiaries. This requires an assessment of the relevant activities of the investee, being those activities that significantly affect the investee’s returns. Despite owning no shares, or having any voting rights, the Company determined that it exercises control over Agnity Global, Inc. (“Agnity”) as the Company has the right to nominate a majority of the members of Agnity’s Operations Committee and therefore the right and ability to direct the relevant activities of Agnity and to significantly affect its returns through the use of its rights. The Company has the right to receive royalty payments from Agnity on a monthly basis in perpetuity and the Company has credit risk with respect to the collectability of these royalty payments.

Assessment of indicators of impairment of goodwill, long-lived assets and intangible assets

Management reviews goodwill, depreciable long-lived assets and intangible assets for impairment triggers to determine if any events or changes in circumstances exist that would indicate that the carrying amount of an asset may not be recoverable over time. If impairment indicators exist, impairment assessments are conducted as the asset level or level of cash generating units (“CGUs”) as appropriate.

Leases

In measuring the Company’s leases judgement is required to determine the lease term of the contract including whether the Company is reasonably certain to exercise extension options where it is the lessee. A longer lease term results in a larger lease liability and right-of-use asset to be recognized by the Company and future changes in this lease term will result in modifications. In addition, estimates and assumptions are required to determine the incremental borrowing rate used to measure lease liabilities at inception of a lease.

Contingent consideration

Management uses judgement to assess the existence of contingencies. By their nature, contingencies will only be resolved when one or more future events occur or fail to occur. At initial recognition at the date of a business combination and at the end of each reporting period, management also uses judgement to assess the likelihood of the occurrence of one or more future events which impacts the fair value of the contingent consideration.

Determination of CGUs

For the purposes of assessing impairment of goodwill and non-financial assets, the Company must identify CGUs. Assets and liabilities are grouped into CGUs at the lowest level of separately identified cash flows. Determination of what constitutes a CGU is subject to management judgment. The composition of a CGU can directly impact the recoverability of non-financial assets included within the CGU. Management has determined that the Company has two CGUs: Agnity and the rest of mCloud.

9  |  Notes to the Consolidated Financial Statements

F-12

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 3 – CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS (continued)

(b) Key sources of estimation uncertainty

Information about assumptions and estimation uncertainties that have a significant risk of resulting in a material adjustment to the carrying amounts of assets and liabilities and results of operations where a different estimate or assumption is used, are as follows:

Value of components for convertible debt and equity offerings

Management makes judgements related to the measurement of the fair value of the convertible debentures and equity offerings issued in the period, including the determination of the allocation of the proceeds between the components of the instrument. At inception of an instrument, the Company determines the value of each piece of the instrument and judgement is required in determining the inputs used in the fair value calculations and in determining the probability of certain outcomes.

Determination of stand-alone selling price

The total transaction price of certain revenue contacts is allocated to each performance obligation on a relative stand-alone selling price (“SSP”) basis, representing the selling price as if it was sold separately. This is a formal process involving judgement which could impact the timing of recognized revenue. In most cases, the SSP is based on observable data. If the SSP is not directly observable, the amount is estimated using either the expected cost plus a margin or residual approach. The SSP for perpetual software licenses is highly variable and therefore the Company applies the residual approach (Note 32(C)).

Expected credit loss allowance and provision

The Company recognizes an amount equal to the lifetime expected credit loss (“ECL”) on trade and long-term receivables, other receivables, unbilled revenue and amounts due from related parties for which there has been a significant increase in credit risk since initial recognition. Loss allowances are measured based on historical experience and forecasted economic conditions. The amount of ECL is sensitive to changes in circumstances of forecast economic conditions.

Impairment of goodwill and other non-financial assets

Goodwill is reviewed annually on December 31 or more frequently if changes in circumstances indicate that the carrying value may be impaired. The Company completed its annual impairment testing at December 31, 2021 and determined there was no impairment. Determining whether an impairment has occurred requires the valuation of the recoverable amount of the CGUs as described in Note 10(b).

Share-based payment arrangements

The Company uses the Black-Scholes option-pricing model (“Black-Scholes model”) to determine the fair value of stock options and other equity instruments where the goods and services cannot be valued. In estimating the fair value, management is required to make certain assumptions and estimates such as the expected life of options, volatility of the Company’s future share price, risk-free rate, future dividend yields and estimated forfeitures at the initial measurement date. Changes in assumptions used to estimate fair value could result in different outcomes.

Business combinations - purchase price allocation

The consideration transferred and acquired assets and assumed liabilities are recognized at fair value on the date the Company effectively obtains control. The measurement of each business combination is based on the information available on the acquisition date. The estimate of fair value of the consideration transferred and acquired intangible assets (including goodwill), property and equipment, other assets and the liabilities assumed are based on estimates and assumptions. The measurement is largely based on projected cash flows, discount rates and market conditions at the date of acquisition.

10  |  Notes to the Consolidated Financial Statements

F-13

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 3 – CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS (continued)

(b) Key sources of estimation uncertainty (continued)

Taxation

Calculations for current and deferred taxes require management’s interpretation of tax regulations and legislation in the various tax jurisdictions in which the Company operates, which are subject to change. The measurement of deferred tax assets and liabilities requires estimates of the timing of the reversal of temporary differences identified and management’s assessment of the Company’s ability to utilize the underlying future tax deductions against future taxable income before they expire, which involves estimating future taxable income.

The Company is subject to assessments by various taxation authorities in the tax jurisdictions in which it operates, and these taxation authorities may interpret the tax legislation and regulations differently. In addition, the calculation of income taxes involves many complex factors. As such, income taxes are subject to measurement uncertainty and actual amounts of taxes may vary from the estimates made by management.

NOTE 4 – SEGMENT REPORTING

The Company operates in one operating segment. For the purpose of segment reporting, the Company’s Chief Executive Officer (“CEO”) is the Chief Operating Decision Maker. The determination of the Company’s operating segment is based on its organization structure and how the information is reported to the CEO on a regular basis.

The Company’s revenue by location of the ultimate customer or consumer of product solution are as follows:

	Year ended December 31,
	2021		2020		2019
Canada	$	10,733,922	$	13,832,691	$	10,889,542
United States		6,564,271		5,691,202		7,450,707
Japan		5,849,967		6,446,939		–
Australia		993,933		152,301		–
Other		1,454,879		805,306		–
Total revenue	$	25,596,972	$	26,928,439	$	18,340,249

The table below presents significant customers who accounted for greater than 10% of total revenues.

For the years ended December 31,	2021	2020	2019
Customer A	Less than 10%	14  %	n/a
Customer B	Less than 10%	13  %	11  %
Customer C	11  %	Less than 10%	20  %
Customer D	11  %	Less than 10%	n/a

The Company’s non-current assets by country are as follows:

	December 31, 2021		December 31, 2020
Canada	$	30,812,581	$	37,966,772
Australia		10,372,410		11,731,960
United States		9,014,016		12,424,844
Total non-current assets	$	50,199,007	$	62,123,576

11  |  Notes to the Consolidated Financial Statements

F-14

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 5 - REVENUE

The Company’s operations and main revenue streams are those described in Note 32(C). All of the Company’s revenue is derived from contracts with customers. In the following tables, revenue is disaggregated by major service line and timing of revenue recognition.

	Year ended December 31,
	2021		2020		2019
AssetCare Initialization 1	$	1,250,181	$	7,689,232	$	5,964,663
AssetCare Solutions 2		23,461,748		12,809,054		2,939,582
Engineering Services 3		885,043		6,430,153		9,436,004
	$	25,596,972	$	26,928,439	$	18,340,249

1  Revenues from initial implementation and activation of AssetCare projects, including the sale of hardware.

2  Revenues include sales of subscriptions to AssetCare, other subscriptions, post contract support and maintenance, perpetual software licenses, and installation and engineering services.

3  Revenues includes consulting, implementation and integration services entered into on a time and materials basis or fixed fee basis without the use of AssetCare.

	Year ended December 31,
Timing of revenue recognition	2021		2020		2019
Over time	$	24,422,749	$	18,551,736	$	12,375,586
At a point in time upon completion		1,174,223		8,376,703		5,964,663
	$	25,596,972	$	26,928,439	$	18,340,249

Significant changes in unbilled revenue and deferred revenue balances are as follows:

	Unbilled revenue			Deferred revenue
Balance at January 1, 2019	$	—		$	133,678
Acquired in business combination (Note 17(c))		2,347,207			133,556
Acquired in business combination (Note 17(b))		—			457,259
Additions		9,595,535			5,309,436
Less: transferred to trade and other receivables		(11,278,312	)		—
Less: recognized in revenue		—			(4,878,419	)
Less: Loss allowance		(5,499	)		—
Effect of movement in exchange rates		—			(17,229	)
Balance at December 31, 2019	$	658,931		$	1,138,281
Acquired in business combination		117,686			–
Additions		11,478,436			6,316,586
Less: transferred to trade and other receivables		(11,557,665	)		–
Less: write-offs		(146,489	)		–
Less: recognized in revenue		–			(5,612,896	)
Less: applied to outstanding trade receivables		–			(30,586	)
Effect of movement in exchange rates		3,841			(40,265	)
Balance at December 31, 2020	$	554,740		$	1,771,120
Additions		7,470,881			10,616,893
Less: transferred to trade and other receivables		(7,269,579	)		–
Less: recognized in revenue		–			(9,585,211	)
Effect of movement in exchange rates		–			8,606
Balance at December 31, 2021 1	$	756,042		$	2,811,408

1  Unbilled revenue is included in trade and other receivables (Note 6) and relates to the Company’s right to consideration for work completed but not billed at the reporting date. Unbilled revenue is transferred to trade and other receivables when services are billed to customers.

12  |  Notes to the Consolidated Financial Statements

F-15

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 6 - TRADE AND OTHER RECEIVABLES AND LONG-TERM RECEIVABLES

	December 31, 2021			December 31, 2020
Trade receivables from contracts with customers	$	14,204,320		$	10,182,229
Unbilled revenue (Note 5)		756,042			554,740
Indirect taxes receivable		148,200			341,583
Income taxes receivable		2,217			594,036
Other receivables		919,954			961,714
Contract asset 1		86,777			153,178
Loss allowance (Note 26(b))		(1,550,535	)		(474,666	)
Total trade and other receivables - current	$	14,566,975		$	12,312,814

1  At December 31, 2021, the total contract assets were $90,200 with the non-current portion of $3,423 included in other assets (December 31, 2020 - $314,894 total and $161,716 non-current). No new contract assets were recognized and amortization to cost of sales over the life of the contract assets continues to occur until June 30, 2023.

Long-term receivables

Long-term receivables represent receivables associated with revenue contracts whereby certain customers make fixed monthly installment payments over a period of time, ranging from one to three years, for performance obligations delivered upfront. For contracts where all performance obligations were completed except for monthly post contract and support maintenance, amounts due are included in trade receivables from contracts with customers.

	December 31, 2021		December 31, 2020
Current portion of long-term receivables 1	$	397,060	$	445,213
Non-current portion of long-term receivables 2		343,371		2,091,059
Total long-term receivables	$	740,431	$	2,536,272

1  Net of expected credit loss allowance of $95,064 at December 31, 2021 and $131,364 at December 31, 2020 (Note 26(b)).

2  Net of expected credit loss allowance of $61,619 at December 31, 2021 and nil at December 31, 2020 (Note 26(b)).

NOTE 7 - PREPAID EXPENSES AND OTHER ASSETS

	December 31, 2021		December 31, 2020
Prepaid insurance	$	348,063	$	122,893
Advances		121,806		38,593
Deposits		862,338		189,734
Prepaid licenses		938,887		1,075,797
Prepaid services		505,448		292,552
Other prepaid costs		197,962		325,481
Other assets		3,423		293,116
Prepaid expenses and other assets	$	2,977,927	$	2,338,166
Current portion	$	2,355,350	$	1,326,319
Non-current portion		622,577		1,011,847
	$	2,977,927	$	2,338,166

13  |  Notes to the Consolidated Financial Statements

F-16

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 8 - LEASES

The Company leases buildings for its office space, vehicles and other office equipment. The length of a lease depends on the location of the office, with leases generally ranging from three to five years with an option to renew the lease after that date. The majority of office leases require the payment of variable rent for operating costs and taxes which are not based on an index or rate and are recognized as rent expense. Lease payments for short-term leases and low-value assets are recognized as rent expense on a straight-line basis over the lease term. The maturity analysis of the undiscounted cash flows for lease liabilities is included in Note 26(a).

a) Right-of-use assets

The following table presents the change in carrying amount of the Company’s right-of-use assets:

	Office			Equipment and Vehicles			Total
Balance at January 1, 2019	$	285,086		$	–		$	285,086
Acquired right-of-use assets (Note 17)		4,207,837			95,378			4,303,215
Additions to right-of-use assets		–			183,617			183,617
Depreciation charge for the year		(433,617	)		(48,360	)		(481,977	)
Impairment charge for the year		(78,764	)		–			(78,764	)
Effect of movement in exchange rates		(4,369	)		–			(4,369	)
Balance at January 1, 2020	$	3,976,173		$	230,635		$	4,206,808
Acquired right-of-use assets (Note 17)		509,290			–			509,290
Additions to right-of-use assets		84,413			6,158			90,571
Depreciation charge for the year		(780,767	)		(145,661	)		(926,429	)
Impact of lease modification		(221,590	)		–			(221,590	)
Effect of movement in exchange rates		2,648			(582	)		2,067
Balance at December 31, 2020	$	3,570,167		$	90,550		$	3,660,717
Depreciation charge for the year		(748,058	)		(80,198	)		(828,256	)
Impact of lease modification		(1,924,504	)		–			(1,924,504	)
Effect of movement in exchange rates		8,122			(51	)		8,071
Balance at December 31, 2021	$	905,727		$	10,301		$	916,028

b) Amounts recognized in consolidated statements of loss and comprehensive loss

	Year ended December 31,
	2021		2020		2019
Accretion of lease liabilities included in finance costs	$	137,272	$	350,792	$	168,571
Depreciation of right-of-use assets 1		828,256		926,429		481,977
Expense related to variable lease payments 2		825,212		824,062		–
Expense related to short-term leases 2		4,550		–		–
	$	1,795,290	$	2,101,283	$	650,548

1  Included in depreciation and amortization expense.

 2 Included in rent expense within general and administrative expense.

14  |  Notes to the Consolidated Financial Statements

F-17

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 8 - LEASES (continued)

c) Amounts recognized in consolidated statements of cash flows

	Year ended December 31,
	2021		2020		2019
Total cash outflows included in operating activities	$	137,272	$	350,792	$	168,571
Total cash outflows included in financing activities	$	1,095,327	$	814,072	$	422,783

NOTE 9 - PROPERTY AND EQUIPMENT

	Office Furniture and Equipment			Leasehold Improvements			Computer Equipment			Total
Cost:
At January 1, 2019	$	10,117		$	239,555		$	52,966		$	302,638
Additions		30,529			74,641			32,952			138,122
Acquisitions		253,057			64,366			232,175			549,598
Impairment		–			–			(14,460	)		(14,460	)
Effect of movement in exchange rates		(1,339	)		(1,973	)		(6,990	)		(10,302	)
At December 31, 2019	$	292,364		$	376,589		$	296,643		$	965,596
Additions		30,543			–			97,145			127,688
Effect of movement in exchange rates		(917	)		(1,351	)		(6,964	)		(9,232	)
Balance at December 31, 2020	$	321,990		$	375,238		$	386,824		$	1,084,052
Additions		–			–			626,841			626,841
Disposals		(29,459	)		(43,409	)		(124,544	)		(197,412	)
Effect of movement in exchange rates		(504	)		(744	)		(4,588	)		(5,836	)
Balance at December 31, 2021	$	292,027		$	331,085		$	884,533		$	1,507,645
Accumulated depreciation:
At January 1, 2019	$	410		$	13,433		$	13,318		$	27,161
Depreciation		44,729			71,143			123,272			239,144
Effect of movement in exchange rates		(1,321	)		(1,577	)		(8,363	)		(11,261	)
At December 31, 2019	$	43,818		$	82,999		$	128,227		$	255,044
Depreciation		78,289			77,906			175,027			331,222
Effect of movement in exchange rates		(923	)		(1,436	)		(6,242	)		(8,601	)
Balance at December 31, 2020	$	121,184		$	159,469		$	297,012		$	577,665
Depreciation		75,117			73,864			336,765			485,746
Disposals		(29,458	)		(43,409	)		(123,240	)		(196,107	)
Other movements		6,746			–			(6,746	)		–
Effect of movement in exchange rates		(505	)		(744	)		(7,813	)		(9,062	)
Balance at December 31, 2021	$	173,084		$	189,180		$	495,978		$	858,242
Carrying amounts:
Balance at December 31, 2020	$	200,806		$	215,769		$	89,812		$	506,387
Balance at December 31, 2021	$	118,943		$	141,905		$	388,555		$	649,403

15  |  Notes to the Consolidated Financial Statements

F-18

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 10 - INTANGIBLE ASSETS AND GOODWILL

a) Intangible assets

	Patents and trademarks			Customer relationships			Technology			Total
Cost:
At January 1, 2019	$	192,032		$	2,118,739		$	1,590,958		$	3,901,729
Additions		–			–			–			–
Acquisitions		–			14,168,830			10,212,390			24,381,220
Effect of movements in exchange rates		(9,374	)		(46,579	)		(47,366	)		(103,319	)
Balance at December 31, 2019	$	182,658		$	16,240,990		$	11,755,982		$	28,179,630
Additions		–			–			2,333,666			2,333,666
Acquisitions		–			3,434,334			3,846,189			7,280,523
Effect of movements in exchange rates		(2,957	)		(38,494	)		(32,016	)		(73,467	)
Balance at December 31, 2020	$	179,701		$	19,636,830		$	17,903,821		$	37,720,352
Additions		–			–			440,965			440,965
Effect of movement in exchange rates		(343	)		(3,217	)		1,556			(2,004	)
Balance at December 31, 2021	$	179,358		$	19,633,613		$	18,346,342		$	38,159,313
Accumulated amortization and impairments:
At January 1, 2019	$	51,238		$	333,430		$	349,188		$	733,856
Amortization 1		36,564			1,668,090			1,618,368			3,323,022
Impairment		–			–			507,433			507,433
Effect of movements in exchange rates		(3,219	)		(23,895	)		(28,656	)		(55,770	)
Balance at December 31, 2019	$	84,583		$	1,977,625		$	2,446,333		$	4,508,541
Amortization 1		35,243			2,696,767			2,753,602			5,485,612
Effect of movements in exchange rates		(3,078	)		(19,774	)		(17,788	)		(40,640	)
Balance at December 31, 2020	$	116,748		$	4,654,618		$	5,182,147		$	9,953,513
Amortization 1		32,073			3,099,234			4,479,503			7,610,810
Effect of movement in exchange rates		85			3,820			5,252			9,157
Balance at December 31, 2021	$	148,906		$	7,757,672		$	9,666,902		$	17,573,480
Carrying amounts:
Balance at December 31, 2020	$	62,953		$	14,982,212		$	12,721,674		$	27,766,839
Balance at December 31, 2021	$	30,452		$	11,875,941		$	8,679,440		$	20,585,833

1  Amortization charges are included in depreciation and amortization in the consolidated statements of loss and comprehensive loss.

b) Goodwill

Goodwill is tested for impairment on an annual basis at December 31, and when there are indicators the carrying amount may be impaired. In reviewing indicators of impairment, the Company considers the relationship between its market capitalization and its book value, among other qualitative and quantitative factors. At December 31, 2021, the Company had two CGUs, mCloud Technologies Corp. and Agnity (December 31, 2020 - two CGUs). Goodwill is all allocated to mCloud Technologies Corp. as this CGU benefits from prior business combinations. Furthermore, the Company has no ownership of the Agnity CGU but instead 100% non-controlling interest and this CGU does not include goodwill. The carrying amount of goodwill is as follows:

16  |  Notes to the Consolidated Financial Statements

F-19

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 10 - INTANGIBLE ASSETS AND GOODWILL - (continued)

	December 31, 2021		December 31, 2020
Opening balance	$	27,086,727	$	18,758,975
Acquisitions, business combinations (Note 18)		–		8,405,341
Effect of movements in exchange rates		(4,932)		(77,589)
Total goodwill	$	27,081,795	$	27,086,727

The recoverable amount of the mCloud CGU was determined using fair value less costs of disposal (“FVLCD”) with reference to the market capitalization of the Company. The impairment test of goodwill at December 31, 2021, concluded that the recoverable amount exceeded the carrying amount of the CGU, including goodwill, and as such no goodwill impairment existed. At December 31, 2021, the enterprise value implied by market capitalization of the Company was $146,500,000 compared to a net asset carrying value of $36,160,000.

NOTE 11 - TRADE PAYABLES AND ACCRUED LIABILITIES

	December 31, 2021		December 31, 2020
Trade payables	$	5,591,316	$	5,903,789
Accrued liabilities		5,398,389		4,795,742
Interest payable		233,854		425,054
Mastercard facility (Note 13)		296,669		600,590
Due to related parties (Note 28)		265,074		846,228
Income taxes payable		266,753		21,752
Indirect taxes payable		150,577		242,703
Other		218,677		88,398
Total trade payables and accrued liabilities	$	12,421,309	$	12,924,256

NOTE 12 - LOANS AND BORROWINGS

The carrying value of loans and borrowings by entities controlled by the Company are as follows:

	December 31, 2021		December 31, 2020
Term loan	$	9,275,683	$	10,928,055
Nations Interbanc facility		2,639,143		1,137,360
Debenture payable to Industry Canada		26,412		76,227
Loan payable to related party 1		335,860		318,428
Oracle financing 2		826,418		427,250
Other loans and financing		112,085		264,980
Total 3	$	13,215,601	$	13,152,300
Current		12,447,939		3,431,251
Non-current		767,662		9,721,049
	$	13,215,601	$	13,152,300

1  Loan assumed as part of CSA Acquisition (Note 17(d)) which bears interest at 6% and matures in January 2023. Interest is payable annually and accrued interest is included in trade payables and accrued liabilities.

2  Financing arrangements provided by Oracle Credit Corporation (“Oracle”) bearing interest between 6.2% and 6.6%. Interest is due in quarterly installments with loans maturing in May 2023 and February 2024. During the year ended December 31, 2021, proceeds from additional funding received was $577,378 (December 31, 2020 - $495,944)

3  Note 30(b) includes the reconciliation of movements of liabilities to cash flows arising from financing activities.

17  |  Notes to the Consolidated Financial Statements

F-20

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 12 - LOANS AND BORROWINGS (continued)

Term loan

In 2019, a subsidiary of the Company, mCloud Technology Services Inc. (“MTS”), entered into a term loan facility with Fiera Private Debt Fund VI LP (“Fiera”, formerly Integrated Private Debt Fund VI LP) in the amount of $13,000,000. The term loan payments are blended payments of principal and interest until maturity in August 2026 and the loan is secured against the assets of MTS. The Company and certain subsidiaries are guarantors.

On November 9, 2021, the Company amended its term loan and amended the associated intercreditor agreement between Fiera, ATB Financial (“ATB”) and the Company. The intercreditor agreement determines the priority of security interests in the case of default, with Fiera having first priority on all assets other than accounts receivable (Note 13). The amendments to the term loan include: increase in interest rate from 6.85% to 7.5% per annum; certain changes to financial covenants which are applicable for the period from July 1, 2021 to December 31, 2022; and, the addition of two mCloud subsidiaries as additional guarantors. See Note 31 (a) and (b) for subsequent changes to Fiera loan. 

The principal amount of the loan and the maturity date of August 7, 2026 remained the same. During the year ended December 31, 2021 there were $2,343,036 of principal and interest payments made. A modification loss associated with this change in terms of $138,908 is included in finance costs in the consolidated statement of loss for the year ended December 31, 2021 with an offsetting increase in the carrying value of the term loan. Transaction costs of $191,310 were incurred and are netted against the carrying value of the term loan.

Breach of loan covenants

The term loan contains covenants with quarterly and quarter end metrics. For the quarter ended December 31, 2021, the Company did not meet certain minimum covenants and therefore the term loan is due on demand and has been classified as current until such time as the covenants are in compliance. For the quarter ended March 31, 2022, the Company continued not to meet certain minimum covenants and did not receive a waiver from the lender. See Note 31 (b) for subsequent change to Fiera loan covenants.

Nations Interbanc facility

Under a factoring and security agreement with Nations Interbanc (“Nations”), Agnity, an entity controlled by the Company, receives advances up to a maximum of US$2,000,000 at any one time from Nations for providing them the right to collect cash flows from factored accounts receivable and charges a fee for this service. This is a financing agreement and the accounts receivables factored still carry credit risk, are not sold, and are not derecognized from Agnity’s statement of financial position. Nations advances funds up to a value of 85% of the accounts receivables factored. Nations charges a factoring fee of 1.5% of the gross face invoice amount for the first 30 days and a daily proration of 0.06% per day thereafter. The amount of funds advanced varies and is dependent on the cash requirements of Agnity. During the year ended December 31, 2021, Nations advanced $9,246,693 and Agnity repaid $7,954,698 of this balance.

NOTE 13 – BANK INDEBTEDNESS

	December 31, 2021		December 31, 2020
ATB Financial revolving operating facility	$	3,460,109	$	–
Operating loan facility 1		–		923,461
Bank overdraft 1		–		53,318
Total	$	3,460,109	$	976,779

1  At December 31, 2020, the Company had access to an operating loan facility and Mastercard facility. On April 15, 2021, the operating loan facility was repaid and closed. The Mastercard facility remains in place and at December 31, 2021, $296,669 was drawn (December 31, 2020 - $600,590) and this amount is included in trade payables and accrued liabilities on the consolidated statements of financial position. The bank overdraft at December 31, 2020 was repaid in October 2021.

18  |  Notes to the Consolidated Financial Statements

F-21

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 13 – BANK INDEBTEDNESS (continued)

ATB Financial Facility

On May 17, 2021, one of the Company’s subsidiaries executed a commitment letter for a $5,000,000 secured revolving operating facility with ATB which is a financial institution wholly owned by the Province of Alberta. The facility is available by way of a variety of instruments. On June 24, 2021, $2,500,000 was drawn which was the maximum amount under the intercreditor agreement with Fiera at that time. The facility is due on demand, bears interest at the prime rate plus 2% per annum with interest and fees due at the end of each month and may be prepaid without penalty.

On November 8, 2021, the Company and ATB amended the commitment letter between the parties governing the revolving operating facility. The amendment added an accordion feature which allows the Company to request ATB to increase the maximum principal amount of the facility from $5,000,000 to $10,000,000, funded in increments of $1,250,000, subject to certain requirements and approval from Fiera and ATB under an intercreditor agreement.

The facility is subject to certain reporting and financial covenants. The Company was in compliance with these covenants at December 31, 2021, but not at March 31, 2022 and June 30, 2022. The facility is secured against certain assets of the Company and its principal subsidiaries. In addition, the Company and certain of its subsidiaries have provided an unlimited guarantee for repayment of all amounts due under the facility. As part of the commitment letter amendment, the Company agreed to issue warrants to ATB (Note 15).

On November 9, 2021, Fiera, ATB and the Company amended the intercreditor agreement which allows the Company to draw the full $5,000,000 of the facility subject to a limit which is equal to the lesser of $5,000,000 and the aggregate of eligible accounts receivable less priority payables as defined in the agreement. An additional $950,000 was drawn under the facility on November 12, 2021. At December 31, 2021, as a result of the Fiera covenant breach and at March 31, 2022 and June 30, 2022 as a result of non-compliance with covenants on the ATB Financial revolving operating facility, ATB has the ability to restrict further advances under the ATB facility. 

NOTE 14 – CONVERTIBLE DEBENTURES

	December 31, 2021		December 31, 2020
2019 Convertible debentures liability (a)	$	22,185,170	$	19,534,988
2021 Convertible debentures liability (b)		69,034		–
2021 Convertible debentures embedded derivative (b)		41,506		–
Total	$	22,295,710	$	19,534,988

Current debentures	$	22,185,170	$	–
Non-current debentures		110,540		19,534,988
	$	22,295,710	$	19,534,988

a) 2019 Convertible debentures

	December 31, 2021		December 31, 2020
Opening balance	$	19,767,472	$	17,753,016
Conversion of debentures into common shares		–		(50,000)
Interest paid		(2,345,750)		(2,345,750)
Accreted interest at effective interest rate		4,958,927		4,410,206
Carrying amount of liability component	$	22,380,649	$	19,767,472
Less: interest payable		(195,479)		(232,484)
Total	$	22,185,170	$	19,534,988

19  |  Notes to the Consolidated Financial Statements

F-22

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 14 – CONVERTIBLE DEBENTURES (continued)

a) 2019 Convertible debentures (continued)

In July 2019, the Company completed a private placement offering of convertible unsecured subordinated debentures (the “2019 Debentures”) for total aggregate gross proceeds of $23,507,500 and net cash proceeds of $22,865,049. The 2019 Debentures bear interest at a rate of 10% per annum, paid quarterly, and mature on May 31, 2022, at which time the outstanding principal amount of $23,457,500 and any unpaid interest is repayable in cash if the 2019 Debentures have not been converted at the option of the holder or otherwise extinguished.

The principal amount of the 2019 Debentures is convertible into 1,563,833 units of the Company at the option of the holder at any time prior to maturity at a conversion price of $15.00 per unit. At June 30, 2022, no units had been converted. Each unit is comprised of one common share and one share purchase warrant. Each warrant is exercisable to acquire one common share at an exercise price of $22.50 until June 2024.

b) 2021 Convertible debentures

Issuance of Convertible Debentures

On December 7, 2020, the Company commenced efforts to raise an aggregate of US$10,000,000 through a private placement offering (the “Offering”) of convertible unsecured subordinated debentures (the “2021 Debentures”) at a price of US$100 per debenture. At December 31, 2020, total proceeds of $5,285,997 (US$4,146,825) had been received associated with two tranches of the Offering; however, as the debenture certificates were not yet issued the proceeds were recorded as other liabilities in the consolidated statement of financial position at December 31, 2020 (Note 16).

The Offering closed in six tranches between December 7, 2020 and May 25, 2021 with total gross proceeds of $11,328,870 (US$8,884,000). Each tranche had a specific maturity date and USD conversion price which was set at the date of close. The conversion prices ranged between $4.11 (US$3.42) and $8.28 (US$6.60) depending on the tranche.

Up until the date of conversion as described below under Conversion of Convertible Debentures, the maturity date of the 2021 Debentures was 36 months following the closing date of the applicable tranche. The principal amounts of the 2021 Debentures were convertible into common shares at the option of the holder at any time prior to maturity at the calculated conversion price stated in the debenture. The 2021 Debentures bore interest at 8% per annum, payable, at the option of the Company, in cash or common shares of the Company calculated in accordance with the debenture agreement which considered such factors as the price of the common stock on the TSX.V converted into USD at the date of record. The Company elected to pay all accrued interest in common shares which were issued on the conversion date.

On initial recognition, the 2021 Debentures included a host liability and embedded derivative conversion option. The fair value of the embedded derivative was determined first, with the residual amount of the total fair value of the convertible debentures allocated to the host liability. The host liability was classified as a financial liability recognized at amortized cost and the embedded derivative conversion option was an embedded derivative classified as fair value through profit or loss (“FVTPL”). The fair value measurement is further described in Note 26(b) - Financial Instruments under Valuation methodologies used in the measurement of fair value for Level 3 financial liabilities.

Conversion of Convertible Debentures

On July 12, 2021, the Company announced that it had entered into Debt Conversion and Exchange Agreements (“Conversion Agreements”) with holders of more than 99.2% of the outstanding principal amount of the 2021 Debentures subject to a number of conditions including TSX.V approval. The Conversion Agreements provided for certain changes in terms including a reduced conversion price on certain tranches of the 2021 Debentures and the addition of a common share purchase warrant for each common share to be issued upon conversion.

On August 13, 2021, the Company received TSX.V approval and issued an aggregate of 2,107,787 common shares and 2,107,787 common share purchase warrants (Note 19(a)) to extinguish 99.2% of the principal and accrued interest thereon to the date of the Conversion Agreements.

The following reconciliation includes: (a) the original issuance of and accounting for the convertible debentures up to July 12, 2021; (b) the derecognition of the host liability and embedded derivative on July 12, 2021 as the change in terms of the agreement was determined to be a substantial modification and resulted in recognition of a new financial liability at this date; (c) the extinguishment of the amount due under the 2021 Debentures on August 13, 2021 in exchange for common shares and warrants; and (d) the accounting for the remaining debenture which was not converted. The warrants issued continue to be financial liabilities of the Company as further described in Note 15.

20  |  Notes to the Consolidated Financial Statements

F-23

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 14 – CONVERTIBLE DEBENTURES (continued)

b) 2021 Convertible debentures (continued)

	December 31, 2021
Proceeds from issue of convertible debentures	$	11,328,870
Fair value adjustments (Note 23)		1,615,102
Total fair value of convertible debentures		12,943,972
Less: fair value of embedded derivative		(5,060,776	)
Less: transaction costs 1		(660,604	)
Carrying value of liability at inception		7,222,592
Interest expense associated with liability		813,615
Debt extinguishment, including interest payable		(7,735,230	)
Foreign exchange adjustments		(224,286	)
		76,691
Less: accrued interest included in accrued liabilities		(7,657	)
Carrying value of liability at end of period 2	$	69,034

1  Total transaction costs were $1,061,854 which include cash compensation paid to brokers and the value of 115,760 broker warrants issued. Transaction costs of $401,250 allocated to the embedded derivative portion of the convertible debentures were expensed in finance costs in the consolidated statements of loss and comprehensive loss for the year ended December 31, 2021.

2  Convertible debt in the principal amount of US$75,000 which matures January 2024, bears interest at 8% per annum and is convertible to the Company’s shares at a conversion price of $5.84 (US$4.59).

	December 31, 2021
Fair value of embedded derivative at inception	$	5,060,776
Fair value decrease 1		(784,261	)
Derecognition of embedded derivative on conversion		(4,214,198	)
Foreign exchange adjustments		(20,811	)
Balance, embedded derivative	$	41,506

1 The fair value of the embedded derivative is remeasured at the end of each reporting period and on conversion and recognized in fair value (gain) loss on derivatives in the consolidated statements of loss and comprehensive loss (Note 23).

NOTE 15 - WARRANT LIABILITIES

	December 31, 2021		December 31, 2020
Derivative warrant liabilities - 2021 Debentures (a)	$	1,868,541	$	–
Derivative warrant liabilities - USD equity financing (b)		6,106,596		–
Warrant liability related to business acquisition (c)		709,835		710,924
Other warrant liability (c)		195,066		–
Total, all current	$	8,880,038	$	710,924

21  |  Notes to the Consolidated Financial Statements

F-24

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 15 - WARRANT LIABILITIES (continued)

Derivative warrant liabilities

The Company issued warrants in conjunction with debt and equity transactions. Certain of these warrants are classified as derivatives which are recognized as financial liabilities. The estimated fair value of the derivative warrant liabilities has been calculated using the Black-Scholes model. At the issuance date and each reporting date until warrants are exercised, the fair value of the liability is remeasured, with changes in the fair value recorded as gains or losses in the consolidated statements of loss and comprehensive loss.

In conjunction with the USD equity offering described at (b) below, the Company agreed to list the warrants issued as part of the unit offering on the NASDAQ. On February 15, 2022, these warrants commenced trading under the symbol MCLDW (Note 31).

Derivative warrant liabilities are classified as a Level 3 fair value measurement as further described in Note 26. There were no exercises of the warrants described below since issuance.

a) Warrants associated with 2021 Debentures

On August 13, 2021, the Company issued 2,107,787 common share purchase warrants in conjunction with the conversion and extinguishment of the 2021 Debentures (Note 14(b); 19(b)). The common share purchase warrants entitle the holder to purchase one common share of the Company at an exercise price of US$6.87 and mature in August 2024. The fair value of the warrants at August 13, 2021 was $5,947,689.

At December 31, 2021, the warrants were remeasured at a fair value of $1,868,541 and the Company recorded a gain on remeasurement since initial recognition of $4,177,825. The Black-Scholes model inputs and assumptions include:

	December 31, 2021		August 13, 2021
Share price at date of valuation	$	6.18	$	6.90
Exercise price	$	8.74	$	8.74
Risk free rate		0.88 %		0.43 %
Expected life (years)		2.62		3.00
Expected volatility 1		45.0 %		71.5 %
Fair value per warrant 2	$	0.89	$	2.82

1  Expected volatility at December 31, 2021 measured at implied volatility of traded warrants.

2  Considers a liquidity discount of 20% in determining the fair value per warrant as these warrants are not publicly traded.

b) Warrants associated with USD equity financing

On November 29, 2021, the Company issued 2,415,000 common share purchase warrants in conjunction with the November 2021 USD unit offering (Note 19). The common share purchase warrants entitle the holder to purchase one common share of the Company at an exercise price of US$4.75 and mature five years after issuance. The fair value of the warrants at issuance was $5,302,004 (US4,158,396) and at December 31, 2021, the remeasured fair value was $6,106,596. The Black-Scholes model inputs and assumptions include:

	December 31, 2021		November 29, 2021
Share price at date of valuation	$	6.18	$	5.70
Exercise price	$	6.04	$	6.05
Risk free rate		1.25 %		1.18 %
Expected life (years)		4.92		5.00
Expected volatility 1		45.0 %		45.0 %
Fair value per warrant	$	2.53	$	2.19

1  Expected volatility at represents implied volatility of the Company’s traded warrants.

22  |  Notes to the Consolidated Financial Statements

F-25

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 15 - WARRANT LIABILITIES (continued)

c) Other warrant liabilities

Warrant liability related to business acquisition - Associated with the acquisition of Agnity, the Company assumed a warrant liability whereby the holder of the warrant has the option to convert the warrant into shares of Agnity, not the Company, by April 15, 2022, or receive a cash payment of US$552,250 at any time before the expiry of the warrant. The liability is measured at the Canadian dollar equivalent to its cash redemption amount which varies as a function of movements in exchange rates. The warrant holder elected to receive cash repayment resulting in the C$ equivalent of the cash payment being reclassed to trade payables and accrued liabilities at June 30, 2022.

Warrant liability related to ATB Financial - At December 31, 2021, the Company had an obligation to issue warrants to ATB (Note 13). The fair value of the warrants was measured at the date the services were received in the amount of $195,066. On January 17, 2022, the Company issued 183,486 share purchase warrants to ATB to purchase an equivalent number of common shares of the Company at an exercise price of $5.45 per share, maturing one year from date of issuance (Note 31).

NOTE 16 - OTHER LIABILITIES

	December 31, 2021		December 31, 2020
US Government loans	$	–	$	950,418
2021 Debentures subscriptions payable (Note 14(b))		–		5,285,997
Total	$	–	$	6,236,415
Current portion 1	$	–		6,003,838
Non-current portion		–		232,577
	$	–	$	6,236,415

1  Includes US Government loans of $717,841 at December 31, 2020. These forgivable loans are considered to be government grants when there is reasonable assurance that they will be forgiven.

During the year ended December 31, 2021, the Company received two additional US Government loans as part of the Paycheck Protection Program (“PPP”) totaling $840,845 (US$668,689), each bearing interest at 1% per annum with maturity dates in February and May 2026. During the year ended December 31, 2020, the Company received four PPP US Government loans totaling $1,120,139 (US$805,246). A portion or the entirety of the amounts funded may be forgiven if all the funds are used for qualifying expenses which include payroll costs, rent and utility costs, and employment and compensation levels are maintained. The Company has used the entire loan amounts for qualifying expenses and as such expects these loans will be forgiven and no principal or interest payments will be made. During the year ended December 31, 2021, five government loans were forgiven resulting in $1,825,237 being included in other income (Note 24).

23  |  Notes to the Consolidated Financial Statements

F-26

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 17 - BUSINESS ACQUISITIONS

a) Acquisition of Royalty interests

On January 22, 2019, the Company executed a Purchase Agreement with Flow Capital Corp. (“Flow”) pursuant to which the Company acquired Flow’s interest in a Royalty Purchase Agreement (“Royalty Agreement”) with Agnity Global, Inc. (“Agnity”). According to the Purchase Agreement, the Company assumed the Royalty agreement and acquired an interest in a financial asset with the following characteristics:

i. a receivable owing by Agnity to Flow of USD $2,834,750;

ii. a monthly royalty payment stream until October 31, 2020 equal to the greater of:

• A monthly amount of USD $41,667; or

• 4.25% of Agnity’s revenue for each calendar month; and

iii. commencing November 1, 2020, a monthly royalty payment stream equal to 4.25% of Agnity’s revenue for each calendar month in perpetuity.

The Royalty Agreement includes a formula by which the royalty percentage is proportionately adjusted for any subsequent further advances to or repayments from Agnity.

As consideration for acquiring the interest in the Royalty Agreement, the Company paid $204,604 (USD $153,227) in cash at the closing date and entered into the following agreements with Flow:

(i) A secured loan agreement for USD $2,000,000. The loan bears interest at 25% per annum and is due on demand. The Company had the option to repay 100% of the loan, at any time, by paying an amount equal to the principal of the loan and any unpaid interest. Upon prepayment of the loan, the Company, at the option of Flow (the “Flow’s option”), was obligated to pay either:

• Cash of USD $525,000; or

• Issue 50,000 common shares of the Company (“repayment shares”)

The fair value of the loan was initially determined to be $2,670,600 (USD $2,000,000) which is equivalent to its face value as it is due on demand. It is classified as other financial liabilities and subsequently measured at amortized cost. The fair value of Flow’s option to receive either USD $525,000 in cash or repayment shares upon prepayment of the loan by the Company was determined to be USD $606,495 on initial recognition. The option was accounted for as a compound instrument which includes a liability component of USD $525,000 and an equity conversion option of USD $81,495. The liability component was classified as other financial liabilities and subsequently measured at the amortized cost while the equity component was accounted for as an equity instrument in contribute surplus. The Company used the Black-Scholes option model to determine the fair value of the option using the following inputs at January 22, 2019:

Share price	$10.50
Risk free rate	1.90%
Expected life	0.5 years
Expected volatility	60.00%
Expected dividends	Nil

24  |  Notes to the Consolidated Financial Statements

F-27

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 17 - BUSINESS ACQUISITIONS (continued)

a) Acquisition of Royalty interests (continued)

On July 26, 2019, the Company settled the USD $2,000,000 loan and Flow’s option in cash of $2,703,148 and the issuance of 50,000 common shares. The value attributable to the option of USD $606,495 was reclassified from liabilities and contributed surplus to share capital (note 19a)).

(i) The Company also agreed to issue a quantity of its common shares based on the trading price of the Company. Specifically, for the period after January 22, 2019 and prior to January 22, 2025, if the five-day volume weighted average trading price of the Company’s common shares equals or exceeds:

• $30.00, 50,000 common shares will be issued;

• $60.00, 33,333 common shares will be issued;

• $90.00, 33,333 common shares will be issued.

The fair value of these shares issuable to Flow was determined to be $712,000 on initial recognition. They are accounted for as equity instruments and recorded in contributed surplus. The Company used Black-Scholes option model to determine the fair value of these shares using the following inputs at January 22, 2019:

Barrier share price	$30 - $90
Risk free rate	1.90%
Expected life	6 years
Expected volatility	80.00%
Expected dividends	Nil

As of December 31, 2021, 2020 and 2019, none of the share trading price thresholds noted above have been met.

b) Acquisition of Agnity

On April 22, 2019, the Company executed an amending agreement with Agnity to modify the terms of the Royalty Agreement acquired. Pursuant to the amending agreement, both parties agreed to establish an Operations Committee for which at all times the Company has the right to nominate a majority of the members. As consideration for the amendment, the Company agreed to fix the royalty payment at US$10,000 per month commencing March 2019 and to assume $43,050 of Agnity’s liabilities payable to a third party.

Pursuant to the amending agreement the Company determined that it had obtained control over Agnity and its subsidiaries pursuant to IFRS 10 Consolidated Financial Statements. The Company considered several factors in determining if and when it gained control over Agnity including, if it had the right and ability to direct the relevant activities of the entity, the ability to significantly affect its returns through the use of its rights, and whether it had exposure to variable returns.

Factors evaluated included, but were not limited to, delegation of power by Agnity’s Board for the Company to direct Agnity’s relevant activities through the formation and activities of the Operations Committee controlled by the Company. Determination of whether the Company has obtained control over Agnity involves judgement based on interpretation of the amending agreement with Agnity and identification and analysis of the relevant facts. In addition, judgement was required to determine if the acquisition represented a business combination or an asset purchase. The Company determined that Agnity and its related subsidiaries represented a business as the assets were an integrated set of activities with inputs, processes and outputs.

Accordingly, the acquisition of Agnity is accounted as a business combination effective on April 22, 2019 using the acquisition method in accordance with IFRS 3 Business Combinations. Given the Company owns nil voting interests in Agnity, the non-controlling interest is measured at the 100% of the acquired net identifiable assets of Agnity.

25  |  Notes to the Consolidated Financial Statements

F-28

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 17 - BUSINESS ACQUISITIONS (continued)

b) Acquisition of Agnity (continued)

Agnity develops and sells software applications and technology services that enable telecommunication service providers, network equipment manufacturers and enterprises to design, develop, and deploy communication-centric application solutions on a world-wide basis. Taking control of Agnity has enabled the Company to gain access to Agnity’s patented technology and its customer base. In addition, Agnity’s communication platform ensures that AssetCare™ deployments around the globe are assured of connectivity, supported by Agnity telecommunication solutions.

The following table summarizes the acquisition-date fair value of each major class of consideration transferred, the recognized amounts of the identifiable assets acquired, and liabilities assumed, and the resulting measurement of 100% NCI recorded by the Company at the date of acquisition:

Consideration transferred:		Final
Change in fair-value of interest in Royalty Agreement (i)	$	167,488
Assumption of Agnity’s liabilities		43,050
Total consideration transferred	$	210,538

(i) The fair value of interest in the Royalty Agreement at April 22, 2019 was estimated using the discounted cash flow model. The major inputs employed in the model include forecasted royalty payments and the discount rate of 16%.

Fair value of assets and liabilities recognized:		Final
Cash and cash equivalents	$	33,524
Trade and other receivables		1,387,723
Prepaid expenses and deposits		46,483
Long term receivable		–
Property and equipment		1,281
Intangible Asset – Technology		8,412,390
Intangible Asset – Customer Relationship		1,468,830
Accounts payable and accrued liabilities		(3,232,910	)
Deferred revenue		(457,259	)
Loans and borrowings		(5,556,587	)
Warrant liability (i)		(737,419	)
Due to related party		(930,608	)
Deferred income tax liability		(444,768	)
Net identifiable assets acquired (liabilities assumed)		(9,320	)
Allocation to non-controlling interest	$	219,858

(i) A warrant was issued by Agnity in 2015 which entitles the warrant holder to acquire 6,324,660 common shares of Agnity at the exercise price of $0.000036 per share at any time until April 15, 2022. The exercise price of the warrant is subject to certain anti-dilution adjustment provisions in the event of certain capital or business transactions. The warrant holder has the option to demand a cash settlement of the warrant for US$552,250 at any time prior to its expiry date if the warrant is not exercised. It is classified as other financial liabilities and measured at its redemption amount of US$552,250 or $737,419 in Canadian dollars on acquisition date, which is equivalent to its assessed acquisition date fair value. The fair value in Canadian dollar equivalent as at December 31, 2021 was $709,835 (December 31, 2020 - $710,924; December 31, 2019 - $725,086).

There have been no adjustments to the preliminary purchase price allocation recognized at December 31, 2019 in the period ended December 31, 2020.

26  |  Notes to the Consolidated Financial Statements

F-29

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 17 - BUSINESS ACQUISITIONS (continued)

b) Acquisition of Agnity (continued)

There are no acquisition costs associated with this transaction as the business combination with Agnity was effected by way of assessed control in accordance with IFRS 3 and 10.

c) Acquisition of mCloud Technologies Services Inc.

On July 10, 2019, the Company closed a series of merger and acquisition transactions resulting in the acquisition of 100% control of mCloud Technologies Services Inc. (“MTS”), formerly known as Autopro Automation Consultants Ltd. (“Autopro”). The acquisition was completed by way of an amalgamation between 2199027 Alberta Ltd., a subsidiary of the Company, and Fulcrum Automated Technologies Ltd. (“Fulcrum”), an entity established to facilitate the acquisition, with the amalgamated entity being a wholly owned subsidiary of the Company, named Autopro Automation Ltd. Immediately prior to the amalgamation, Fulcrum acquired MTS. The consideration transferred to the original shareholders of MTS included cash, issuance of promissory notes and 1,200,000 common shares of the Company.

MTS is a professional engineering and integration firm that specializes in design and implementation of industrial automation solutions, focusing on Canadian oil and gas companies. The acquisition has provided the Company with an increased share of the market through access to MTS’ customer base in the Canadian oil and gas industry, petrochemical, and process manufacturing markets.

The following table summarizes the acquisition-date fair value of each major class of consideration transferred, the recognized amounts of the identifiable assets acquired, and liabilities assumed, and the resulting value of goodwill:

Consideration transferred:		Final
Cash consideration	$	4,650,689
Fair value of demand promissory notes issued(1)		18,000,000
Fair value of common shares transferred(2)		13,320,000
Total consideration transferred	$	35,970,689

(1) Comprised of two promissory notes with fair-value of $6,000,000 and $12,000,000 which were fully repaid and settled on July 10 and August 8, 2019 respectively; there was no gain or loss on settlement.

(2) The fair value of shares transferred as consideration is based on the quoted share price on the date of acquisition

27  |  Notes to the Consolidated Financial Statements

F-30

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 17 - BUSINESS ACQUISITIONS (continued)

c) Acquisition of mCloud Technologies Services Inc. (continued)

Fair value of assets and liabilities recognized:		Final
Cash and cash equivalents	$	2,227,739
Trade and other receivables (includes Unbilled revenue of $2,347,207)		5,120,830
Prepaid expenses and deposits		611,104
Right-of-use assets		4,303,215
Property and equipment		548,317
Intangible asset – Customer relationships		12,700,000
Intangible asset – Technology		1,800,000
Accounts payable and accrued liabilities		(2,030,470)
Deferred revenue		(133,556	)
Lease liabilities		(4,303,215	)
Deferred income tax liability		(3,632,250	)
Fair value of net assets acquired		17,211,714
Goodwill	$	18,758,975
	$	35,970,689

There have been no adjustments to the preliminary purchase price allocation recognized at December 31, 2019 or in the periods ended December 31, 2020.

Goodwill arising from the acquisition is attributable mainly to the skills and technical talent of MTS’ work force and the synergies expected to be achieved from integrating MTS into the Company’s existing business. The talent and domain expertise of MTS’ workforce has enabled the Company to establish credibility in the oil and gas, petrochemical, and process manufacturing markets, and accelerate the development of artificial intelligence applications geared toward process industries. None of the goodwill recognized is expected to be deductible for tax purposes.

Transaction costs of $9,869,589 were incurred in connection with the acquisition including consulting fees of $750,000, legal and professional fees of $239,589 and fair value of $8,880,000 for 800,000 common shares issued to the original shareholders of Fulcrum for brokering and due diligence services and were recognized in the consolidated statement of loss and comprehensive loss.

28  |  Notes to the Consolidated Financial Statements

F-31

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 17 - BUSINESS ACQUISITIONS (continued)

d) Acquisition of Construction Systems Associates, Inc. USA

On January 24, 2020, the Company completed its acquisition of all the outstanding and issued common shares of Construction Systems Associates, Inc. USA (“CSA”). The acquisition was accounted for as a business combination using the acquisition method whereby the assets acquired, and the liabilities assumed were recorded at fair value. At acquisition date the fair values assigned to intangible assets, goodwill and the deferred tax liabilities were measured on a provisional basis and were revised by the Company as additional information was received.

On January 24, 2021, the measurement period for the acquisition ended and there were no further measurement period adjustments during the year ended December 31, 2021. The following table summarizes the final balances of each major class of consideration transferred, the recognized amounts of the identifiable assets acquired and liabilities assumed, and the resulting value of goodwill.

	Final
Consideration transferred:
Cash consideration	$	703,212
Fair value of common share consideration		2,304,073
Fair value of contingent consideration payable		879,066
Total consideration	$	3,886,351

Fair value of assets and liabilities recognized:
Cash	$	181,408
Trade and other receivables		262,846
Prepaid expenses and other deposits		13,863
Property and equipment		2,098
Right of use assets		242,894
Intangible - technology		551,880
Intangible - customer relationships		801,540
Accounts payable and accrued liabilities		(168,542	)
Short-term loan		(371,610	)
Lease liabilities		(242,894	)
Deferred tax liabilities		—
Fair value of net assets acquired	$	1,273,483
Goodwill	$	2,612,868

The fair value of common shares transferred as consideration is based on the quoted share price on the date of acquisition, which is at $18.18 per common share.

The fair value of the contingent consideration payable was based on an estimated weighted probability of certain revenue and EBITDA targets being met in the 2-year period following the acquisition date. At December 31, 2021, the Company assessed the fair value of the contingent consideration to be nil as these targets were not expected to be met and as such $838,932 was recognized in other income in the consolidated statements of loss and comprehensive loss for the year ended December 31, 2021 (Note 24).

The Company is required during the measurement period to retrospectively adjust the provisional amounts recognized at the acquisition date to reflect new information obtained about facts and circumstances that existed as of the acquisition date. The measurement period adjustments from acquisition date to the end of the measurement period are reflected above with the cumulative changes increasing goodwill. The impact on net income (loss) of recognizing these adjustments to the provisional amounts as if the accounting had been completed at the acquisition date are limited to a decrease in amortization of intangibles and related foreign currency translation differences.

29  |  Notes to the Consolidated Financial Statements

F-32

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 17 - BUSINESS ACQUISITIONS (continued)

e) Acquisition of kanepi

On October 8, 2020, the Company completed its acquisition of all the outstanding and issued common shares of kanepi. kanepi provides advanced visual analytics solutions designed to deliver an immediate and positive impact on the industrial operations of asset intensive industries. The acquisition was accounted for as a business combination using the acquisition method whereby the net assets acquired, and the liabilities assumed were recorded at fair value. At acquisition date the fair values assigned to intangible assets, goodwill and the deferred tax liabilities were measured on a provisional basis.

The Company is required during the measurement period to retrospectively adjust the provisional amounts recognized at the acquisition date to reflect new information obtained about facts and circumstances that existed as of the acquisition date. On October 8, 2021, the measurement period for the acquisition ended and the following table summarizes the acquisition-date fair value and the final balances of each major class of consideration transferred, the recognized amounts of the identifiable assets acquired and liabilities assumed, and the resulting value of goodwill. The preliminary balances were reported in the consolidated financial statements for the year ended December 31, 2020 and there were no measurement period adjustments.

	Final
Consideration transferred:
Cash consideration	$	4,657,512
Fair value of common share consideration		5,882,547
Fair value of contingent consideration payable		568,638
Total consideration	$	11,108,697

Fair value of assets and liabilities recognized:
Cash	$	556,880
Trade and other receivables		598,059
Other current assets		13,149
Property and equipment		1,224
Right of use assets		266,396
Intangible - technology		3,294,309
Intangible - customer relationships		2,632,794
Accounts payable and accrued liabilities		(643,385	)
Lease liabilities		(266,396	)
Deferred tax liabilities		(1,136,806	)
Fair value of net assets acquired	$	5,316,224
Goodwill	$	5,792,473

The fair value of the contingent consideration payable is based on an estimated weighted probability of certain revenue or customer acquisition targets being met in a two-year period from the acquisition date. At acquisition date and December 31, 2020, the fair value of the contingent consideration was determined to be $568,638 based on estimates of achievement of targets. The fair value of the contingent consideration is determined using a discounted cash flow model at a discount rate of 27%. At December 31, 2021, the Company assessed the likelihood of achievement of the targets and determined the fair value of the contingent consideration decreased by $171,092 and this amount was recognized in other income in the consolidated statements of loss and comprehensive loss for the year ended December 31, 2021 (Note 24).

30  |  Notes to the Consolidated Financial Statements

F-33

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 18 - BUSINESS ACQUISITION PAYABLE

	December 31, 2021			December 31, 2020
Opening balance	$	2,439,529		$	1,043,314
Contingent consideration changes related to CSA (Note 17)		(853,308	)		879,066
Contingent consideration changes related to kanepi (Note 17)		(171,092	)		568,638
Effect of foreign exchange differences		(16,157	)		(51,489	)
		1,398,972			2,439,529
Current portion		1,398,972			1,594,297
Non-current portion		—			845,232
	$	1,398,972		$	2,439,529

During the year ended December 31, 2021, the Company determined that the amount of the contingent consideration recognized at the date of acquisition of Construction Systems Associates, Inc. USA (“CSA”) would not be payable as the operational performance metrics were not expected to be achieved. In addition, the fair value of the contingent consideration recognized at the date of acquisition for kanepi Group Pty Ltd. and its subsidiaries (“kanepi”) was remeasured based on management’s estimate of the likelihood the performance metrics would be met by October 2022, resulting in a decrease in fair value and an offsetting amount recognized as other income.

At December 31, 2021, $383,368 of contingent consideration payable remains associated with the kanepi acquisition. The remaining balance of $1,015,604 relates to the acquisition consideration payable associated with the Field Diagnostic Services, Inc. (“FDSI”) acquisition completed in 2017.

NOTE 19 - SHARE CAPITAL

a) Common shares

The Company has an unlimited number of authorized voting shares with no par value. The following is a summary of shares issued during the year ended December 31, 2021. The Company issued 71,190 common shares on exercise of Restricted Share Units (“RSUs”) (Note 20(b)).

Brokered public offering

On April 15, 2021, the Company closed a public offering of 2,300,000 units of the Company at a price of $6.30 per unit for aggregate gross proceeds of $14,490,000. Each unit consists of one common share and one common share purchase warrant. Each warrant entitles the holder to purchase one common share at an exercise price of $8.55 for 36 months following closing subject to adjustment in certain events.

The public offering was brokered, and the underwriting agent received cash commissions of $1,014,300 or 7% of the gross proceeds under the offering. In addition, the Company also incurred $459,986 of share issuance costs in connection with the offering, for total net proceeds of $13,015,714. Net proceeds were allocated $12,395,918 to share capital with the residual of $619,796 allocated to warrants which is included in contributed surplus in the consolidated statement of changes in equity for the year ended December 31, 2021.

Non-brokered private placement offering

On August 13, 2021, the Company completed a non-brokered private placement, pursuant to a subscription agreement dated July 12, 2021, of 75,676 units of the Company at a unit price of $5.55 for gross proceeds of $420,000. Each unit consists of one common share and one share purchase warrant at an exercise price of $8.55 per common share with warrants expiring April 2024. Net proceeds of $420,000 were allocated fully to the common shares.

31  |  Notes to the Consolidated Financial Statements

F-34

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 19 - SHARE CAPITAL (continued)

Conversion of 2021 Convertible Debentures

On August 13, 2021, the Company extinguished 99.2% of the principal and accrued interest of the 2021 Debentures (Note 14(b)). The principal and interest payable balance of converted debentures was settled by issuing an aggregate of 2,107,787 common shares and 2,107,787 common share purchase warrants. The value of the common shares at August 13, 2021, net of transaction costs was $14,436,728. See Note 15 for description of warrants issued.

USD Brokered public offering

On November 29, 2021, the Company closed a public offering of 2,100,000 units of the Company at US$4.50 per unit for aggregate gross proceeds of $12,040,198 (US$9,450,000) and net proceeds of $10,912,251 after underwriting discounts and commissions payable. On December 3, 2021, an additional 315,000 units, representing the over-allotment option under the offering, were issued for aggregate gross proceeds of $1,820,070 (US$1,417,450) and net proceeds of $1,674,464. Each unit consists of one common share of the Company and one common share purchase warrant. Each warrant entitles the holder to purchase one common share, a warrant share, at an exercise price of US$4.75 per warrant share for five years following closing subject to adjustment in certain circumstances. The common shares and the share purchase warrants were issued separately.

Gross proceeds were allocated $5,302,004 to the warrants with the residual of $8,558,264 allocated to share capital. Transaction costs of $1,738,087 associated with the issuance of the units were allocated proportionately with the allocation of gross proceeds with $1,073,262 net against share capital and $664,825 allocated to finance costs (Note 22).

The Company also issued warrants to the underwriter of the offering to purchase 126,000 common shares at an exercise price of US$4.95 which are exercisable to May 22, 2025. The fair value of these warrants of $162,947 were recorded to contributed surplus and are considered transaction costs of which a portion is expensed in the consolidated statements of loss and comprehensive loss.

In addition to the transaction costs associated with the issuance of the units, the Company incurred additional expenses related to the registration process and listing of its common shares on the NASDAQ which are included in general and administrative costs in the consolidated statements of loss and comprehensive loss.

Common shares in escrow

At December 31, 2021, the Company has 681,024 (December 31, 2020 - 1,674,284; December 31, 2019 - 2,381,826) common shares subject to escrow conditions resulting from business combinations and asset acquisitions in prior years. There were no additional common shares subject to escrow conditions added during the year ended December 31, 2021. Escrow restrictions will be released on 458,599 shares in the year ending December 31, 2022, and the remaining 222,425 shares in the year ending December 31, 2023.

32  |  Notes to the Consolidated Financial Statements

F-35

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 19 - SHARE CAPITAL (continued)

Shares issued for debt settlement

During February and September 2019, the Company issued 1,964 and 5,000 common shares respectively for settlement of outstanding debt to vendors for services provided. The Company valued these common shares based on the trading price of the Company’s shares on the date of issuance.

b)  Warrants

The Company’s warrants outstanding at December 31, 2021, 2020 and 2019 are as follows and includes warrants classified as equity-settled and warrants classified as financial liabilities (Note 15):

	Number of Warrants	Weighted Average   Exercise Price   $
December 31, 2018	1,104,378	$                                        13.50
Issued	19,957	$                                        14.46
Exercised	(133,176)	$                                        12.96
Expired	(209,899)	13.50
December 31, 2019	781,260	$                                        13.80
Issued	2,433,081	13.72
Exercised	(1,228,935)	12.06
Expired	(53,880)	13.31
December 31, 2020	1,931,526	$                                        14.82
Issued	7,140,223	7.64
Expired	(589,820)	13.97
December 31, 2021	8,481,929	$                                          8.83

During the year ended December 31, 2021, the Company issued share purchase warrants in conjunction with the following transactions:

Equity classified warrants

• 115,760 warrants to brokers in connection with the issuance of the 2021 Debentures (Note 14(b)). Warrants issued to brokers are denominated in USD with exercise prices that range between $4.12 (US$3.42) and $8.28 (US$6.60) and are exercisable for 24 months with maturity dates ranging from December 2022 to May 2023.

The total fair value of warrants issued to brokers of $294,894 was calculated using the Black-Scholes model with the following weighted average inputs and assumptions: issue date share price of $6.39; exercise price of $5.85; risk-free rate of 0.26%; expected life of 1.88 years; expected volatility of 69%; and no expected dividends.

• 2,300,000 warrants in connection with the April 15, 2021 public offering (Note 19(a));

• 75,676 warrants in connection with the non-brokered private placement offering (Note 19(a)); and

• 126,000 warrants issued to the underwriter of the November 2021 USD public offering (Note 19(a)). The total fair value of warrants of $162,947 was calculated using the Black-Scholes model with the following inputs and assumptions: issue date share price of $5.70; exercise price of $6.31; risk-free rate of 1.04%; expected life of 3.48 years; expected volatility of 45%; and no expected dividends.

33  |  Notes to the Consolidated Financial Statements

F-36

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 19 - SHARE CAPITAL (continued)

Derivative liability warrants

• 2,107,787 warrants in connection with the August 13, 2021, conversion and interest settlement of the majority of the 2021 Debentures (Note 14(b)); and

• 2,415,000 warrants in connection with the November 2021 USD public offering (Note 19(a); Note 15).

Warrants outstanding at December 31, 2021 were as follows:

Expiry Date	Exercise Price $	Outstanding Warrants
June 2022	15.00	19,584
July 2022	14.25	525,114
December 2022	5.63	1,000
January 2023	5.72	37,400
January 2023	6.97	25,400
February 2023	7.80	8,000
March 2023	8.28	9,000
May 2023	4.12	34,960
April 2024	8.55	2,375,676
June 2024	22.50	3,333
August 2024	8.60	2,107,787
January 2025	16.20	611,027
May 2025	6.31	126,000
July 2025	14.25	182,648
November 2026	6.05	2,415,000
	$                                            8.83	8,481,929

The weighted average remaining contractual life of outstanding warrants was 3.09 years at December 31, 2021 (December 31, 2020 - 2.29 years; December 31, 2019 - 1.37 years). Exercise prices for warrants denominated in USD as presented above were converted to the C$ equivalent exercise prices on the date of the applicable transaction.

34  |  Notes to the Consolidated Financial Statements

F-37

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 20 – SHARE-BASED PAYMENT ARRANGEMENTS

The Company has an equity incentive plan (the “Plan”) which allows management to grant incentive stock options, non-statutory stock options, share appreciation rights, restricted share awards, restricted share unit awards, and other share awards to selected directors, employees, and consultants. A maximum of 10% of the issued and outstanding common shares of the Company may be reserved for issuance under the Plan.

The Company recorded share-based compensation as follows.

	Year Ended December 31,
	2021		2020		2019
Stock options (a)	$	908,293	$	677,452	$	820,613
Restricted share units (b)		959,622		776,783		647,748
Total	$	1,867,915	$	1,454,235	$	1,468,361

a) Stock Options

The board of directors or designated committee set the terms of the share-based payment arrangements under the Plan; however, the general terms of stock options are as follows. The options have a maximum term of 10 years and vest as to 33% on each anniversary date of the date of grant over three years. In limited cases, options vest immediately. For the majority of grants, the exercise price is equal to the closing price of the Company’s common shares on the grant date. On the date the option holder ceases to be employed, vested options are exercisable for a period of three months following that date, and unvested options are forfeited. Compensation is recognized on a graded vesting basis over the vesting period.

Movement in the number of stock options outstanding and their related weighted-average exercise prices were as follows:

	Number of Options			Weighted Average Exercise Price		Number of Options			Weighted Average Exercise Price		Number of Options			Weighted Average Exercise Price
	2021			2021		2020			2020		2019			2019
Opening balance		423,303		$	11.01		349,657		$	11.48		95,000		$	11.70
Granted		487,775			7.10		153,828			9.99		323,278			11.20
Exercised		–			–		(7,639	)		10.50		(50,838	)		10.62
Forfeited		(40,088	)		9.87		(32,777	)		11.52		(17,783	)		10.35
Expired		(4,201	)		11.03		(6,433	)		10.67		–			–
Cancelled		–			–		(33,333	)		10.50		–			–
Outstanding at December 31		866,789		$	8.81		423,303		$	11.01		349,657		$	11.48
Exercisable at December 31		275,473		$	11.10		161,244		$	11.70		17,014		$	12.87

35  |  Notes to the Consolidated Financial Statements

F-38

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 20 – SHARE-BASED PAYMENT ARRANGEMENTS (continued)

a) Stock Options (continued)

The following summarizes information about the Company’s stock options outstanding at December 31, 2021:

	Options Outstanding						Options exercisable
Range of prices	Number		Weighted average exercise price		Weighted average life (years)		Number		Weighted average exercise price
$5.67 - $8.70		506,502	$	6.88		9.0		25,389	$	6.56
$8.71 - $10.95		200,706	$	10.67		4.9		138,622	$	10.57
$10.96 - $12.59		104,303	$	11.78		6.1		71,461	$	11.78
$12.60 - $18.02		55,278	$	14.11		6.4		40,001	$	14.59
		866,789	$	8.81		7.5		275,473	$	11.10

At December 31, 2021, if all exercisable options were exercised total cash received would be $3,057,750 (December 31, 2020 - $1,886,555; December 31, 2019 - $1,206,687). Unrecognized share-based compensation expense related to unvested stock options granted was $1,824,812 at December 31, 2021 (December 31, 2020 - $710,934; December 31, 2019 - $1,061,013).

Measurement of fair values for equity-settled arrangements

The weighted average fair value of stock options granted during the year ended December 31, 2021 of $4.25 per option, or $2,061,007 (December 31, 2020 - $4.54 per option or $698,949; December 31, 2019 - $4.91 per option or $1,597,043) was calculated at the grant date using the Black-Scholes model with the following weighted average assumptions and inputs.

	2021	2020	2019
Grant date share price	$                                    7.00	$                                    8.93	$                                10.88
Exercise price	$                                    7.10	$                                    9.74	$                                11.13
Risk-free rate	1.32  %	0.36  %	1.57  %
Expected life, years	6.2 years	5.0 years	3.9 years
Expected volatility	75  %	66  %	54  %
Expected dividends	–  %	–  %	–  %
Forfeiture rate	7  %	–  %	10  %

Expected volatility is based on an evaluation of the historical volatility of the Company’s share prices since the Company commenced trading which is a reasonable approximation of the volatility over the expected term of the stock option. The expected term of the options has been based on historical experience and general option holder behavior. The forfeiture rate reflects the anticipated level of forfeitures of options in the future.

b) Restricted Share Units (“RSUs”)

RSUs are granted to directors, employees and consultants and each RSU entitles the holder to one common share at the end of the vesting period. RSUs have various terms ranging from immediate vesting to vesting on either the first, second or third anniversary of the grant date, or as to 33% on each anniversary date of the grant over three years. Compensation is recognized on a graded vesting basis over the vesting period. The Company issues common shares to the RSU holder equal to the number of vested RSUs at the RSU holders’ request.

36  |  Notes to the Consolidated Financial Statements

F-39

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 20 – SHARE-BASED PAYMENT ARRANGEMENTS (continued)

b) Restricted Share Units (“RSUs”) (continued)

The Company’s obligation to issue shares on the vesting of RSUs is an unfunded and unsecured obligation of the Company. A continuity of RSUs is as follows:

Number of RSUs	2021	2020	2019
Outstanding at January 1	222,222	151,790	101,778
Granted	73,164	123,797	71,640
Exercised 1	(71,190)	(35,877)	(11,905)
Forfeited	(7,074)	(3,332)	(9,723)
Withheld 1	(8,448)	(14,156)	–
Outstanding at December 31	208,674	222,222	151,790
Exercisable at December 31	115,468	33,516	32,036

1  71,190 common shares issued on exercise of 79,638 RSUs at a weighted average grant date exercise price of $8.87. Certain RSU holders elected for RSUs exercised to be settled net of any tax withholding obligations.

The fair value of each RSU is based on the market price of the Company’s common shares on the date of grant and the total fair value of RSUs granted in the year ended December 31, 2021 was $528,028 (December 31, 2020 - $1,069,042; December 31, 2019 - $829,976). Unrecognized share-based compensation expense related to unvested RSUs was $277,686 at December 31, 2021 (December 31, 2020 - $807,830; December 31, 2019 - $702,373).

NOTE 21 – NON-CONTROLLING INTEREST

In April 2019, the Company obtained control over Agnity and its subsidiaries via a business combination and the non-controlling interest (“NCI”) was measured at 100% of the acquired net identifiable assets of Agnity at the date of acquisition. Agnity develops and sells software applications and technology services that enable telecommunication service providers, network equipment manufacturers and enterprises to design, develop, and deploy communication-centric application solutions on a world-wide basis. Having control of Agnity has enabled the Company to gain access to Agnity’s patented technology and its customer base. In addition, Agnity’s communication platform ensures that AssetCare deployments around the globe are assured of connectivity, supported by Agnity telecommunication solutions.

The movement in the equity attributable to the non-controlling interest in the Company is detailed in the consolidated statements of changes in equity. There was no change to the non-controlling interest percentage in the years ended December 31, 2021, 2020 or 2019.

37  |  Notes to the Consolidated Financial Statements

F-40

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 21 – NON-CONTROLLING INTEREST (continued)

The following table summarizes the information relating to Agnity before any intercompany eliminations.

						December 31, 2021			December 31, 2020
NCI percentage						100%			100%
				Recast (Note 2)			Recast (Note 2)
Current assets					$	11,906,502		$	7,778,252
Non-current assets						5,111,714			8,081,135
Current liabilities						(8,752,552)			(7,107,244)
Non-current liabilities						(5,598,783)			(6,185,049)
Net assets attributable to NCI					$	2,666,881		$	2,567,094
For the years ended			December 31, 2021			December 31, 2020			December 31, 2019
	Recast (Note 2)			Recast (Note 2)			Recast (Note 2)
Revenue		$	11,966,226		$	11,548,811		$	6,010,753
Income (loss) allocated to NCI			63,387			1,586,588			590,056
Other comprehensive income allocated to NCI			138,655			159,749			176,711
Total comprehensive income attributable to NCI		$	202,042		$	1,746,337		$	766,767
Cash flows (used in) provided by operating activities		$	(1,859,900)			(405,548)			483,245
Cash flows used in investing activities			(578,483)			–			(3,731)
Cash flows (used in) provided by financing activities			2,081,137			655,347			(417,068)
Foreign exchange impact on cash held in USD			(6,383)			155,274			5,976
Net (decrease) increase in cash and cash equivalents		$	(363,629)		$	405,073		$	68,422

NOTE 22 - FINANCE COSTS

	Year Ended December 31,
	2021		2020		2019
Interest on loans and borrowings (Note 12)	$	1,179,234	$	1,272,512	$	918,682
Interest on convertible debentures (Note 14)		5,740,346		4,410,206		2,130,247
Interest on lease liabilities (Note 8)		137,245		350,792		168,571
Transaction costs expensed 1		1,471,219		–		–
Other finance costs		90,750		–		–
Total finance costs	$	8,618,794	$	6,033,510	$	3,217,500

1  Transaction costs include costs incurred associated with financing or equity transactions that are not otherwise netted against the debt or equity instrument. The majority of costs are associated with the USD brokered public offering (Note 19(a)), the 2021 Debentures (Note 14(b)), the Fiera term loan amendment (Note 12) and the ATB facility amendment (Note 13). See Note 31 (a) and (b) for subsequent changes to Fiera loan. 

38  |  Notes to the Consolidated Financial Statements

F-41

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 23 - FAIR VALUE LOSS (GAIN) ON DERIVATIVES

Year Ended December 31,

	2021
Gain on embedded derivatives 1	$	(784,261	)
Deferred charge loss 1		1,615,102
Loss on substantial modification and conversion 1		8,571,881
Gain on warrant liability remeasurement (Note 15) 2		(3,362,601	)
Total	$	6,040,121

1  Associated with the 2021 Debentures (Note 14(b)) of which the majority is realized at December 31, 2021.

2  Change in fair value unrealized (Note 26).

NOTE 24 - OTHER INCOME

	Year Ended December 31,
	2021		2020		2019
Government assistance 1	$	(4,201,822)	$	(2,775,677)	$	–
US Government loan forgiveness 2 (Note 16)		(1,825,237)		(124,507)		–
Derecognition of contingent consideration (Note 18)		(1,010,024)		–		–
Other		(89,014)		(32,158)		(167,913)
Total other income	$	(7,126,097)	$	(2,932,342)	$	(167,913)

1  Majority represents amounts received from the Canadian Government for wage and rental subsidies associated with COVID-19. The amount of government assistance available is dependent on the programs in place and the Company’s eligibility for these programs.

2  Includes other income recognized as below market interest rate benefit.

NOTE 25 - INCOME TAXES

a) Amounts recognized in net loss

	Year Ended December 31,
	2021			2020			2019
Current tax expense
Current year		157,303			(295,709	)		181,895
Changes in estimates related to prior years		–			–			–
		157,303			(295,709)			181,895
Deferred tax expense (recovery)
Origination and reversal of temporary differences		(13,161,689	)		(10,744,803	)		(6,261,674	)
Change in unrecognized deferred income tax assets		11,339,580			10,076,594			3,569,361
		(1,822,109)			(668,209)			(2,692,313)
Tax expense (recovery)	$	(1,664,806)		$	(963,918)		$	(2,510,418)

39  |  Notes to the Consolidated Financial Statements

F-42

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 25 - INCOME TAXES (continued)

b) Reconciliation of effective tax rate

The following table is a reconciliation of income tax expense (recovery), at the Canadian income tax rate and the amount of reported income tax recovery in the consolidated statements of loss and comprehensive loss. The Company’s operations are subject to income taxes primarily in Canada and the United States.

	Year Ended December 31,
	2021			2020			2019
Loss before taxes	$	(46,364,119)		$	(35,824,882)		$	(30,405,252)
Statutory income tax rate 1		27	%		27	%		27	%
Income tax recovery at statutory rate		(12,518,312)			(9,672,718)			(8,209,418)
Increase (decrease) in taxes resulting from:
Change in deferred tax assets not recognized		11,339,580			10,076,594			3,569,361
Foreign tax rate and other foreign tax differences		(2,089,761)			(2,293,503)			(1,015,536)
Change in enacted rates		608,064			(58,050)			–
Share issuance costs and other		(828,082)			126,247			49,210
Non-deductible transaction costs		38,776			424,828			2,664,789
Other non-deductible items		1,784,929			432,684			431,176
Tax expense (recovery)	$	(1,664,806)		$	(963,918)		$	(2,510,418)

1  Comprised of the Canadian Federal effective corporate tax rate of 15.0% and blended provincial tax rates.

c) Movement in deferred tax balances

The significant components of the Company’s deferred income tax asset (liabilities) are as follows:

	At December 31, 2020		Recovery/ (expense) through earnings		Recovery/ (expense) through equity		Recovery/ (expense) through OCI		At December 31, 2021
Property and equipment	$	261,661	$	(195,977)	$	–	$	2,575	$	68,259
Intangible assets		(5,012,355)		1,415,370		–		73,801		(3,523,184)
Loans and accrued liabilities		(1,714,850)		1,471,654		–		(1,816)		(245,012)
Share issuance costs		27,453		25,467		–		–		52,920
Foreign exchange		–		(6,765)		–		24		(6,741)
Non-capital losses/net operating losses		2,269,186		(887,640)		–		(18,845)		1,362,701
Total	$	(4,168,905)	$	1,822,109	$	–	$	55,739	$	(2,291,057)

	At December 31, 2019		Acquired in business combinations		Recovery/ (expense) through earnings		Recovery/ (expense) through equity		Recovery/ (expense) through OCI		At December 31, 2020
Property and equipment	$	–	$	(376)	$	263,436	$	–	$	(1,399)	$	261,661
Intangible assets		(5,321,008)		(1,136,429)		1,280,692		–		164,390		(5,012,355)
Loans and accrued liabilities		(1,696,435)		–		(41,233)		24,000		(1,182)		(1,714,850)
Share issuance costs		–		–		27,453		–		–		27,453
Foreign exchange		(39,533)		–		39,533		–		–		0
Non-capital losses/net operating losses		3,202,361		–		(901,672)		–		(31,503)		2,269,186
Total	$	(3,854,615)	$	(1,136,805)	$	668,209	$	24,000	$	130,306	$	(4,168,905)

40  |  Notes to the Consolidated Financial Statements

F-43

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 25 - INCOME TAXES (continued)

d) Deferred tax assets not recognized and tax losses carried forward

The Company recognizes deferred tax assets to the extent that it is probable that future taxable profit will be available against which the Company can utilize the benefits of the deductible temporary differences and unused tax losses. Deductible temporary differences and unused tax losses for which a future benefit has not been recognized as a deferred tax asset include the following:

	Year Ended December 31,
	2021		2020
Net operating losses - United States	$	77,415,498	$	55,395,751
Non-capital losses - Canada		68,018,286		45,619,846
Foreign tax losses		157,602		865,599
Investment tax credits and research and development expenditures		6,603,163		6,603,287
Property and equipment		948,765		753,467
Share issuance costs		6,510,677		1,282,965
Other		2,046,890		1,922,194
	$	161,700,881	$	112,443,109

The Company has net operating losses of approximately US$60,837,326 and non-capital losses of approximately $70,204,681 (2020: US$44.1 million and $49.6 million) which are available to reduce future year’s taxable income in the United States and Canada, respectively. The net operating losses will start expiring in 2029 while the non-capital losses will start expiring in 2027 if not utilized.

The Company has foreign tax losses in various jurisdictions of approximately $2,307,882 (2020 - $1.2 million) which are available to reduce future year’s taxable income in their respective countries. The losses have expiry dates ranging from five years to indefinite life. The investment tax credit balance is $500,000 (2020 - $500,000) which is available to reduce future year’s taxes payable in Canada. The investment tax credits begin to expire in 2022 if not utilized.

Management estimates future income using forecasts based on the best available current information. No deferred tax liability has been recognized at December 31, 2021 or December 31, 2020 on temporary differences associated with earnings retained in the Company’s investments in foreign subsidiaries in which it has an equity percentage. The Company is able to control the timing of the reversal of these differences and currently has no plans in the foreseeable future to repatriate any funds in excess of its foreign investment.

41  |  Notes to the Consolidated Financial Statements

F-44

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 26 - FINANCIAL INSTRUMENTS

a) Classification and measurement of financial assets and liabilities by category

The following represents the carrying values of the financial assets and liabilities of the Company and the associated measurement basis for each balance.

Financial assets	Measurement basis	December 31, 2021		December 31, 2020
Cash and cash equivalents	Amortized cost	$	4,588,057	$	1,110,889
Trade and other receivables 1	Amortized cost		14,329,781		11,224,017
Long-term receivables	Amortized cost		740,431		2,536,272
Derivative asset	FVTPL		—		131,400
		$	19,658,269	$	15,002,578
Financial liabilities
Bank indebtedness	Amortized cost	$	3,460,109	$	976,779
Trade payables and accrued liabilities 1	Amortized cost		12,003,979		12,693,256
Loans and borrowings	Amortized cost		13,215,601		13,152,300
Lease liabilities 2	Amortized cost		1,045,472		3,945,076
2019 Debentures - host liability 3	Amortized cost		22,185,170		19,534,988
2021 Debentures - host liability 3	Amortized cost		69,034		—
2021 Debentures embedded derivative	FVTPL		41,506		—
Warrant liability - business acquisition	FVTPL		709,835		710,924
Warrant liabilities - derivatives (Note 15)	FVTPL		7,975,137		—
Business acquisition payable	Amortized cost		1,398,972		2,439,529
Other liabilities	Amortized cost		—		6,236,415
		$	62,104,815	$	59,689,267

1  Excludes amounts for indirect taxes, income taxes and contract asset, where applicable. Note 27 describes credit risk associated with trade receivables including reconciliation of expected credit loss allowance.

2  Lease liabilities are not subject to classification in the fair value hierarchy.

3  2019 Debentures (Note 14(a)) and 2021 Debentures host liability (Note 14(b)).

Financial instruments not measured at fair value

The carrying values of the financial assets and liabilities where the measurement basis is other than FVTPL approximate their fair values due to the immediate or short-term nature of these instruments considering there have been no significant changes in credit and market interest rates since origination date.

b) Measurement of fair value

The fair value hierarchy establishes three levels to classify the significance of inputs to valuation techniques used in making fair value measurements of all financial assets and liabilities (Note 32(L)). At December 31, 2021 and 2020, there were no financial assets or financial liabilities measured and recognized at fair value on a non-recurring basis subsequent to initial recognition.

The Company’s policy for determining when a transfer between levels of the fair value hierarchy occurs is to assess the impact at the date of the event or change in circumstance that could result in the transfer. During the year ended December 31, 2021, subscriptions payable included in other liabilities of $5,285,997 were transferred from Level 2 to Level 3 on issuance of the 2021 Debentures, of which only $110,540 remain at December 31, 2021 (Note 14(b)). There were no other transfers between levels during the year ended December 31, 2021.

42  |  Notes to the Consolidated Financial Statements

F-45

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 26 - FINANCIAL INSTRUMENTS (continued)

b) Measurement of fair value (continued)

Valuation methodologies used in the measurement of fair value for Level 2 financial assets and financial liabilities

The measurement of Level 2 financial assets and liabilities is made by reference to the inputs used to determine the fair value of each instrument using an appropriate valuation method. The fair value of long-term receivables is based on the present value considering the expected time of collection of the long-term contracts.

The fair value of loans and borrowings approximates their carrying value and has been determined by discounting the contractual cash flows using implied yields of obligations with similar credit risk and maturities. The fair value of the host liability for the 2019 Debentures approximates the carrying value and the fair value was initially calculated using a discount rate of 25% for an equivalent, non-convertible loan at the date of issue. The warrant liability associated with a previous business combination is measured based on the amount of cash that is payable in certain circumstances. A portion of other liabilities at December 31, 2020, represent subscriptions payable and the carrying amount of these balances approximates fair value.

Valuation methodologies used in the measurement of fair value for Level 3 financial liabilities

2021 Debentures

The fair value of the entire financial instrument associated with the 2021 Debentures was determined using a partial differential equation model for convertible debt which considered that the convertible debt consists of two components, each having different default risks. The model calculates the value based on key inputs, which impact the value of the convertible debt including: yield to maturity, principal and coupon payments, share price, exercise price, volatility, term, risk free rates and dividends. The risk adjusted discount rate was applied in determining yield to maturity and this is the most significant unobservable input, and the estimated fair value would increase (decrease) if the risk-adjusted discount rate were lower (higher).

The 2021 Debentures include an embedded derivative for the conversion option. The fair value of the embedded derivative was determined using the same methodology as above adjusted for the nature of the instrument. The embedded derivative includes a foreign currency component which reflects the foreign exchange exposure to convert a USD denominated liability to common shares which are denominated in Canadian dollars. The fair value of the embedded derivative was determined first with the residual of the total fair value of the instrument allocated to the host debt. The embedded derivative will be remeasured at each period end with changes in the fair value recognized in the consolidated statements of loss and comprehensive loss.

The Company determined that at the initial recognition date, which was the date of issuance of the debentures, that the fair value of the financial instruments was in excess of the transaction price for tranches one through five (i.e., the fair value of the proceeds received) and the fair value of the tranche six financial instrument was equal to the proceeds received. There were fluctuations in the fair value inputs that arose in the period between the closing of tranches one through five of the Offering and the date of the actual issuance of the debenture certificates. As such the difference between the fair value and transaction price was deferred at initial recognition and the deferred difference was recognized as a loss as factors including the passage of time were met which required recognition. The reconciliation of the opening to closing balances associated with the 2021 Debentures is presented in Note 14(b) including fair value changes.

The 2021 Debentures were derecognized at July 12, 2021 (with the exception of the US$75,000 principal balance which did not convert) as the instruments were substantially modified, and a new financial liability measured at FVTPL was recognized. The fair value was based on the price of common shares at July 12, 2021 and the warrant value was determined using the Black-Scholes model. These instruments were remeasured directly before conversion to equity. The remaining instruments are warrant liabilities as described following.

Warrant liabilities

With the exception of the warrant liability associated with a previous acquisition, the fair value of warrant liabilities is measured on a recurring basis using the Black-Scholes model based on the quoted price of the Company’s common stock in an active market, expected volatility, expected life and risk-free rate (Note 15).

43  |  Notes to the Consolidated Financial Statements

F-46

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 26 - FINANCIAL INSTRUMENTS (continued)

b) Measurement of fair value (continued)

Business acquisition payable

The business acquisition payable consists of contingent consideration payable, the values of which were determined using a discounted cash flow model based on the present value of probability weighted average amount of expected payments discounted at an appropriate discount rate. The reconciliation of the opening to closing balances for Level 3 fair values are presented in Note 18.

NOTE 27 – CAPITAL AND RISK MANAGEMENT

Capital and Risk Management

The Company’s objective and polices for managing capital are to safeguard its ability to continue as a going concern in order to provide returns for shareholders and benefits for other stakeholders and to maintain an optimal capital structure to reduce the cost of capital. The Company manages its capital structure and makes changes based on economic conditions including the impact of the ongoing pandemic, risks that impact the consolidated operations and future significant capital investment opportunities. In order to maintain or adjust its capital structure, the Company may issue new equity instruments or raise additional debt financing.

The Company is exposed to a variety of financial risks by virtue of its activities: liquidity risk, credit risk, interest rate risk and currency risk. The Board of Directors has overall responsibility for the determination of the Company’s capital and risk management objectives and policies while retaining ultimate responsibility for them. The Company’s overall capital and risk management program has not changed throughout the year. It focuses on the unpredictability of financial markets and seeks to minimize potential adverse effects on financial performance. Risk management is carried out by the finance department under policies approved by the Board of Directors. The finance department identifies and evaluates financial risks in close cooperation with management.

The Company’s risks related to financial instruments and the Company’s strategy to manage risks, are described below.

a) Liquidity risk

Liquidity risk is the risk that the Company will not have sufficient cash resources to meet its financial obligations as they come due in the normal course of business. The Company generally relies on funds generated from operations and external financing to provide sufficient liquidity to meet expected operating requirements. The Company manages its liquidity risk by monitoring its operating requirements, reducing costs where possible and applying for any available government COVID-19 support to support its business. The Company also engaged in fundraising activities throughout the year. Cash and cash equivalents as at December 31, 2021 were $4,588,057 (December 31, 2020 - $1,110,889).

Total working capital deficit increased to $42,108,177 at December 31, 2021 from $13,052,702 at December 31, 2020. Current assets increased by $6,712,207 at December 31, 2021 from December 31, 2020, the majority of which are increases in cash and cash equivalents and trade and other receivables. Current liabilities increased by $35,767,682 at December 31, 2021 from December 31, 2020; however, management anticipates a portion of this amount will not be paid in cash due to the nature of the instruments as detailed in the table following. Liquidity risk has increased during the year ended December 31, 2021, and current liquidity levels are not adequate to fund the working capital deficiency at December 31, 2021. The Company anticipates it will need additional financing to meet its current and future demands and the Company is in the process of securing additional financing; however, a material uncertainty exists that may cast doubt on the Company’s ability to continue as a going concern (Note 2).

44  |  Notes to the Consolidated Financial Statements

F-47

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 27 – CAPITAL AND RISK MANAGEMENT (continued)

a) Liquidity risk (continued)

Maturities of financial liabilities

The Company’s carrying values of financial liabilities and the contractual undiscounted cash flows associated with these liabilities broken into relevant maturity grouping based on their contractual maturities are as follows:

At December 31, 2021			Undiscounted Contractual Cash Flows
	Carrying Amount		< 1 year		1 – 2 years		> 2 years		Total
Bank indebtedness 1	$	3,460,109	$	3,460,109	$	–	$	–	$	3,460,109
Trade payables and accrued liabilities		12,421,309		12,421,309		–		–		12,421,309
Loans and borrowings 2		13,215,601		11,763,697		786,123		–		12,549,820
Lease liabilities 3		1,045,472		521,506		534,241		179,281		1,235,028
2019 Debentures		22,185,170		24,630,375		–		–		24,630,375
2021 Debentures		110,540		7,635		103,073		–		110,708
Warrant liabilities 4		8,880,038		709,835		–		–		709,835
Business acquisition payable		1,398,972		1,398,972		–		–		1,398,972
	$	62,717,211	$	54,913,438	$	1,423,437	$	179,281	$	56,516,156

1  No contractual maturity. Excludes interest charged on facility as detailed in Note 13.

2  Includes term loan with a carrying value of $9,275,683 classified as current due to covenant breach. Assuming term loan is repaid in accordance with agreement to maturity, the undiscounted contractual cash flows for loans and borrowings would be $2,933,739, $5,472,193, and $4,143,888 , respectively for the periods presented above.

3  Variable costs due under leases not included in this amount. Minimum payment related to leases which have not yet commenced are not included in this amount. See Note 29.

4  Majority of liability will be settled by issuing common shares of the Company when warrants are exercised during the year. The remaining amount may be settled in cash or common shares of Agnity (Note 15).

As at December 31, 2020			Undiscounted Contractual Cash Flows
	Carrying Amount		< 1 year		1 – 2 years		> 2 years		Total
Bank indebtedness	$	976,779	$	976,779	$	–	$	–	$	976,779
Trade payables and accrued liabilities		12,924,256		12,924,256		–		–		12,924,256
Loans and borrowings		13,152,300		4,248,351		2,617,443		8,796,757		15,662,551
Lease liabilities		3,945,076		1,131,528		939,108		2,815,695		4,886,331
2019 Debentures		19,534,988		2,350,750		24,629,655		–		26,980,405
Warrant liabilities		710,924		710,924		–		–		710,924
Business acquisition payable		2,439,529		1,594,297		845,232		–		2,439,529
Other liabilities		6,236,415		6,003,838		232,577		–		6,236,415
	$	59,920,267	$	29,940,723	$	29,264,015	$	11,612,452	$	70,817,190

b) Credit risk

Credit risk is the risk that a third party might fail to discharge its obligations under the terms of a financial contract. Credit risk is limited to the following instruments and the Company’s maximum exposure to credit risk is the carrying value of the financial assets (Note 26(a)).

The Company is mainly exposed to credit risk from credit sales. Management of the Company monitors the creditworthiness of its customers by performing background checks on all new customers. Further, management monitors the frequency of payments from ongoing customers and performs frequent reviews of outstanding balances. The Company considers that there has been a significant increase in credit risk when contractual payments are more than 90 days past due.

45  |  Notes to the Consolidated Financial Statements

F-48

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 27 – CAPITAL AND RISK MANAGEMENT (continued)

b) Credit risk (continued)

Provisions for outstanding balances are established based on forward-looking information and revised when there are changes in circumstances that would create doubt over the receipt of funds. Such reviews are conducted on a continued basis through the monitoring of outstanding balances as well as the frequency of payments received. Accounts receivable amounts are completely written off once management determines the probability of collection to be remote.

Trade and other receivables, unbilled revenue and long-term receivables are from individual customers and are not assessed based on external credit rating agencies. The Company uses a provision matrix to measure the lifetime expected credit loss (“ECL”) of these balances. Receivables are grouped based on similar credit risk profiles and days past due. Loss rates are based on actual credit loss experience and reflect the forward looking conditions over the expected life of the receivable. As of December 31, 2021, substantially all of the Company’s trade receivables were outstanding for less than 60 days and a loss rate of 1% was applied in determining the ECL. The majority of the ECL is based on specific provisions related to specific customers.

The movement in the ECL allowance related to trade receivables and long-term receivables was as follows (Note 6):

	December 31, 2021			December 31, 2020
Beginning balance	$	606,030		$	382,901
Increase in loss allowance		1,162,537			443,961
Amounts written off during the year as uncollectible		(65,930	)		(220,832	)
Effects of movement in exchange rates		4,581			–
Total	$	1,707,218		$	606,030

c) Market risk

Market risk is the risk that changes in market prices such as interest rates or foreign exchange rates will affect the Company’s results or value as a result of holding these financial instruments. The object of market risk management is to manage and control market risk exposures within acceptable parameters given the nature of the business.

Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of the Company’s financial instruments will fluctuate because of changes in market interest rates. The Company is exposed to interest rate risk on its credit facility and as this instrument is subject to variable rate interest. Management does not believe interest rate risk is currently material to its business.

Foreign currency risk

Currency risk is the risk that the fair values or future cash flows of the Company’s financial instruments will fluctuate because of changes in foreign currency rates and the degree of volatility of these rates. The Company conducts its business in the regions of Canada, Asia-Pacific, the United States and Europe, the Middle East and Africa, which gives rise to exposure to markets from changes in foreign currency rates. Currently, the Company does not use derivative instruments or other measures to reduce its exposure to foreign currency risk.

At December 31, 2021, the C$ equivalent carrying amount of the Company’s USD denominated monetary assets and liabilities was $14,554,193 (December 31, 2020 - $8,291,005) and $11,685,160 (December 31, 2020 - $16,398,521), respectively. Assuming all other variables remain constant, a fluctuation of +/- 5.0% in the exchange rate between C$ and USD would impact the net loss for the period by approximately $143,452 (December 31, 2020 - $405,376).

46  |  Notes to the Consolidated Financial Statements

F-49

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 28 – RELATED PARTY TRANSACTIONS

The Company’s related parties includes its subsidiaries and key management personnel. During its normal course of operations, the Company enters into transactions with its related parties for goods and services that are measured at the amount exchanged.

Key management personnel compensation

Key management personnel include those persons having authority and responsibility for planning, directing, and controlling the activities of the Company as a whole. The Company defines key management personnel as key officers and directors.

For the years ended December 31,	2021		2020		2019
Salaries, management and directors’ fees	$	1,613,502	$	1,683,015	$	1,460,296
Share-based payments		432,098		628,019		388,398
Total	$	2,045,600	$	2,311,034	$	1,848,694

Other related party balances and transactions 1

	December 31, 2021		December 31, 2020
Due to principal owner of Agnity 2	$	234,278	$	813,023
Due to officer of Company for working capital loan 2		30,796		33,205
Due to key management personnel 2		121,852		116,091
Due to Agnity Communications Private Ltd. 3		1,111,521		1,138,630
Loan due to former shareholder of CSA 4		335,860		318,428
Amount due to related parties	$	1,834,307	$	2,419,377

1  Unless otherwise noted, all amounts due are unsecured, non-interest bearing and due on demand.

2  Included in trade accounts payable and accrued liabilities on the consolidated statements of financial position.

3  Associated with consulting services paid to a company partially owned by the principal owner of Agnity. Consulting services were $3,765,201 for the year ended December 31, 2021 (December 31, 2020 - $2,532,550; December 31, 2019 - $1,630,119). Balance due included in trade accounts payable and accrued liabilities on the consolidated statements of financial position.

4  Included in loans and borrowings (Note 12) on the consolidated statements of financial position.

NOTE 29 – COMMITMENTS AND CONTINGENCIES

Commitments

The Company has the following minimum payments for contractual commitments that are not recognized as liabilities at December 31, 2021, which are disclosed in Note 27(a) - Risk Management, Liquidity Risk.

	Undiscounted Contractual Cash Flows
	< 1 year		2 - 3 years		4 - 5 years		More than 5 years		Total
Variable lease payments 1	$	396,719	$	477,562	$	125,275	$	12,999	$	1,012,555
Lease payments related to leases which have not yet commenced 2		104,702		2,589,330		2,762,597		12,636,454		18,093,083
	$	501,421	$	3,066,892	$	2,887,872	$	12,649,453	$	19,105,638

1  Variable lease payments associated lease liabilities (Note 8).

2  In October 2021, the Company executed a 12-year lease for office space in Calgary, Alberta. Basic rent and estimated common expense payments commence in December 2022, preceded by a fixturing period which the Company will use to build out the space. The Company will receive a tenant improvement allowance which is expected to cover the majority of the costs.

47  |  Notes to the Consolidated Financial Statements

F-50

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 29 – COMMITMENTS AND CONTINGENCIES (continued)

Contingencies

The Company may be party to legal proceedings and claims that arise in the ordinary course of business as either a plaintiff or defendant. The Company analyzes all legal proceedings and the allegations therein. The outcome of any proceedings, either individually or in the aggregate, is not expected to have a material adverse effect on the Company’s financial position, results of operations or liquidity.

NOTE 30 – SUPPLEMENTAL CASH FLOW INFORMATION

a) Changes in non-cash working capital

	2021		2020		2019
Trade and other receivables (increase)		$        (3,342,737)		$        (2,006,780)		$            (169,896)
Long-term receivables decrease (increase)		1,682,646		(924,625)		(3,662,207)
Prepaid expenses and other assets decrease (increase)		(591,737)		(1,119,123)		150,991
Trade payables and accrued liabilities (decrease) increase		(782,561)		2,513,477		1,102,361
Deferred revenue increase		1,045,868		632,839		447,511
Decrease in working capital		$        (1,988,521)		$           (904,212)		$         (2,131,240)

b) Changes in liabilities arising from financing activities

	2021		2020		2019
Balance of loans, borrowings and PPP loans, beginning of year		$        14,102,718		$        13,973,055		$                78,285
New advances		10,664,916		8,726,766		16,539,700
Repayments of principal		(9,781,554)		(9,011,638)		(6,787,528)
Repayments of interest		(757,950)		(642,809)		(500,413)
Liability assumed		–		–		2,904,355
Liability related items
Assumption of loans in business combination		–		371,609		1,339,546
Forgiveness of PPP Loans		(1,835,237)		(124,507)		–
Finance fees paid		(191,310)		–
Non-cash related items
Accretion of interest and debt issuance costs		869,567		959,058		445,762
Loss on debt modification		138,908		–		–
Foreign exchange and other		5,543		(148,816)		(46,652)
Balance of loans, borrowings and PPP loans, end of year		$        13,215,601		$        14,102,718		$        13,973,055

48  |  Notes to the Consolidated Financial Statements

F-51

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 30 – SUPPLEMENTAL CASH FLOW INFORMATION (continued)

c) Non-cash investing and financing activities

For the years ended December 31,		2021		2020		2019
Value of shares issued in business combination		$	–	$	8,186,620	$	13,320,000
Value of shares issued on conversion of 2021 Debentures	14(b)	$	14,436,728	$	–	$	–
Value of share issued on conversion of 2019 Debentures		$	–	$	50,000	$	–
Value of shares issued on AirFusion asset acquisition		$	–	$	820,000	$	–
Settlement of liabilities through issuance of common shares or RSUs		$	–	$	143,002	$	84,252
Non-cash accretion of interest included in finance cost		$	3,015,294	$	2,145,706	$	909,158
Non-cash broker warrants compensation	19(b)	$	294,894	$	–	$	–
Non-cash underwriter warrants compensation	19(b)	$	162,947	$	–	$	–
Non-cash warrants consideration associated with credit facility		$	195,066	$	–	$	–
Shares issued to extinguish the loan from Flow Capital		$	–	$	–	$	606,495
Addition to right-of-use assets		$	–	$	599,861	$	468,703
Addition to lease liabilities		$	–	$	599,861	$	586,000

NOTE 31 – EVENTS AFTER THE REPORTING PERIOD

a) Financing of Electric Vehicle Development Projects

In conjunction with the Company’s agreements to provide AssetCare solutions to optimize Electric Vehicle (“EV”) charging efficiency at auto dealerships in the states of New York and California, on March 28, 2022, a subsidiary of the Company executed a promissory note with the Noteholder in the aggregate principal amount of US$15,000,000 (the “Note”).

The initial principal amount of US$5,000,000 (the “Loan”) was funded on April 1, 2022 and an additional US$10,000,000 was funded on May 5, 2022. The Loan matures on March 31, 2025, with 10% per annum interest payable monthly in arrears in USD. The Loan may not be prepaid unless authorized by the lender and is unsecured until certain conditions are met. The Loan contains representations, warranties and covenants which must be complied with to avoid an event of default which will allow the lender to demand repayment and increase the interest rate to 18%, amongst other implications.

The use of proceeds of is solely for the development of the Company’s EV dealership projects. In addition to the Loan, the Note requires certain income based payments, including sharing on a 50/50% basis, all EV, solar and carbon reduction related tax credits and incentives, be made from the borrower to the lender based on income resulting from this project over the term of the 20-year EV dealership projects. The Note is subject to change of control provisions and right of first refusal provisions for additional financing related to the EV projects.

On May 5, 2022, the Company, Carbon and Fiera executed a Subordination and Postponement Agreement (the “Subordination Agreement”), whereby the parties agreed that the security previously held by Fiera would be subordinate to the security to be granted to Carbon commencing on the date of the agreement. The security granted to Carbon means the EV Dealership Projects and to the extent related to the EV Dealership projects, all accounts, equipment and machinery, contracts and contract rights, including contracts with auto dealerships, inventory, cash and proceeds, rent and profits for each of the preceding.

b) Loans and Borrowings – Change to Term Loan

On May 5, 2022, the Company and Fiera executed an Accommodation Agreement (the “Accommodation Agreement”) and the parties agreed that a portion of the outstanding principal amount under the term loan would be paid in addition to a prepayment penalty and accommodation fee. The Company paid a total of $2,044,086 on May 6, 2022. The parties also agreed that the remainder of the principal and interest due under the loan would be paid on or before October 31, 2022 (the “Repayment Date”). The term loan was amended to increase the interest rate charged from 6.85% to 9.5% effectively immediately and clarified that the Company is not required to maintain the financial covenants set out in the November 9, 2021 amending agreement. The Company may be required to repay the loan before the Repayment Date if the Company is in default or breach of the Accommodation Agreement. As part of the Accommodation Agreement, Fiera signed an agreement, whereby Fiera’s security is subordinate to the security granted to Carbon.

There are no financial covenants under the Accommodation Agreement and the Company is no longer required to maintain the previous financial covenants.

c) Warrant activity

On February 15, 2022, the Company’s warrants associated with the USD equity offering described in Note 15(b), commenced trading under the symbol MCLDW (Notes 1 and 15).

On January 17, 2022, the Company issued warrants to ATB to purchase an equivalent number of common shares of the Company and the warrant liability of $195,066 described in Note 15(c) was derecognized with an offsetting credit to contributed surplus for the value assigned to the warrants.

d) Loss of control of subsidiary

On July 29, 2022, the Company entered into a Technology Continuation Agreement (the “Technology Continuation Agreement”) with Agnity, which replaced the Royalty Agreement, as amended, executed between the parties in April 2019. Under the terms of the Technology Continuation Agreement, the Company received a payment on July 29, 2022 of approximately US$6.0 million which includes amounts to settle the net receivable due from Agnity for advances, net of services received. Concurrent with the signing of the Technology Continuation Agreement, a third party acquired all of the outstanding shares in Agnity from its shareholder. As a result of these events, the Company no longer has the right to nominate the majority of the members of the Operations Committee and no longer has control of Agnity. As a result of the loss of control, effective as of July 29, 2022, the Company will no longer include any of Agnity’s operating results in mCloud’s financial statements and Agnity will no longer be consolidated.

e) Contract modification revenue reversal

In April, 2022, the Company agreed to cancel a multi-year customer contract for which services had been performed in prior periods, resulting in a contract modification. As a result, revenue totalling $2,571,676 which was recorded in prior periods was reversed during the six months ended June 30, 2022. Of this amount, $2,037,014 is associated with the AssetCare Initialization service line and $534,662 is associated with the AssetCare Solutions service line.

f) Share capital and equity awards

On June 30, 2022, 19,318 warrants with an exercise price of $15.00 expired unexercised. On July 6, 2022, 525,114 warrants with an exercise price of $14.25 expired unexercised. On July 29, 2022, the Company granted an aggregate amount of 161,300 stock options and 151,550 RSU’s under the Company’s equity incentive plan.

49  |  Notes to the Consolidated Financial Statements

F-52

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 32 – SIGNIFICANT ACCOUNTING POLICIES

The Company has consistently applied the following accounting policies to all periods presented in these consolidated financial statements.

A. Basis of Consolidation

The consolidated financial statements include the financial statements of the Company and all its subsidiaries as at December 31, 2021. Control exists over an investee when the Company is exposed, or has rights, to variable returns from its investee and has the ability to affect those returns through its power over the investee. Subsidiaries are included in the consolidated financial results of the Company from the effective date of acquisition up to the effective date of disposition or loss of control. Unless otherwise stated, the subsidiaries have share capital consisting solely of ordinary shares and the proportion of ownership interests held equals the voting rights held by the entity.

Subsidiaries

The Company’s principal subsidiaries include the following entities many of which have 100% ownership in other entities. The Company directly and indirectly owns 100% of all subsidiaries except for the Agnity group of companies. While the Company does not have an ownership interest in the Agnity entities, the Company controls them and as such the financial results are consolidated into the Company’s consolidated financial statements.

	Principle activity	Place of business and operations	Functional currency
mCloud Technologies Corp.	Parent company	Canada		CDN $
mCloud Technologies (USA) Inc.	Operations	United States		USD $
mCloud Technologies (Canada) Inc.	Operations	Canada		CDN $
Field Diagnostic Services, Inc. (“FDSI”)	Operations	United States		USD $
Construction Systems Associates, Inc. (“CSA”)	Operations	United States		USD $
mCloud Technologies Services Inc. (“MTS”)	Operations	Canada		CDN $
NGRAIN (Canada) Corporation (“NGRAIN”)	Operations	Canada		CDN $
kanepi Group Pty. Ltd.	Operations	Australia		AUD $
kanepi Services Pty. Ltd.	Operations	Australia		AUD $
mCloud Technologies Singapore Pte. Ltd.	Operations	Singapore		SGD $
mCloud Corp (HK) Ltd.	Operations	China		RMB ¥
mCloud Technologies (Saudi Arabia)	Operations	Saudi Arabia		SAR $
Agnity Global, Inc. (“Agnity”)	Operations	United States		USD $
Agnity Communications, Inc. (“ACI”)	Operations	United Stated		USD $
Agnity Healthcare, Inc. (“AHI”)	Operations	United States		USD $

When the Company loses control over a subsidiary, it derecognizes the assets and liabilities of the subsidiary and any related non-controlling interests and other components of equity. Any resulting gain or loss is recognized in net income (loss). Any interest retained by the former subsidiary is measured at fair value when control is lost.

All intercompany transactions, balances, revenues and expenses have been eliminated on consolidation. Amounts reported in the financial statements of subsidiaries have been adjusted where necessary to ensure consistency with the accounting policies adopted by the Company. Profit or loss and other comprehensive income of subsidiaries acquired or disposed of during the year are recognized from the effective date of acquisition, or up to the effective date of disposal, as applicable.

50  |  Notes to the Consolidated Financial Statements

F-53

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 32 – SIGNIFICANT ACCOUNTING POLICIES (continued)

A. Basis of Consolidation (continued)

Non-controlling interests

Non-controlling interests arise from business combinations in which the Company acquires less than 100% ownership interest. Non-controlling interests, presented as part of equity, represent the portion of a subsidiary’s profit or loss and net assets that is not attributable to the common shareholders of the Company. The entire portion of the Agnity operations is a non-controlling interest. The interests of the non-controlling shareholders are initially measured at either fair value or at the non-controlling interests’ proportionate share of the recognized amounts of the acquiree’s identifiable net assets. Any subsequent income/loss, dividends and foreign translation adjustments attributable to the non-controlling interests is recognized as part of the non-controlling interests’ income or equity. When changes in ownership interests are disproportionate to cumulative contributions, distributions and income (loss) allocations, non-controlling interest are adjusted through direct charges to equity. The Company attributes total comprehensive income or loss of subsidiaries between the owners of the parent and the non-controlling interests based on their respective ownership interests. Changes in the Company’s interest in a subsidiary that do not result in a loss of control are accounted for as equity transactions.

Business combinations

Acquisitions of subsidiaries and assets that meet the definition of a business under IFRS are accounted for using the acquisition method. The consideration transferred in the acquisition is measured at acquisition date fair value. The identifiable assets acquired and liabilities assumed that meet the conditions for recognition under IFRS 3 Business Combinations are recognized at their fair values at the acquisition date. Any excess consideration over the fair value of the identifiable net assets is recognized as goodwill. Acquisition-related costs, other than those associated with the issuance of debt or equity, are recognized in profit or loss as incurred.

If the initial accounting for a business combination is incomplete by the end of the reporting period in which the combination occurs, the Company reports provisional amounts for the items for which the accounting is incomplete. Those provisional amounts are adjusted retrospectively during the measurement period, or additional assets or liabilities are recognized, to reflect new information obtained about facts and circumstances that existed as of the acquisition date that, if known, would have affected the amounts recognized as of that date. The measurement period is the period from the date of acquisition to the date the Company obtains complete information about facts and circumstances that existed as of the acquisition date up to a maximum of one year.

Any contingent consideration is measured at fair value at the acquisition date. If contingent consideration that meets the definition of a financial instrument is classified as equity, it is not remeasured and its subsequent settlement is accounted for within equity. Other contingent consideration is remeasured at fair value at each reporting date with changes in fair value recognized in profit or loss.

B. Foreign currency

Functional currency is the currency of the primary economic environment in which an entity operates. The functional currency of the parent company and its material subsidiaries are presented in the table in Note 32(A). These consolidated financial statements are presented in Canadian dollars.

Foreign currency transactions. In preparing the financial statements of each individual subsidiary, transactions in currencies other than the entity’s functional currency (foreign currencies) are recognized at the rates of exchange prevailing at the dates of the transactions. At the end of each reporting period, monetary items denominated in foreign currencies are retranslated at the rates prevailing at that date. Non-monetary items carried at fair value that are denominated in foreign currencies are retranslated at the rates prevailing at the dates those fair values are determined. Non-monetary items that are measured in terms of historical cost in a foreign currency are not retranslated. Exchange differences on monetary items are recognized in profit or loss in the period in which they arise.

Presentation currency translations. For the purposes of presenting consolidated financial statements, the assets and liabilities of the Company’s foreign operations are translated into Canadian dollars using exchange rates prevailing at the end of each reporting period. Income and expense items are translated at the average exchange rates for the period, unless exchange rates fluctuate significantly during that period, in which case the exchange rates at the dates of the transactions are used. Exchange differences arising, if any, are recognized in other comprehensive income (loss) and accumulated in equity (attributed to non-controlling interests as appropriate).

51  |  Notes to the Consolidated Financial Statements

F-54

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 32 – SIGNIFICANT ACCOUNTING POLICIES (continued)

C. Revenue recognition

The Company’s revenues are derived from the sales of perpetual software licenses, subscriptions to AssetCare, installation and engineering services, hardware and post contract support and maintenance (“PCS”).

Revenue from the sale of hardware and perpetual software licenses is recognized at the point in time when control is transferred to the customer, generally upon delivery at the customer’s location.

Installation services involve the installation and implementation of energy efficient hardware, perpetual software licenses and IoT connections which feed information to the AssetCare platform. Engineering services include consulting, implementation and integration services entered into either on a time and materials basis or fixed fee basis. Revenue from installation and engineering services is recognized overtime, using an input method based on direct labour hours to measure progress towards complete satisfaction of the service.

Revenues from PCS and subscriptions to the AssetCare platform are recognized ratably overtime over the term of the PCS or subscription. Any amounts received for which performance obligations have not been completed are recognized as deferred revenue.

The Company’s contracts often include a number of promised goods or services, which are typically distinct from other performance obligations, and are therefore accounted for separately. A good or service is distinct if the customer can benefit from it on its own or together with other readily available resources, and the Company’s promise to transfer the good or service is separately identifiable from other promises in the contractual arrangement with the customer.

In determining the transaction price of a contract with a customer, the Company considers the effects of variable consideration, existence of a significant financing component, non-cash consideration, and any consideration payable to the customer. The total transaction price is allocated to each performance obligation on a relative stand-alone selling price (“SSP”) basis, representing the selling price as if it was sold separately. This is a formal process involving judgement which could impact the timing of recognized revenue.

In most cases, the SSP is based on observable data. Where possible, a narrow SSP range for each product and service is established and this range is assessed on a periodic basis or when material changes in facts and circumstances warrant a review. If the SSP is not directly observable, the amount is estimated using either the expected cost plus a margin or residual approach. The SSP for perpetual software licenses is highly variable and therefore the Company applies the residual approach, which determines the SSP by subtracting the SSP of hardware, installation and other services in the contract from the total transaction price.

Long-term contracts

The Company enters into multi-year contracts with some customers for goods and services. Under the terms of these contracts, the customer is billed an equal monthly amount over the term of the contract. Revenue is recognized as performance obligations are completed, generally with a significant portion of the transaction price being recognized at the beginning of the contract based on the calculated SSP for performance obligations that are satisfied at the point in time at which goods are delivered to customers. The remainder of the revenue is recognized over the life of the contract over time or as services are completed.

D. Financial Instruments

i. Recognition and initial measurement

On initial recognition, all financial assets and liabilities are classified and recorded at fair value, net of attributable transaction costs, except for financial assets and liabilities classified as at fair value through profit or loss (“FVTPL”).

Cash and bank indebtedness

Cash is held in bank accounts. The Company considers only those investments that are highly liquid, readily convertible to cash with original maturities of three months or less at date of purchase as cash equivalents.

Bank indebtedness consists of bank overdrafts and draws from the credit facility account repayable on demand for cash management purposes.

52  |  Notes to the Consolidated Financial Statements

F-55

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 32 – SIGNIFICANT ACCOUNTING POLICIES (continued)

ii. Classification and subsequent measurement

Financial Assets

On initial recognition, a financial asset is classified as measured at: amortized cost; fair value through other comprehensive income; or fair value through profit or loss, depending on the business model in which a financial asset is managed and its contractual cash flow characteristics. Financial assets that do not meet the below classifications are classified as fair value through profit or loss.

A financial asset is measured at amortized cost if it meets both of the following conditions and is not designated as FVTPL:

• it is held within a business model whose objective is to hold assets to collect contractual cash flows; and

• its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

A financial asset is measured at fair value through other comprehensive income if it meets both of the following conditions and is not designated as at FVTPL:

• it is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets; and

• its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

Financial Liabilities

Financial liabilities are classified as measured at amortized cost or FVTPL. A financial liability is classified as at FVTPL if it is classified as held-for-trading, it is a derivative, or it is designated as such on initial recognition. Financial liabilities at FVTPL are measured at fair value and net gains and losses, including any interest expense, are recognized in profit or loss. Other financial liabilities are subsequently measured at amortized cost using the effective interest method. Interest expense and foreign exchange gains and losses are recognized in profit or loss. Any gain or loss on derecognition is also recognized in net income (loss).

When a financial liability is non-substantially modified, a gain or loss is recognized into net income (loss). The gain or loss is calculated at the date of modification as the difference between the remaining original contractual cash flows and the modified cash flows both discounted at the original effective interest rate. Any costs associated with the modified loan is added to the loan carrying amount and amortized over the remaining modified loan term. The carrying amount of the loan is revised to reflect the new cash outflows at the date of modification.

iii. Derecognition of financial assets and liabilities

Financial assets are derecognized when the contractual rights to the cash flows from the financial asset expire or the Company transfers the rights to receive the contractual cash flow in a transaction in which substantially all the risks and rewards of ownership have been transferred.

A financial liability is derecognized when its contractual obligations are discharged, cancelled or expire. The Company also derecognizes a financial liability when its terms are modified and the cash flows of the modified liability are substantially different, in which case a new financial liability based on the modified terms is recognized at fair value. On derecognition of a financial liability, the difference between the carrying amount extinguished and the consideration paid (including any non- cash assets transferred or liabilities assumed) is recognized in net income (loss).

iv. Impairment of non-derivative financial assets

The Company applies an expected credit loss (“ECL”) impairment model, which applies to financial assets measured at amortized cost, contract assets, lease receivables, and financial guarantee contracts. The ECL model results in an allowance for credit losses being recorded on financial assets regardless of whether there has been an actual loss event. Except for trade receivables, the ECL model requires the recognition of credit losses based on 12 months of expected losses for financial assets and the recognition of lifetime expected losses on financial assets that have experienced a significant increase in credit risk since origination or which are considered credit impaired. A financial asset is credit-impaired when one or more events that have a detrimental impact on the estimated future cash flows of the financial asset have occurred. ECL’s are probability-weighted estimates of credit losses. Credit losses are measured as the present value of all cash shortfalls representing the difference between the cash flows due to the entity in accordance with the contract and the cash flow an entity expects to receive. The Company has elected to measure loss allowances for trade receivables at an amount equal to lifetime ECL’s.

53  |  Notes to the Consolidated Financial Statements

F-56

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 32 – SIGNIFICANT ACCOUNTING POLICIES (continued)

iv. Impairment of non-derivative financial assets (continued)

When determining whether the credit risk of a financial asset has increased significantly since initial recognition and when estimating ECL, the Company considers reasonable and supportable information that is relevant and available without undue cost or effort. This includes both quantitative and qualitative information analysis, based on the Company’s historical experience and including forward looking information. Loss allowances for financial assets measured at amortized cost are deducted from the gross carrying amount of the assets. The gross carrying amount of a financial asset is written off when the Company has no reasonable expectations of recovering a portion or the full amount. The Company assesses the timing of write-offs based on whether there is a reasonable expectation of recovery. Impairment losses related to trade and other receivables are presented within general and administrative expenses.

E. Property and equipment

Property and equipment are recorded at cost, less accumulated depreciation and accumulated impairment losses, if any. Cost includes expenditures that are directly attributable to the acquisition of the asset. Depreciation is calculated on a straight-line basis over the estimated useful lives of the assets, as follows:

	Life
Computer equipment	2 -5 years
Office furniture and equipment	7 years
Leasehold improvements	lesser of useful lives or lease term

The estimated useful lives and depreciation methods are reviewed at the end of each reporting period, with the effect of any changes in estimate accounted for on a prospective basis.

An item of property and equipment is derecognized upon disposal or when no future economic benefits are expected to arise from the continued use of the asset. Any gain or loss arising on the disposal or retirement of an item of property and equipment is determined as the difference between the sales proceeds and the carrying amount of the asset and is recognized in profit or loss. Repairs and maintenance costs that do not improve or extend productive life are recognized in profit or loss in the period in which the costs are incurred.

F. Intangible assets and goodwill

Intangible assets

Intangible assets acquired separately

Intangible assets patents and trademarks, customer relationships and technology, all of which have a finite life. Intangible assets acquired separately are measured on initial recognition at cost and intangible assets acquired in a business combination are recognized at fair value at the date of acquisition. Following initial recognition, intangible assets are carried at cost less any accumulated amortization and accumulated impairment losses.

Subsequent expenditure is capitalized only when it increases the future economic benefits embodied in the specific asset to which it relates. All other expenditure, including expenditure on internally generated goodwill and intangible assets are recognized in profit or loss as incurred.

Intangible assets are amortized over their estimated useful lives, on a straight-line basis, as follows:

	Life
Patents and trademarks	5 - 15 years
Customer relationships	5 - 20 years
Technology	5 years

Amortization methods, useful lives and residual values are reviewed at the end of each reporting period and adjusted if required on a prospective basis.

54  |  Notes to the Consolidated Financial Statements

F-57

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 32 – SIGNIFICANT ACCOUNTING POLICIES (continued)

F. Intangible assets and goodwill (continued)

An intangible asset is derecognized on disposal, or when no future economic benefits are expected from use or disposal. Gains or losses arising from derecognition of an intangible asset, measured as the difference between the net disposal proceeds and the carrying amount of the asset, are recognized in profit or loss when the asset is derecognized.

Internally generated intangible assets

Expenditures on research activities are recognized as an expense in the period in which they were incurred.

Internally-generated intangible assets arising from development or from the development phase of an internal project are recognized if all of the following factors have been demonstrated:

• Technical feasibility of completing the intangible asset results in the intangible asset being available for use or sale;

• There is an intention to complete the intangible asset and use or sell it;

• There is an ability to use or sell the intangible asset;

• Evidence to suggest how the intangible asset will generate probable future economic benefits;

• There is availability of adequate technical, financial and other resources to complete the development and to use or sell the intangible asset; and,

• An ability to reliably measure the expenditure(s) attributable to the intangible asset during its development exists.

The estimated useful life and amortization method are reviewed at the end of each reporting period, with the effect of any changes in estimate being accounted for on a prospective basis. Where no internally-generated intangible asset can be recognized, development expenditures are recognized in profit or loss in the period in which it is incurred.

Goodwill

Goodwill, representing the excess of the consideration paid for entities acquired over the fair values of the assets acquired and liabilities assumed, is initially measured at cost and is not amortized. After initial recognition, goodwill is measured at cost less any accumulated impairment losses and is tested annually for impairment.

For the purpose of impairment testing, goodwill is allocated to each of the Company’s cash-generating units that are expected to benefit from the synergies of the business combination. A cash-generating unit to which goodwill has been allocated is tested for impairment annually, or more frequently when there is indication that the unit may be impaired. If the recoverable amount of the cash-generating unit is less than the carrying amount, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro-rata based on the carrying amount of each asset in the cash generating unit. The recoverable amount is the greater of an asset’s fair value less costs of disposal or its value in use. In determining fair value less costs of disposal, recent market transactions are considered or an appropriate valuation model is used. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset or CGU. Any impairment loss for goodwill is recognized directly in profit or loss in the consolidated statements of loss on comprehensive loss. Goodwill impairments are not reversed. Management evaluates goodwill for impairment annually as of December 31 unless impairment indicators exist at another reporting date. On disposal of a cash-generating unit, the attributable amount of goodwill is included in the determination of the profit or loss on disposal.

G. Impairment of non-financial assets

The carrying amount of property and equipment and intangible assets with a finite life are reviewed each reporting period to determine whether events or changes in circumstances indicate that their carrying amounts may not be recoverable. Intangible assets with an indefinite life are reviewed and tested on an annual basis or whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable.

An impairment loss is recognized for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs of disposal or its value in use. To assess value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. In determining fair value less costs of disposal recent market transactions are considered or an appropriate valuation model is used.

55  |  Notes to the Consolidated Financial Statements

F-58

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 32 – SIGNIFICANT ACCOUNTING POLICIES (continued)

G. Impairment of non-financial assets (continued)

To assess impairment, assets are grouped at the lowest levels for which there are separately identifiable cash inflows (cash-generating units). For an asset that does not generate largely independent cash flows, the recoverable amount is determined for the cash-generating unit to which the asset belongs. Impairment losses recognized in prior periods are assessed at each reporting date for any indications that the loss has decreased or no longer exists. An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortization, if no impairment loss had been recognized.

H. Leases

i. Recognition and initial measurement as a lessee

At the commencement date of a lease, the Company recognizes a right-of-use asset and a lease liability for all leases except leases of low-value assets and leases with a duration of 12 months or less.

At inception of a contract, the Company assesses whether a contract is, or contains, a lease. A lease is defined as a contract, or part of a contract, that conveys the right to control the use of an identified asset for a period of time in exchange for consideration. To assess whether a contract conveys the right to control the use of an identified asset, the Company determines whether, throughout the period of use, it has the right to obtain substantially all of the economic benefits from use of the identified asset and the right to direct the use of the identified asset. The Company reassesses whether a contract is, or contains, a lease only if the terms and conditions of the contract are changed.

Lease liabilities are initially measured at the present value of unpaid lease payments at the commencement date of the lease, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the Company’s incremental borrowing rate.

Lease payments included in the measurement of the lease liability comprise the following:

• fixed payments (including in-substance fixed payments), less any lease incentives receivable;

• variable lease payments that depend on an index or a rate (such as CPI), initially measured using the index or rate as at the commencement date;

• amounts expected to be payable by the Company under residual value guarantees;

• exercise price of a purchase option if the Company is reasonably certain to exercise that option; and

• payments of penalties for terminating the lease, if the lease term reflects the Company exercising an option to terminate the lease.

Variable rent payments that are not based on an index or rate, including additional rent for operating costs and taxes and non-recoverable goods and services tax, are recognized as rent expense, within general and administrative expense or direct costs, as incurred. Lease payments for short-term leases and leases of low-value assets are recognized as rent expense on a straight-line basis over the lease term.

Right-of-use assets are initially measured at cost comprised of the initial lease liability adjusted for any lease payments made at or before commencement of the lease, plus initial direct costs incurred less lease incentives received.

ii. Classification and subsequent measurement as a lessee

Subsequent to the commencement date of the lease, the lease liability is measured at amortized cost using the effective interest method. The lease liability is remeasured by discounting the revised lease payments using a revised discount rate when there is a change in the lease term or there is a change in the assessment of an option to purchase the underlying asset. The lease liability is remeasured by discounting the revised lease payments using an unchanged discount rate when there is a change in the amounts expected to be payable under a residual value guarantee or there is a change in future lease payments resulting from a change in an index or a rate used to determine variable payments. Upon remeasurement of a lease liability, a corresponding adjustment to the right-of-use asset is recognized.

Subsequent to the commencement date of the lease, the Company measures the right-of-use asset at cost, less accumulated depreciation, and any accumulated impairment losses, and adjusted for any remeasurement of the lease liability.

56  |  Notes to the Consolidated Financial Statements

F-59

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 32 – SIGNIFICANT ACCOUNTING POLICIES (continued)

H. Leases (continued)

The right-of-use asset is depreciated using the straight-line method from the commencement date of the lease to the earlier of the end of the useful life of the underlying asset and the end of the lease term. The Company assesses its right-of-use assets for impairment and accounts for identified impairment losses similar to its assessment of impairment on other property and equipment.

Refundable security deposits are classified as financial assets measured at amortized cost and included in current other receivables or other non-current assets. Tenant improvement allowances are recognized as a reduction in the costs of the associated leasehold improvement assets.

The Company has taken the practical expedient not to assess whether rent concessions arising as a result of COVID-19 are lease modifications. These rent concessions are in the form of rent deferrals and there is no change to the amount recognized in profit or loss as a result of these changes.

I. Government grants

Government grants are assistance by government agencies in the form of transfers of resources to an entity in return for past or future compliance with certain conditions related to the operating activities of the entity. Government grants are recognized where there is reasonable assurance that the grant will be received, and the Company will comply with all attached conditions. Government grants related to costs are deferred, if applicable, and recognized gross in profit or loss on a systematic basis in the periods in which the expenses are recognized. When the grant relates to an asset, it is recognized as income in equal amounts over the expected useful life of the related asset. Government loans are analyzed to determine whether they qualify as grants or are required to be treated as financial liabilities.

J. Provisions

Provisions are recognized when the Company has a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation. Where appropriate, the future cash flow estimates are adjusted to reflect risks specific to the liability. Provisions are measured using managements best estimate as to the outcomes, based on known facts, risks and uncertainties at the reporting date.

Contingent liabilities are possible obligations whose existence will only be confirmed by future events not wholly within the control of the Company. Contingent liabilities are not recognized in the consolidated financial statements but are disclosed unless the possibility of an outflow of economic resources is considered remote.

K. Share related items

Stock options

The Company grants stock options to employees, directors, officers, and consultants. The fair value of options granted is recognized as a share-based payment expense with a corresponding increase in equity. The fair value is measured for each tranche at grant date and is recognized on a graded-vesting basis over the period during which the options vest. Stock options granted to non-employees are measured at the fair value of the goods or services received except where the fair value cannot be estimated, in which case it is measured at the fair value of the equity instrument granted. The fair value of the share-based compensation to non-employees is periodically re-measured until counterparty performance is complete, and any change therein is recognized over the period and in the same manner as if the Company had paid cash instead of paying with stock options.

The fair value of options is determined using the Black-Scholes option pricing model which incorporates all the market vesting conditions. The number of options expected to vest is reviewed and adjusted at the end of each reporting period such that the amount recognized for services received as consideration for the equity instruments granted shall be based on the number of equity instruments that eventually vest.

Expected forfeitures are estimated at the date of grant and subsequently adjusted if further information indicates actual forfeitures may vary from the original estimate. The impact of the revision of the original estimate is recognized in net loss such that the cumulative expense reflects the revised estimate. Upon exercise of stock options, consideration received on exercise of these equity instruments is recorded as share capital and the related share-based payment reserve is transferred to share capital.

57  |  Notes to the Consolidated Financial Statements

F-60

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 32 – SIGNIFICANT ACCOUNTING POLICIES (continued)

K. Share related items (continued)

Restricted share units

The Company grants RSU’s to directors, employees and consultants which are measured at fair value based on the closing price of the Company’s common shares for the day preceding the date of the grant. The fair value of the grant is recognized as a share-based payment expense over the vesting period with a corresponding charge to contributed surplus. Common shares of the Company are issued on exercise by the holder of vested RSU’s.

Warrants issued as consideration for services

In certain circumstances, the Company issues warrants as consideration for services provided generally in conjunction with debt or equity financings. Where identifiable services are not reliability measured the services are measured with reference to the fair value of the equity instruments issued using the Black-Scholes model. The measurement date is when the entity obtains the goods or is provided the services and the warrants are not remeasured thereafter.

Loss per share

Basic loss per share is calculated by dividing the loss attributable to the common shareholders of the Company by the weighted average number of common shares outstanding during the respective reporting periods. Where a loss is reported, diluted loss per share is the same as basic loss per shares as all potential equity instruments are anti-dilutive and not included in the calculation.

L. Fair value measurement

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date or, in its absence, the most advantageous market to which the group has access at that date. Several of the company’s accounting policies and disclosures require the measurement of fair values for both financial and non-financial assets and liabilities. The Company uses the fair value hierarchy to classify the significance of inputs to valuation techniques used in making fair value measurements of financial assets and liabilities. The categories are:

• Level 1 inputs are quoted prices in active markets for identical assets or liabilities that the Company can access at the measurement date;

• Level 2 inputs are inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (i.e., as prices) or indirectly (i.e., derived from prices); and

• Level 3 inputs are unobservable inputs for the asset or liability.

When one level one input is available the Company measures the fair value of the instrument using the quoted price in an active market for that instrument (Level 1). A market is regarded as active if transactions for the asset or a liability take place with sufficient frequency and volume to provide pricing information on an ongoing basis.

If there is no quoted price in an active market, then the group uses valuation techniques that maximize the use of relevant observable inputs and minimizes the use of unobservable inputs (Level 2 or Level 3). The chosen valuation technique incorporates all the factors that market participants would consider in pricing a transaction.

M. Convertible debentures

Convertible debentures are accounted for depending on the terms of the contract. The fair value of the debentures are allocated into components parts, which may include separate host debt, embedded derivative(s) and/or equity components based on the terms of the contract. Where the fair value of the financial instrument is different than the transaction price then the measurement is dependent on whether the fair value was determined based on a valuation technique that only uses data from observable markets (Level 1 input) or otherwise. For compound financial instruments such as the 2019 Debentures where there is a liability and equity component, on issuance of the convertible debentures, the fair value of the liability component is determined using a market rate for an equivalent non-convertible instrument.

The proceeds are allocated to the liability component first with the remainder of the proceeds allocated to the conversion option that is recognized and included in equity. The liability component (net of transaction costs) is subsequently measured at amortized cost using the effective interest rate method until it is extinguished on conversion or redemption. The carrying amount of the conversion option is not remeasured in subsequent periods.

58  |  Notes to the Consolidated Financial Statements

F-61

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 32 – SIGNIFICANT ACCOUNTING POLICIES (continued)

M. Convertible debentures (continued)

For the majority of the 2021 Debentures, the fair value of the financial instruments was greater than the transaction price. The residual is treated as a deferred amount and recognized similar to fair value adjustments on derivatives. For hybrid financial instruments such as the 2021 Debentures where there is a liability and embedded derivative component, the fair value of the embedded derivative is determined first with the residual of the total fair value for the instrument allocated to the host debt. The host debt (liability), net of transaction costs, is subsequently measured at amortized cost using the effective interest rate method until it is extinguished on conversion or redemption.

Transaction costs are apportioned between each component of the convertible debentures based on a percentage of proceeds when the instruments are initially recognized. Transaction costs attributable to the liability and equity components are offset against the respective balances with transaction costs attributable to embedded derivatives directly expensed.

N. Warrant liabilities

Warrants issued where the number of common shares to be issued or the value of the common shares varies as they are denominated in a foreign currency are classified as derivative financial liabilities. The derivative warrant liability is measured at fair value with changes in fair value recognized in the consolidated statements of loss at the end of each reporting period.

O. Income taxes and deferred taxation

Income tax expense of the Company represents current tax and deferred tax.

The Company records current tax based on the taxable profits for the period which is calculated using tax rates that have been enacted or substantively enacted by the reporting date. Taxable profit differs from profit as reported in the consolidated statements of loss and comprehensive loss because of items of income or expense that are taxable or deductible in other years and items that are never taxable or deductible.

Deferred income taxes are accounted for using the liability method. Under this method, deferred tax assets and liabilities are determined based on temporary differences between the financial reporting and tax basis of assets and liabilities and measured using the substantively enacted tax rates and laws in effect when the differences are expected to reverse. The effect of a change in tax rates or tax legislation is recognized in the period of substantive enactment. Deferred tax assets, such as unused tax losses, income tax reductions, and certain items that have a tax basis but cannot be identified with an asset or liability on the statement of financial position, are recognized to the extent it is probable that taxable profit will be available against which the difference can be utilized. Deferred tax assets and liabilities are offset when the Company has a legally enforceable right to offset current assets and liabilities. The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilized. Unrecognized deferred tax assets are reassessed at each reporting date and are recognized to the extent that it has become probable that future taxable profits will allow the deferred tax asset to be recovered.

When there is uncertainty concerning the Company’s filing position regarding the tax bases of assets or liabilities, the taxability of certain transactions or other tax-related assumptions, then the Company: (a) considers whether uncertain tax treatments should be considered separately, or as a group, based on which approach provides better predictions of the resolution; (b) determines if it is probable that the tax authorities will accept the uncertain tax treatment; and (c) if it is not probable that the uncertain tax treatment will be accepted, measure the tax uncertainly based on the most likely amount or expected value, depending on whichever method better predicts the resolution of the uncertainty. Companies are to assume in making this measurement that a taxation authority with the right to examine any amounts reported to it will examine those amounts and will have full knowledge of all relevant information when making those examinations.

59  |  Notes to the Consolidated Financial Statements

F-62

mCloud Technologies Corp.

Notes to the Consolidated Financial Statements

For the Years Ended December 31, 2021, 2020 and 2019

(Expressed in Canadian Dollars except otherwise noted)

NOTE 32 – SIGNIFICANT ACCOUNTING POLICIES (continued)

P. Accounting standards development

(a) Application of new and revised IFRSs

The Company did not apply any new standards or amendments for the year ended December 31, 2021.

(b) New accounting standards, interpretations and amendments not yet effective

There are a number of new accounting standards, amendments to standards, and interpretations which have been issued by the IASB that are effective in future accounting periods that are not expected to have a material impact on the Company in the year of adoption and as such are not included here.

In February 2021, the IASB issued amendments to two existing accounting standards regarding accounting estimates and accounting policies. The amendments issued were Disclosure of Accounting Policies (Amendments to IAS 1 and IFRS Practice Statement 2), which helps preparers determine which accounting policies to disclose in their financial statements, and Definition of Accounting Estimates (Amendment to IAS 8) which helps entities to distinguish between accounting policies and accounting estimates. These amendments are applicable starting January 1, 2023 with early adoption permitted and are not expected to have a material impact on the Company.

60  |  Notes to the Consolidated Financial Statements

F-63

mCloud Technologies Corp.

Condensed Consolidated Interim Statements of Financial Position

Unaudited - Expressed in Canadian Dollars

	Notes	June 30, 2022			December 31, 2021
					Recast (Note 2)
ASSETS
Current assets
Cash and cash equivalents		$	4,405,948		$	4,588,057
Trade and other receivables	5		12,134,992			14,566,975
Current portion of prepaid expenses and other assets			2,679,472			2,355,350
Current portion of long-term receivables	5		390,398			397,060
Total current assets		$	19,610,810		$	21,907,442
Non-current assets
Prepaid expenses and other assets		$	402,838		$	622,577
Long-term receivables	5		318,360			343,371
Right-of-use assets	6		7,298,424			916,028
Property and equipment			518,185			649,403
Intangible assets			17,429,695			20,585,833
Goodwill			27,119,177			27,081,795
Total non-current assets		$	53,086,679		$	50,199,007
Total assets		$	72,697,489		$	72,106,449
LIABILITIES
Current liabilities
Bank indebtedness	9	$	3,679,631		$	3,460,109
Trade payables and accrued liabilities	7		16,343,347			12,421,309
Deferred revenue	4		4,813,199			2,811,408
Current portion of loans and borrowings	8		10,399,574			12,447,939
Current portion of convertible debentures	10		23,457,500			22,185,170
Warrant liabilities	11		3,017,643			8,880,038
Current portion of lease liabilities	6		554,895			410,674
Business acquisition payable			1,399,580			1,398,972
Total current liabilities		$	63,665,369		$	64,015,619
Non-current liabilities
Convertible debentures		$	85,091		$	110,540
Lease liabilities	6		7,123,723			634,798
Loans and borrowings	8		19,586,233			767,662
Deferred income tax liabilities			827,672			2,291,057
Total liabilities		$	91,288,088		$	67,819,676
EQUITY (DEFICIT)
Share capital			118,327,722			118,195,363
Contributed surplus			11,547,919			11,040,751
Accumulative other comprehensive income			291,811			1,227,269
Deficit			(146,501,130	)		(128,671,898	)
Total shareholders’ equity (deficit)		$	(16,333,678	)	$	1,791,485
Non-controlling interest			(2,256,921	)		2,495,288
Total equity (deficit)		$	(18,590,599	)	$	4,286,773
Total liabilities and equity		$	72,697,489		$	72,106,449

Going concern (Note 2); Events after the reporting period (Note 8, 18)

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

Approved on behalf of the Board of Directors on August 15, 2022

“Russ McMeekin”	“Michael Allman”
Director	Director

1 | Condensed Consolidated Interim Financial Statements

F-64

mCloud Technologies Corp.

Condensed Consolidated Interim Statements of Loss and Comprehensive Loss

(Unaudited - Expressed in Canadian dollars except number of shares)

		Three months ended June 30,						Six months ended June 30,
	Notes	2022			2021			2022			2021
						Recast (Note 2)						Recast (Note 2)
Revenue	4	$	2,269,026		$	6,556,463		$	6,698,629		$	13,992,029
Cost of sales			(1,933,442	)		(2,060,784	)		(3,865,798	)		(5,319,514	)
Gross profit		$	335,584		$	4,495,679		$	2,832,831		$	8,672,515
Expenses
Salaries, wages and benefits		$	5,059,254		$	6,333,270		$	10,373,584			11,203,665
Sales and marketing			1,139,984			328,354			1,902,215			513,053
Research and development			568,334			711,715			1,100,284			1,460,879
General and administration			2,065,443			1,556,068			4,617,456			2,893,429
Professional and consulting fees			3,560,346			2,490,612			6,736,389			4,230,033
Share-based compensation	13		191,528			360,645			444,461			735,919
Depreciation and amortization			1,826,415			1,993,021			3,769,628			3,963,971
Total expenses		$	14,411,304		$	13,773,685		$	28,944,017		$	25,000,949
Operating loss		$	14,075,720		$	9,278,006		$	26,111,186		$	16,328,434
Other expenses (income)
Finance costs	16(a)	$	2,229,993		$	1,946,586		$	4,088,630		$	4,182,513
Foreign exchange (gain) loss			(1,116,052	)		164,355			(493,543	)		531,783
Business acquisition costs and other expenses			—			11,610			—			336,020
Fair value (gain) loss on derivatives	16(b)		(2,538,329	)		(1,113,106	)		(5,031,599	)		451,043
Other income	16(c)		(264,024	)		(1,155,002	)		(662,292	)		(3,065,308	)
Loss before tax		$	12,387,308		$	9,132,449		$	24,012,382		$	18,764,485
Current tax expense (recovery)			(184,181	)		240,562			104,682			479,359
Deferred tax (recovery)			(591,418	)		(372,600	)		(1,482,234	)		(491,824	)
Net loss for the period		$	11,611,709		$	9,000,411		$	22,634,830		$	18,752,020
Other comprehensive (income) loss
Foreign subsidiary translation differences			1,531,158			(523,979	)		882,069			(909,326	)
Comprehensive loss for the period		$	13,142,867		$	8,476,432		$	23,516,899		$	17,842,694
Net loss (income) for the period attributable to:
mCloud Technologies Corp. shareholders		$	8,051,662		$	8,930,312		$	17,829,232		$	19,201,037
Non-controlling interest			3,560,047			70,099			4,805,598			(449,017	)
		$	11,611,709		$	9,000,411		$	22,634,830		$	18,752,020
Comprehensive loss (income) for the period attributable to:
mCloud Technologies Corp. shareholders		$	9,617,122		$	8,487,838		$	18,764,690		$	18,513,256
Non-controlling interest			3,525,745			(11,406	)		4,752,209			(670,562	)
		$	13,142,867		$	8,476,432		$	23,516,899		$	17,842,694
Loss per share attributable to mCloud shareholders – basic and diluted		$	0.50		$	0.88		$	1.10		$	1.89
Weighted average number of common shares outstanding - basic and diluted			16,154,794			10,154,320			16,151,197			10,154,320

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

2 | Condensed Consolidated Interim Financial Statements

F-65

mCloud Technologies Corp.

Condensed Consolidated Interim Statements of Changes in Equity (Deficit)

For the Six Months Ended June 30, 2022 and 2021

(Unaudited - Expressed in Canadian Dollars except number of shares)

	Notes	Number of Shares		Share Capital		Contributed Surplus			Accumulated Other Comprehensive Income (Loss)			Deficit			Total Shareholders’ Equity (Deficit)			Non- controlling Interest			Total Equity (Deficit)
Balance, December 31, 2021 - Recast (Note 2)			16,138,069	$	118,195,363	$	11,040,751		$	1,227,269		$	(128,671,898	)	$	1,791,485		$	2,495,288		$	4,286,773
Share-based payments	13		—		—		444,461			—			—			444,461			—			444,461
RSUs exercised	12(a)		17,585		132,359		(132,359	)		—			—			—			—			—
Warrants issued in financing	12(b)		—		—		195,066			—			—			195,066			—			195,066
Net loss for the period			—		—		—			—			(17,829,232	)		(17,829,232	)		(4,805,598	)		(22,634,830	)
Other comprehensive (loss) income for the period			—		—		—			(935,458	)		—			(935,458	)		53,389			(882,069	)
Balance, June 30, 2022			16,155,654	$	118,327,722	$	11,547,919		$	291,811		$	(146,501,130	)	$	(16,333,678	)	$	(2,256,921	)	$	(18,590,599	)
Balance, December 31, 2020 - Recast (Note 2)			9,168,416	$	83,120,611	$	8,518,476		$	1,435,384		$	(83,909,198	)	$	9,165,273		$	2,293,246		$	11,458,519
Share-based payments			—		—		735,919			—			—			735,919			—			735,919
RSUs exercised			10,773		129,814		(129,814	)		—			—			—			—			—
Broker warrants issued			—		—		372,947			—			—			372,947			—			372,947
Shares issued in public offering, net of costs			2,300,000		12,395,918					—			—			12,395,918			—			12,395,918
Investor warrants issued, net of costs			—		—		619,796			—			—			619,796			—			619,796
Net (loss) income for the period			—		—		—			—			(19,201,037	)		(19,201,037	)		449,017			(18,752,020	)
Other comprehensive income for the period			—		—		—			687,781			—			687,781			221,545			909,326
Balance, June 30, 2021 - Recast (Note 2)			11,479,189	$	95,646,343	$	10,117,324		$	2,123,165		$	(103,110,235	)	$	4,776,597		$	2,963,808		$	7,740,405

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

3 | Condensed Consolidated Interim Financial Statements

F-66

mCloud Technologies Corp.

Condensed Consolidated Interim Statements of Cash Flows

(Unaudited - Expressed in Canadian Dollars)

		Six months ended June 30,
	Notes	2022			2021
Operating activities					Recast (Note 2)
Net loss for the period		$	(22,634,830	)	$	(18,752,020	)
Items not affecting cash:
Depreciation and amortization			3,769,628			3,963,971
Share-based compensation	13		444,461			735,919
Finance costs	16(a)		4,088,630			4,182,513
Fair value (gain) loss on derivatives	16(b)		(5,031,599	)		451,043
Other income			(5,265	)		(873,950	)
Provision for expected credit loss			(64,337	)		—
Unrealized foreign currency exchange (gain) loss			65,086			611,061
Current tax expense			104,682			479,359
Deferred income tax recovery			(1,482,234	)		(491,824	)
Increase (decrease) in working capital	17(a)		6,880,330			(1,647,105	)
Interest paid			(2,284,458	)		(1,613,861	)
Net cash used in operating activities		$	(16,149,906	)	$	(12,954,894	)
Investing activities
Acquisition of property and equipment		$	(35,935	)	$	(337,784	)
Expenditure on intangible assets			—			(436,555	)
Net cash used in investing activities		$	(35,935	)	$	(774,339	)
Financing activities
Payment of lease liabilities		$	(268,359	)	$	(592,372	)
Repayment of loans			(8,224,068	)		(7,009,073	)
Proceeds from loans and bank indebtedness, net of transaction costs			25,376,844			8,760,673
Repayments of bank indebtedness			(857,816	)		(953,584	)
Proceeds from issuance of shares, net of issuance costs			—			12,395,918
Proceeds from issuance of convertible debentures, net of costs			—			5,527,298
Advance from subscription of units			—			420,000
Proceeds from exercise of warrants, net			—			619,796
Net cash provided by financing activities		$	16,026,601		$	19,168,656
Net (decrease) increase in cash and cash equivalents		$	(159,240	)	$	5,439,423
Effect of exchange rate fluctuations on cash held			(22,869	)		(20,604	)
Cash and cash equivalents, beginning of period			4,588,057			1,110,889
Cash and cash equivalents, end of period		$	4,405,948		$	6,529,708

Supplemental cash flow information (Note 17)

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

4 | Condensed Consolidated Interim Financial Statements

F-67

mCloud Technologies Corp.

Notes to the Condensed Consolidated Interim Financial Statements

For the Three and Six Months Ended June 30, 2022 and 2021

(Unaudited - Expressed in Canadian Dollars except otherwise noted)

NOTE 1 – NATURE OF OPERATIONS

mCloud Technologies Corp. (“mCloud” or the “Company”), is a provider of proprietary technology solutions, AssetCare. Customers use AssetCare software-as-a-service (“SaaS”) and data solutions to ensure assets continuously operate at peak performance. AssetCare is an asset management platform combining IoT, AI and the cloud to drive next-level performance and efficiency. mCloud offers foundational enterprise technology solutions enabling capabilities such as secure communications, connected work, and remote monitoring.

The Company is domiciled in Vancouver, Canada with its head office in Calgary, Alberta and its registered offices located at 550-510 Burrard Street, Vancouver, British Columbia, V6C 3A8.

The Company’s common shares trade on the TSX.V trading in Canadian dollars under the symbol MCLD, on the Nasdaq Stock Market LLC (“NASDAQ”) in U.S. dollars under the symbol MCLD, and on the OTCQB Venture Market under the symbol MCLDF.

NOTE 2 – BASIS OF ACCOUNTING

Basis of preparation

These condensed consolidated interim financial statements of the Company include the accounts of the Company, the ultimate parent company of its consolidated group, and its subsidiaries, and are prepared in accordance with International Accounting Standard 34 - Interim Financial Reporting (“IAS 34”) as issued by the International Accounting Standards Board (“IASB”). Certain disclosures included in the annual financial statements prepared in accordance with International Financial Reporting Standards (“IFRSs”) as issued by the IASB have been condensed or omitted as they are not required for interim financial statements. Accordingly, these condensed consolidated interim financial statements should be read in conjunction with the Company’s audited consolidated annual financial statements and notes thereto for the year ended December 31, 2021 (the “2021 Annual Financial Statements”), which are available on SEDAR at www.sedar.com. Selected explanatory notes are included in the interim financial statements to explain events and transactions that are significant to the understanding of changes in the Company’s financial position and performance since the last annual financial statements. The accounting policies applied in the preparation of these condensed consolidated interim financial statements are consistent with those applied in the 2021 Annual Financial Statements.

The Company’s presentation currency is Canadian dollars, and all amounts are presented in Canadian dollars unless otherwise stated. Certain disclosures include the use of U.S. Dollars (“USD” or “US$”) in describing certain financing transactions. These condensed consolidated interim financial statements have been prepared on a going-concern basis, under the historical cost convention except for certain financial instruments that have been measured at fair value. There were no changes in the entities contained in the consolidated results or the equity percentage held by the Company from December 31, 2021.

Total revenues recognized in the consolidated statement of loss and comprehensive loss during the year ended December 31, 2021, have been corrected between the four quarters ended March 31, 2021, June 30, 2021, September 30, 2021 and December 31, 2021. The adjustment to the previously reported amounts for the three and six months ended June 30, 2021, resulted in a decrease to revenue of $945,470 and $1,597,134, respectively, and a corresponding increase to net loss and net loss attributable to mCloud shareholders. During the three and six months ended June 30, 2021, basic and diluted net loss per share increased to a net loss of $0.88 per share from $0.75 per share and $1.89 per share from $1.73 per share, respectively.

The Company has reclassified certain expenses during the six months ended June 30, 2021 in the condensed consolidated interim statements of loss and comprehensive loss. These adjustments impacted previously reported amounts for the six months ended by decreasing cost of sales by $539,776, increasing sales, wages and benefits by $749,688 and decreasing professional and consulting fees by $209,912.

The Company has corrected net income (loss) and other comprehensive income (loss) attributable to mCloud shareholders and non-controlling interest for the years ended December 31, 2019, 2020 and 2021. This resulted in a reclassification between non-controlling interest, accumulated other comprehensive income, and accumulated deficit in the condensed consolidated statements of financial position at December 31, 2020, June 30, 2021 and December 31, 2021. At December 31, 2020, on the condensed consolidated statement of financial position, accumulated other comprehensive income decreased by $234,212, deficit decreased by $1,777,168, and non-controlling interest decreased by $1,542,956. At June 30, 2021, on the condensed consolidated statement of changes in equity, accumulated other comprehensive income decreased by $102,247, and non-controlling interest increased by $102,247. At December 31, 2021, on the condensed consolidated statement of financial position, accumulated other comprehensive income decreased by $344,729, deficit decreased by $1,344,175, and non-controlling interest decreased by $999,446 taking into consideration the cumulative impacts of prior period adjustments.  

5 | Notes to the Condensed Consolidated Interim Financial Statements

F-68

mCloud Technologies Corp.

Notes to the Condensed Consolidated Interim Financial Statements

For the Three and Six Months Ended June 30, 2022 and 2021

(Unaudited - Expressed in Canadian Dollars except otherwise noted)

NOTE 2 – BASIS OF ACCOUNTING (continued)

In addition, the comparative disclosures as at December 31, 2021 in Note 14, Non-controlling interest, reflect the corrected balances for non-current assets, current liabilities and non-current liabilities of the non-controlling interest arising from the above noted attribution of net income (loss) and other comprehensive income (loss) errors as well as certain other disclosure errors.

These condensed consolidated interim financial statements were authorized for issue by the Audit Committee, on behalf of the Board of Directors, on August 15, 2022.

Going Concern

The outbreak of the COVID-19 pandemic and the measures adopted by governments in countries worldwide to mitigate the pandemic’s spread have impacted the Company. These measures required the Company to restrict deployment of technical services due to the in-person nature of these activities and delayed the start of certain projects throughout 2021 and into 2022. This negatively impacted the Company’s financial performance and liquidity position. While restrictions continue to ease there have been increased cases of COVID-19 and there is still uncertainty over how COVID-19 will impact the Company’s business and the timing of future revenues.

During the six months ended June 30, 2022, the Company generated a net loss of $22,634,830 and negative cash flows from operating activities of $16,149,906. At June 30, 2022, the Company had a working capital deficiency of $44,054,559. Working capital deficiency is a non-IFRS measure which is calculated as current assets less current liabilities. Current liquidity levels and available sources of capital are not adequate to fund the working capital deficiency. The most significant expected cash outflows included in current liabilities at June 30, 2022 include the 2019 Convertible Debentures of $23,652,979 (Note 10); loans and borrowings of $12,721,061 including principal and interest payments; payment of trade and other payables of $16,343,347; and payments associated with leases of approximately $1,408,243.

Based on the Company’s liquidity position at the date of authorization of these condensed consolidated interim financial statements and considering the uncertainty surrounding the impact of the pandemic, management estimates that it will need additional financing to meet its financial obligations. The Company is currently working with stakeholders and others to address the working capital deficiency. In the long-term, the ability of the Company to operate as a going concern is dependent on its ability to achieve and maintain profitable operations and positive cash flow from operations, and, as necessary, to obtain the necessary equity or debt financing to continue with operations. To date, the Company has funded its operations through debt and equity financing. While the Company has been successful in raising capital in the past and anticipates the lenders will not accelerate repayment of loans with covenant breaches as of June 30, 2022, and potential breaches forecasted over the coming year, there is no assurance that it will be successful in closing further financings in the future or obtaining waivers of the covenant breaches.

As a result, these factors are indicators that material uncertainties exist that raises significant doubt about the Company’s ability to continue as a going concern and, therefore, its ability to realize assets and discharge liabilities in the normal course of business.

In making their assessment, management considered all available information, together with forecasts and other mitigating strategies, about the future which is at least, but not limited to, 12 months from the end of the reporting period. Management has considered the following in its assessment that the going concern assumption remains appropriate:

• the plan for the repayment of the 2019 Convertible Debentures;

• the repayment of the term loan in full on or before October 31, 2022 (Note 8);

• the likelihood that undrawn funds under the revolving operating facility will be available and will not be required to be repaid (Note 9);

• the required cash principal and interest payments on indebtedness;

• the likelihood of payments required under contingent consideration arrangements;

• cash inflows from current operations and expected increases in revenues and cash flows resulting from new revenue contracts expected over the next 12 months due to the anticipated reduction of COVID-19 related restrictions; and

• future debt and equity raises.

These condensed consolidated interim financial statements have been prepared on a going concern basis, which contemplates that the Company will continue in operation and be able to realize its assets and discharge its liabilities and commitments in the normal course of business for the foreseeable future. These condensed consolidated interim financial statements do not include any adjustments to the carrying amounts and classifications of assets, liabilities and reported expenses that may otherwise be required if the going concern basis was not appropriate.

6 | Notes to the Condensed Consolidated Interim Financial Statements

F-69

mCloud Technologies Corp.

Notes to the Condensed Consolidated Interim Financial Statements

For the Three and Six Months Ended June 30, 2022 and 2021

(Unaudited - Expressed in Canadian Dollars except otherwise noted)

NOTE 3 – CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS

In the preparation of the condensed consolidated interim financial statements and the application of the Company’s accounting policies, management is required to make judgments, estimates and assumptions that affect the carrying amounts of assets and liabilities and disclosure of contingent liabilities at the dates of the consolidated financial statements, and the reported amounts of revenues and expenses during each reporting period. The estimates and associated assumptions are limited by the relevance of historical data and uncertainty of future events. Actual results could differ from those estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to estimates are recognized in the period in which the estimates are revised and in any future period.

The Company applied critical judgements and estimates, including significant areas of estimation uncertainty in applying policies, in preparing these condensed consolidated interim financial statements.

NOTE 4 - REVENUE

All of the Company’s revenue is derived from contracts with customers. In the following tables, revenue is disaggregated by major service line and timing of revenue recognition.

	Three months ended June 30,					Six months ended June 30,
	2022			2021		2022			2021
AssetCare Initialization 1	$	28,979		$	303,321	$	443,470		$	818,564
AssetCare Solutions 2		4,695,074			6,079,949		8,684,202			12,514,458
Engineering Services 3		116,649			173,193		142,633			659,007
Contract modification revenue reversal 4		(2,571,676	)		—		(2,571,676	)		—
	$	2,269,026		$	6,556,463	$	6,698,629		$	13,992,029

1  Revenues from initial implementation and activation of AssetCare projects, including the sale of hardware.

2 Revenues include sales of subscriptions to AssetCare, other subscriptions, post contract support and maintenance, perpetual software licenses, and installation and engineering services.

3 Revenues includes consulting, implementation and integration services entered into on a time and materials basis or fixed fee basis without the use of AssetCare.

4 During the three months ended June 30, 2022, the Company cancelled a multi-year customer contract for which services had been performed in prior periods, resulting in a contract modification. As a result, revenue from AssetCare Initialization of $2,037,014 and AssetCare Solutions of $534,662 which were recorded in prior periods was reversed during the three and six months ended June 30, 2022.

	Three months ended June 30,					Six months ended June 30,
Revenue recognized	2022			2021		2022			2021
Over time 1	$	3,783,459		$	6,253,142	$	7,645,663		$	11,701,851
At a point in time upon completion 1		(1,514,433	)		303,321		(947,034	)		2,290,178
	$	2,269,026		$	6,556,463	$	6,698,629		$	13,992,029

1  See table above and related footnote 4. The three and six months ended June 30, 2022 reflects the reversal of $534,662 of revenue recognized over time and $2,037,014 of revenue recognized at point in time upon completion.

The Company’s revenue by location of the ultimate customer or consumer of product solution are as follows:

	Three months ended June 30,					Six months ended June 30,
	2022			2021		2022		2021
Canada 1	$	(767,709	)	$	3,440,590	$	1,271,267	$	7,852,189
Americas		1,647,854			1,422,069		3,167,929		2,671,673
Asia Pacific		1,027,989			1,579,435		1,705,857		3,298,173
Other		360,892			114,369		553,576		169,994
Total revenue	$	2,269,026		$	6,556,463	$	6,698,629	$	13,992,029

1  Impact of previously recognized revenue for contract modification as explained in tables above.

7 | Notes to the Condensed Consolidated Interim Financial Statements

F-70

mCloud Technologies Corp.

Notes to the Condensed Consolidated Interim Financial Statements

For the Three and Six Months Ended June 30, 2022 and 2021

(Unaudited - Expressed in Canadian Dollars except otherwise noted)

NOTE 4 - REVENUE (continued)

Significant changes in unbilled revenue and deferred revenue balances are as follows:

	Unbilled revenue			Deferred revenue
Balance at December 31, 2021	$	756,042		$	2,811,408
Additions		3,057,402			5,805,365
Less: transferred to trade and other receivables		(2,952,031	)		—
Less: recognized in revenue		—			(3,853,163	)
Effect of movements in exchange rates		—			49,589
Balance at June 30, 2022	$	861,413		$	4,813,199

NOTE 5 - TRADE AND OTHER RECEIVABLES AND LONG-TERM RECEIVABLES

	June 30, 2022			December 31, 2021
Trade receivables from contracts with customers	$	11,532,760		$	14,204,320
Unbilled revenue (Note 4)		861,413			756,042
Indirect taxes receivable		293,320			148,200
Income taxes receivable		11,404			2,217
Other receivables		920,419			919,954
Contract asset		46,812			86,777
Loss allowance		(1,531,136	)		(1,550,535	)
Total trade and other receivables - current	$	12,134,992		$	14,566,975

Long-term receivables

Long-term receivables represent receivables associated with revenue contracts whereby certain customers make fixed monthly installment payments over a period of time, ranging from one to three years, for performance obligations delivered upfront. For contracts where all performance obligations were completed except for monthly post contract and support maintenance, amounts due are included in trade receivables from contracts with customers.

	June 30, 2022		December 31, 2021
Current portion of long-term receivables 1	$	390,398	$	397,060
Non-current portion of long-term receivables 2		318,360		343,371
Total long-term receivables	$	708,758	$	740,431

1 Net of expected credit loss allowance of $95,518 at June 30, 2022 (December 31, 2021 - $95,064).

2 Net of expected credit loss allowance of $61,619 at June 30, 2022 (December 31, 2021 - $61,619).

NOTE 6 - LEASES

In October 2021, the Company executed a 12-year lease for office space in Calgary, Alberta. Basic rent and estimated common area expense payments commence in December 2022, preceded by a fixturing period which the Company will use to build out the space. Effective January 2022, the Company recognized a right-of-use asset associated with this office space of $6,322,509 and a related lease liability of $6,221,749.

The carrying value of all right-of-use assets at June 30, 2022 was $7,298,424 (December 31, 2021 - $916,028). Total lease liabilities were $7,678,618 at June 30, 2022 (December 31, 2021 - $1,045,472). The change in undiscounted contractual cash flows associated with new premise leases are described in Note 15(c).

8 | Notes to the Condensed Consolidated Interim Financial Statements

F-71

mCloud Technologies Corp.

Notes to the Condensed Consolidated Interim Financial Statements

For the Three and Six Months Ended June 30, 2022 and 2021

(Unaudited - Expressed in Canadian Dollars except otherwise noted)

NOTE 7 - TRADE PAYABLES AND ACCRUED LIABILITIES

	June 30, 2022		December 31, 2021
Trade payables		$              8,697,912		$                    5,591,316
Accrued liabilities		5,453,285		5,398,389
Interest payable		228,222		233,854
Mastercard facility		372,374		296,669
Due to related parties		217,795		265,074
Income taxes payable		278,813		266,753
Indirect taxes payable		279,993		150,577
Other 1		814,953		218,677
Total trade payables and accrued liabilities		$            16,343,347		$                  12,421,309

1 At June 30, 2022, includes $718,092 associated with previous warrant liability (Note 11(c)).

NOTE 8 - LOANS AND BORROWINGS

The carrying value of loans and borrowings by entities controlled by the Company are as follows. Note 17(b) includes the reconciliation of cash flows associated with borrowing activities.

	June 30, 2022		December 31, 2021
Term loan (a)		$              6,623,292		$                    9,275,683
Promissory notes (b)		19,342,593		—
Nations Interbanc facility 1		2,975,021		2,639,143
Debenture payable to Industry Canada		—		26,412
Loan payable to related party 2		349,980		335,860
Oracle financing		632,034		826,418
Other loans and financing		62,887		112,085
Total		$            29,985,807		$                  13,215,601
Current		$            10,399,574		$                  12,447,939
Non-current		$            19,586,233		$767,662
Total		$            29,985,807		$                  13,215,601

1 Nations advanced $5,433,688 under the factor and security agreement and was repaid $5,454,108 in the six months ended June 30, 2022 (six months ended June 30, 2021 - $4,842,450 advances and $6,020,883 repayments).

2 Loan which originally matured in January 2023 was repaid in full in August 2022.

Loan repayment terms vary depending on the nature of the debt. Total interest expense associated with loans and borrowings recognized in net loss was $734,854 and $1,131,557 for the three and six months ended June 30, 2022 (three and six months ended June 30, 2021 - $286,144 and $533,508) (Note 16(a)). All of the Company’s loans have fixed interest rates, with the exception of its credit facility (Note 9).

a) Term Loan

In May 2022, the Company and Fiera Private Debt Fund VI LP (“Fiera”) executed an Accommodation Agreement (the “Accommodation Agreement”) and the Company paid a total of $2,044,086 representing a portion of the outstanding principal amount under the term loan and a prepayment penalty and accommodation fee. The parties agreed that the remainder of the principal and interest due under the term loan would be paid on or before October 31, 2022 (the “Repayment Date”) and not the original maturity date of August 7, 2026. The term loan was amended to increase the interest rate charged from 6.85% to 9.5% per annum. The Company may be required to repay the loan before the Repayment Date if the Company is in default or breach of the Accommodation Agreement. As part of the Accommodation Agreement, Fiera signed an agreement, whereby Fiera’s security against certain assets of the Company is subordinate to the security granted to Carbon Royalty Corp. (Note 8(b)).

9 | Notes to the Condensed Consolidated Interim Financial Statements

F-72

mCloud Technologies Corp.

Notes to the Condensed Consolidated Interim Financial Statements

For the Three and Six Months Ended June 30, 2022 and 2021

(Unaudited - Expressed in Canadian Dollars except otherwise noted)

NOTE 8 - LOANS AND BORROWINGS (continued)

a)  Term Loan (continued)

Blended payments of principal and interest of $2,987,535, inclusive of the lump sum principal repayment, were paid for the six months ended June 30, 2022 (six months ended June 30, 2021 - $1,171,518). A modification loss associated with the change in terms of $161,698 is included in finance costs in the consolidated statement of loss for the six months ended June 30, 2022 with an offsetting increase in the carrying value of the term loan. Transaction costs were incurred and netted against the value of the term loan.

The term loan was classified as current at December 31, 2021 as the Company did not meet certain minimum covenants set forth in the November 2021 amendment to the term loan and therefore the term loan was due on demand. There are no financial covenants under the Accommodation Agreement and the Company is no longer required to maintain the previous financial covenants.

b)  Financing of Electric Vehicle Development Projects

In conjunction with the Company’s agreements to provide AssetCare solutions to optimize Electric Vehicle (“EV”) charging efficiency at auto dealerships in certain U.S. States (the “EV Dealership Projects”), on March 28, 2022, a subsidiary of the Company executed a promissory note in the aggregate principal amount of US$15,000,000 (the “Note”) with Carbon Royalty Corp. (“Carbon”). EV Dealership Projects are the design, installation and operation of integrated power systems consisting of solar, batteries and EV charging power stations for auto dealerships.

The initial principal amount under the Note of US$5,000,000 was funded on April 1, 2022 and an additional US$10,000,000 was funded on May 5, 2022 (the “Loans”). The Loans mature on March 31, 2025, with 10% per annum interest payable monthly in arrears in USD. In addition to the interest payments, certain income-based payments, including tax incentives, are required to be made from the borrower to the lender based on income resulting from the EV dealership projects over their 20-year term. The Loans may not be prepaid unless authorized by the lender. The Loans contain representations, warranties and covenants which must be complied with to avoid an event of default which will allow the lender to demand repayment and increase the interest rate to 18%, amongst other implications.

On May 5, 2022, the Company, Carbon and Fiera executed a Subordination and Postponement Agreement (the “Subordination Agreement”), whereby the parties agreed that the security previously held by Fiera would be subordinate to the security granted to Carbon commencing on the date of the agreement. The security granted to Carbon includes, to the extent related to the EV Dealership Projects, all accounts, equipment and machinery, contracts and contract rights, including contracts with auto dealerships, inventory, cash and proceeds, rent and profits.

NOTE 9 – BANK INDEBTEDNESS

	June 30, 2022		December 31, 2021
ATB Financial revolving operating facility	$	3,679,631	$	3,460,109

ATB Financial Facility

The Company’s secured revolving operating facility (“ATB Facility”) with ATB Financial (“ATB”) is due on demand, bears interest at the prime rate plus 2% per annum with interest and fees due at the end of each month. During the six months ended June 30, 2022, additional draws of $1,077,338 were made and principal repayments of $863,502 were made in accordance with the agreement.

The ATB Facility is subject to certain reporting and financial covenants. The Company was not in compliance with these covenants at June 30, 2022.

10 | Notes to the Condensed Consolidated Interim Financial Statements

F-73

mCloud Technologies Corp.

Notes to the Condensed Consolidated Interim Financial Statements

For the Three and Six Months Ended June 30, 2022 and 2021

(Unaudited - Expressed in Canadian Dollars except otherwise noted)

NOTE 10 – CONVERTIBLE DEBENTURES

2019 Convertible debentures

	June 30, 2022		December 31, 2021
Opening balance	$	22,380,649	$	19,767,472
Interest paid		(1,172,875)		(2,345,750)
Accreted interest at effective interest rate		2,445,205		4,958,927
Carrying amount of liability component	$	23,652,979	$	22,380,649
Less: interest payable		(195,479)		(195,479)
Total - current	$	23,457,500	$	22,185,170

The Company completed a private placement offering of convertible unsecured subordinated debentures (the “2019 Debentures”) for total aggregate gross proceeds of $23,507,500 in July 2019. The 2019 Debentures bear interest at a rate of 10% per annum, paid quarterly, and matured on June 30, 2022, at which time the principal amount of $23,457,500 and any unpaid interest was repayable in cash because the conversion option was not exercised by the holders as of that date.

NOTE 11 - WARRANT LIABILITIES

	June 30, 2022		December 31, 2021
Derivative warrant liabilities - 2021 Debentures (a)	$	367,019	$	1,868,541
Derivative warrant liabilities - USD equity financing (b)		2,650,624		6,106,596
Warrant liability related to business acquisition (c)		—		709,835
Other warrant liability (c)		—		195,066
Total, all current	$	3,017,643	$	8,880,038

Derivative warrant liabilities

The Company issued warrants in conjunction with debt and equity transactions. Certain of these warrants are classified as derivatives which are recognized as financial liabilities. At the issuance date and each reporting date until warrants are exercised, the fair value of the liability is remeasured, with changes in the fair value recorded as gains or losses in the consolidated statements of loss and comprehensive loss. There were no new derivative warrants issued or warrants exercised in the three and six months ended June 30, 2022.

a)  Warrants associated with 2021 Debentures

The 2,107,787 common share purchase warrants entitle the holder to purchase one common share of the Company at an exercise price of US$6.87 and expire August 13, 2024. At June 30, 2022, the warrants were remeasured at a fair value of $367,019, resulting in a $853,068 and $1,509,069 gain on remeasurement for the three and six months ended June 30, 2022. The fair value of derivative warrants at June 30, 2022 of $0.17 per warrant was calculated using the Black-Scholes option pricing model (“Black-Scholes model”) with the following inputs and assumptions: share price of $4.05, Canadian dollar equivalent exercise price of $8.87, risk-free rate of 2.93%, expected life of 2.1 years, expected volatility of 43%, and no expected dividends. These warrants are classified as a Level 3 fair value measurement.

b)  Warrants associated with USD equity financing

The 2,415,000 common share purchase warrants entitle the holder to purchase one common share of the Company at an exercise price of US$4.75 and expire November 29, 2026. On February 15, 2022, these warrants commenced trading on the NASDAQ, under the symbol MCLDW, and as a result, these warrants are classified as a Level 1 fair value measurement (previously Level 3) at June 30, 2022 (Note 15(b)). At June 30, 2022, the warrants were remeasured at a fair value of $2,650,624, resulting in a $1,652,742 and $3,490,011 gain on remeasurement for the three and six months ended June 30, 2022. The fair value of derivative warrants at June 30, 2022 of $1.10 (US$0.85) per warrant was based on the closing price of the warrants.

11 | Notes to the Condensed Consolidated Interim Financial Statements

F-74

mCloud Technologies Corp.

Notes to the Condensed Consolidated Interim Financial Statements

For the Three and Six Months Ended June 30, 2022 and 2021

(Unaudited - Expressed in Canadian Dollars except otherwise noted)

NOTE 11 - WARRANT LIABILITIES (continued)

c) Other warrant liabilities

Warrant liability related to business acquisition - During 2019, the Company assumed a warrant liability whereby the holder of the warrant has the option to convert the warrant into shares of Agnity, not the Company, by April 15, 2022, or receive a cash payment of US$552,250 at any time before the expiry of the warrant. The liability is measured at the Canadian dollar equivalent to its cash redemption amount which varies as a function of movements in exchange rates. The warrant holder elected to receive cash repayment and the C$ equivalent of the cash payment has been reclassified to trade payables and accrued liabilities at June 30, 2022.

Warrant liability related to ATB Financial - At December 31, 2021, the Company had an obligation to issue warrants to ATB. The fair value of the warrants was measured at the date the services were received in the amount of $195,066. On January 17, 2022, the Company issued 183,486 share purchase warrants to ATB which gives them the ability to purchase an equivalent number of common shares of the Company at an exercise price of $5.45 per share, maturing one year from date of issuance (Note 12(b)).

NOTE 12 - SHARE CAPITAL

a)   Common shares

The Company has an unlimited number of authorized voting common shares with no par value. During the six months ended June 30, 2022, the Company issued 17,585 common shares on exercise of Restricted Share Units (Note 13(b)).

Common shares in escrow

At June 30, 2022, the Company has 441,913 (December 31, 2021 - 681,024) common shares subject to escrow conditions resulting from business combinations and asset acquisitions in prior years.

b)   Warrants

The Company’s warrants outstanding as at June 30, 2022 are as follows and include both warrants classified as equity-settled and warrants classified as financial liabilities (Note 11):

	Number of Warrants			Weighted Average  Exercise Price
Balance, December 31, 2021		8,481,929		$	8.83
Issued		183,486			5.45
Expired		(19,318	)		15.00
Balance, June 30, 2022		8,646,097		$	8.74

On January 17, 2022, the Company issued warrants to ATB to purchase an equivalent number of common shares of the Company and the warrant liability of $195,066 described in Note 11(c) was derecognized with an offsetting credit to contributed surplus for the value assigned to the warrants. The weighted average remaining contractual life of outstanding warrants was 2.6 years at June 30, 2022 (December 31, 2021 - 3.1 years).

12 | Notes to the Condensed Consolidated Interim Financial Statements

F-75

mCloud Technologies Corp.

Notes to the Condensed Consolidated Interim Financial Statements

For the Three and Six Months Ended June 30, 2022 and 2021

(Unaudited - Expressed in Canadian Dollars except otherwise noted)

NOTE 13 – SHARE BASED PAYMENT ARRANGEMENTS

The Company recorded share-based compensation as follows:

	Three months ended June 30,				Six months ended June 30,
	2022		2021		2022		2021
Stock options (a)	$	128,441	$	116,892	$	320,588	$	247,790
Restricted share units (b)		63,087		243,753		123,873		488,129
Total	$	191,528	$	360,645	$	444,461	$	735,919

a)   Stock Options

	Number of Options			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (years)
Outstanding, December 31, 2021		866,789		$	8.81		7.5
Granted		167,699		$	4.70		9.6
Forfeited		(137,526	)	$	7.11		9.3
Expired		(40,648	)	$	10.46		1.1
Outstanding, June 30, 2022		856,314		$	8.20		7.7

At June 30, 2022, 263,202 stock options were exercisable at a weighted average exercise price of $10.94. Exercise prices of stock options range from $3.46 to $18.02 per option. As at June 30, 2022, unrecognized share-based compensation expense related to non-vested stock options granted is $1,202,934 (December 31, 2021 - $1,824,812).

The weighted average fair value of stock options granted during the six months ended June 30, 2022 of $482,514, or $2.88 per option, was calculated at the date of grant using the Black-Scholes model with the following weighted average assumptions and inputs: grant date share price of $4.70, exercise price of $4.70, risk-free rate of 2.23%, expected life of 6.5 years, expected volatility of 74%, forfeiture rate of 10%, and no expected dividends. Expected volatility is estimated taking into account historical share price volatility.

b)   Restricted Share Units (“RSUs”)

The Company’s obligation to issue shares on the vesting of RSUs is an unfunded and unsecured obligation of the Company. A continuity of RSUs is as follows:

	Number of RSUs
Outstanding, December 31, 2021		208,674
Granted		98,417
Exercised		(17,585	)
Forfeited		(35,893	)
Outstanding, June 30, 2022		253,613
Exercisable at June 30, 2022		108,992

During the six months ended June 30, 2022, 17,585 common shares were issued on the exercise of 17,585 RSUs at a weighted average share price at exercise of $7.53. The fair value of each RSU is based on the market price of the Company’s common shares on the date of grant and the total fair value of RSUs granted in six months ended June 30, 2022 was $491,999. As at June 30, 2022, unrecognized share-based compensation expense related to non-vested RSUs granted was $310,434 (December 31, 2021 - $277,686).

13 | Notes to the Condensed Consolidated Interim Financial Statements

F-76

mCloud Technologies Corp.

Notes to the Condensed Consolidated Interim Financial Statements

For the Three and Six Months Ended June 30, 2022 and 2021

(Unaudited - Expressed in Canadian Dollars except otherwise noted)

NOTE 14 – NON-CONTROLLING INTEREST

In April 2019, the Company obtained control over Agnity as a party to the modified Royalty Purchase Agreement (“Royalty Agreement”). The transaction was accounted for as a business combination, and given the Company had no voting rights, the non-controlling interest (“NCI”) was measured at 100% of the acquired net identifiable assets of Agnity at the transaction date. See Note 18(a) for activity subsequent to June 30, 2022.

	June 30, 2022			December 31, 2021
					Recast (Note 2)
NCI percentage		100%			100%
Current assets	$	8,923,871		$	11,906,502
Non-current assets		4,512,625			5,111,714
Current liabilities		(11,141,684	)		(8,752,552	)
Non-current liabilities		(4,510,938	)		(5,598,783	)
Net assets (liabilities) attributable to NCI	$	(2,216,126	)	$	2,666,881
For the six months ended	June 30, 2022			June 30, 2021
					Recast (Note 2)
Revenue	$	1,761,613		$	6,010,328
(Loss) income allocated to NCI		(4,805,598	)		449,017
Other comprehensive income allocated to NCI		53,389			221,545
Total comprehensive (loss) income attributable to NCI	$	(4,752,209	)	$	670,562
Cash flows (used in) provided by operating activities	$	(209,162	)		1,396,859
Cash flows (used in) investing activities		(8,790	)		(309,586	)
Cash flows provided by (used in) financing activities		90,633			(387,222	)
Foreign exchange impact on cash held in USD		125			15,283
Net (decrease) increase in cash and cash equivalents	$	(127,194	)	$	715,334

14 | Notes to the Condensed Consolidated Interim Financial Statements

F-77

mCloud Technologies Corp.

Notes to the Condensed Consolidated Interim Financial Statements

For the Three and Six Months Ended June 30, 2022 and 2021

(Unaudited - Expressed in Canadian Dollars except otherwise noted)

NOTE 15 - FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT

a)  Classification and measurement of financial assets and liabilities by category

The following represents the carrying values of the financial assets and liabilities of the Company and the associated measurement basis for each balance.

Financial assets	Measurement basis	June 30, 2022		December 31, 2021
Cash and cash equivalents	Amortized cost	$	4,405,948	$	4,588,057
Trade and other receivables 1	Amortized cost		11,783,456		14,329,781
Long-term receivables	Amortized cost		708,758		740,431
		$	16,898,162	$	19,658,269
Financial liabilities
Bank indebtedness	Amortized cost	$	3,679,631	$	3,460,109
Trade payables and accrued liabilities 1	Amortized cost		15,784,541		12,003,979
Loans and borrowings	Amortized cost		29,985,807		13,215,601
Lease liabilities	Amortized cost		7,678,618		1,045,472
2019 Debentures - host liability	Amortized cost		23,457,500		22,185,170
2021 Debentures - host liability	Amortized cost		75,491		69,034
2021 Debentures embedded derivative	FVTPL		9,600		41,506
Warrant liability - business acquisition	FVTPL		–		709,835
Warrant liabilities - derivatives (Note 11)	FVTPL		3,017,643		7,975,137
Business acquisition payable	FVTPL		1,399,580		1,398,972
		$	85,088,411	$	62,104,815

1   Excludes amounts for indirect taxes, income taxes and contract assets, where applicable.

Financial instruments not measured at fair value

The carrying values of the financial assets and liabilities where the measurement basis is other than FVTPL approximate their fair values due to the immediate or short-term nature of these instruments considering there have been no significant change in credit and market interest rates since origination date.

b)  Measurement of fair value

The fair value hierarchy establishes three levels to classify the significance of inputs to valuation techniques used in making fair value measurements of all financial assets and liabilities. At June 30, 2022 and December 31, 2021, there were no financial assets and financial liabilities measured and recognized at fair value on a non-recurring basis subsequent to initial recognition.

The Company’s policy for determining when a transfer between levels of the fair value hierarchy occurs is to assess the impact at the date of the event or change in circumstance that could result in the transfer. During the six months ended June 30, 2022, the warrant liabilities associated with the USD Equity financing were transferred from Level 3 to Level 1 as these warrants are now measured by reference to the closing price of the traded warrants (Note 11(b)). There were no other transfers between any of the levels during the six months ended June 30, 2022.

Valuation methodologies used in the measurement of fair value for Level 2 financial assets and financial liabilities

The measurement of Level 2 financial assets and liabilities is made by reference to the inputs used to determine the fair value of each instrument using an appropriate valuation method. There were no changes in the valuation methodologies from those at December 31, 2021.

Valuation methodologies used in the measurement of fair value for Level 3 financial liabilities

There were no changes in the valuation methodologies for Level 3 financial liabilities from those at December 31, 2021, except from the transfer from Level 3 to Level 1 described above. The Black-Scholes model remains in use for the warrants issued on conversion of the 2021 Debentures and is based on the quoted price of the Company’s common stock in an active market, expected volatility, expected life and risk-free rate.

15 | Notes to the Condensed Consolidated Interim Financial Statements

F-78

mCloud Technologies Corp.

Notes to the Condensed Consolidated Interim Financial Statements

For the Three and Six Months Ended June 30, 2022 and 2021

(Unaudited - Expressed in Canadian Dollars except otherwise noted)

NOTE 15 - FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT (continued)

c)  Financial instruments risk

There were no significant changes in the Company’s exposure to those risks during the six months ended June 30, 2022, except for the additional commitments as noted below which impacts liquidity risk and a change to foreign currency risk.

Contractual Obligations and Commitments

During the six months ended June 30, 2022, the most significant changes in contractual obligations were: (a) the addition of new premise leases with lease obligations for base rent of approximately $10,200,000 and variable lease payments of approximately $8,600,000, the majority of which were previously included as commitments; (b) new financing of US$15,000,000 (Note 8(b)) which is classified as non-current at June 30, 2022; and (c) increase in trade payables and accrued liabilities, which includes the cash payment election made by the holder for the settlement of a previous warrant liability (Note 7). Contractual obligations at December 31, 2021, have been reduced by normal course payments made during the six months ended June 30, 2022.

Foreign currency risk

At June 30, 2022, the C$ equivalent carrying amount of the Company’s USD denominated monetary assets and liabilities was $12,015,544 and $32,282,233, respectively (December 31, 2021 - $14,554,193 and $11,685,160) with the majority of the change associated with the Carbon promissory note denominated in USD. Assuming all other variables remain constant, a fluctuation of +/- 5.0% in the exchange rate between the C$ and USD would impact the net loss for the period by approximately $1,013,334 (December 31, 2021 - $143,452).

NOTE 16 - OTHER INCOME / EXPENSE

a)  Finance Costs

	Three months ended June 30,					Six months ended June 30,
	2022		2021			2022		2021
Interest on loans and borrowings	$	734,854	$	286,144		$	1,131,557	$	533,508
Interest on convertible debentures		1,126,304		1,592,597			2,454,350		3,105,233
Interest on lease liabilities		118,368		75,179			201,417		154,854
Transaction costs expensed		229,716		87,070			248,645		454,574
Other finance costs		20,751		(94,404	)		52,661		(65,656	)
Total finance costs	$	2,229,993	$	1,946,586		$	4,088,630	$	4,182,513

b)  Fair value gain (loss) on derivatives

	Three months ended June 30,						Six months ended June 30,
	2022			2021			2022			2021
Gain on warrant liability remeasurement 1	$	(2,505,810	)	$	—		$	(4,999,080	)	$	—
Gain on embedded derivatives 2		(32,519	)		(1,107,784	)		(32,519	)		(1,164,059	)
Deferred charge loss 2		—			(5,322	)		—			1,615,102
Total fair value (gain) loss on derivatives	$	(2,538,329	)	$	(1,113,106	)	$	(5,031,599	)	$	451,043

1 Unrealized change in fair value (Note 11).

2 Associated with the 2021 Debentures. Transactions detailed in the 2021 Annual Financial Statements.

16 | Notes to the Condensed Consolidated Interim Financial Statements

F-79

mCloud Technologies Corp.

Notes to the Condensed Consolidated Interim Financial Statements

For the Three and Six Months Ended June 30, 2022 and 2021

(Unaudited - Expressed in Canadian Dollars except otherwise noted)

NOTE 16 - OTHER INCOME / EXPENSE (continued)

c) Other income

	Three months ended June 30,						Six months ended June 30,
	2022			2021			2022			2021
Government assistance 1	$	(258,296	)	$	(941,369	)	$	(637,942	)	$	(2,117,743	)
Government loan forgiveness		—			(181,770	)		—			(299,082	)
Derecognition of contingent consideration		—			8,855			—			(572,262	)
Other		(5,728	)		(40,718	)		(24,350	)		(76,221	)
Total other income	$	(264,024	)	$	(1,155,002	)	$	(662,292	)	$	(3,065,308	)

1 Majority of government assistance are grants from the Canadian Government for wage and rental subsidies.

NOTE 17 – SUPPLEMENTAL CASH FLOW INFORMATION

a)  Changes in non-cash working capital

	Six months ended June 30,
	2022			2021
Trade and other receivables decrease (increase)	$	2,567,218		$	(721,406	)
Long-term receivables decrease		37,442			806,434
Prepaid expenses and other assets (increase)		(106,582	)		(926,225	)
Trade payables and accrued liabilities increase (decrease)		2,419,693			(2,231,429	)
Deferred revenue increase		1,962,559			1,425,521
Increase (decrease) in working capital	$	6,880,330		$	(1,647,105	)

b)  Changes in liabilities arising from financing activities

	Six months ended June 30,
	2022			2021
Balance of loans, borrowings and PPP loans, beginning of period	$	13,215,601		$	14,102,718
New advances		24,600,213			6,260,673
Repayments of principal		(8,224,068	)		(7,009,073	)
Repayments of interest		(1,055,673	)		(377,648	)
Liability related items
Forgiveness of PPP Loans 1		—			(175,790	)
Finance fees paid		(300,707	)		—
Non-cash related items
Accretion of interest and debt issuance costs		836,182			460,411
Loss on debt modification		161,698			—
Benefit from below market interest rate		—			(117,482	)
Foreign exchange and other		752,561			(9,354	)
Balance of loans, borrowings and PPP loans, end of period	$	29,985,807		$	13,134,455

1 Paycheck Protection Plan (“PPP”) loans as described in the 2021 Annual Financial Statements.

17 | Notes to the Condensed Consolidated Interim Financial Statements

F-80

mCloud Technologies Corp.

Notes to the Condensed Consolidated Interim Financial Statements

For the Three and Six Months Ended June 30, 2022 and 2021

(Unaudited - Expressed in Canadian Dollars except otherwise noted)

NOTE 17 – SUPPLEMENTAL CASH FLOW INFORMATION (continued)

c) Non-cash investing and financing activities

	Six months ended June 30,
	2022		2021
Non-cash accretion of interest included in finance costs 1	$	1,274,689	$	1,572,967
Addition of right-of-use assets 2		6,874,258		—
Addition to lease liabilities 2		6,758,036		—
Non-cash broker warrants compensation		—		372,947

1 Associated mainly with convertible debentures.

2 Associated mainly with Calgary lease described in Note 6 and one other new lease in the six months ended June 30, 2022.

NOTE 18 – EVENTS AFTER THE REPORTING PERIOD

a) Loss of control of subsidiary

On July 29, 2022, the Company entered into a Technology Continuation Agreement (the “Technology Continuation Agreement”) with Agnity, which replaced the Royalty Agreement, as amended, executed between the parties in April 2019. Under the terms of the Technology Continuation Agreement, the Company received a payment on July 29, 2022 of approximately US$6.0 million which includes amounts to settle the net receivable due from Agnity for advances, net of services received. Concurrent with the signing of the Technology Continuation Agreement, a third party acquired all of the outstanding shares in Agnity from its shareholder. As a result of these events, the Company no longer has the right to nominate the majority of the members of the Operations Committee and no longer has control of Agnity. As a result of the loss of control, effective as of July 29, 2022, the Company will no longer include any of Agnity’s operating results in mCloud’s financial statements and Agnity will no longer be consolidated. See Note 14 for additional information at June 30, 2022 and for the six months ended June 30, 2022 related to Agnity.

b) Share capital and equity awards

On July 6, 2022, 525,114 warrants with an exercise price of $14.25 expired unexercised. On July 29, 2022, the Company granted an aggregate amount of 161,300 stock options and 151,550 RSU’s under the Company’s equity incentive plan.

18 | Notes to the Condensed Consolidated Interim Financial Statements

F-81

SUBJECT TO COMPLETION, DATE [                ], 2022

1,400,000 9.0% Series A Cumulative Preferred Shares

Warrants to Purchase 35,000,000 Common Shares

Minimum Offering: $15,000,000 of Securities

Maximum Offering: $35,000,000 of Securities

PROSPECTUS

MCLOUD TECHNOLOGIES CORP.

PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

Item 6. Indemnification of Directors, Officers, Employees and Agents

Under the BCBCA, a company may indemnify: (i) a current or former director or officer of that company; (ii) a current or former director or officer of another corporation if, at the time such individual held such office, the corporation was an affiliate of the company, or if such individual held such office at the company’s request; or (iii) an individual who, at the request of the company, held, or holds, an equivalent position in another entity (an “indemnifiable person”) against all costs, charges and expenses, including an amount paid to settle an action or satisfy a judgment, reasonably incurred by him or her in respect of any civil, criminal, administrative or other legal proceeding or investigative action (whether current, threatened, pending or completed) in which he or she is involved because of that person’s position as an indemnifiable person, unless: (i) the individual did not act honestly and in good faith with a view to the best interests of such company or the other entity, as the case may be; or (ii) in the case of a proceeding other than a civil proceeding, the individual did not have reasonable grounds for believing that the individual’s conduct was lawful. A company cannot indemnify an indemnifiable person if it is prohibited from doing so under its articles or by applicable law. A company may pay, as they are incurred in advance of the final disposition of an eligible proceeding, the expenses actually and reasonably incurred by an indemnifiable person in respect of that proceeding only if the indemnifiable person has provided an undertaking that, if it is ultimately determined that the payment of expenses was prohibited, the indemnifiable person will repay any amounts advanced. Subject to the aforementioned prohibitions on indemnification, a company must, after the final disposition of an eligible proceeding, pay the expenses actually and reasonably incurred by an indemnifiable person in respect of such eligible proceeding if such indemnifiable person has not been reimbursed for such expenses, and was wholly successful, on the merits or otherwise, in the outcome of such eligible proceeding or was substantially successful on the merits in the outcome of such eligible proceeding. On application from an indemnifiable person, a court may make any order the court considers appropriate in respect of an eligible proceeding, including the indemnification of penalties imposed or expenses incurred in any such proceedings and the enforcement of an indemnification agreement. As permitted by the BCBCA, our articles require us to indemnify our directors and former directors (and such individual’s respective heirs and legal representatives) and permit us to indemnify any person to the extent permitted by the BCBCA.

Item 7. [Recent Sales of Unregistered Securities]

In the prior three years, we have issued and sold the securities described below without registering the securities under the Securities Act. We believe that each of the following issuances was exempt from registration under the Securities Act in reliance on Regulation S promulgated under the Securities Act regarding sales by an issuer in offshore transactions, Regulation D under the Securities Act, Rule 701 under the Securities Act or pursuant to Section 4(a)(2) of the Securities Act regarding transactions not involving a public offering.

On November 1, 2022, the Company entered into securities purchase agreements with a consortium of strategic investors, largely industrial organizations based in Saudi Arabia aligned with Saudi Vision 2030, for the purposes of completing a non-brokered common share financing for gross proceeds of up to USD$12,500,000 (the “Offering”). The Company intends to issue up to 10,964,913 common shares at a price of USD$1.14 per share. The Offering is subject to receipt of all required approvals, including the approval of the TSXV. The securities issued under the Offering will be subject to a four-month hold period in accordance with applicable securities legislation.

On August 13, 2021, the Company completed a non-brokered Offering of Units and issued 75,676 common shares at a price of $8.55 CDN for total proceeds of $647,030

On April 14, 2021, the Company completed a Public Offering and issued 2,300,000 common shares at a price of $6.30 USD per share for total proceeds of $14,490,000 which consists of one common share and one common share purchase warrant of the Company. Each Warrant entitles the holder to acquire on Common Share at an exercise price of $8.55 per Warrant Share at any time prior to 5pm on the date that is 3 months following the closing of the Offering.

On July 16, 2020, the Company closed a non-brokered unit offering issuing an aggregate of 365,297 units of the Company at a price of $10.95 per unit. Each Unit consists of one common share of the Company and one-half of one common share purchase warrant, with each Warrant being exercisable to acquire one common share of the Company at an exercise price of $14.25 for a term of 5 years following the closing of the Offering.

On July 6, 2020, the Company closed a brokered public offering for 1,050,229 common shares at a price of $10.95 per Unit for aggregate gross proceeds to the Company of $11,500,003. Each Unit comprised on one common share and on-half of one common share purchase warrant of the Company exercisable to acquire one common share of the company until July 6,2022 at an exercise price of $14.25 per share.

Item 8. Exhibits and Financial Statement Schedules

(a) Exhibits

The following exhibits are filed herewith or incorporated by reference in this prospectus:

Exhibit	Exhibit title
1.1	*Form of Placement Agency Agreement
3.1	Certificate of Incorporation and Articles, as amended and the Notice of Articles of the Company (incorporated by reference to Exhibit 1.1 of the Registrant’s Annual Report on Form 20-F filed with the Commission on May 2, 2022)
4.1	*Rights and Restrictions for 9.0% Cumulative Series A Preferred Shares
4.2	Form of Warrant (incorporated by reference to Exhibit 4.2 of the Registrant’s Registration Statement on Form F-1 filed with the Commission on July 15, 2022)
5.1	*Opinion of Morton Law LLP
5.2	*Opinion of Sichenzia Ross Ference LLP
10.1	Credit agreement dated August 7, 2019 between the Company and Private Debt Fund VI LP (incorporated by reference to Exhibit 4.1 of the Registrant’s 20-F filed with the Commission on May 2, 2022)
10.2	Form of Credit facility agreement dated between the Company and ATB Financial (incorporated by reference to Exhibit 4.2 of the Registrant’s 20-F filed with the Commission on May 2, 2022)
10.3	Amalgamation agreement dated July 11, 2019 among the Company, 2199027 Alberta Ltd. and Fulcrum Automation Technologies Ltd. (incorporated by reference to Exhibit 99.30 of the Registrant’s Registration Statement on Form 40-F filed with the Commission on August 16, 2021)
10.4	Amending agreement dated April 22, 2019 between the Company and Agnity Global Inc. (incorporated by reference to Exhibit 99.29 of the Registrant’s Registration Statement on Form 40-F filed with the Commission on August 16, 2021)
10.5	Warrant Indenture dated January 14, 2020 between the Company and AST Trust Company (Canada) (incorporated by reference to Exhibit 99.2 of the Registrant’s Registration Statement on Form 40-F filed with the Commission on August 16, 2021)
10.6	Loan Agreement dated January 21, 2019 between the Company and Flow Capital Corp. (incorporated by reference to Exhibit 99.27 of the Registrant’s Registration Statement on Form 40-F filed with the Commission on August 16, 2021)
10.7	Warrant Indenture dated July 6, 2020 between the Company and AST Trust Company (Canada) (incorporated by reference to Exhibit 99.103 of the Registrant’s Registration Statement on Form 40-F filed with the Commission on August 16, 2021)
10.8	Employment Agreement of Russell H. McMeekin dated May 1, 2017 (incorporated by reference to Exhibit 10.8 of the Registrant’s Registration Statement on Form F-1 filed with the Commission on June 13, 2022)
10.9	Employment Agreement of Dave Weinerth dated January 17, 2021 (incorporated by reference to Exhibit 10.9 of the Registrant’s Registration Statement on Form F-1 filed with the Commission on June 13, 2022)
10.10	Employment Agreement of Kim Clauss dated March 1, 2021 (incorporated by reference to Exhibit 10.10 of the Registrant’s Registration Statement on Form F-1 filed with the Commission on June 13, 2022)
10.11	Employment Agreement of Barry Po dated March 7, 2018 (incorporated by reference to Exhibit 10.11 of the Registrant’s Registration Statement on Form F-1 filed with the Commission on June 13, 2022)
10.12	Employment Agreement of Constantino Lanza dated May 1, 2017 (incorporated by reference to Exhibit 10.12 of the Registrant’s Registration Statement on Form F-1 filed with the Commission on June 13, 2022)
10.13	Offer Letter of Chantal Schutz dated May 24, 2019 (incorporated by reference to Exhibit 10.13 of the Registrant’s Registration Statement on Form F-1 filed with the Commission on June 13, 2022)
10.14	Offer Letter of Chantal Schutz (Revised) dated October 1, 2019 (incorporated by reference to Exhibit 10.14 of the Registrant’s Registration Statement on Form F-1 filed with the Commission on June 13, 2022)
10.15	Form of Transfer Agency and Registrar Services Agreement by and between the Company and American Stock Transfer & Trust Company, LLC (incorporated by reference to Exhibit 4.1 of the Registrant’s Registration Statement on Form F-1 filed with the Commission on August 9, 2022)
10.16	Amended and Restated Royalty Purchase Agreement dated October 27, 2016 between Agnity Global, Inc., Agnity Communications, Inc., Agnity Healthcare, Inc. SPINACOM, Inc., and Grenville Strategic Royalty Corp. (incorporated by reference to Exhibit 4.1 of the Registrant’s Registration Statement on Form F-1 filed with the Commission on August 9, 2022)
10.17	*Form of Securities Purchase Agreement
10.18	*Form of Regulation S Securities Purchase Agreement
10.19	*Google Cloud Marketplace Vendor Agreement by and between mCloud Technologies (USA) Inc. and Google LLC
10.20	*Form of Bonus Warrant
10.21	*Form of 15% Unsecured Debenture
21	Subsidiaries of the Company (incorporated by reference to Exhibit 8.1 of the Registrant’s Registration Statement on Form 20-F filed with the Commission on May 2, 2022)
23.1	*Consent of Morton Law LLP (included in Exhibit 5.1)
23.2	*Consent of Sichenzia Ross Ference LLP (included in Exhibit 5.2)
23.3	*Consent of KPMG LLP
24	Power of Attorney (included on signature page of Registration Statement on Form F-1 filed with the Commission on May 11, 2022)
107	*Filing Fee Table

* filed herewith

(b) Financial Statement Schedules

None.

Item 9. Undertakings

The undersigned registrant hereby undertakes:

To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:

(i) To include any prospectus required by section 10(a)(3) of the Securities Act of 1933;

(ii) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) (§230.424(b) of this chapter) if, in the aggregate, the changes in volume and price represent no more than 20% change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement.

(iii) To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement;

That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

That, for purposes of determining any liability under the Securities Act of 1933, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the registrant pursuant to Rule 424(b) (1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this registration statement as of the time it was declared effective.

To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.

That, for the purpose of determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities: The undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser:

(i) Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424 (§230.424 of this chapter);

(ii) Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant;

(iii) The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and

(iv) Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser.

That, insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.”

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, as amended, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form F-1 and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in City of Vancouver, Province of British Columbia, Canada on November 7, 2022.

mCloud Technologies Corp.
By:	/s/ Russell H. McMeekin
Name:	Russell H. McMeekin
Title:	Chief Executive Officer (Principal Executive Officer)
Dated:	November 7, 2022

Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities and on the dates indicated.

Signature	Title	Date
/s/ Russell H. McMeekin	Chief Executive Officer	November 7, 2022
Russell H. McMeekin	(Principal Executive Officer)
/s/ Chantal Schutz	Chief Financial Officer	November 7, 2022
Chantal Schutz	(Principal Accounting and Financial Officer)
/s/ *	Director	November 7, 2022
Michael Allman
/s/ *	Director	November 7, 2022
Constantino Lanza
/s/ *	Director	November 7, 2022
Elizabeth MacLean
/s/ *	Director	November 7, 2022
Ian C. W. Russell

*By:	/s/ Russell H. McMeekin	Attorney-in-fact	November 7, 2022
	Russell H. McMeekin

SIGNATURE OF AUTHORIZED REPRESENTATIVE IN THE UNITED STATES

Pursuant to the Securities Act of 1933, the undersigned, the duly authorized representative in the United States of the Company has signed this registration statement or amendment thereto in the United States on November 7, 2022.

Authorized U.S. Representative
By:	/s/ Russell H. McMeekin
	Name: Russell H. McMeekin
	Title: Chief Executive Officer

EX-1.1

Exhibit 1.1

PLACEMENT AGENCY AGREEMENT

[•], 2022

Maxim Group LLC

300 Park Avenue, 16th Floor

New York, NY 10022

Ladies and Gentlemen:

Introduction. Subject to the terms and conditions herein (this “Agreement”), mCloud Technologies Corp., a company incorporated under the Business Corporations Act (British Columbia) (collectively with its subsidiaries, the “Company”), hereby agrees to sell a minimum of an aggregate of $15,000,000 (the “Minimum Amount”) of registered securities and up to maximum of an aggregate of $35,000,000 (the “Maximum Amount”) of registered securities of the Company, including, but not limited to, up to 1,400,000 Units, with each Unit consisting of one 9.0% Series A Cumulative Perpetual Preferred Share (the “Series A Shares”) and 25 warrants to purchase one Common Share of the Company each (the “Warrants,” and the Common Shares underlying the Warrants, the “Warrant Shares”, and the Units, Series A Shares, the Warrants and the Warrant Shares, the “Securities”) directly to various investors (each, an “Investor” and, collectively, the “Investors”) through Maxim Group LLC (the “Placement Agent”) as placement agent. The documents executed and delivered by the Company and the Investors in connection with the Offering (as defined below), including, without limitation, a securities purchase agreement (the “Purchase Agreement”), shall be collectively referred to herein as the “Transaction Documents.” The purchase price to the Investors for each Unit is $25.00 and the exercise price to the Investors for each Common Share issuable upon exercise of the Warrants is $4.75. The Offering will terminate upon the earlier of (a) the date upon which the Company has accepted subscriptions for the Maximum Amount, and (b) the date that is 60 days after the date of this Agreement; unless extended by the mutual agreement of the Company and the Placement Agent for an additional 30-day period (such period, the “Offering Period”). The Placement Agent may retain other brokers or dealers to act as sub-agents or selected-dealers on its behalf in connection with the Offering.

The Company hereby confirms its agreement with the Placement Agent as follows:

Section 1. Agreement to Act as Placement Agent.

(a) On the basis of the representations, warranties and agreements of the Company herein contained, and subject to all the terms and conditions of this Agreement, the Placement Agent shall be the exclusive placement agent in connection with the offering and sale by the Company of the Securities pursuant to the Company’s registration statement on Form F-1 (File No. 333-264859) (the “Registration Statement”), with the terms of such offering (the “Offering”) to be subject to market conditions and negotiations between the Company, the Placement Agent and the prospective Investors. The Placement Agent will act on a reasonable best efforts basis and the Company agrees and acknowledges that there is no guarantee of the successful placement of the Securities, or any portion thereof, in the prospective Offering. Under no circumstances will the Placement Agent or any of its “Affiliates” (as defined below) be obligated to underwrite or purchase any of the Securities for its own account or otherwise provide any financing. The Placement Agent shall act solely as the Company’s agent and not as principal. The Placement Agent shall have no authority to bind the Company with respect to any prospective offer to purchase Securities and the Company shall have the sole right to accept offers to purchase Securities and may reject any such offer, in whole or in part. Subject to the terms and conditions hereof, payment of the purchase price for, and delivery of, the Securities shall be made at one or more closings (each a “Closing” and the date on which each Closing occurs, a “Closing Date”).

(b) Unless the Minimum Amount is subscribed for and accepted by the Company by the conclusion of the Offering Period, or waived by the Company, the Offering will be terminated and all subscription proceeds will be returned to Investors without interest or deduction. If at least the Minimum Amount has been subscribed for and accepted by the Company at any time during the Offering Period, the Company will conduct an initial Closing at a time of its choosing (the “Initial Closing”). Thereafter, the Company may, in its sole and absolute discretion, conduct subsequent Closings until the first to occur of: (i) the full subscription for and acceptance by the Company of the Maximum Amount, (ii) the conclusion of the Offering Period, or (iii) the termination of the Offering and this Agreement.

(c) The Closing of the issuance of the Securities shall occur via “Delivery Versus Payment”, i.e., on the Closing Date, the Company shall issue the Securities directly to the account designated by the Placement Agent and, upon receipt of such Securities, the Placement Agent shall electronically deliver such Securities to the applicable Investor and payment shall be made by the Placement Agent (or its clearing firm) by wire transfer to the Company. As compensation for services rendered, on each Closing Date, the Company shall pay to the Placement Agent the fees and expenses set forth below:

(i) A cash fee equal to 8.0% of the gross proceeds received by the Company from the sale of the Securities at the closing of the Offering (the “Closing”).

(ii) The Company also agrees to reimburse Placement Agent’s expenses up to a maximum of $125,000 (inclusive of any advance paid by the Company to the Placement Agent), unless otherwise agreed by the Company and the Placement Agent, payable immediately upon and only in the event of the Closing of the Offering.

(d) The term of the Placement Agent’s exclusive engagement will be as set forth in the Engagement Agreement, dated April 27, 2022 (“Engagement Agreement”). Notwithstanding anything to the contrary contained herein, the provisions concerning confidentiality, indemnification and contribution contained herein and the Company’s obligations contained in the indemnification provisions will survive any expiration or termination of this Agreement, and the Company’s obligation to pay fees actually earned and payable and to reimburse expenses actually incurred and reimbursable pursuant to Section 1 hereof and which are permitted to be reimbursed under FINRA Rule 5110(g)(4)(A), will survive any expiration or termination of this Agreement; provided, however, that if for any reason an Offering is not consummated, then the obligation of the Company to reimburse the Placement Agent for expenses shall not exceed $25,000 in the aggregate. Nothing in this Agreement shall be construed to limit the ability of the Placement Agent or its Affiliates to pursue, investigate, analyze, invest in, or engage in investment banking, financial advisory or any other business relationship with Persons (as defined below) other than the Company. As used herein (i) “Persons” means an individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability company, joint stock company, government (or an agency or subdivision thereof) or other entity of any kind and (ii) “Affiliate” means any Person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common control with a Person as such terms are used in and construed under Rule 405 under the Securities Act of 1933, as amended (the “Securities Act”).

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Section 2. Representations, Warranties and Covenants of the Company. The Company hereby represents, warrants and covenants to the Placement Agent as of the date hereof, and as of each Closing Date, as follows:

(a) Securities Law Filings. The Company has filed with the Securities and Exchange Commission (the “Commission”) the Registration Statement under the Securities Act, which was filed on May 11, 2022 and declared effective on [•], 2022 for the registration of the Securities under the Securities Act. Following the determination of pricing among the Company and the prospective Investors introduced to the Company by Placement Agent, the Company will file with the Commission pursuant to Rules 430A and 424(b) under the Securities Act, and the rules and regulations (the “Rules and Regulations”) of the Commission promulgated thereunder, a final prospectus relating to the placement of the Securities, their respective pricings and the plan of distribution thereof and will advise the Placement Agent of all further information (financial and other) with respect to the Company required to be set forth therein. Such registration statement, at any given time, including the exhibits thereto filed at such time, as amended at such time, is hereinafter called the “Registration Statement”; such prospectus in the form in which it appears in the Registration Statement at the time of effectiveness is hereinafter called the “Preliminary Prospectus”; and the final prospectus, in the form in which it will be filed with the Commission pursuant to Rules 430A and/or 424(b) (including the Preliminary Prospectus as it may be amended or supplemented) is hereinafter called the “Final Prospectus.” The Registration Statement at the time it originally became effective is hereinafter called the “Original Registration Statement.” Any reference in this Agreement to the Registration Statement, the Original Registration Statement, the Preliminary Prospectus or the Final Prospectus shall be deemed to refer to and include the documents incorporated by reference therein (the “Incorporated Documents”), if any, which were or are filed under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), at any given time, as the case may be; and any reference in this Agreement to the terms “amend,” “amendment” or “supplement” with respect to the Registration Statement, the Original Registration Statement, the Preliminary Prospectus or the Final Prospectus shall be deemed to refer to and include the filing of any document under the Exchange Act after the date of this Agreement, or the issue date of the Preliminary Prospectus or the Final Prospectus, as the case may be, deemed to be incorporated therein by reference. All references in this Agreement to financial statements and schedules and other information which is “contained,” “included,” “described,” “referenced,” “set forth” or “stated” in the Registration Statement, the Preliminary Prospectus or the Final Prospectus (and all other references of like import) shall be deemed to mean and include all such financial statements and schedules and other information which is or is deemed to be incorporated by reference in the Registration Statement, the Preliminary Prospectus or the Final Prospectus, as the case may be. As used in this paragraph and elsewhere in this Agreement, “Time of Sale Disclosure Package” means the Preliminary Prospectus, any subscription agreement between the Company and the Investors, the final terms of the Offering provided to the Investors (orally or in writing) and any issuer free writing prospectus as defined in Rule 433 of the Act (each, an “Issuer Free Writing Prospectus”), if any, that the parties hereto shall hereafter expressly agree in writing to treat as part of the Time of Sale Disclosure Package. The term “any Prospectus” shall mean, as the context requires, the Preliminary Prospectus, the Final Prospectus, and any supplement to either thereof. The Company has not received any notice that the Commission has issued or intends to issue a stop order suspending the effectiveness of the Registration Statement or the use of the Preliminary Prospectus or any prospectus supplement or intends to commence a proceeding for any such purpose.

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(b) Assurances. The Original Registration Statement, as amended (and any further documents to be filed with the Commission), contains all exhibits and schedules as required by the Securities Act. Each of the Registration Statement and any post-effective amendment thereto, at the time it became effective, complied in all material respects with the Securities Act and the applicable Rules and Regulations and did not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading. The Final Prospectus, as of its date, complied or will comply in all material respects with the Securities Act and the applicable Rules and Regulations. The Final Prospectus, as amended or supplemented, did not and will not contain as of the date thereof any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. The Incorporated Documents, when they were filed with the Commission, conformed in all material respects to the requirements of the Exchange Act and the applicable Rules and Regulations promulgated thereunder, and none of such documents, when they were filed with the Commission, contained any untrue statement of a material fact or omitted to state a material fact necessary to make the statements therein (with respect to Incorporated Documents incorporated by reference in the Final Prospectus), in light of the circumstances under which they were made not misleading. No post-effective amendment to the Registration Statement reflecting any facts or events arising after the date thereof which represent, individually or in the aggregate, a fundamental change in the information set forth therein is required to be filed with the Commission. Except for this Agreement and the Transaction Documents, there are no documents required to be filed with the Commission in connection with the transaction contemplated hereby that (x) have not been filed as required pursuant to the Securities Act or (y) will not be filed within the requisite time period. Except for this Agreement and the Transaction Documents, there are no contracts or other documents required to be described in the Final Prospectus, or to be filed as exhibits or schedules to the Registration Statement, which have not been described or filed as required. The representations set forth in this Section 2(b) do not apply to statements or omissions in the Registration Statement or the Prospectus based upon information furnished to the Company in writing by the Placement Agent expressly for use therein, it being understood and agreed that the only such information furnished by the Placement Agent consists of the disclosure under the “Plan of Distribution” section of the Final Prospectus (the “Underwriter Information”).

(c) Offering Materials. Neither the Company nor any of its directors and officers has distributed and none of them will distribute, prior to each Closing Date, any offering material in connection with the offering and sale of the Securities other than the Time of Sale Disclosure Package.

(d) Authorization; Enforcement. The Company has the requisite corporate power and authority to enter into and to consummate the transactions contemplated by this Agreement and the Time of Sale Disclosure Package and otherwise to carry out its obligations hereunder and thereunder. The execution and delivery of each of this Agreement by the Company and the consummation by it of the transactions contemplated hereby and thereby have been duly authorized by all necessary action on the part of the Company and no further action is required by the Company, the Company’s Board of Directors (the “Board of Directors”) or the Company’s shareholders in connection therewith other than in connection with the Required Approvals (as defined below). This Agreement has been duly executed by the Company and, when delivered in accordance with the terms hereof, will constitute the valid and binding obligation of the Company enforceable against the Company in accordance with its terms, except (i) as limited by general equitable principles and applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general application affecting enforcement of creditors’ rights generally, (ii) as limited by laws relating to the availability of specific performance, injunctive relief or other equitable remedies and (iii) insofar as indemnification and contribution provisions may be limited by applicable law. For purposes of this Agreement, the term “Required Approvals” shall mean: (i) the filings required pursuant to Section 4.4 of the Purchase Agreement, (ii) the filing with the Commission of the Prospectus, (iii) application(s) to the Nasdaq Capital Market and TSX Venture Exchange, as applicable (the “Trading Market”), for the listing of the Series A Shares, Warrants and Warrant Shares for trading thereon in the time and manner required thereby, and (iv) such filings as are required to be made under applicable state securities laws.

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(e) No Conflicts. The execution, delivery and performance by the Company of this Agreement and the transactions contemplated pursuant to the Time of Sale Disclosure Package, the issuance and sale of the Securities and the consummation by it of the transactions contemplated hereby and thereby to which it is a party do not and will not (i) conflict with or violate any provision of the Company’s or any Subsidiary’s certificate or articles of incorporation, bylaws or other organizational or charter documents, or (ii) conflict with, or constitute a default (or an event that with notice or lapse of time or both would become a default) under, result in the creation of any Lien upon any of the properties or assets of the Company or any Subsidiary, or give to others any rights of termination, amendment, acceleration or cancellation (with or without notice, lapse of time or both) of, any agreement, credit facility, debt or other instrument (evidencing a Company or Subsidiary debt or otherwise) or other understanding to which the Company or any Subsidiary is a party or by which any property or asset of the Company or any Subsidiary is bound or affected, or (iii) subject to the Required Approvals, conflict with or result in a violation of any law, rule, regulation, order, judgment, injunction, decree or other restriction of any court or governmental authority to which the Company or a Subsidiary is subject (including federal and state securities laws and regulations), or by which any property or asset of the Company or a Subsidiary is bound or affected; except in the case of each of clauses (ii) and (iii), such as could not reasonably be expected to result in a Material Adverse Change.

(f) Certificates. Any certificate signed by an officer of the Company and delivered to the Placement Agent or to counsel for the Placement Agent shall be deemed to be a representation and warranty by the Company to the Placement Agent as to the matters set forth therein.

(g) Reliance. The Company acknowledges that the Placement Agent will rely upon the accuracy and truthfulness of the foregoing representations and warranties and hereby consents to such reliance.

(h) Forward-Looking Statements. No forward-looking statements (within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act) contained in the Time of Sale Disclosure Package has been made or reaffirmed without a reasonable basis or has been disclosed other than in good faith.

(i) Statistical or Market-Related Data. Any statistical, industry-related and market-related data included or incorporated by reference in the Time of Sale Disclosure Package, are based on or derived from sources that the Company reasonably and in good faith believes to be reliable and accurate, and such data agree with the sources from which they are derived.

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(j) Certain Fees; FINRA Affiliations. Except as set forth in the Registration Statement and Prospectus, no brokerage or finder’s fees or commissions are or will be payable by the Company, any Subsidiary or Affiliate of the Company to any broker, financial advisor or consultant, finder, placement agent, investment banker, bank or other Person with respect to the transactions contemplated by the Transaction Documents. There are no other arrangements, agreements or understandings of the Company or, to the Company’s knowledge, any of its shareholders that may affect the Placement Agent’s compensation, as determined by FINRA. Other than payments to the Placement Agent for this Offering, the Company has not made and has no agreements, arrangements or understanding to make any direct or indirect payments (in cash, securities or otherwise) to: (i) any person, as a finder’s fee, consulting fee or otherwise, in consideration of such person raising capital for the Company or introducing to the Company persons who raised or provided capital to the Company; (ii) any FINRA member participating in the offering as defined in FINRA Rule 5110 (a “Participating Member”); or (iii) any person or entity that has any direct or indirect affiliation or association with any Participating Member, within the 180-day period preceding the initial filing of the Registration Statement through the 60-day period after the Effective Date. None of the net proceeds of the Offering will be paid by the Company to any Participating Member or its affiliates, except as specifically authorized herein. To the Company’s knowledge, no officer, director or any beneficial owner of 10% or more of the Company’s Common Shares or Common Share Equivalents has any direct or indirect affiliation or association with any Participating Member in the Offering. Except for securities purchased on the open market, no Company Affiliate is an owner of stock or other securities of any Participating Member. No Company Affiliate has made a subordinated loan to any Participating Member. No proceeds from the sale of the Securities (excluding placement agent compensation as disclosed in the Registration Statement and the Prospectus) will be paid to any Participating Member, any persons associated with a Participating Member or an affiliate of a Participating Member. Except as disclosed in the Prospectus, the Company has not issued any warrants or other securities or granted any options, directly or indirectly, to the Placement Agent within the 180-day period prior to the initial filing date of the Prospectus. Except for securities issued to the Placement Agent as disclosed in the Prospectus, no person to whom securities of the Company have been privately issued within the 180-day period prior to the initial filing date of the Prospectus is a Participating Member, is a person associated with a Participating Member or is an affiliate of a Participating Member. No Participating Member in the Offering has a conflict of interest with the Company. For this purpose, a “conflict of interest” exists when a Participating Member, the parent or affiliate of a Participating Member or any person associated with a Participating Member in the aggregate beneficially own 5% or more of the Company’s outstanding subordinated debt or common equity, or 5% or more of the Company’s preferred equity. “FINRA member participating in the Offering” includes any associated person of a Participating Member in the Offering, any member of such associated person’s immediate family and any affiliate of a Participating Member in the Offering. When used in this Section 3.1(j) the term “affiliate of a FINRA member” or “affiliated with a FINRA member” means an entity that controls, is controlled by or is under common control with a FINRA member. The Company will advise the Representative and Placement Agent Counsel if it learns that any officer, director or owner of 10% or more of the Company’s outstanding Common Shares or Common Share Equivalents is or becomes an affiliate or associated person of a Participating Member.

(k) Board of Directors. The Board of Directors is comprised of the persons set forth under the heading of the Prospectus captioned “Management.” The qualifications of the persons serving as board members and the overall composition of the Board of Directors comply with the Sarbanes-Oxley Act of 2002 and the rules promulgated thereunder applicable to the Company and the rules of the Trading Market. In addition, at least a majority of the persons serving on the Board of Directors qualify as “independent” as defined under the rules of the Trading Market.

(l) D&O Questionnaires. To the Company’s knowledge, all information contained in the questionnaires most recently completed by each of the Company’s directors and officers is true and correct in all respects and the Company has not become aware of any information which would cause the information disclosed in such questionnaires become inaccurate and incorrect.

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(m) Representations and Warranties Incorporated by Reference. Each of the representations and warranties (together with any related disclosure schedules thereto) made to the Investors in the Purchase Agreement is hereby incorporated herein by reference (as though fully restated herein) and is hereby made to, and in favor of, the Placement Agent.

Section 3. Delivery and Payment. Each Closing shall occur at the offices of Fox Rothschild LLP, 222 South Ninth Street, Suite 2000, Minneapolis, Minnesota 55402 (“Placement Agent Counsel”) (or at such other place as shall be agreed upon by the Placement Agent and the Company). Subject to the terms and conditions hereof, at each Closing payment of the purchase price for the Securities sold on such Closing Date shall be made by Federal Funds wire transfer, against delivery of such Securities, and such Securities shall be registered in such name or names and shall be in such denominations, as the Placement Agent may request at least one business day before the time of purchase (as defined below).

Deliveries of the documents with respect to the purchase of the Securities, if any, shall be made at the offices of Placement Agent Counsel. All actions taken at a Closing shall be deemed to have occurred simultaneously.

Section 4. Covenants and Agreements of the Company. The Company further covenants and agrees with the Placement Agent as follows:

(a) Registration Statement Matters. The Company will advise the Placement Agent promptly after it receives notice thereof of the time when any amendment to the Registration Statement has been filed or becomes effective or any supplement to the Final Prospectus has been filed and will furnish the Placement Agent with copies thereof. The Company will file promptly all reports and any definitive proxy or information statements required to be filed by the Company with the Commission pursuant to Section 13(a), 14 or 15(d) of the Exchange Act subsequent to the date of any Prospectus and for so long as the delivery of a prospectus is required in connection with the Offering. The Company will advise the Placement Agent, promptly after it receives notice thereof (i) of any request by the Commission to amend the Registration Statement or to amend or supplement any Prospectus or for additional information, (ii) of the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement or any post-effective amendment thereto or any order directed at any Incorporated Document, if any, or any amendment or supplement thereto or any order preventing or suspending the use of the Preliminary Prospectus or the Final Prospectus or any prospectus supplement or any amendment or supplement thereto or any post-effective amendment to the Registration Statement, of the suspension of the qualification of the Securities for offering or sale in any jurisdiction, of the institution or threatened institution of any proceeding for any such purpose, or of any request by the Commission for the amending or supplementing of the Registration Statement or a Prospectus or for additional information, (iii) of the issuance by any state securities commission of any proceedings for the suspension of the qualification of the Securities for offering or sale in any jurisdiction or of the initiation, or the threatening, of any proceeding for that purpose; (iv) of the mailing and delivery to the Commission for filing of any amendment or supplement to the Registration Statement or Prospectus; (v) of the receipt of any comments or request for any additional information from the Commission; and (vi) of the happening of any event during the period described in this Section 4(a) that, in the judgment of the Company, makes any statement of a material fact made in the Registration Statement or the Prospectus untrue or that requires the making of any changes in the Registration Statement or the Prospectus in order to make the statements therein, in light of the circumstances under which they were made, not misleading. The Company shall use its best efforts to prevent the issuance of any such stop order or prevention or suspension of such use. If the Commission shall enter any such stop order or order or notice of prevention or suspension at any time, the Company will use its best efforts to obtain the lifting of such order at the earliest possible moment, or will file a new registration statement and use its best efforts to have such new registration statement declared effective as soon as practicable. Additionally, the Company agrees that it shall comply with the provisions of Rules 424(b), 430A, 430B and 430C, as applicable, under the Securities Act, including with respect to the timely filing of documents thereunder, and will use its reasonable efforts to confirm that any filings made by the Company under such Rule 424(b) are received in a timely manner by the Commission.

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(b) Blue Sky Compliance. The Company will cooperate with the Placement Agent and the Investors in endeavoring to qualify the Securities for sale under the securities laws of such jurisdictions (United States and foreign) as the Placement Agent and the Investors may reasonably request and will make such applications, file such documents, and furnish such information as may be reasonably required for that purpose, provided the Company shall not be required to qualify as a foreign corporation or to file a general consent to service of process in any jurisdiction where it is not now so qualified or required to file such a consent, and provided further that the Company shall not be required to produce any new disclosure document. The Company will, from time to time, prepare and file such statements, reports and other documents as are or may be required to continue such qualifications in effect for so long a period as the Placement Agent may reasonably request for distribution of the Securities. The Company will advise the Placement Agent promptly of the suspension of the qualification or registration of (or any such exemption relating to) the Securities for offering, sale or trading in any jurisdiction or any initiation or threat of any proceeding for any such purpose, and in the event of the issuance of any order suspending such qualification, registration or exemption, the Company shall use its best efforts to obtain the withdrawal thereof at the earliest possible moment.

(c) Amendments and Supplements to a Prospectus and Other Matters. The Company will comply with the Securities Act and the Exchange Act, and the rules and regulations of the Commission thereunder, so as to permit the completion of the distribution of the Securities as contemplated in this Agreement, the Incorporated Documents and any Prospectus. If during the period in which a prospectus is required by law to be delivered in connection with the distribution of Securities contemplated by the Incorporated Documents or any Prospectus (the “Prospectus Delivery Period”), any event shall occur as a result of which, in the judgment of the Company or in the opinion of the Placement Agent or counsel for the Placement Agent, it becomes necessary to amend or supplement the Incorporated Documents or any Prospectus in order to make the statements therein, in the light of the circumstances under which they were made, as the case may be, not misleading, or if it is necessary at any time to amend or supplement the Incorporated Documents or any Prospectus or to file under the Exchange Act any Incorporated Document to comply with any law, the Company will promptly prepare and file with the Commission, and furnish at its own expense to the Placement Agent and to dealers, an appropriate amendment to the Registration Statement or supplement to the Registration Statement, the Incorporated Documents or any Prospectus that is necessary in order to make the statements in the Incorporated Documents and any Prospectus as so amended or supplemented, in the light of the circumstances under which they were made, as the case may be, not misleading, or so that the Registration Statement, the Incorporated Documents or any Prospectus, as so amended or supplemented, will comply with law. Before amending the Registration Statement or supplementing the Incorporated Documents or any Prospectus in connection with the Offering, the Company will furnish the Placement Agent with a copy of such proposed amendment or supplement and will not file any such amendment or supplement to which the Placement Agent reasonably objects.

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(d) Copies of any Amendments and Supplements to a Prospectus. The Company will furnish the Placement Agent, without charge, during the period beginning on the date hereof and ending on the later of the last Closing Date of the Offering, as many copies of any Prospectus or prospectus supplement and any amendments and supplements thereto, as the Placement Agent may reasonably request.

(e) Free Writing Prospectus. The Company covenants that it will not, unless it obtains the prior written consent of the Placement Agent, make any offer relating to the Securities that would constitute a Company Free Writing Prospectus or that would otherwise constitute a “free writing prospectus” (as defined in Rule 405 of the Securities Act) required to be filed by the Company with the Commission or retained by the Company under Rule 433 of the Securities Act. In the event that the Placement Agent expressly consents in writing to any such free writing prospectus (a “Permitted Free Writing Prospectus”), the Company covenants that it shall (i) treat each Permitted Free Writing Prospectus as an Company Free Writing Prospectus, and (ii) comply with the requirements of Rule 164 and 433 of the Securities Act applicable to such Permitted Free Writing Prospectus, including in respect of timely filing with the Commission, legending and record keeping.

(f) Transfer Agent. The Company will maintain, at its expense, a registrar and transfer agent for the Series A Shares and Common Shares.

(g) Earnings Statement. As soon as practicable and in accordance with applicable requirements under the Securities Act, but in any event not later than 18 months after the last Closing Date, the Company will make generally available to its security holders and to the Placement Agent an earnings statement, covering a period of at least 12 consecutive months beginning after the last Closing Date, that satisfies the provisions of Section 11(a) and Rule 158 under the Securities Act.

(h) Periodic Reporting Obligations. During the Prospectus Delivery Period, the Company will duly file, on a timely basis, with the Commission and the Trading Market all reports and documents required to be filed under the Exchange Act within the time periods and in the manner required by the Exchange Act.

(i) Additional Documents. The Company will enter into any subscription, purchase or other customary agreements as the Placement Agent or the Investors deem necessary or appropriate to consummate the Offering, all of which will be in form and substance reasonably acceptable to the Placement Agent and the Investors. The Company agrees that the Placement Agent may rely upon, and each is a third party beneficiary of, the representations and warranties, and applicable covenants, set forth in any such purchase, subscription or other agreement with Investors in the Offering.

(j) No Manipulation of Price. Neither the Company, nor, to its knowledge, any of its employees, directors or shareholders, has taken or will take, directly or indirectly, any action designed to or that has constituted or that might reasonably be expected to cause or result in, under the Exchange Act, or otherwise, stabilization or manipulation of the price of any security of the Company to facilitate the sale or resale of the Securities.

(k) Acknowledgment. The Company acknowledges that any advice given by the Placement Agent to the Company is solely for the benefit and use of the Board of Directors of the Company and may not be used, reproduced, disseminated, quoted or referred to, without the Placement Agent’s prior written consent.

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(l) Announcement of Offering. The Company acknowledges and agrees that the Placement Agent may, subsequent to the Closing, make public its involvement with the Offering.

(m) Reliance on Others. The Company confirms that it will rely on its own counsel and accountants for legal and accounting advice.

(n) Research Matters. By entering into this Agreement, the Placement Agent does not provide any promise, either explicitly or implicitly, of favorable or continued research coverage of the Company and the Company hereby acknowledges and agrees that the Placement Agent’s selection as a placement agent for the Offering was in no way conditioned, explicitly or implicitly, on the Placement Agent providing favorable or any research coverage of the Company. In accordance with FINRA Rule 2241(b)(2)(K), the parties acknowledge and agree that the Placement Agent has not directly or indirectly offered favorable research, a specific rating or a specific price target, or threatened to change research, a rating or a price target, to the Company or inducement for the receipt of business or compensation. The Company hereby waives and releases, to the fullest extent permitted by law, any claims that the Company may have against the Placement Agent with respect to any conflict of interest that may arise from the fact that the views expressed by their independent research analysts and research departments may be different from or inconsistent with the views or advice communicated to the Company by the Placement Agent’s investment banking divisions. The Company acknowledges that the Placement Agent is a full service securities firm and as such from time to time, subject to applicable securities laws, may effect transactions for its own account or the account of its customers and hold long or short position in debt or equity securities of the Company.

(o) Subsequent Equity Sales.

(i) From the date hereof until ninety (90) days after the Closing Date, neither the Company nor any Subsidiary shall (i) issue, enter into any agreement to issue or announce the issuance or proposed issuance of any Common Shares or Common Share Equivalents or (ii) file any registration statement or amendment or supplement thereto, other than the Prospectus or otherwise with respect to the Securities or filing a registration statement on Form S-8 in connection with any employee benefit plan, in each case without prior written consent of the Placement Agent.

(ii) From the date hereof until ninety (90) days after the Closing Date, the Company shall be prohibited from effecting or entering into an agreement to effect any Variable Rate Transaction. “Variable Rate Transaction” means a transaction entered into after the date hereof in which the Company (i) issues or sells any debt or equity securities that are convertible into, exchangeable or exercisable for, or include the right to receive additional Common Shares either (A) at a conversion price, exercise price or exchange rate or other price that is based upon and/or varies with the trading prices of or quotations for the Common Shares at any time after the initial issuance of such debt or equity securities, or (B) with a conversion, exercise or exchange price that is subject to being reset at some future date after the initial issuance of such debt or equity security or upon the occurrence of specified or contingent events directly or indirectly related to the trading prices of or quotations for the Common Shares; provided that, for the avoidance of doubt, such an issuance or sale shall not be deemed to constitute a Variable Rate Transaction solely because such securities provide for customary adjustments to the terms of conversion, exchange or exercise to account for stock dividends and splits, rights offerings, distributions, fundamental transactions and similar transactions or (ii) enters into, or effects a transaction under, any agreement, including, but not limited to, an equity line of credit or an “at-the-market offering”, whereby the Company may issue securities at a future determined price that is based upon and/or varies with the trading prices of or quotations for the Common Shares. The Placement Agent shall be entitled to obtain injunctive relief against the Company to preclude any such issuance, which remedy shall be in addition to any right to collect damages.

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(iii) Notwithstanding the foregoing, this Section 4(o) shall not apply in respect of an Exempt Issuance, except that no Variable Rate Transaction shall be an Exempt Issuance other than as described in (d) of the definition of Exempt Transaction. An “Exempt Issuance” means the issuance of (a) Common Shares or equity awards to employees, officers or directors of the Company pursuant to the Company’s Board approved equity incentive plan in effect as of the date hereof, (b) securities upon the exercise or exchange of or conversion of any Securities issued hereunder and/or other securities exercisable or exchangeable for or convertible into Common Shares issued and outstanding on the date of this Agreement, provided that such securities have not been amended since the date of this Agreement to increase the number of such securities or to decrease the exercise price, exchange price or conversion price of such securities (other than in connection with stock splits or combinations) or to extend the term of such securities, (c) securities issued pursuant to acquisitions or strategic transactions approved by a majority of the disinterested directors of the Company, provided that such securities are issued as “restricted securities” (as defined in Rule 144) and carry no registration rights that require or permit the filing of any registration statement in connection therewith during the prohibition period in Section 4(o) herein, and provided that any such issuance shall only be to a Person (or to the equityholders of a Person) which is, itself or through its subsidiaries, an operating company or an owner of an asset in a business synergistic with the business of the Company and shall provide to the Company additional benefits in addition to the investment of funds, but shall not include a transaction in which the Company is issuing securities primarily for the purpose of raising capital or to an entity whose primary business is investing in securities, and (d) for the avoidance of doubt, the issuance of the Securities in the Offering or the filing of any registration statement or amendment or supplement thereto in connection with the Offering.

(iv) If within twelve (12) months of the Closing, the Company completes any financing of equity or equity-linked capital-raising activity with, or receives proceeds from, any of the investors that were contacted or introduced by the Placement Agent to the Company during the Engagement Period (as defined in the Engagement Agreement), then the Company shall pay to the Placement Agent upon closing of such financing or receipt of such proceeds the compensation equivalent to that set forth in Section 1(a) herein, provided, that, within five (5) business days of a written request from the Company following the termination of the Engagement Period, the Placement Agent provides a list to the Company of such investors.

(p) Capital Changes. Until 90 days after the Closing Date, the Company shall not undertake a reverse or forward stock split or reclassification of the Common Shares without the prior written consent of the Placement Agent which shall not be unreasonably withheld.

(q) FINRA. The Company shall advise the Placement Agent (who shall make an appropriate filing with FINRA) if it is aware that any officer, director, 10% or greater shareholder of the Company or Person that received the Company’s unregistered equity securities in the past 180 days is or becomes an affiliate or associated person of a FINRA member firm prior to the earlier of the termination of this Agreement or the 60-day period after the Effective Date.

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Section 5. Conditions of the Obligations of the Placement Agent. The obligations of the Placement Agent hereunder shall be subject to the accuracy of the representations and warranties on the part of the Company set forth in Section 2 hereof, in each case as of the date hereof and as of each Closing Date as though then made, to the timely performance by each of the Company of its covenants and other obligations hereunder on and as of such dates, and to each of the following additional conditions:

(a) Accountants’ Comfort Letter. On the date hereof, the Placement Agent shall have received, and the Company shall have caused to be delivered to the Placement Agent, a letter from KPMG LLP (the independent registered public accounting firm of the Company), addressed to the Placement Agent, dated as of the date hereof, in form and substance satisfactory to the Placement Agent. The letter shall not disclose any change in the condition (financial or other), earnings, operations, business or prospects of the Company from that set forth in the Incorporated Documents or the applicable Prospectus or prospectus supplement, which, in the Placement Agent’s sole judgment, is material and adverse and that makes it, in the Placement Agent’s sole judgment, impracticable or inadvisable to proceed with the Offering of the Securities as contemplated by such Prospectus.

(b) Compliance with Registration Requirements; No Stop Order; No Objection from the FINRA. Each Prospectus (in accordance with Rule 424(b)) and “free writing prospectus” (as defined in Rule 405 of the Securities Act), if any, shall have been duly filed with the Commission, as appropriate; no stop order suspending the effectiveness of the Registration Statement or any part thereof shall have been issued and no proceeding for that purpose shall have been initiated or threatened by the Commission; no order preventing or suspending the use of any Prospectus shall have been issued and no proceeding for that purpose shall have been initiated or threatened by the Commission; no order having the effect of ceasing or suspending the distribution of the Securities or any other securities of the Company shall have been issued by any securities commission, securities regulatory authority or stock exchange and no proceedings for that purpose shall have been instituted or shall be pending or, to the knowledge of the Company, contemplated by any securities commission, securities regulatory authority or stock exchange; all requests for additional information on the part of the Commission shall have been complied with; and the FINRA shall have raised no objection to the fairness and reasonableness of the placement terms and arrangements.

(c) Corporate Proceedings. All corporate proceedings and other legal matters in connection with this Agreement, the Registration Statement and each Prospectus, and the registration, sale and delivery of the Securities, shall have been completed or resolved in a manner reasonably satisfactory to the Placement Agent’s counsel, and such counsel shall have been furnished with such papers and information as it may reasonably have requested to enable such counsel to pass upon the matters referred to in this Section 5.

(d) No Material Adverse Change. Subsequent to the execution and delivery of this Agreement and prior to each Closing Date, in the Placement Agent’s sole judgment after consultation with the Company, there shall not have occurred any material adverse effect or any material adverse change or development involving a prospective material adverse change in the condition or the business activities, financial or otherwise, of the Company from the latest dates as of which such condition is set forth in the Registration Statement and Prospectus (“Material Adverse Change”).

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(e) Opinion of Counsel for the Company. The Placement Agent shall have received on each Closing Date the favorable opinion of Sichenzia Ross Ference LLP, U.S. legal counsel to the Company, and Morton Law LLP, Canadian counsel to the Company, each dated as of such Closing Date, including, without limitation, a negative assurance letter addressed to the Placement Agent and in form and substance satisfactory to the Placement Agent.

(f) Officers’ Certificate. The Placement Agent shall have received on each Closing Date a certificate of the Company, dated as of such Closing Date, signed by the Chief Executive Officer and Chief Financial Officer of the Company, to the effect that, and the Placement Agent shall be satisfied that, the signers of such certificate have reviewed the Registration Statement, the Incorporated Documents, the Prospectus, and this Agreement and to the further effect that:

(i) The representations and warranties of the Company in this Agreement are true and correct, as if made on and as of such Closing Date, and the Company has complied with all the agreements and satisfied all the conditions on its part to be performed or satisfied at or prior to such Closing Date;

(ii) No stop order suspending the effectiveness of the Registration Statement or the use of the Prospectus has been issued and no proceedings for that purpose have been instituted or are pending or, to the Company’s knowledge, threatened under the Securities Act; no order having the effect of ceasing or suspending the distribution of the Securities or any other securities of the Company has been issued by any securities commission, securities regulatory authority or stock exchange in the United States and no proceedings for that purpose have been instituted or are pending or, to the knowledge of the Company, contemplated by any securities commission, securities regulatory authority or stock exchange in the United States;

(iii) When the Registration Statement became effective, at the time of sale, and at all times subsequent thereto up to the delivery of such certificate, the Registration Statement and the Incorporated Documents, if any, when such documents became effective or were filed with the Commission, and any Prospectus, contained all material information required to be included therein by the Securities Act and the Exchange Act and the applicable rules and regulations of the Commission thereunder, as the case may be, and in all material respects conformed to the requirements of the Securities Act and the Exchange Act and the applicable rules and regulations of the Commission thereunder, as the case may be, and the Registration Statement and the Incorporated Documents, if any, and any Prospectus, did not and do not include any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading (provided, however, that the preceding representations and warranties contained in this paragraph (iii) shall not apply to any statements or omissions made in reliance upon and in conformity with information furnished in writing to the Company by the Placement Agent expressly for use therein) and, since the effective date of the Registration Statement, there has occurred no event required by the Securities Act and the rules and regulations of the Commission thereunder to be set forth in the Incorporated Documents which has not been so set forth; and

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(iv) Subsequent to the respective dates as of which information is given in the Registration Statement, the Incorporated Documents and any Prospectus, there has not been: (a) any Material Adverse Change; (b) any transaction that is material to the Company and the Subsidiaries taken as a whole, except transactions entered into in the ordinary course of business; (c) any obligation, direct or contingent, that is material to the Company and the Subsidiaries taken as a whole, incurred by the Company or any Subsidiary, except obligations incurred in the ordinary course of business; (d) any material change in the capital stock (except changes thereto resulting from the exercise of outstanding stock options or warrants) or outstanding indebtedness of the Company or any Subsidiary; (e) any dividend or distribution of any kind declared, paid or made on the capital stock of the Company; or (f) any loss or damage (whether or not insured) to the property of the Company or any Subsidiary which has been sustained or will have been sustained which has a Material Adverse Change.

(g) Bring-down Comfort Letter. On each Closing Date, the Placement Agent shall have received from KPMG LLP, or such other independent registered public accounting firm of the Company, a letter dated as of such Closing Date, in form and substance satisfactory to the Placement Agent, to the effect that they reaffirm the statements made in the letter furnished pursuant to subsection (a) of this Section 5, except that the specified date referred to therein for the carrying out of procedures shall be no more than three business days prior to such Closing Date.

(h) Lock-Up Agreements. On the date hereof, the Placement Agent shall have received the executed lock-up agreement, in the form attached hereto as Exhibit A (the “Lock-Up Agreements”), from each of the Company’s directors and officers and each other holder of Common Shares and Common Share Equivalents holding, on a fully diluted basis, three percent (3%) or more of the Company’s issued and outstanding Common Shares.

(i) Stock Exchange Listing. The Series A Shares, Common Shares and Warrants shall be registered under the Exchange Act and shall be listed on the Trading Market, and the Company shall not have taken any action designed to terminate, or likely to have the effect of terminating, the registration of the Series A Shares under the Exchange Act or delisting or suspending from trading the Series A Shares, Common Shares or Warrants from the Trading Market, nor shall the Company have received any information suggesting that the Commission or the Trading Market is contemplating terminating such registration or listing.

(j) Warrant Agency Agreement. On the Closing Date, the duly executed warrant agency agreement executed by and between the Company and the transfer agent.

(k) Additional Documents. On or before each Closing Date, the Placement Agent and counsel for the Placement Agent shall have received such information and documents as they may reasonably require for the purposes of enabling them to pass upon the issuance and sale of the Securities as contemplated herein, or in order to evidence the accuracy of any of the representations and warranties, or the satisfaction of any of the conditions or agreements, herein contained.

If any condition specified in this Section 5 is not satisfied when and as required to be satisfied, this Agreement may be terminated by the Placement Agent by notice to the Company at any time on or prior to a Closing Date, which termination shall be without liability on the part of any party to any other party, except that Section 6 (Payment of Expenses), Section 7 (Indemnification and Contribution) and Section 8 (Representations and Indemnities to Survive Delivery) shall at all times be effective and shall survive such termination.

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Section 6. Payment of Expenses. Subject to the limitations set forth in Section 1(a)(ii) and Section 1(b) above, the Company agrees to pay all costs, fees and expenses incurred by the Company in connection with the performance of its obligations hereunder and in connection with the transactions contemplated hereby, including, without limitation: (i) all expenses incident to the issuance, delivery and qualification of the Securities (including all printing and engraving costs); (ii) all fees and expenses of the registrar and transfer agent of the Common Shares and of any escrow agent; (iii) all necessary issue, transfer and other stamp taxes in connection with the issuance and sale of the Securities; (iv) all fees and expenses of the Company’s counsel, independent public or certified public accountants and other advisors; (v) all costs and expenses incurred in connection with the preparation, printing, filing, shipping and distribution of the Registration Statement (including financial statements, exhibits, schedules, consents and certificates of experts), the Preliminary Prospectus, the Final Prospectus and each prospectus supplement, if any, and all amendments and supplements thereto, and this Agreement; (vi) all filing fees, reasonable attorneys’ fees and expenses incurred by the Company or the Placement Agent in connection with qualifying or registering (or obtaining exemptions from the qualification or registration of) all or any part of the Securities for offer and sale under the state securities or blue sky laws or the securities laws of any other country, and, if requested by the Placement Agent, preparing and printing a “Blue Sky Survey,” an “International Blue Sky Survey” or other memorandum, and any supplements thereto, advising the Placement Agent of such qualifications, registrations and exemptions; (vii) if applicable, the filing fees incident to the review and approval by the FINRA of the Placement Agent’s participation in the offering and distribution of the Securities; (viii) the fees and expenses associated with including the Series A Shares and Warrant Shares on the Trading Market; (ix) all costs and expenses incident to the travel and accommodation of the Company’s and the Placement Agent’s employees on the “roadshow,” if any; (x) all fees, expenses and disbursements relating to background checks of the Company’s officers and directors, not to exceed $5,000; and (x) all other fees, costs and expenses referred to in Part II of the Registration Statement.

Section 7. Indemnification and Contribution.

(a) The Company agrees to indemnify and hold harmless the Placement Agent, and each dealer selected by the Placement Agent that participates in the offer and sale of the Securities (each a “Selected Dealer”) and each of their respective directors, officers and employees and each Person, if any, who controls the Placement Agent or any Selected Dealer (“Controlling Person”) within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act, against any and all loss, liability, claim, damage and expense whatsoever (including but not limited to any and all legal or other expenses reasonably incurred in investigating, preparing or defending against any litigation, commenced or threatened, or any claim whatsoever, whether arising out of any action between the Placement Agent and the Company or between the Placement Agent and any third party or otherwise) to which they or any of them may become subject under the Securities Act, the Exchange Act or any other statute or at common law or otherwise or under the laws of foreign countries, arising out of or based upon any untrue statement or alleged untrue statement of a material fact contained in (i) any Preliminary Prospectus, if any, the Registration Statement or the Final Prospectus (as from time to time each may be amended and supplemented); (ii) any materials or information provided to investors by, or with the approval of, the Company in connection with the marketing of the offering of the Securities, including any “road show” or investor presentations made to investors by the Company (whether in person or electronically); or (iii) any application or other document or written communication (in this Section 7, collectively called “application”) executed by the Company or based upon written information furnished by the Company in any jurisdiction in order to qualify the Securities under the securities laws thereof or filed with the Commission, any state securities commission or agency, Trading Market or any securities exchange; or the omission or alleged omission therefrom of a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading, unless such statement or omission was made in reliance upon and in conformity with written information furnished to the Company with respect to the Placement Agent by or on behalf of the Placement Agent expressly for use in any Preliminary Prospectus, if any, the Registration Statement or Final Prospectus, or any amendment or supplement thereto, or in any application, as the case may be. With respect to any untrue statement or omission or alleged untrue statement or omission made in the Preliminary Prospectus, if any, the indemnity agreement contained in this Section 7 shall not inure to the benefit of the Placement Agent to the extent that any loss, liability, claim, damage or expense of the Placement Agent results from the fact that a copy of the Final Prospectus was not given or sent to the Person asserting any such loss, liability, claim or damage at or prior to the written confirmation of sale of the Securities to such Person as required by the Securities Act and the rules and regulations thereunder, and if the untrue statement or omission has been corrected in the Final Prospectus, unless such failure to deliver the Final Prospectus was a result of non-compliance by the Company with its obligations under this Agreement. The Company agrees promptly to notify the Placement Agent of the commencement of any litigation or proceedings against the Company or any of its officers, directors or Controlling Persons in connection with the issue and sale of the Securities or in connection with the Registration Statement or the Final Prospectus.

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(b) If any action is brought against the Placement Agent, a Selected Dealer or a Controlling Person in respect of which indemnity may be sought against the Company pursuant to Section 7(a), the Placement Agent, such Selected Dealer or Controlling Person, as the case may be, shall promptly notify the Company in writing of the institution of such action and the Company shall assume the defense of such action, including the employment and fees of counsel (subject to the reasonable approval of the Placement Agent or such Selected Dealer, as the case may be) and payment of actual expenses. The Placement Agent, such Selected Dealer or Controlling Person shall have the right to employ its or their own counsel in any such case, but the fees and expenses of such counsel shall be at the expense of the Placement Agent, such Selected Dealer or Controlling Person unless (i) the employment of such counsel at the expense of the Company shall have been authorized in writing by the Company in connection with the defense of such action, or (ii) the Company shall not have employed counsel to have charge of the defense of such action, or (iii) such indemnified party or parties shall have reasonably concluded that there may be defenses available to it or them which are different from or additional to those available to the Company (in which case the Company shall not have the right to direct the defense of such action on behalf of the indemnified party or parties), in any of which events the reasonable fees and expenses of not more than one additional firm of attorneys selected by the Placement Agent (in addition to local counsel), Selected Dealer and/or Controlling Person shall be borne by the Company. Notwithstanding anything to the contrary contained herein, if the Placement Agent, Selected Dealer or Controlling Person shall assume the defense of such action as provided above, the Company shall have the right to approve the terms of any settlement of such action which approval shall not be unreasonably withheld.

(c) The Placement Agent agrees to indemnify and hold harmless the Company, its directors, officers and employees and agents who control the Company within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act against any and all loss, liability, claim, damage and expense described in the foregoing indemnity from the Company to the Placement Agent, as incurred, but only with respect to untrue statements or omissions, or alleged untrue statements or omissions made in any Preliminary Prospectus, if any, the Registration Statement or Final Prospectus or any amendment or supplement thereto or in any application, in reliance upon, and in strict conformity with, written information furnished to the Company with respect to the Placement Agent by or on behalf of the Placement Agent expressly for use in such Preliminary Prospectus, if any, the Registration Statement or Final Prospectus or any amendment or supplement thereto or in any such application. In case any action shall be brought against the Company or any other Person so indemnified based on any Preliminary Prospectus, if any, the Registration Statement or Final Prospectus or any amendment or supplement thereto or any application, and in respect of which indemnity may be sought against the Placement Agent, the Placement Agent shall have the rights and duties given to the Company, and the Company and each other Person so indemnified shall have the rights and duties given to the Placement Agent by the provisions of this Section 7. Notwithstanding the provisions of this Section 7(c), the Placement Agent shall not be required to indemnify the Company for any amount in excess of the placement agent commissions applicable to the Securities purchased pursuant to the transactions contemplated pursuant to the Registration Statement and Purchase Agreement.

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(d) In order to provide for just and equitable contribution under the Securities Act in any case in which (i) any Person entitled to indemnification under this Section 7 makes a claim for indemnification pursuant hereto but it is judicially determined (by the entry of a final judgment or decree by a court of competent jurisdiction and the expiration of time to appeal or the denial of the last right of appeal) that such indemnification may not be enforced in such case notwithstanding the fact that this Section 7 provides for indemnification in such case, or (ii) contribution under the Securities Act, the Exchange Act or otherwise may be required on the part of any such Person in circumstances for which indemnification is provided under this Section 7, then, and in each such case, the Company and the Placement Agent, severally and not jointly, shall contribute to the aggregate losses, liabilities, claims, damages and expenses of the nature contemplated by said indemnity agreement incurred by the Company and the Placement Agent, as incurred, in such proportions that the Placement Agent is responsible for that portion represented by the percentage that the placement agent commission appearing on the cover page of the Final Prospectus bears to the initial offering price appearing thereon and the Company is responsible for the balance; provided, that, no Person guilty of a fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any Person who was not guilty of such fraudulent misrepresentation. For purposes of this Section, each director, officer and employee of the Placement Agent or the Company, as applicable, and each Person, if any, who controls the Placement Agent or the Company, as applicable, within the meaning of Section 15 of the Securities Act shall have the same rights to contribution as the Placement Agent or the Company, as applicable. Notwithstanding the provisions of this Section 7(d), the Placement Agent shall not be required to contribute any amount in excess of the placement agent commissions applicable to the Securities purchased pursuant to the transactions contemplated pursuant to the Registration Statement and Purchase Agreement.

(e) Within fifteen days after receipt by any party to this Agreement (or its representative) of notice of the commencement of any action, suit or proceeding, such party will, if a claim for contribution in respect thereof is to be made against another party (“contributing party”), notify the contributing party of the commencement thereof, but the failure to so notify the contributing party will not relieve it from any liability which it may have to any other party other than for contribution hereunder. In case any such action, suit or proceeding is brought against any party, and such party notifies a contributing party or its representative of the commencement thereof within the aforesaid fifteen days, the contributing party will be entitled to participate therein with the notifying party and any other contributing party similarly notified. Any such contributing party shall not be liable to any party seeking contribution on account of any settlement of any claim, action or proceeding affected by such party seeking contribution without the written consent of such contributing party. The contribution provisions contained in this Section 7 are intended to supersede, to the extent permitted by law, any right to contribution under the Securities Act, the Exchange Act or otherwise available.

(f) The reimbursement, indemnity and contribution obligations of the Company set forth herein shall apply to any modification of this Agreement and shall remain in full force and effect regardless of any termination of, or the completion of any Indemnified Person’s services under or in connection with, this Agreement.

Section 8. Representations and Indemnities to Survive Delivery. The respective indemnities, agreements, representations, warranties and other statements of the Company or any person controlling the Company, of its officers, and of the Placement Agent set forth in or made pursuant to this Agreement will remain in full force and effect, regardless of any investigation made by or on behalf of the Placement Agent, the Company, or any of its or their partners, officers or directors or any controlling person, as the case may be, and will survive delivery of and payment for the Securities sold hereunder and any termination of this Agreement. A successor to a Placement Agent, or to the Company, its directors or officers or any person controlling the Company, shall be entitled to the benefits of the indemnity, contribution and reimbursement agreements contained in this Agreement.

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Section 9. Notices. All communications hereunder shall be in writing and shall be mailed, hand delivered or e-mailed and confirmed to the parties hereto as follows:

If to the Placement Agent to the address set forth above, attention: James Siegel, General Counsel, email: jsiegel@maximgrp.com

With a copy to:

Fox Rothschild LLP

222 South Ninth Street, Suite 2000

Minneapolis, MN 55402

E-mail: bhanson@foxrothschild.com

Attention: Brett Hanson

If to the Company:

mCloud Technologies Corp.

550-510 Burrard Street

Vancouver, BC V6C 3A8

E-mail: russmcmeekin@mcloudcorp.com

Attention: Russel H. McMeekin, Chief Executive Officer

With a copy to:

Sichenzia Ross Ference LLP

1185 Avenue of the Americas, 31st Floor

New York, NY 10036

E-mail: mross@srf.law

Attention: Marc J. Ross

Any party hereto may change the address for receipt of communications by giving written notice to the others.

Section 10. Successors. This Agreement will inure to the benefit of and be binding upon the parties hereto, and to the benefit of the employees, officers and directors and controlling persons referred to in Section 7 hereof, and to their respective successors, and personal representative, and no other person will have any right or obligation hereunder.

Section 11. Partial Unenforceability. The invalidity or unenforceability of any section, paragraph or provision of this Agreement shall not affect the validity or enforceability of any other section, paragraph or provision hereof. If any Section, paragraph or provision of this Agreement is for any reason determined to be invalid or unenforceable, there shall be deemed to be made such minor changes (and only such minor changes) as are necessary to make it valid and enforceable.

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Section 12. Governing Law; Agent for Service of Process. This Agreement will be governed by, and construed in accordance with, the laws of the State of New York applicable to agreements made and to be performed entirely in such State, without regard to the conflicts of laws principles thereof. This Agreement may not be assigned by either party without the prior written consent of the other party. This Agreement shall be binding upon and inure to the benefit of the parties hereto, and their respective successors and permitted assigns. Any right to trial by jury with respect to any dispute arising under this Agreement or any transaction or conduct in connection herewith is waived. Any dispute arising under this Agreement may be brought into the courts of the State of New York or into the Federal Court located in New York, New York and, by execution and delivery of this Agreement, the Company hereby accepts for itself and in respect of its property, generally and unconditionally, the jurisdiction of aforesaid courts. Each party hereto hereby irrevocably waives personal service of process and consents to process being served in any such suit, action or proceeding by delivering a copy thereof via overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any manner permitted by law. The Company agrees that a final judgment in any such action, proceeding or counterclaim brought in any such court shall be conclusive and binding upon the Company and may be enforced in any other courts to the jurisdiction of which the Company is or may be subject, by suit upon such judgment. If either party to this Agreement shall commence an action or proceeding to enforce any provisions of a Transaction Document, then the prevailing party in such action or proceeding shall be reimbursed by the other party for its attorney’s fees and other costs and expenses incurred with the investigation, preparation and prosecution of such action or proceeding. In addition to and without limiting the foregoing, the Company has confirmed that it has appointed Sichenzia Ross Ference LLP, as its authorized agent (the “Authorized Agent”) upon whom process may be served in any suit, action or proceeding arising out of or based upon the this Agreement or the Transaction Documents or the transactions contemplated herein which may be instituted in any New York federal or state court, by the Representative, the directors, officers, partners, employees and agents of the Representative and each affiliate of the Representative, and expressly accept the non-exclusive jurisdiction of any such court in respect of any such suit, action or proceeding. The Company hereby represents and warrants that the Authorized Agent has accepted such appointment and has agreed to act as said agent for service of process, and the Company agrees to take any and all action, including the filing of any and all documents that may be necessary to continue such appointment in full force and effect as aforesaid. The Company hereby authorizes and directs the Authorized Agent to accept such service. Service of process upon the Authorized Agent shall be deemed, in every respect, effective service of process upon the Company. If the Authorized Agent shall cease to act as agent for service of process, the Company shall appoint, without unreasonable delay, another such agent in the United States, and notify you of such appointment. This paragraph shall survive any termination of this Agreement, in whole or in part.

Section 13. General Provisions.

(a) This Agreement constitutes the entire agreement of the parties to this Agreement and supersedes all prior written or oral and all contemporaneous oral agreements, understandings and negotiations with respect to the subject matter hereof. This Agreement may be executed in two or more counterparts, each one of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument. This Agreement may not be amended or modified unless in writing by all of the parties hereto, and no condition herein (express or implied) may be waived unless waived in writing by each party whom the condition is meant to benefit. Section headings herein are for the convenience of the parties only and shall not affect the construction or interpretation of this Agreement.

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(b) The Company acknowledges that in connection with the offering of the Securities: (i) the Placement Agent’s responsibility to the Company is solely contractual and commercial in nature, (ii) the Placement Agent has acted at arms length, are not agents of, and owe no fiduciary duties to the Company or any other person, (iii) the Placement Agent owes the Company only those duties and obligations set forth in this Agreement and (iv) the Placement Agent may have interests that differ from those of the Company. The Company waives to the fullest extent permitted by applicable law any claims it may have against the Placement Agent arising from any breach or alleged breach of fiduciary duty in connection with the offering of the Securities

[The remainder of this page has been intentionally left blank.]

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If the foregoing is in accordance with your understanding of our agreement, please sign below whereupon this instrument, along with all counterparts hereof, shall become a binding agreement in accordance with its terms.

Very truly yours,
MCLOUD TECHNOLOGIES CORP.
By:
	Name: Russel H. McMeekin
	Title: Chief Executive Officer

The foregoing Placement Agency Agreement is hereby confirmed and accepted as of the date first above written.

MAXIM GROUP LLC
By:
	Name: Clifford A. Teller
	Title: Executive Managing Director, Investment Banking

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EX-4.1

Exhibit 4.1

27.3   9.0 % Series A Cumulative Perpetual Preferred Shares

27.3.1 Designation and Number of Shares.

There shall hereby be created and established a series of preferred shares of the Company designated as “Series A Cumulative Perpetual Preferred Shares” (the “Series A Preferred Shares”). The authorized number of Series A Preferred Shares shall be 2,300,000. The Company shall have the authority to issue fractional shares of the Series A Preferred Shares. Each Series A Preferred Share shall be identical in all respects to every other Series A Preferred Share, except that Series A Preferred Shares issued after the date of the first issuance of Series A Preferred Shares (the “Original Issue Date”) shall accrue dividends from the later of the Original Issue Date and the Dividend Payment Date (as defined hereafter) immediately prior to the original issue date of such additional shares for which full cumulative dividends have been paid. As used in this Article 27.3, “accrual” (or similar terms) used with respect to a dividend or dividend period refers only to the determination of the amount of such dividend and does not imply that any right to a dividend in any dividend period that arises prior to the date on which such dividend is declared.

27.3.2 Ranking.

(1) The Series A Preferred Shares will, as to dividend rights and rights as to the distribution of assets upon the Company’s liquidation, dissolution or winding up, rank:

(a) senior to all classes or series of the Common Shares and to all other shares issued by the Company expressly designated as ranking junior to the Series A Preferred Shares,

(b) on parity with any future class or series of the Company’s shares expressly designated as ranking on parity with the Series A Preferred Shares;

(c) junior to any future class or series of the Company’s shares expressly designated as ranking senior to the Series A Preferred Shares; and

(d) junior to all the Company’s existing and future indebtedness (including subordinated indebtedness and any indebtedness convertible into Common Shares or preferred shares) and other liabilities with respect to assets available to satisfy claims against the Company and structurally subordinated to the indebtedness and other liabilities of (as well as any preferred equity interests held by others in) existing or future subsidiaries of the Company.

(2) The Company may issue junior shares described in Article 27.3.2(1)(a) above and parity shares described in Article 27.3.2(b) above at any time and from time to time in one or more series without the consent of the holders of the Series A Preferred Shares. The Company’s ability to issue any senior shares described in Article 27.3.2(c) above is limited as described in Article 27.3.10(4)(a).

27.3.3 Dividends.

(1) Subject to the preferential rights, if any, of the holders of any class or series of shares of the Company ranking senior to the Series A Preferred Shares as to dividends, the holders of Series A Preferred Shares will be entitled to receive, when, as and if declared by the board of directors (or a duly authorized committee of the board of directors), only out of funds legally available for the payment of dividends, cumulative cash dividends at the annual rate of 9.0% of the $25.00 liquidation preference per year (equivalent to $2.25 per year); provided, however, that (a) on the fifth annual anniversary of the Original Issue Date, the dividend rate will increase to 13.0% of the $25.00 liquidation preference per year (equivalent to $3.25 per year) and (b) the dividend rate will increase on the dates that are three, six and nine months after the fifth annual anniversary of the Original Issue Date, respectively, to 17.0% (equivalent to $4.25 per year), 21.0% (equivalent to $5.25 per year) and 25.0% (equivalent to $6.25 per year) of the $25.00 liquidation preference per year. A “dividend period” is the period from and including a dividend payment date (as defined herein) (except that the initial dividend period shall commence on and include the Original Issue Date) and continuing to, but excluding, the next succeeding dividend payment date. Dividends on the Series A Preferred Shares will accumulate and be cumulative from, and including, the Original Issue Date; except that Series A Preferred Shares issued after the Original Issue Date shall accrue dividends from the later of the Original Issue Date and the dividend payment date (as defined herein) immediately prior to the Original Issue Date of such additional shares for which full cumulative dividends have been paid. The Company will be entitled to defer the payment of any declared dividends on the Series A Preferred Stock until the occurrence of a liquidation or Change of Control Event (as defined herein) approved by the Board of Directors of the Company.

(2) Dividends, when, as and if declared by the board of directors (or a duly authorized committee of the board of directors), will be payable monthly in arrears on the same day of the month as the Original Issue Date, each of which is a “dividend payment date”; provided that if any dividend payment date is not a business day (as defined below), then such date will nevertheless be a dividend payment date but the dividend which would otherwise have been payable on that dividend payment date, when, as and if declared, will be paid on the next succeeding business day and no interest, additional dividends or other sums will accumulate on the amounts so payable for the period from and after that dividend payment date to that next succeeding business day. As used in this Article 27.3, “business day” means any day, other than a Saturday or Sunday, that is neither a legal holiday nor a day on which banking institutions in New York City are authorized or required by law, regulation or executive order to close.

(3) Any dividend, including any dividend payable on the Series A Preferred Shares for any dividend period (or portion thereof) will be computed on the basis of a 360-day year consisting of twelve 30-day months. Dividends are payable to holders of record of Series A Preferred Shares as they appear on the central securities register for the Series A Preferred Shares or, where a transfer agent is appointed to maintain the register for the Series A Preferred Shares, in the records of the Company’s transfer agent (the “Transfer Agent”) at the close of business on the applicable record date, which will be the date designated by the board of directors (or a duly authorized committee of the board of directors) for the payment of a dividend that is not more than thirty (30) nor less than ten (10) days prior to the applicable dividend payment date.

(4) The board of directors (or a duly authorized committee of the board of directors) will not authorize, pay or set apart for payment by the Company any dividend on the Series A Preferred Shares at any time that:

(a) the terms and provisions of any of the Company’s agreements, including any agreement relating to the Company’s indebtedness, prohibits such authorization, payment or setting apart for payment;

(b) the terms and provisions of any of the Company’s agreements, including any agreement relating to the Company’s indebtedness, provides that such authorization, payment or setting apart for payment thereof would constitute a breach of, or a default under, such agreement; or

(c) the law, including the Business Corporations Act, restricts or prohibits the authorization or payment of dividends on the Series A Preferred Shares.

Notwithstanding the foregoing, dividends on the Series A Preferred Shares will accumulate whether or not (i) the terms and provisions of any of the Company’s agreements relating to its indebtedness prohibit such authorization payment or setting apart for payment, (ii) the Company has earnings, (iii) there are funds legally available for the payment of the dividends, (iv) or the dividends are authorized. Accordingly, if the board of directors (or a duly authorized committee of the board of directors) does not declare a dividend on the Series A Preferred Shares payable in respect of any dividend period before the related dividend payment date, such dividend shall accumulate and an amount equal to such accumulated dividend shall become payable out of funds legally available therefor upon the liquidation, dissolution or winding up of the Company’s affairs (or earlier redemption of such Series A Preferred Shares), to the extent not paid prior to such liquidation, dissolution or winding up or earlier redemption, as the case may be. No interest, or sums in lieu of interest, will be payable in respect of any dividend payment or payments on the Series A Preferred Shares, which may be in arrears, and holders of Series A Preferred Shares will not be entitled to any dividends in excess of the full cumulative dividends described above. Any dividend payment made on the Series A Preferred Shares shall first be credited against the earliest accumulated but unpaid dividends due with respect to those shares.

27.3.4 Restrictions on Dividends, Redemption and Repurchases.

(1) So long as any Series A Preferred Shares remain outstanding, unless the Company also has either paid or declared and set apart for payment full cumulative dividends on the Series A Preferred Shares for all past completed dividend periods, the Company will not during any dividend period:

(a) pay or declare and set apart for payment any dividends or declare or make any distribution of cash or other property on Common Shares or other shares that rank junior to or on parity with the Series A Preferred Shares with respect to dividend rights and rights to the distribution of assets upon the Company’s voluntary or involuntary liquidation, dissolution or winding up (other than, in each case, (i) a dividend paid in Common Shares or other shares ranking junior to the Series A Preferred Shares with respect to dividend rights and rights to the distribution of assets upon the Company’s voluntary or involuntary liquidation, dissolution or winding up or (ii) any declaration of a Common Share dividend in connection with any shareholders’ rights plan, or the issuance of rights, shares or other property under any shareholders’ rights plan, or the redemption or repurchase of rights pursuant to the plan);

(b) redeem, purchase or otherwise acquire Common Shares or other shares that rank junior to or on parity with the Series A Preferred Shares (other than the Series A Preferred Shares) with respect to dividend rights and rights to the distribution of assets upon the Company’s voluntary or involuntary liquidation, dissolution or winding up (other than (i) by conversion into or exchange for Common Shares or other shares ranking junior to the Series A Preferred Shares with respect to dividend rights and rights to the distribution of assets upon the Company’s voluntary or involuntary liquidation, dissolution or winding up, (ii) the redemption of shares pursuant to the provisions of these Articles relating to the restrictions upon ownership and transfer of shares, (iii) a purchase or exchange offer made on the same terms to holders of all outstanding Series A Preferred Shares and any other shares that rank on parity with the Series A Preferred Shares with respect to dividend rights and rights to the distribution of assets upon the Company’s voluntary or involuntary liquidation, dissolution or winding up, (iv) purchases, redemptions or other acquisitions of shares of the Company ranking junior to the Series A Preferred Shares with respect to dividend rights and rights to the distribution of assets upon the Company’s voluntary or involuntary liquidation, dissolution or winding up pursuant to any employment contract, dividend reinvestment and share purchase plan, benefit plan or other similar arrangement with or for the benefit of employees, officers, directors, consultants or advisors, (v) through the use of the proceeds of a substantially contemporaneous sale of shares ranking junior to the Series A Preferred Shares with respect to dividend rights and rights to the distribution of assets upon the Company’s voluntary or involuntary liquidation, dissolution or winding up, or (vi) purchases or other acquisitions of shares of the Company pursuant to a contractually binding share repurchase plan existing prior to the preceding dividend payment date on which dividends were not paid in full); or

(c) redeem, purchase or otherwise acquire Series A Preferred Shares (other than (i) by conversion into or exchange for Common Shares or other shares ranking junior to the Series A Preferred Shares with respect to dividend rights and rights to the distribution of assets upon the Company’s voluntary or involuntary liquidation, dissolution or winding up, (ii) a purchase or exchange offer made on the same terms to holders of all outstanding Series A Preferred Shares or (iii) with respect to redemptions, a redemption pursuant to which all Series A Preferred Shares are redeemed).

(2) Notwithstanding the foregoing, if the board of directors (or a duly authorized committee of the board of directors) elects to declare only partial instead of full dividends for a dividend payment date and related dividend period on the Series A Preferred Shares or any class or series of the Company’s shares that rank on parity with the Series A Preferred Shares with respect to dividends, then, to the extent permitted by the terms of the Series A Preferred Shares and each outstanding class or series of the Company’s shares that rank on parity with the Series A Preferred Shares with respect to dividends, such partial dividends shall be declared on Series A Preferred Shares and class or series of the Company’s shares that rank on parity with the Series A Preferred Shares with respect to dividends, and dividends so declared shall be paid, as to any such dividend payment date and related dividend period, in amounts such that the ratio of the partial dividends declared and paid on each such series to full dividends on each such series is the same. As used in this paragraph, “full dividends” means, as to any class or series of the Company’s shares that rank on parity with the Series A Preferred Shares with respect to dividends that bear dividends on a cumulative basis, the amount of dividends that would need to be declared and paid to bring such class or series of the Company’s shares that rank on parity with the Series A Preferred Shares with respect to dividends current in dividends, including undeclared dividends for past dividend periods. To the extent a dividend period with respect to the Series A Preferred Shares or any class or series of the Company’s shares that rank on parity with the Series A Preferred Shares with respect to dividends (in either case, the “first series”) coincides with more than one dividend period with respect to another series as applicable (in either case, a “second series”), then, for purposes of this paragraph, the board of directors (or a duly authorized committee of the board of directors) may, to the extent permitted by the terms of each affected series, treat such dividend period for the first series as two or more consecutive dividend periods, none of which coincides with more than one dividend period with respect to the second series, or may treat such dividend period(s) with respect to any class or series of the Company’s shares that rank on parity with the Series A Preferred Shares with respect to dividends and dividend period(s) with respect to the Series A Preferred Shares for the purposes of this paragraph in any other manner that it deems to be fair and equitable in order to achieve ratable payments of dividends on such class or series of the Company’s shares that rank on parity with the Series A Preferred Shares with respect to dividends and the Series A Preferred Shares.

(3) Subject to the foregoing, dividends (payable in cash, shares or otherwise) as may be determined by the board of directors (or a duly authorized committee of the board of directors) may be declared and paid on any Common Shares or other shares ranking junior to the Series A Preferred Shares with respect to dividend rights and rights to the distribution of assets upon the Company’s voluntary or involuntary liquidation, dissolution or winding up from time to time out of any funds legally available therefor, and the Series A Preferred Shares shall not be entitled to participate in any such dividend.

27.3.5 Liquidation Preference.

(1) In the event of the voluntary or involuntary liquidation, dissolution or winding up of the affairs of the Company, the holders of Series A Preferred Shares will be entitled to be paid out of the assets of the Company legally available for distribution to its shareholders (i.e., after satisfaction of all the Company’s liabilities to creditors, if any) and, subject to the rights of holders of any shares of each other class or series of shares ranking, as to rights to the distribution of assets upon the Company’s voluntary or involuntary liquidation, dissolution or winding up, senior to the Series A Preferred Shares, a liquidation preference of $25.00 per share, plus an amount equal to any accumulated and unpaid dividends to the date of payment (whether or not declared), before any distribution or payment may be made to holders of shares of Common Shares or any other class or series of the Company’s shares ranking, as to rights to the distribution of assets upon any voluntary or involuntary liquidation, dissolution or winding up, junior to the Series A Preferred Shares (the “liquidation preference”).

(2) If, upon such voluntary or involuntary liquidation, dissolution or winding up of the Company’s affairs, the assets of the Company legally available for distribution to the Company’s shareholders are insufficient to pay the full amount of the liquidation preference on all outstanding Series A Preferred Shares and the corresponding amounts payable on all shares of each other class or series of shares of the Company ranking, as to rights to the distribution of assets upon any voluntary or involuntary liquidation, dissolution or winding up, on parity with the Series A Preferred Shares, then the holders of Series A Preferred Shares and each such other class or series of shares of the Company ranking, as to rights to the distribution of assets upon the Company’s voluntary or involuntary liquidation, dissolution or winding up, on parity with the Series A Preferred Shares will share ratably in any distribution of assets in proportion to the full liquidation preference to which they would otherwise be respectively entitled. In any such distribution, the “liquidation preference” of any holder of the Company’s shares other than the Series A Preferred Shares means the amount otherwise payable to such holder in such distribution (assuming no limitation on the Company’s assets available for such distribution), including an amount equal to any declared but unpaid dividends in the case of any holder or Shares on which dividends accrue on a non-cumulative basis and, in the case of any holder of shares on which dividends accrue on a cumulative basis, an amount equal to any unpaid, accrued, cumulative dividends, whether or not earned or declared, as applicable.

(3) Holders of Series A Preferred Shares will be entitled to written notice of any voluntary or involuntary liquidation, dissolution or winding up of the Company, no fewer than thirty (30) days and no more than sixty (60) days prior to the payment date.

(4) If the liquidation preference has been paid in full to all holders of Series A Preferred Shares and each such other class or series of shares ranking, as to rights to the distribution of assets any voluntary or involuntary liquidation, dissolution or winding up, on parity with the Series A Preferred Shares, holders of Series A Preferred Shares and each such other class or series of shares ranking, as to rights to the distribution of assets upon any voluntary or involuntary liquidation, dissolution or winding up, on parity with the Series A Preferred Shares will have no right or claim to any of the Company’s remaining assets and the holders of shares of Common Shares or any class or series of shares ranking, as to rights to the distribution of assets any voluntary or involuntary liquidation, dissolution or winding up, junior to the Series A Preferred Shares, will be entitled to receive all of the Company’s remaining assets according to their respective rights and preferences.

(5) The consolidation, merger or other business combination of the Company with or into any other entity or the sale, lease, transfer or conveyance of all or substantially all of the assets, property or business of the Company will not be deemed to constitute a liquidation, dissolution or winding up of the Company.

27.3.6 Optional Redemption.

(1) The Series A Preferred Shares are perpetual and have no maturity date. The Series A Preferred Shares are not redeemable prior to the one-year anniversary of the Original Issue Date, except under the circumstances described in Article 27.3.8 hereof.

(2) On or after the one-year anniversary of the Original Issue Date, the Series A Preferred Shares may be redeemed at the Company’s option, in whole or in part, from time to time, at a redemption price of $25.00 per Series A Preferred Share, plus all dividends accumulated and unpaid (whether or not declared) on the Series A Preferred Shares up to, but not including, the date of such redemption (the “Redemption Date”), upon the giving of notice, as provided in Article 27.3.7 hereof.

27.3.7 Redemption Procedures.

(1) In the event the Company elects to redeem Series A Preferred Shares, notice of redemption will be mailed to each holder of record of Series A Preferred Shares called for redemption at such holder’s address as it appears on the Company’s share transfer records, not less than thirty (30) nor more than sixty (60) days prior to the Redemption Date. Any notice mailed as provided in this paragraph shall be conclusively presumed to have been duly given, whether or not the holder receives such notice, but failure duly to give such notice by mail, or any defect in such notice or in the mailing thereof, to any holder of Series A Preferred Shares designated for redemption shall not affect the validity of the proceedings for the redemption of any other Series A Preferred Shares. Notwithstanding the foregoing, if the Series A Preferred Shares are issued in book-entry form through The Depository Trust Company (“DTC”) or any other similar facility, notice of redemption may be given to the holders of Series A Preferred Shares at such time and in any manner permitted by such facility.

(2) The notice will notify the holder of the election to redeem the shares and will state at least the following:

(a) the Redemption Date;

(b) the redemption price;

(c) the number of Series A Preferred Shares to be redeemed (and, if fewer than all the shares are to be redeemed, the number of shares to be redeemed from such holder or the method for determining such number);

(d) the place(s) where holders may surrender certificates, if any, evidencing the Series A Preferred Shares for payment;

(e) if applicable, that the Series A Preferred Shares are being redeemed pursuant to the Company’s special optional redemption right in connection with the occurrence of a Delisting Event, Change of Control or $8 VWAP Event (each as defined hereafter), as applicable, and a brief description of the transaction or transactions or circumstances constituting such Delisting Event, Change of Control or $8 VWAP Event, as applicable; and

(f) that dividends on such Series A Preferred Shares will cease to accumulate on the date prior to the Redemption Date.

(3) If fewer than all of the outstanding Series A Preferred Shares are to be redeemed, the shares to be redeemed will be determined pro rata (as nearly as practicable without creating fractional shares) or by lot. So long as all Series A Preferred Shares are held of record by the nominee of DTC, the Company will give notice, or cause notice to be given, to DTC of the number of Series A Preferred Shares to be redeemed, and DTC will determine the number of Series A Preferred Shares to be redeemed from the account of each of its participants holding such shares in its participant account. Thereafter, each participant will select the number of shares to be redeemed from each beneficial owner for whom it acts (including the participant, to the extent it holds Series A Preferred Shares for its own account). A participant may determine to redeem Series A Preferred Shares from some beneficial owners (including the participant itself) without redeeming Series A Preferred Shares from the accounts of other beneficial owners. Subject to the provisions hereof, the board of directors (or a duly authorized committee of the board of directors) shall have full power and authority to prescribe the terms and conditions on which Series A Preferred Shares shall be redeemed from time to time. If the Company shall have issued certificates for the Series A Preferred Shares and fewer than all shares represented by any certificates are redeemed, new certificates shall be issued representing the unredeemed shares without charge to the holders thereof.

(4) On or after the Redemption Date, each holder of Series A Preferred Shares to be redeemed that holds a certificate other than through DTC book entry must present and surrender the certificates evidencing the Series A Preferred Shares at the place designated in the notice of redemption and shall be entitled to the redemption price and any accumulated and unpaid dividends payable upon the redemption following the surrender.

(5) From and after the Redemption Date or, if notice of redemption has been duly given, and if on or before the Redemption Date specified in the notice, all funds necessary for the redemption have been set aside by the Company, separate and apart from the Company’s other funds, in trust for the pro rata benefit of the holders of the shares called for redemption, so as to be and continue to be available for that purpose, then, in each case unless the Company defaults in payment of the redemption price: (i) all dividends on the shares designated for redemption in the notice will cease to accumulate on or after the Redemption Date; (ii) all rights of the holders of the shares, except the right to receive the redemption price thereof (including all accumulated and unpaid dividends up to the date prior to the Redemption Date), will cease and terminate; and (iii) the shares designated for redemption in the notice will be deemed to not be outstanding for any purpose whatsoever.

(6) Any funds held in trust and unclaimed at the end of two years from the Redemption Date, to the extent permitted by law, shall be released from the trust so established and may be commingled with the Company’s other funds, and after that time the holders of the shares so called for redemption shall look only to the Company for payment of the redemption price of such shares.

(7) Notwithstanding any other provision herein, any declared but unpaid dividends payable on a Redemption Date that occurs subsequent to the applicable record date for a dividend period shall not be paid to the holder entitled to receive the redemption price on the Redemption Date, but rather shall be paid to the holder of record of the redeemed shares on such record date relating to the applicable dividend payment date.

27.3.8 Special Optional Redemption.

(1) During any period of time (whether before or after the one-year anniversary of the Original Issue Date) that both (i) the Series A Preferred Shares are no longer (a) listed on The Nasdaq Stock Market LLC (“Nasdaq”), the New York Stock Exchange LLC (the “NYSE”), or the NYSE American LLC (the (“NYSE AMER”) or (b) listed or quoted on an exchange or quotation system that is a successor to Nasdaq, the NYSE or the NYSE AMER, and (ii) the Company is not subject to the reporting requirements of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), but any Series A Preferred Shares are still outstanding (collectively, a “Delisting Event”), the Company may, at its option, redeem the Series A Preferred Shares, in whole or in part and within ninety (90) days after the date of the Delisting Event, by paying $25.00 per Series A Preferred Share, plus all dividends accumulated and unpaid (whether or not declared) on the Series A Preferred Shares up to, but not including, the Redemption Date.

(2) During any period of time (whether before or after one-year anniversary of the Original Issue Date), upon the occurrence of a Change of Control (as defined hereafter), the Company may, at its option, redeem the Series A Preferred Shares, in whole or in part and within ninety(90) days after the first date on which such Change of Control occurred, by paying $25.00 per Series A Preferred Share, plus all dividends accumulated and unpaid (whether or not declared) on the Series A Preferred Shares up to, but not including, the date of such redemption.

(3) During any period of time (whether before or after one-year anniversary of the Original Issue Date) upon the occurrence of an $8 VWAP Event (as defined hereafter), the Company may at its option redeem the Series A Preferred Shares, in whole or in part and within ninety (90) days after the date of the Delisting Event, by paying $25.00 per Series A Preferred Share, plus all dividends accumulated and unpaid (whether or not declared) on the Series A Preferred Shares up to, but not including, the Redemption Date.

(4) As used in this Certificate, a “Change of Control” is when, after the Original Issue Date, the following have occurred and are continuing:

(a) any person or persons acting together which would constitute a “group” for purposes of Section 13(d) of the Exchange Act (other than the Company or any subsidiary of the Company) shall beneficially own (as defined in Rule 13d-3 of the Exchange Act), directly or indirectly, at least 25% of the total voting power of all classes of capital stock of the Company entitled to vote generally in the election of the board of directors;

(b) Current Directors (as herein defined) shall cease for any reason to constitute at least a majority of the members of the board of directors (for this purpose, a “Current Director” shall mean any member of the Board as of the date hereof and any successor of a Current Director whose election, or nomination for election by the Company’s shareholders, was approved by at least a majority of the Current Directors then on the board of directors);

(c) (i) the complete liquidation of the Company or (ii) the merger or consolidation of the Company, other than a merger or consolidation in which (x) the holders of the common shares of the Company immediately prior to the consolidation or merger have, directly or indirectly, at least a majority of the common shares of the continuing or surviving corporation immediately after such consolidation or merger or (y) the board of directors immediately prior to the merger or consolidation would, immediately after the merger or consolidation, constitute a majority of the board of directors of the continuing or surviving corporation, which liquidation, merger or consolidation has been approved by the shareholders of the Company; or

(d) the sale or other disposition (in one transaction or a series of transactions) of all or substantially all of the assets of the Company pursuant to an agreement (or agreements) which has (have) been approved by the shareholders of the Company.

(5) As used in this Certificate, an “$8 VWAP Event” is when, after the Original Issue Date, the volume weighted average price of the Common Shares on the Nasdaq Capital Market for five consecutive trading days (as reported by Bloomberg L.P. based on a trading day from 9:30 a.m. to 4:02 p.m. (New York City time)) is at least $8.00.

(6) The redemption procedures set forth in Article 27.3.7 will apply to any redemption under this Article 27.3.8.

27.3.9 Conversion.

(1) The Series A Preferred Shares are convertible into Common Shares at a conversion ratio of (a) the $25.00 per share liquidation preference divided by (b) $1.00 (the denominator of such conversion ratio, the “Conversion Price”). Any declared but unpaid dividends shall be paid upon such a conversion to the holder of Series A Preferred Stock in cash. Notwithstanding the foregoing, the Series A Preferred Shares are not convertible into or exchangeable for any other property or securities of the Company or any other entity, except as provided for in this Article 27.3.9.

(2) The Company will not issue fractional Common Shares upon the conversion of Series A Preferred Shares. In the event that the conversion would result in the issuance of fractional shares of Common Shares, the Company will pay the holder of Series A Preferred Shares the cash value of such fractional shares in lieu of such fractional shares based on a value per full Common Share equal to the Conversion Price then in effect.

(3) To exercise the conversion right, each holder of Series A Preferred Shares will be required to notify the Company of the number of Series A Preferred Shares to be converted and otherwise to comply with any applicable procedures required by the Transfer Agent or DTC for effecting the conversion.

(4) Series A Preferred Shares as to which the conversion right has been properly exercised will be converted into the applicable number of Common Shares (the “Conversion Shares”). The Company will take commercially reasonable efforts to deliver the applicable Conversion Shares no later than the third business day following receipt of the conversion notice from the holder of Series A Preferred Shares.

(5) If, at any time while the Series A Preferred Shares are outstanding, the Company sells or grants any option to purchase or sells or grants any right to reprice, or otherwise disposes of or issues (or announces any offer, sale, grant or any option to purchase or other disposition), any Common Shares (or any securities of the Company which would entitle the holder thereof to acquire at any time Common Shares, including any debt, preferred stock, rights, options, warrants or other instrument that is at any time convertible into or exercisable or exchangeable for, or otherwise entitles the holder thereof to receive, Common Shares (“Common Share Equivalents”)) entitling any party to acquire Common Shares at an effective price per share that is lower than the Conversion Price then in effect (such lower price, the “Base Conversion Price” and such issuances, collectively, a “Dilutive Issuance”) (it being understood and agreed that if the holder of the Common Shares or Common Share Equivalents so issued shall at any time, whether by operation of purchase price adjustments, reset provisions, floating conversion, exercise or exchange prices or otherwise, or due to warrants, options or rights per share which are issued in connection with such issuance, be entitled to receive Common Shares at an effective price per share that is lower than the Conversion Price, such issuance shall be deemed to have occurred for less than the Conversion Price on such date of the Dilutive Issuance at such effective price), then simultaneously with the consummation of each Dilutive Issuance the Conversion Price shall be reduced so as to be to equal the Base Conversion Price, provided that (i) the Base Conversion Price shall not be less than $0.20 (subject to adjustment for reverse and forward stock splits, recapitalizations and similar transactions following the Original Issue Date) and (ii) and (ii) for so long as the Common Shares are listed on the TSX Venture Exchange (A) any reduction to the Conversion Price pursuant to this provision will be subject to the prior approval of the TSX Venture Exchange, and (B) the Base Conversion Price shall not be less than the Market Price (as that term is defined in the policies of the TSX Venture Exchange). The Conversion Price shall also be subject to adjustment for reverse and forward stock splits, recapitalizations and similar transactions following the Original Issue Date. Notwithstanding the foregoing, no adjustment will be made under this Article 27.3.9(5) in respect of an Exempt Issuance (as defined below). The Company shall notify the holders of Series A Preferred Shares in writing, no later than the business day following the issuance or deemed issuance of any Common Shares or Common Share Equivalents subject to this Article 27.3.9(5), indicating therein the applicable issuance price, or applicable reset price, exchange price, conversion price, exercise price and other pricing terms (such notice, the “Dilutive Issuance Notice”). For purposes of clarification, whether or not the Company provides a Dilutive Issuance Notice pursuant to this Article 27.3.9(5), upon the occurrence of any Dilutive Issuance, the holders of Series A Preferred Shares are entitled to receive a number of Conversion Shares based upon the Base Conversion Price on or after the date of such Dilutive Issuance, regardless of whether the holder accurately refers to the Base Conversion Price in the notice of conversion. The adjustment under this Article 27.3.9(5) may be waived with respect to a particular Dilutive Issuance on behalf of all holders of Series A Preferred Shares by the affirmative written consent or vote of the holders of at least a majority of the Series A Preferred Shares then outstanding.

“Exempt Issuance” means the sale or issuance of (i) Common Shares or options or other equity awards issued to employees or directors of the Company pursuant to a plan, agreement or arrangement approved by the Board of Directors; (ii) securities exercisable or exchangeable for or convertible into Common Shares issued and outstanding on the Original Issue Date, provided that such securities have not been amended since the Original Issue Date to increase the number of such securities or to decrease the exercise price, exchange price or conversion price of such securities (other than in connection with stock splits or combinations) or to extend the term of such securities; (iii) Common Shares, options or convertible securities issued as acquisition consideration pursuant to the acquisition of another entity by the Company by merger, purchase of substantially all of the assets or other reorganization or to a joint venture agreement, provided that such issuances are approved by the Board of Directors provided that such securities are issued as “restricted securities” (as defined in Rule 144) and carry no registration rights that require or permit the filing of any registration statement in connection therewith until the 180th day after the Original Issue Date, and provided that any such issuance shall only be to a party (or to the equity holders of a party) which is, itself or through its subsidiaries, an operating company or an owner of an asset in a business synergistic with the business of the Company and shall provide to the Company additional benefits in addition to the investment of funds, but shall not include a transaction in which the Company is issuing securities primarily for the purpose of raising capital or to an entity whose primary business is investing in securities; (iv) Common Shares, options or convertible securities issued in connection with sponsored research, collaboration, technology license, development, OEM, marketing or other similar agreements or strategic partnerships approved by the Board of Directors provided that such securities are issued as “restricted securities” (as defined in Rule 144) and carry no registration rights that require or permit the filing of any registration statement in connection therewith until the 180th day after Original Issue Date, and provided that any such issuance shall not include a transaction in which the Company is issuing securities primarily for the purpose of raising capital or to an entity whose primary business is investing in securities; and (v) Common Shares issued in connection with the issuance of bona fide commercial bank debt or equipment lease transactions, provided that such issuances are approved by the Board of Directors provided that such securities are issued as “restricted securities” (as defined in Rule 144) and carry no registration rights that require or permit the filing of any registration statement in connection therewith until the 180th day after the Original Issue Date.

27.3.10 Voting Rights.

(1) Holders of Series A Preferred Shares shall not have any voting rights, except as set forth in this Article 27.3.10 or as otherwise required by law.

(2) In any matter in which the Series A Preferred Shares may vote (as expressly provided herein or as may be required by law), each Series A Preferred Share shall be entitled to one vote per $25.00 of liquidation preference; provided that if the Series A Preferred Shares and any other Shares ranking on parity to the Series A Preferred Shares as to dividend rights and rights as to the distribution of assets upon the Company’s liquidation, dissolution or winding up are entitled to vote together as a single class on any matter, the holders of each will vote in proportion to their respective liquidation preferences.

(3) As used in this Article 27.3, “voting preferred shares” means any other class or series of the Company’s preferred shares ranking equally with the Series A Preferred Shares as to dividends (whether cumulative or non-cumulative) and the distribution of the Company’s assets upon liquidation, dissolution or winding up and upon which like voting rights to the Series A Preferred Shares have been conferred and are exercisable.

(4) So long as any Series A Preferred Shares remain outstanding, the Company will not, without the consent or the affirmative vote of the holders of at least two-thirds of the outstanding Series A Preferred Shares and each other class or series of preferred shares entitled to vote thereon (voting together as a single class), given in person or by proxy, either in writing without a meeting or by vote at any meeting called for the purpose:

(a) authorize, create or issue, or increase the number of authorized or issued number of shares of, any class or series of shares ranking senior to the Series A Preferred Shares with respect to payment of dividends or the distribution of assets upon the liquidation, dissolution or winding up of the Company or reclassify any authorized shares of the Company into any such shares, or create, authorize or issue any obligation or security convertible into or evidencing the right to purchase any such shares; or

(b) amend, alter or repeal the provisions of these Articles or the Company’s Notice of Articles, insofar as the Notice of Articles relates to the Company’s authorized capital, including the terms of the Series A Preferred Shares, whether by merger, consolidation, transfer or conveyance of all or substantially all of the Company’s assets or otherwise, so as to materially and adversely affect the rights, preferences, privileges or voting powers of the Series A Preferred Shares, taken as a whole.

(5) If any event described in Article 27.3.10(4)(b) would materially and adversely affect the rights, preferences, privileges or voting powers of the Series A Preferred Shares, taken as a whole, disproportionately relative to any other class or series of voting preferred Shares, the affirmative vote of the holders of at least two-thirds of the outstanding Series A Preferred Shares, voting as a separate class, will also be required. Furthermore, if holders of Series A Preferred Shares receive the $25.00 per share of the Series A Preferred Shares liquidation preference plus all accrued and unpaid dividends thereon or greater amounts pursuant to the occurrence of any of the event described in 27.3.10(4)(b), then such holders shall not have any voting rights with respect to the event described in 27.3.10(4)(b).

(6) The following actions are not deemed to materially and adversely affect the rights, preferences, powers or privileges of the Series A Preferred Shares:

(a) any increase in the number of authorized Common Shares or preferred shares or the creation or issuance of shares or any class or series ranking, as to dividends (whether cumulative or not) or the distribution of assets upon the Company’s liquidation, dissolution or winding up, on parity with, or junior to, the Series A Preferred Shares; or

(b) the amendment, alteration or repeal or change of any provision of the Articles or the Company’s Notice of Articles, insofar as the Notice of Articles relates to the Company’s authorized capital, as a result of a merger, consolidation, reorganization or other business combination, if (x) the Series A Preferred Shares remain outstanding or, in the case of any such merger or consolidation with respect to which the Company is not the surviving or resulting entity, the Series A Preferred Shares are converted into or exchanged for preference securities of the surviving or resulting entity or its ultimate parent, and (y) such shares remaining outstanding or such preference securities, as the case may be, have such rights, preferences, privileges and voting powers, and limitations and restrictions thereof, taken as a whole, as are not materially less favorable to the holders thereof than the rights, preferences, privileges and voting powers, and restrictions and limitations thereof, of the Series A Preferred Shares, taken as a whole, immediately prior to such consummation.

(7) Without the consent of the holders of Series A Preferred Shares, the Company may amend, alter, supplement or repeal any terms of the Series A Preferred Shares:

(a) to cure any ambiguity, or to cure, correct or supplement any provision contained in this Article 27.3 for the Series A Preferred Shares that may be defective or inconsistent, so long as such action does not materially and adversely affect the rights, preferences, privileges and voting powers of the Series A Preferred Shares, taken as a whole;

(b) to conform this Article 27.3 to the description of the Series A Preferred Shares set forth in the Company’s final prospectus filed with the U.S. Securities and Exchange Commission related to the initial issuance of Series A Preferred Shares in connection with the Company’s Registration Statement on Form F-1 (Registration No. 333-264859); or

(c) to make any provision with respect to matters or questions arising with respect to the Series A Preferred Shares that is not inconsistent with the provisions of this Article 27.3.

(8) The foregoing voting provisions will not apply if, at or prior to the time when the act with respect to which the vote would otherwise be required shall be effected, all outstanding Series A Preferred Shares have been redeemed or called for redemption on proper notice and sufficient funds have been set aside by the Company for the benefit of the holders of Series A Preferred Shares to effect the redemption within ninety (90) days unless all or a part of the outstanding Series A Preferred Shares are being redeemed with the proceeds from the sale of shares of, any class or series of shares ranking senior to the Series A Preferred Shares with respect to payment of dividends or the distribution of assets upon the Company’s liquidation, dissolution or winding up.

(9) The rules and procedures for calling and conducting any meeting of the holders of Series A Preferred Shares (including, without limitation, the fixing of a record date in connection therewith), the solicitation and use of proxies at such a meeting, the obtaining of written consents and any other aspect or matter with regard to such a meeting or such consents shall be governed by any rules the board of directors (or a duly authorized committee of the board of directors), in its discretion, may adopt from time to time, which rules and procedures shall conform to the requirements of these Articles, applicable law (including the Business Corporations Act) and any national securities exchange or other trading facility on which the Series A Preferred Shares may be listed or traded at the time.

(10) Holders of Series A Preferred Shares will not have any voting rights with respect to, and the consent of the holders of Series A Preferred Shares is not required for, the taking of any corporate action, including any merger or consolidation involving the Company or a sale of all or substantially all of the Company’s assets, regardless of the effect that such merger, consolidation or sale may have upon the powers, preferences, voting power or other rights or privileges of the Series A Preferred Shares, except as set forth above.

27.3.11 Redemption Upon Request of Holder in Connection with Change of Control.

(1) Upon the occurrence of a Change of Control that is approved by the Board of Directors, each holder of Series A Preferred Shares may require the Company to redeem all or a portion of such holder’s Series A Preferred Shares at a per share redemption price of $25.00, plus declared and unpaid dividends to, but excluding, the effective date of the Change of Control).

(2) Upon not less than 30 nor more than 60 days’ following the occurrence of a Change of Control, the Company will provide to holders of Series A Preferred Shares a written notice (in a manner prescribed by this Article 27.3) of occurrence of the Change of Control that describes the procedure for delivering a redemption request pursuant to this Article 27.3.11 (a “Change of Control Redemption Request”). Holders will be required to tender such Series A Preferred Shares in connection with the delivery of a Change of Control Redemption Request and will receive payment for the redemption of such Series A Preferred Shares no later than the third business day following the delivery of the Change of Control Redemption Request.

(3) In addition to the procedures set forth in this Article 27.3.11, the redemption procedures set forth in Article 27.3.7(4) and (7) will apply to any redemption under this Article 27.3.11.

27.3.12 No Preemptive Rights.

Holders of Series A Preferred Shares do not have any preemptive rights.

27.3.13 No Maturity, Sinking Fund or Mandatory Redemption.

The Series A Preferred Shares have no maturity date and the Company is not required to redeem the Series A Preferred Shares at any time. Accordingly, the Series A Preferred Shares will remain outstanding indefinitely, unless the Company decides, at its option, to exercise its redemption right or, under circumstances where the holders of Series A Preferred Shares have a conversion right, such holders convert the Series A Preferred Shares into the Company’s common Shares. The Series A Preferred Shares are not subject to any sinking fund.

27.3.14 Exclusion of Other Rights.

The Series A Preferred Shares do not have any voting powers, preferences or relative, participating, optional or other special rights, or qualifications, limitations or restrictions thereof, other than as set forth in this Article 27.3.

27.3.15 Headings of Subdivisions.

The headings of the various subdivisions of this Article 27.3 are for convenience of reference only and shall not affect the interpretation of any of the provisions hereof.

27.3.16 Severability of Provisions.

If any preferences or other rights, voting powers, restrictions, limitations as to dividends or other distributions, qualifications or terms or conditions of redemption of the Series A Preferred Shares set forth in this Article 27.3 are invalid, unlawful or incapable of being enforced by reason of any rule of law or public policy, all other preferences or other rights, voting powers, restrictions, limitations as to dividends or other distributions, qualifications or terms or conditions of redemption of Series A Preferred Shares set forth in this Article 27.3 which can be given effect without the invalid, unlawful or unenforceable provision thereof shall, nevertheless, remain in full force and effect and no preferences or other rights, voting powers, restrictions, limitations as to dividends or other distributions, qualifications or terms or conditions of redemption of the Series A Preferred Shares herein set forth shall be deemed dependent upon any other provision thereof unless so expressed therein.

27.3.17 Record Holders.

To the fullest extent permitted by applicable law, the Company and the Transfer Agent may deem and treat the record holder of any share of the Series A Preferred Shares as the true and lawful owner thereof for all purposes, and neither the Company nor the Transfer Agent shall be affected by any notice to the contrary.

27.3.18 Notices.

All notices or communications in respect of the Series A Preferred Shares will be sufficiently given if given in writing and delivered in person or by first class mail, postage prepaid, or if given in such other manner as may be permitted in this Article 27.3 or in these Articles or by applicable law.

27.3.19 Certificates.

The Company may at its option issue Series A Preferred Shares without certificates. If DTC or its nominee is the registered owner of the Series A Preferred Shares, the following provisions of this Article 27.3.19 shall apply. If and as long as DTC or its nominee is the registered owner of the Series A Preferred Shares, DTC or its nominee, as the case may be, shall be considered the sole owner and holder of all such Series A Preferred Shares of which DTC or its nominee is the registered owner for all purposes under the instruments governing the rights and obligations of holders of Series A Preferred Shares. If DTC discontinues providing its services as securities depositary with respect to the Series A Preferred Shares, or if DTC ceases to be registered as a clearing agency under applicable securities laws, in the event that a successor securities depositary is not obtained within ninety (90) days, the Company shall either print and deliver certificates for the Series A Preferred Shares or provide for the direct registration of the Series A Preferred Shares with the Transfer Agent. If the Company decides to discontinue the use of the system of book-entry-only transfers through DTC (or a successor securities depositary), the Company shall print certificates representing the Series A Preferred Shares and deliver such certificates to DTC or shall provide for the direct registration of the Series A Preferred Shares with the Transfer Agent. Except in the limited circumstances referred to above, owners of beneficial interests in the Series A Preferred Shares of which DTC or its nominee is the registered owner:

(a) shall not be entitled to have such Series A Preferred Shares registered in their names;

(b) shall not receive or be entitled to receive physical delivery of securities certificates in exchange for beneficial interests in the Series A Preferred Shares; and

(c) shall not be considered to be owners or holders of Series A Preferred Shares for any purpose under the instruments governing the rights and obligations of holders of Series A Preferred Shares.

27.3.20 Restatement of Articles.

On any restatement of these Articles, Article 27.3.1 through Article 27.3.19 of this Article 27.3 shall be included in the Articles under the heading “9.0% Series A Cumulative Perpetual Preferred Shares” and this Article 27.3.20 may be omitted. If the board of directors so determines, the numbering of Article 27.3.1 through Article 27.3.19 may be changed for convenience of reference or for any other proper purpose.

EX-5.1

Exhibit 5.1

Our File No.: 4609.103

November 7, 2022

MCLOUD TECHNOLOGIES CORP.

550-510 Burrard Street

Vancouver, British Columbia Canada, V6C 3A8

Ladies and Gentlemen:

Re: MCLOUD TECHNOLOGIES CORP.—Registration Statement on Form F-1

We have acted as British Columbia counsel to mCloud Technologies Corp. (the “Company”), a British Columbia company, in connection with the registration by the Company of up to (i) $35,000,000 9.0% Series A Cumulative Perpetual Preferred Shares (the “Preferred Shares”) and accompanying (ii) warrants to purchase common shares (the “Warrants”), with each Preferred Share to be sold with 25 accompanying Warrants, in connection with a best efforts public offering of the Company (the “Offering”).

In connection with this opinion, we have reviewed and relied upon originals, photocopies or copies, certified or otherwise identified to our satisfaction, of the Registration Statement on Form F-1 (Registration Statement No. 333-264859) (the “Registration Statement”) filed by the Company with the Securities and Exchange Commission and as to which this opinion is filed as an exhibit, the exhibits to the Registration Statement including the form of Placement Agency Agreement between the Company and Maxim Group LLC, the form of Securities Purchase Agreement between the Company and the purchasers signatory thereto, the Company’s Notice of Articles, the Company’s Articles, records of the Company’s corporate proceedings in connection with the Offering, and such other documents, records, certificates, memoranda and other instruments as we deem necessary as a basis for this opinion. With respect to the foregoing documents, we have assumed, without independent investigation: (i) the authenticity of all records, documents, and instruments submitted to us as originals; (ii) the genuineness of all signatures on all agreements, instruments and other documents submitted to us; (iii) the legal capacity and authority of all persons or entities (other than the Company) executing all agreements, instruments or other documents submitted to us; (iv) the authenticity and the conformity to the originals of all records, documents, and instruments submitted to us as copies; (v) that the statements contained in the certificates and comparable documents of public officials, officers and representatives of the Company and other persons on which we have relied for purposes of this opinion are true and correct; (vi) that the Registration Statement has been declared effective pursuant to the Securities Act of 1933, as amended (the “Securities Act”); and (vii) that the resolutions of the Company’s directors approving the Offering and the creation of the Preferred Shares, dated July 14, 2022, August 8, 2022, August 22, 2022, and November 4, 2022 are true and complete copies of the proceedings of the Board related to the approval of the Offering and the creation of the Preferred Shares and that the resolutions have not been altered, amended or rescinded as at the date of this opinion. We have also obtained from officers of the Company certificates as to certain factual matters and, insofar as this opinion is based on matters of fact, we have relied on such certificates without independent investigation. With respect to the Placement Agency Agreement, Securities Purchase Agreement and the Warrants, all of which are governed by and construed in accordance with the laws of the State of New York, we have assumed that these agreements comply with and do not violate the laws of the State of New York.

Our opinion is limited to laws of the Province of British Columbia. We have not considered, and have not expressed any opinion with regard to, or as to the effect of, any other law, rule, or regulation, state or federal, applicable to the Company. In particular, we express no opinion as to United States federal securities laws.

Based upon and subject to the foregoing, we are of the opinion that (i) upon payment to the Company of the consideration in such amount and form as shall be determined by its Board of Directors (the “Board”) or by an authorized committee thereof, the Preferred Shares, when issued and sold in the Offering as described in the Registration Statement, will be duly and validly issued, fully paid and non-assessable; (ii) the common shares underlying the Preferred Shares, when issued and sold by the Company and delivered by the Company in accordance with and in the manner described in the Registration Statement and the Rights and Restrictions for 9.0% Cumulative Series A Preferred Shares, will be validly issued, fully paid and non-assessable, and (iii) the common shares underlying the Warrants, when issued and sold by the Company and delivered by the Company against receipt of the exercise price therefor as shall be determined by the Board or an authorized committee thereof, in accordance with and in the manner described in the Registration Statement and the Warrants, will be validly issued, fully paid and non-assessable.

We hereby consent to the filing of this opinion as an exhibit to the Company’s Registration Statement and to the use of our name wherever it appears in the Registration Statement. In giving such consent, we do not believe that we are “experts” within the meaning of such term as used in the Securities Act, or the rules and regulations of the Securities and Exchange Commission issued thereunder with respect to any part of the Registration Statement, including this opinion as an exhibit or otherwise.

We further consent to the incorporation by reference of this letter and consent into any registration statement filed pursuant to Rule 462(b) under the Securities Act with respect to the Securities.

Very truly yours,

/s/ Morton Law LLP

Morton Law LLP

EX-5.2

Exhibit 5.2

November 7, 2022

mCloud Technologies Corp.

550-510 Burrard Street

Vancouver, British Columbia

Canada, V6C 3A8

Ladies and Gentlemen:

This opinion is furnished to you in connection with a Registration Statement on Form F-1 (Registration No. 333-264859) (as amended to date, the “Registration Statement”) filed by mCloud Technologies Corp., a British Columbia company (the “Company”), with the Securities and Exchange Commission (the “Commission”) under the Securities Act of 1933, as amended (the “Securities Act”), relating to the registration in connection with a proposed best efforts public offering of up to $35,000,000 9.0% Series A Cumulative Perpetual Preferred Shares, no par value per share, with a $25.00 liquidation preference per share (the “Series A Preferred Shares”) and accompanying warrants to purchase one common share, no par value per share (the “Warrants” and, together with the Series A Preferred Shares, and the common shares underlying the Warrants, the “Securities”). Each Series A Preferred Share will be issued together with 25 Warrants. The Company has engaged Maxim Group LLC, to act as its placement agent in connection with the proposed public offering of the Company.

We are acting as U.S. securities counsel for the Company in connection with the Registration Statement. In connection with this opinion, we have examined originals or copies, certified or otherwise identified to our satisfaction, of such records of the Company and such agreements, certificates and statements of public officials, certificates of officers or representatives of the Company, and such other documents, certificates and records as we have deemed necessary or appropriate as a basis for the opinion set forth herein. In our examination, we have assumed the legal capacity of all natural persons, the genuineness of all signatures, the authenticity of all documents submitted to us as originals, the conformity to original documents of all documents submitted to us as certified or photostatic copies and the authenticity of all originals of such latter documents. As to any facts material to the opinions expressed herein which were not independently established or verified, we have relied upon oral or written statements and representations of officers and other representatives of the Company and others, including those set forth in the Form of Placement Agency Agreement (the “Placement Agency Agreement”) and form of Securities Purchase Agreement (the “Securities Purchase Agreement”), copies of which have been filed as Exhibit 1.1 and Exhibit 10.17, respectively, to the Registration Statement.

We are admitted to the Bar in the State of New York. We express no opinion as to the laws of any jurisdiction other than the laws of the State of New York.

You are separately receiving an opinion from Morton Law LLP with respect to the corporate proceedings relating to the issuance of the Securities.

Based upon the foregoing and subject to the assumptions and qualifications set forth herein, we are of the opinion that the Warrants, when issued and sold by the Company and delivered by the Company in accordance with and in the manner described in the Registration Statement Placement Agency Agreement and Securities Purchase Agreement, when executed and delivered by the Company, will constitute the valid and binding obligation of the Company, enforceable against the Company in accordance with its terms, subject to applicable bankruptcy, insolvency, fraudulent conveyance, moratorium and similar laws affecting creditors’ rights generally and equitable principles of general applicability and comply with and do not violate the laws of the State of New York.

We express no opinion as to the enforceability of any rights to indemnification or contribution provided for in the Placement Agency Agreement or Securities Purchase Agreement that are violative of the public policy underlying any law, rule or regulation.

We consent to the filing of this opinion as an exhibit to the Registration Statement and we further consent to the use of our name under the caption “Legal Matters” in the Registration Statement and the prospectus that forms a part thereof. In giving these consents, we do not thereby admit that we are within the category of persons whose consent is required under Section 7 of the Securities Act or the rules and regulations of the Commission. This opinion letter is given as of the date hereof and we do not undertake any liability or responsibility to inform you of any change in circumstances occurring, or additional information becoming available to us, after the date hereof which might alter the opinions contained herein.

Very truly yours,

/s/ Sichenzia Ross Ference LLP

Sichenzia Ross Ference LLP

EX-10.17

Exhibit 10.17

SECURITIES PURCHASE AGREEMENT

This Securities Purchase Agreement (this “Agreement”) is dated as of [•], 2022, between mCloud Technologies Corp., a company incorporated under the Business Corporations Act (British Columbia) (the “Company”), and each purchaser identified on the signature pages hereto (each, including its successors and assigns, a “Purchaser” and collectively the “Purchasers”).

WHEREAS, subject to the terms and conditions set forth in this Agreement and pursuant to an effective registration statement under the Securities Act (as defined below), the Company desires to issue and sell to each Purchaser, and each Purchaser, severally and not jointly, desires to purchase from the Company, securities of the Company as more fully described in this Agreement.

NOW, THEREFORE, IN CONSIDERATION of the mutual covenants contained in this Agreement, and for other good and valuable consideration the receipt and adequacy of which are hereby acknowledged, the Company and each Purchaser agree as follows:

ARTICLE I.

DEFINITIONS

1.1 Definitions. In addition to the terms defined elsewhere in this Agreement, for all purposes of this Agreement, the following terms have the meanings set forth in this Section 1.1:

“Action” shall have the meaning ascribed to such term in Section 3.1(j).

“Affiliate” means any Person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common control with a Person as such terms are used in and construed under Rule 405 under the Securities Act.

“Board of Directors” means the board of directors of the Company.

“Business Day” means any day other than Saturday, Sunday or other day on which commercial banks in The City of New York are authorized or required by law to remain closed; provided, however, for clarification, commercial banks shall not be deemed to be authorized or required by law to remain closed due to “stay at home”, “shelter-in-place”, “non-essential employee” or any other similar orders or restrictions or the closure of any physical branch locations at the direction of any governmental authority so long as the electronic funds transfer systems (including for wire transfers) of commercial banks in The City of New York are generally open for use by customers on such day.

“Closing” means the closing of the purchase and sale of the Securities pursuant to Section 2.1.

“Closing Date” means the Trading Day on which all of the Transaction Documents have been executed and delivered by the applicable parties thereto, and all conditions precedent to (i) the Purchasers’ obligations to pay the Subscription Amount and (ii) the Company’s obligations to deliver the Securities, in each case, have been satisfied or waived, but in no event later than the second (2nd) Trading Day following the date hereof.

“Commission” means the United States Securities and Exchange Commission.

“Common Shares” means the common shares of the Company, without par value, and any other class of securities into which such securities may hereafter be reclassified or changed.

“Common Share Equivalents” means any securities of the Company or the Subsidiaries which would entitle the holder thereof to acquire at any time Common Shares, including, without limitation, any debt, preferred shares, right, option, warrant or other instrument that is at any time convertible into or exercisable or exchangeable for, or otherwise entitles the holder thereof to receive, Common Shares.

“Company Counsel” means Sichenzia Ross Ference LLP, with offices located at 1185 Avenue of Americas, 31st Floor, New York, NY 10036.

“Company Canadian Counsel” means Morton Law LLP, with offices located at 1200-750 W. Pender Street, Vancouver, British Columbia, Canada, V6C 2T8.

“Disclosure Time” means, (i) if this Agreement is signed on a day that is not a Trading Day or after 9:00 a.m. (New York City time) and before midnight (New York City time) on any Trading Day, 9:01 a.m. (New York City time) on the Trading Day immediately following the date hereof, unless otherwise instructed as to an earlier time by the Placement Agent, and (ii) if this Agreement is signed between midnight (New York City time) and 9:00 a.m. (New York City time) on any Trading Day, no later than 9:01 a.m. (New York City time) on the date hereof, unless otherwise instructed as to an earlier time by the Placement Agent.

“Evaluation Date” shall have the meaning ascribed to such term in Section 3.1(s).

“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.

“FCPA” means the Foreign Corrupt Practices Act of 1977, as amended.

“IFRS” shall have the meaning ascribed to such term in Section 3.1(h).

“Indebtedness” shall have the meaning ascribed to such term in Section 3.1(aa).

“Intellectual Property Rights” shall have the meaning ascribed to such term in Section 3.1(p).

“Liens” means a lien, charge, pledge, security interest, encumbrance, right of first refusal, preemptive right or other restriction.

“Material Adverse Effect” shall have the meaning assigned to such term in Section 3.1(b).

“Material Permits” shall have the meaning ascribed to such term in Section 3.1(n).

“Person” means an individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability company, joint stock company, government (or an agency or subdivision thereof) or other entity of any kind.

“Placement Agent” means Maxim Group LLC.

“Placement Agent Counsel” means Fox Rothschild LLP, with offices located at 222 South Ninth Street, Suite 2000, Minneapolis, Minnesota 55402.

“Preliminary Prospectus” means any preliminary prospectus included in the Registration Statement, as originally filed or as part of any amendment thereto, or filed with the Commission pursuant to Rule 424(a) of the rules and regulations of the Commission under the Securities Act.

“Pricing Prospectus” means (i) the Preliminary Prospectus relating to the Securities that was included in the Registration Statement immediately prior to 9:15 a.m. (New York City time) on the date hereof and (ii) any free writing prospectus (as defined in the Securities Act) identified on Schedule A hereto, taken together.

“Proceeding” means an action, claim, suit, investigation or proceeding (including, without limitation, an informal investigation or partial proceeding, such as a deposition), whether commenced or threatened.

“Prospectus” means the final prospectus filed for the Registration Statement.

“Purchaser Party” shall have the meaning ascribed to such term in Section 4.7.

“Registration Statement” means the effective registration statement with Commission File No. 333-264859 which registers the sale of the Series A Shares, the Warrants and the Warrant Shares to the Purchasers, and includes any Rule 462(b) Registration Statement.

“Required Approvals” shall have the meaning ascribed to such term in Section 3.1(e).

“Rule 144” means Rule 144 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended or interpreted from time to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same purpose and effect as such Rule.

“Rule 424” means Rule 424 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended or interpreted from time to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same purpose and effect as such Rule.

“Rule 462(b) Registration Statement” means any registration statement prepared by the Company registering additional Securities, which was filed with the Commission on or prior to the date hereof and became automatically effective pursuant to Rule 462(b) promulgated by the Commission pursuant to the Securities Act.

“SEC Reports” shall have the meaning ascribed to such term in Section 3.1(h).

“Securities” means the Units, Series A Shares, the Warrants and the Warrant Shares.

“Securities Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.

“Series A Shares” means the 9.0% Series A Cumulative Perpetual Preferred Shares of the Company, without par value, issued or issuable to each Purchaser pursuant to this Agreement.

“Short Sales” means all “short sales” as defined in Rule 200 of Regulation SHO under the Exchange Act (but shall not be deemed to include locating and/or borrowing Common Shares).

“Subscription Amount” means, as to each Purchaser, the Unit Subscription Amount in accordance with Section 2.1 herein.

“Subsidiary” means any subsidiary of the Company as disclosed in the SEC Reports, and shall, where applicable, also include any direct or indirect subsidiary of the Company formed or acquired after the date hereof.

“Trading Day” means a day on which the principal Trading Market is open for trading.

“Trading Market” means any of the following markets or exchanges on which the Series A Shares and Common Shares are listed or quoted for trading on the date in question: the NYSE American, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market, or the New York Stock Exchange (or any successors to any of the foregoing).

“Transaction Documents” means this Agreement, the Warrant Agency Agreement, the Warrants, all exhibits and schedules thereto and hereto and any other documents or agreements executed in connection with the transactions contemplated hereunder.

“Transfer Agent” means American Stock Transfer & Trust Company, LLC, the current transfer agent of the Company with a mailing address of 6201 15th Avenue, Brooklyn, New York 11219 and an email address of reorg_warrants@astfinancial.com, and any successor transfer agent of the Company.

“Units” means a unit consisting of (a) one Series A Share and (b) 25 Warrants to purchase one Common Share.

“Unit Purchase Price” equals $25.00 per each Unit, subject to adjustment for reverse and forward stock splits, stock dividends, stock combinations and other similar transactions of the Series A Shares or Common Shares that occur after the date of this Agreement.

“Unit Subscription Amount” means, as to each Purchaser, the aggregate amount to be paid for the Units hereunder as specified below such Purchaser’s name on the signature page of this Agreement and next to the heading “Unit Subscription Amount,” in United States dollars and in immediately available funds.

“Warrants” means the Common Share purchase warrants delivered to the Purchasers at the Closing in accordance with Section 2.2(a) hereof, in the form of Exhibit A attached hereto.

“Warrant Shares” means the Common Shares issuable upon exercise of the Warrants.

“Warrant Agency Agreement” means the warrant agency agreement dated on or about the Closing Date, between the Company and the Transfer Agent.

ARTICLE II.

PURCHASE AND SALE

2.1 Closing. On the Closing Date, upon the terms and subject to the conditions set forth herein, substantially concurrent with the execution and delivery of this Agreement by the parties hereto, the Company agrees to sell, and the Purchasers, severally and not jointly, agree to purchase, up to an aggregate of $[•] of Units as determined pursuant to Section 2.2(a). Unless otherwise directed by the Placement Agent, each Purchaser’s Subscription Amount as set forth on the signature page hereto executed by such Purchaser shall be made available for “Delivery Versus Payment” settlement with the Company or its designee. The Company shall deliver to each Purchaser its respective Series A Shares and Warrants as determined pursuant to Section 2.2(a), and the Company and each Purchaser shall deliver the other items set forth in Section 2.2 deliverable at the Closing. Upon satisfaction of the covenants and conditions set forth in Sections 2.2 and 2.3, the Closing shall occur at the offices of the Placement Agent Counsel or such other location as the parties shall mutually agree. Each Purchaser acknowledges that, concurrently with the Closing and pursuant to the Prospectus, the Company may sell up to $35,000,000 of additional Units to purchasers not party to this Agreement, less the aggregate Subscription Amount pursuant to this Agreement, and will issue to such purchasers such Series A Shares and Warrants in the same form and at the same Unit Purchase Price. Unless otherwise directed by the Placement Agent, settlement of the Series A Shares shall occur via “Delivery Versus Payment” (“DVP”) (i.e., on the Closing Date, the Company shall issue the Series A Shares registered in the Purchasers’ names and addresses and released by the Transfer Agent directly to the account(s) at the Placement Agent identified by each Purchaser; upon receipt of such Series A Shares, the Placement Agent shall promptly electronically deliver such Series A Shares to the applicable Purchaser, and payment therefor shall be made by the Placement Agent (or its clearing firm) by wire transfer to the Company). Notwithstanding anything to the contrary herein and a Purchaser’s Subscription Amount set forth on the signature pages attached hereto, the number of Series A Shares purchased by a Purchaser (and its Affiliates) hereunder shall not, when aggregated with all other Common Shares owned by such Purchaser (and its Affiliates) at such time, result in such Purchaser beneficially owning (as determined in accordance with Section 13(d) of the Exchange Act) in excess of 9.99% of the then issued and outstanding Common Shares outstanding at the Closing (the “Beneficial Ownership Maximum”), and such Purchaser’s Subscription Amount, to the extent it would otherwise exceed the Beneficial Ownership Maximum immediately prior to the Closing, shall be conditioned upon the issuance of Shares at the Closing to the other Purchasers signatory hereto. To the extent that a Purchaser’s beneficial ownership of the Series A Shares would otherwise be deemed to exceed the Beneficial Ownership Maximum, such Purchaser’s Subscription Amount shall automatically be reduced as necessary in order to comply with this paragraph.

2.2 Deliveries.

(a) On or prior to the Closing Date (except as indicated below), the Company shall deliver or cause to be delivered to each Purchaser the following:

(i) this Agreement duly executed by the Company;

(ii) a legal opinion of Company Counsel and Company Canadian Counsel, each substantially in the form and substance reasonably acceptable to the Placement Agent;

(iii) subject to the sixth sentence of Section 2.1, the Company shall have provided each Purchaser with the Company’s wire instructions, on Company letterhead and executed by the Chief Executive Officer and Chief Financial Officer;

(iv) subject to the sixth sentence of Section 2.1, a copy of the irrevocable instructions to the Transfer Agent instructing the Transfer Agent to deliver on an expedited basis via The Depository Trust Company Deposit or Withdrawal at Custodian system (“DWAC”) Shares equal to such Purchaser’s Unit Subscription Amount divided by the Unit Purchase Price, registered in the name of such Purchaser;

(v) 25 Warrants registered in the name of such Purchaser, each to purchase up to a number of Common Shares equal to 100% of such Purchaser’s Series A Shares, with an exercise price equal to $4.75, subject to adjustment therein, via The Depository Trust Company Deposit or Withdrawal at Custodian system; and

(vi) the Preliminary Prospectus and Prospectus (which may be delivered in accordance with Rule 172 under the Securities Act).

(b) On or prior to the Closing Date, each Purchaser shall deliver or cause to be delivered to the Company the following:

(i) this Agreement duly executed by such Purchaser; and

(ii) such Purchaser’s Subscription Amount, which shall be made available for “Delivery Versus Payment” settlement with the Company or its designee.

2.3 Closing Conditions.

(a) The obligations of the Company hereunder in connection with the Closing are subject to the following conditions being met:

(i) the accuracy in all material respects (or, to the extent representations or warranties are qualified by materiality, in all respects) on the Closing Date of the representations and warranties of the Purchasers contained herein (unless as of a specific date therein in which case they shall be accurate in all material respects (or, to the extent representations or warranties are qualified by materiality, in all respects) as of such date);

(ii) all obligations, covenants and agreements of each Purchaser required to be performed at or prior to the Closing Date shall have been performed; and

(iii) the delivery by each Purchaser of the items set forth in Section 2.2(b) of this Agreement.

(b) The respective obligations of the Purchasers hereunder in connection with the Closing are subject to the following conditions being met:

(i) the accuracy in all material respects (or, to the extent representations or warranties are qualified by materiality or Material Adverse Effect, in all respects) when made and on the Closing Date of the representations and warranties of the Company contained herein (unless as of a specific date therein in which case they shall be accurate in all material respects or, to the extent representations or warranties are qualified by materiality or Material Adverse Effect, in all respects) as of such date);

(ii) all obligations, covenants and agreements of the Company required to be performed at or prior to the Closing Date shall have been performed;

(iii) the delivery by the Company of the items set forth in Section 2.2(a) of this Agreement;

(iv) there shall have been no Material Adverse Effect with respect to the Company since the date hereof; and

(v) from the date hereof to the Closing Date, trading in the Series A Shares or Common Shares shall not have been suspended by the Commission or the Company’s principal Trading Market, and, at any time prior to the Closing Date, trading in securities generally as reported by Bloomberg L.P. shall not have been suspended or limited, or minimum prices shall not have been established on securities whose trades are reported by such service, or on any Trading Market, nor shall a banking moratorium have been declared either by the United States or New York State authorities nor shall there have occurred any material outbreak or escalation of hostilities or other national or international calamity of such magnitude in its effect on, or any material adverse change in, any financial market which, in each case, in the reasonable judgment of such Purchaser, makes it impracticable or inadvisable to purchase the Securities at the Closing.

ARTICLE III.

REPRESENTATIONS AND WARRANTIES

3.1 Representations and Warranties of the Company. The Company hereby makes the following representations and warranties to each Purchaser:

(a) Subsidiaries. The Company owns, directly or indirectly, all of the capital stock or other equity interests of each Subsidiary free and clear of any Liens (except for those arising under any credit facility as is disclosed in the Registration Statement, the Preliminary Prospectus and the Prospectus). All of the issued and outstanding shares of capital stock of each Subsidiary are validly issued and are fully paid, non-assessable and free of preemptive and similar rights to subscribe for or purchase securities.

(b) Organization and Qualification. The Company and each of the Subsidiaries is an entity duly incorporated or otherwise organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation or organization, with the requisite power and authority to own and use its properties and assets and to carry on its business as currently conducted. Neither the Company nor any Subsidiary is in violation nor default of any of the provisions of its respective certificate or articles of incorporation, bylaws or other organizational or charter documents. Each of the Company and the Subsidiaries is duly qualified to conduct business and is in good standing as a foreign corporation or other entity in each jurisdiction in which the nature of the business conducted or property owned by it makes such qualification necessary, except where the failure to be so qualified or in good standing, as the case may be, could not reasonably be expected to result in: (i) a material adverse effect on the legality, validity or enforceability of any Transaction Document, (ii) a material adverse effect on the results of operations, assets, business, prospects or condition (financial or otherwise) of the Company and the Subsidiaries, taken as a whole, or (iii) a material adverse effect on the Company’s ability to perform in any material respect on a timely basis its obligations under any Transaction Document (any of (i), (ii) or (iii), a “Material Adverse Effect”) and no Proceeding has been instituted in any such jurisdiction revoking, limiting or curtailing or seeking to revoke, limit or curtail such power and authority or qualification.

(c) Authorization; Enforcement. The Company has the requisite corporate power and authority to enter into and to consummate the transactions contemplated by this Agreement and each of the other Transaction Documents to which it is a party and otherwise to carry out its obligations hereunder and thereunder. The execution and delivery of this Agreement and each of the other Transaction Documents by the Company and the consummation by it of the transactions contemplated hereby and thereby have been duly authorized by all necessary action on the part of the Company and no further action is required by the Company, the Board of Directors or the Company’s shareholders in connection herewith or therewith other than in connection with the Required Approvals. This Agreement and each other Transaction Document to which the Company is a party has been (or upon delivery will have been) duly executed by the Company and, when delivered in accordance with the terms hereof and thereof, will constitute the valid and binding obligation of the Company enforceable against the Company in accordance with its terms, except (i) as limited by general equitable principles and applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general application affecting enforcement of creditors’ rights generally, (ii) as limited by laws relating to the availability of specific performance, injunctive relief or other equitable remedies and (iii) insofar as indemnification and contribution provisions may be limited by Applicable Law.

(d) No Conflicts. The execution, delivery and performance by the Company of this Agreement and the other Transaction Documents to which it is a party, the issuance and sale of the Securities and the consummation by it of the transactions contemplated hereby and thereby do not and will not (i) conflict with or violate any provision of the Company’s or any Subsidiary’s certificate or articles of incorporation, bylaws or other organizational or charter documents, or (ii) conflict with, or constitute a default (or an event that with notice or lapse of time or both would become a default) under, result in the creation of any Lien upon any of the properties or assets of the Company or any Subsidiary, or give to others any rights of termination, amendment, anti-dilution or similar adjustments (except as disclosed in the SEC Reports), acceleration or cancellation (with or without notice, lapse of time or both) of, any agreement, credit facility, debt or other instrument (evidencing a Company or Subsidiary debt or otherwise) or other understanding to which the Company or any Subsidiary is a party or by which any property or asset of the Company or any Subsidiary is bound or affected, or (iii) subject to the Required Approvals, conflict with or result in a violation of any Applicable Law or other restriction of any court or Governmental Authority to which the Company or a Subsidiary is subject (including federal and state securities laws and regulations), or by which any property or asset of the Company or a Subsidiary is bound or affected; except in the case of each of clauses (ii) and (iii), such as could not reasonably be expected to result in a Material Adverse Effect.

(e) Filings, Consents and Approvals. The Company is not required to obtain any consent, waiver, authorization or order of, give any notice to, or make any filing or registration with, any court or other federal, state, local or other Governmental Authority or other Person in connection with the execution, delivery and performance by the Company of the Transaction Documents, other than: (i) the filings required pursuant to Section 4.4 of this Agreement, (ii) the filing with the Commission of the Prospectus, (iii) application(s) to each applicable Trading Market for the listing of the Shares and Warrant Shares for trading thereon in the time and manner required thereby, and (iv) such filings as are required to be made under applicable state securities laws (collectively, the “Required Approvals”).

(f) Issuance of the Securities; Registration. The Securities are duly authorized and, when issued and paid for in accordance with the applicable Transaction Documents, will be duly and validly issued, fully paid and nonassessable, free and clear of all Liens imposed by the Company. The Warrant Shares are duly authorized and, when issued in accordance with the terms of the Warrants, will be validly issued, fully paid and nonassessable, free and clear of all Liens imposed by the Company. The Company has reserved from its duly authorized capital stock the maximum number of Series A Shares and Common Shares issuable pursuant to this Agreement and the Warrants. The Securities are not and will not be subject to the preemptive rights of any holders of any security of the Company or similar contractual rights granted by the Company. All corporate action required to be taken for the authorization, issuance and sale of the Securities has been duly and validly taken. The Securities conform in all material respects to all statements with respect thereto contained in the Registration Statement and the Prospectus. The Company has prepared and filed the Registration Statement in conformity with the requirements of the Securities Act, which became effective on [•], 2022 (the “Effective Date”), including the Prospectus, and such amendments and supplements thereto as may have been required to the date of this Agreement. The Registration Statement is effective under the Securities Act and no stop order preventing or suspending the effectiveness of the Registration Statement or suspending or preventing the use of the Preliminary Prospectus or the Prospectus has been issued by the Commission and no proceedings for that purpose have been instituted or, to the knowledge of the Company, are threatened by the Commission. The Company, if required by the rules and regulations of the Commission, shall file the Prospectus with the Commission pursuant to Rule 424(b). At the time the Registration Statement and any amendments thereto became effective, at the date of this Agreement and at the Closing Date, the Registration Statement and any amendments thereto conformed and will conform in all material respects to the requirements of the Securities Act and did not and will not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading; and the Pricing Prospectus and the Prospectus and any amendments or supplements thereto, at the time the Pricing Prospectus or the Prospectus, as applicable, or any amendment or supplement thereto was issued and at the Closing Date, conformed and will conform in all material respects to the requirements of the Securities Act and did not and will not contain an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading.

(g) Capitalization. The capitalization of the Company is as disclosed in the SEC Reports as of the date thereof. The Company has not issued any capital stock except as disclosed or contemplated in the SEC Reports. No Person has any right of first refusal, preemptive right, right of participation, or any similar right to participate in the transactions contemplated by the Transaction Documents. Except as a result of the purchase and sale of the Securities and as disclosed in the SEC Reports, there are no outstanding options, warrants, scrip rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities, rights or obligations convertible into or exercisable or exchangeable for, or giving any Person any right to subscribe for or acquire, any Common Shares or the capital stock of any Subsidiary, or contracts, commitments, understandings or arrangements by which the Company or any Subsidiary is or may become bound to issue additional Common Shares or Common Share Equivalents or capital stock of any Subsidiary. The issuance and sale of the Securities will not obligate the Company or any Subsidiary to issue Common Shares or other securities to any Person (other than the Purchasers). Except as disclosed in the SEC Reports, there are no outstanding securities or instruments of the Company or any Subsidiary with any provision that adjusts the exercise, conversion, exchange or reset price of such security or instrument upon an issuance of securities by the Company or any Subsidiary. Except disclosed in the SEC Reports, there are no outstanding securities or instruments of the Company or any Subsidiary that contain any redemption or similar provisions, and there are no contracts, commitments, understandings or arrangements by which the Company or any Subsidiary is or may become bound to redeem a security of the Company or such Subsidiary. The Company does not have any stock appreciation rights or “phantom stock” plans or agreements or any similar plan or agreement. All of the outstanding shares of capital stock of the Company are duly authorized, validly issued, fully paid and nonassessable, have been issued in compliance with all federal and state securities laws, and none of such outstanding shares was issued in violation of any preemptive rights or similar rights to subscribe for or purchase securities. The authorized shares of the Company conform in all material respects to all statements relating thereto contained in the Registration Statement, the Pricing Prospectus and the Prospectus. The offers and sales of the Company’s securities were at all relevant times either registered under the Securities Act and the applicable state securities or Blue Sky laws or, based in part on the representations and warranties of the purchasers, exempt from such registration requirements. No further approval or authorization of any shareholder, the Board of Directors or others is required for the issuance and sale of the Securities. Except as disclosed in the SEC Reports, there are no shareholders agreements, voting agreements or other similar agreements with respect to the Company’s capital stock to which the Company is a party or, to the knowledge of the Company, between or among any of the Company’s shareholders.

(h) SEC Reports; Financial Statements. The Company has filed all reports, schedules, forms, statements and other documents required to be filed by the Company under the Securities Act and the Exchange Act, including pursuant to Section 13(a) or 15(d) thereof, for the two years preceding the date hereof (or such shorter period as the Company was required by law or regulation to file such material) (the foregoing materials, including the exhibits thereto and documents incorporated by reference therein, together with the Pricing Prospectus and the Prospectus, being collectively referred to herein as the “SEC Reports”) on a timely basis or has received a valid extension of such time of filing and has filed any such SEC Reports prior to the expiration of any such extension. As of their respective dates, the SEC Reports complied in all material respects with the requirements of the Securities Act and the Exchange Act, as applicable, and none of the SEC Reports, when filed, contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. The Company has never been an issuer subject to Rule 144(i) under the Securities Act. The financial statements of the Company included in the SEC Reports comply in all material respects with applicable accounting requirements and the rules and regulations of the Commission with respect thereto as in effect at the time of filing. Such financial statements have been prepared in accordance with International Financial Reporting Standards applied on a consistent basis during the periods involved (“IFRS”), except as may be otherwise specified in such financial statements or the notes thereto and except that unaudited financial statements may not contain all footnotes required by IFRS, and fairly present in all material respects the financial position of the Company and its consolidated Subsidiaries as of and for the dates thereof and the results of operations and cash flows for the periods then ended, subject, in the case of unaudited statements, to normal, immaterial, year-end audit adjustments. The agreements and documents described in the Registration Statement, the Pricing Prospectus, the Prospectus, and the SEC Reports conform in all material respects to the descriptions thereof contained therein and there are no agreements or other documents required by the Securities Act and the rules and regulations thereunder to be described in the Registration Statement, the Pricing Prospectus, the Prospectus or the SEC Reports or to be filed with the Commission as exhibits to the Registration Statement, that have not been so described or filed. Each agreement or other instrument (however characterized or described) to which the Company is a party or by which it is or may be bound or affected and (i) that is referred to in the Registration Statement, the Pricing Prospectus, the Prospectus or the SEC Reports, or (ii) is material to the Company’s business, has been duly authorized and validly executed by the Company, is in full force and effect in all material respects and is enforceable against the Company and, to the Company’s knowledge, the other parties thereto, in accordance with its terms, except (x) as such enforceability may be limited by bankruptcy, insolvency, reorganization or similar laws affecting creditors’ rights generally, (y) as enforceability of any indemnification or contribution provision may be limited under the federal and state securities laws, and (z) that the remedy of specific performance and injunctive and other forms of equitable relief may be subject to the equitable defenses and to the discretion of the court before which any proceeding therefore may be brought. None of such agreements or instruments has been assigned by the Company, and neither the Company nor, to the best of the Company’s knowledge, any other party is in default thereunder and, to the best of the Company’s knowledge, no event has occurred that, with the lapse of time or the giving of notice, or both, would constitute a default thereunder. To the best of the Company’s knowledge, performance by the Company of the material provisions of such agreements or instruments will not result in a violation of any existing Applicable Law or order or decree of any Governmental Authority or court, domestic or foreign, having jurisdiction over the Company or any of its assets or businesses, including, without limitation, those relating to environmental laws and regulations.

(i) Material Changes; Undisclosed Events, Liabilities or Developments. Since the date of the latest audited financial statements included within the SEC Reports, except as disclosed in the SEC Reports, (i) there has been no event, occurrence or development that has had or that could reasonably be expected to result in a Material Adverse Effect, (ii) the Company has not incurred any liabilities (contingent or otherwise) other than (A) trade payables and accrued expenses incurred in the ordinary course of business consistent with past practice and (B) liabilities not required to be reflected in the Company’s financial statements pursuant to IFRS or disclosed in filings made with the Commission, (iii) the Company has not altered its method of accounting, (iv) the Company has not declared or made any dividend or distribution of cash or other property to its shareholders or purchased, redeemed or made any agreements to purchase or redeem any shares of its capital stock and (v) the Company has not issued any equity securities to any officer, director or Affiliate, except pursuant to existing Company stock option plans. The Company does not have pending before the Commission any request for confidential treatment of information. Except for the issuance of the Securities contemplated by this Agreement, no event, liability, fact, circumstance, occurrence or development has occurred or exists or is reasonably expected to occur or exist with respect to the Company or its Subsidiaries or their respective businesses, prospects, properties, operations, assets or financial condition that would be required to be disclosed by the Company under applicable securities laws at the time this representation is made or deemed made that has not been publicly disclosed at least one (1) Trading Day prior to the date that this representation is made.

(j) Litigation. There has not been, and to the knowledge of the Company, there is not pending or contemplated, any action, suit, inquiry, notice of violation, proceeding or investigation pending or, to the knowledge of the Company, threatened against or affecting the Company, any Subsidiary or any of their respective properties before or by any court, arbitrator, Governmental Authority (federal, state, county, local or foreign) (collectively, an “Action”). There are no Actions that (i) adversely affects or challenges the legality, validity or enforceability of any of the Transaction Documents or the Securities or, (ii) could, if there were an unfavorable decision, reasonably be expected to result in a Material Adverse Effect. Neither the Company nor any Subsidiary, nor to the Company’s knowledge any director or officer thereof, is or has been the subject of any Action involving a claim of violation of or liability under federal or state securities laws or a claim of breach of fiduciary duty. There has not been, and to the knowledge of the Company, there is not pending or contemplated, any investigation by the Commission involving the Company or any current or former director or officer of the Company. The Commission has not issued any stop order or other order suspending the effectiveness of any registration statement filed by the Company or any Subsidiary under the Exchange Act or the Securities Act.

(k) Labor Relations. No labor dispute exists or, to the knowledge of the Company, is imminent with respect to any of the employees of the Company, which could reasonably be expected to result in a Material Adverse Effect. None of the Company’s or its Subsidiaries’ employees is a member of a union that relates to such employee’s relationship with the Company or such Subsidiary, and neither the Company nor any of its Subsidiaries is a party to a collective bargaining agreement, and the Company and its Subsidiaries believe that their relationships with their employees are good. To the knowledge of the Company, no executive officer of the Company or any Subsidiary, is, or is now expected to be, in violation of any material term of any employment contract, confidentiality, disclosure or proprietary information agreement or non-competition agreement, or any other contract or agreement or any restrictive covenant in favor of any third party, and the continued employment of each such executive officer does not subject the Company or any of its Subsidiaries to any liability with respect to any of the foregoing matters that would reasonably be expected to have a Material Adverse Effect. The Company and its Subsidiaries are in compliance with all U.S. federal, state, local and foreign laws and regulations relating to employment and employment practices, terms and conditions of employment and wages and hours, except where the failure to be in compliance could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

(l) Compliance. Neither the Company nor any Subsidiary is in default under or in violation of (and no event has occurred that has not been waived that, with notice or lapse of time or both, would result in a default by the Company or any Subsidiary under), nor has the Company or any Subsidiary received notice of a claim that it is in default under or that it is in violation of, any indenture, loan or credit agreement or any other agreement or instrument to which it is a party or by which it or any of its properties is bound (whether or not such default or violation has been waived, except as could not reasonably be expected to result in a Material Adverse Effect.

(m) Environmental Laws. Neither the Company nor any of its Subsidiaries is in violation of any applicable international, national, state or local convention, law, regulation, order, governmental license, convention, treaty or other requirement relating to pollution or protection of human health or safety (as they relate to exposure to Materials of Environmental Concern (as defined below)) or protection of the environment (including, without limitation, ambient air, surface water, groundwater, land surface or subsurface strata) or protection of natural resources, including without limitation, conventions, laws or regulations relating to emissions, discharges, releases or threatened releases of chemicals, pollutants, contaminants, wastes, toxic substances, hazardous substances, petroleum, petroleum products or other hydrocarbons (collectively, “Materials of Environmental Concern”), or otherwise relating to the manufacture, processing, distribution, use, treatment, storage, disposal, transport or handling of Materials of Environmental Concern (collectively, “Environmental Laws”), nor has the Company or any Subsidiary received any written communication, whether from a Governmental Authority, citizens group, employee or otherwise, that alleges that the Company or any such Subsidiary is in violation of any Environmental Law or governmental license required pursuant to Environmental Law; except, in each case, as would not, individually or in the aggregate, have a Material Adverse Effect; (b) there is no claim, action or cause of action filed with a court or Governmental Authority and no investigation, or other action with respect to which the Company or any Subsidiary has received written notice alleging potential liability for investigatory costs, cleanup costs, governmental response costs, natural resources damages, property damages, personal injuries, attorneys’ fees or penalties arising out of, based on or resulting from the presence, or release into the environment, of any Material of Environmental Concern at any location owned, leased or operated by the Company or any Subsidiary, now or in the past, or from any vessel owned, leased or operated by the Company or any Subsidiary, now or in the past (collectively, “Environmental Claim”), pending or, to the knowledge of the Company, threatened against the Company or any Subsidiary or any person or entity whose liability for any Environmental Claim the Company or any Subsidiary has retained or assumed either contractually or by operation of law, except as would not, individually or in the aggregate, have a Material Adverse Effect; (c) to the knowledge of the Company, there are no past or present actions, activities, circumstances, conditions, events or incidents, including, without limitation, the release, emission, discharge, presence or disposal of any Material of Environmental Concern, that reasonably would be expected to result in a violation of any Environmental Law, require expenditures to be incurred pursuant to Environmental Law, or form the basis of an Environmental Claim against the Company, any Subsidiary or against any person or entity whose liability for any Environmental Claim the Company or any Subsidiary has retained or assumed either contractually or by operation of law, except as would not, individually or in the aggregate, have a Material Adverse Effect (for the avoidance of doubt, the operation of vessels in the ordinary course of business shall not be deemed, by itself, an action, activity, circumstance or condition set forth in this clause (c)); and (d) none of the Company or any Subsidiary is subject to any pending proceeding under Environmental Law to which a Governmental Authority is a party and which the Company reasonably believes is likely to result in monetary sanctions of US$100,000 or more. The Company has reasonably concluded that any existing compliance and remediation costs and liabilities arising under Environmental Laws and resulting from the business, operations or properties of the Company or any Subsidiary would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, except as set forth in or contemplated in the Registration Statement, Pricing Prospectus and the Prospectus. In the ordinary course of its business, the Company conducts a periodic review of the effect of Environmental Laws on the business, operations and properties of the Company and the Subsidiaries, in the course of which it identifies and evaluates associated costs and liabilities (including, without limitation, any capital or operating expenditures required for clean-up, closure of properties or compliance with Environmental Laws or any Authorizations, any related constraints on operating activities and any potential liabilities to third parties). No facts or circumstances have come to the Company’s attention that could result in costs or liabilities that could be expected, individually or in the aggregate, to have a Material Adverse Effect.

(n) Law and Permits. Except as described in the Registration Statement or the Pricing Prospectus or the Prospectus, the Company and each of the Subsidiaries: (i) is and at all times since January 1, 2019 has been in material compliance with all United States (federal, state and local) and foreign statutes, rules, regulations, codes, treaties, or guidance applicable to the Company or the Subsidiaries (“Applicable Laws”); (B) since January 1, 2019 has not received any notice of adverse finding, warning letter, untitled letter or other correspondence or notice from any Governmental Authority (as defined below) alleging or asserting noncompliance with any Applicable Laws or any licenses, certificates, approvals, clearances, authorizations, permits and supplements or amendments thereto required by any such Applicable Laws (“Authorizations”); (C) since January 1, 2019 has not received notice of any claim, action, suit, proceeding, hearing, enforcement, investigation, arbitration or other action from any Governmental Authority or third party alleging that any product operation or activity is in violation of any Applicable Laws or Authorizations and has no knowledge that any such Governmental Authority or third party intends to assert any such claim, litigation, arbitration, action, suit, investigation or proceeding; (D) since January 1, 2019 has not received notice that any Governmental Authority has taken, is taking or intends to take action to limit, suspend, modify or revoke any Authorizations and the Company has no knowledge that any such Governmental Authority is considering such action; and (E) has filed, obtained, maintained or submitted all material reports, documents, forms, notices, applications, records, claims, submissions and supplements or amendments as required by any Applicable Laws or Authorizations and that all such reports, documents, forms, notices, applications, records, claims, submissions and supplements or amendments were complete and correct in all material respects on the date filed (or were corrected or supplemented by a subsequent submission), except in the case of (A) through (E) above, as could not, individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect. “Governmental Authority” means any federal, provincial, state, local, foreign or other governmental, quasi-governmental or administrative agency, court or body or any other type of regulatory authority or body, including, without limitation, the Nasdaq Capital Market. The aggregate of all pending legal or governmental proceedings to which the Company or any Subsidiary is a party or of which any of their respective property or assets is the subject which are not described in the Registration Statement, Pricing Prospectus and the Prospectus, including ordinary routine litigation incidental to the business, would not result in a Material Adverse Effect.

(o) Title to Assets. The Company and the Subsidiaries have good and marketable title in fee simple to all real property owned by them and good and marketable title in all personal property owned by them that is material to the business of the Company and the Subsidiaries, in each case free and clear of all Liens, except for (i) Liens arising under any credit facility or loan agreement to which the Company or any of its Subsidiaries is a party or their assets are bound as disclosed in the Registration Statement and the Prospectus, (ii) Liens as do not materially affect the value of such property and do not materially interfere with the use made and proposed to be made of such property by the Company and the Subsidiaries and (iii) Liens for the payment of foreign, federal, state or other taxes, for which appropriate reserves have been made therefor in accordance with IFRS and, the payment of which is neither delinquent nor subject to penalties. Any real property and facilities held under lease by the Company and the Subsidiaries are held by them under valid, subsisting and enforceable leases with which the Company and the Subsidiaries are in compliance.

(p) Intellectual Property. The Company and each of its Subsidiaries owns, possesses, or can acquire on reasonable terms, all Intellectual Property (as defined below) necessary for the conduct of their respective businesses as now conducted or as described in the Registration Statement, the Pricing Prospectus and the Prospectus to be conducted. Except as would not result in a Material Adverse Effect, (A) there are no rights of third parties to any such Intellectual Property owned by the Company; (B) to the knowledge of the Company, there is no infringement, misappropriation or violation by third parties of any such Intellectual Property; (C) there is no pending or, to the knowledge of the Company, threatened, action, suit, proceeding or claim by others challenging the Company’s or any Subsidiary’s rights in or to any such Intellectual Property, and the Company is unaware of any facts which would form a reasonable basis for any such claim; (D) the Intellectual Property owned by the Company and each of the Subsidiaries, and to the knowledge of the Company, the Intellectual Property licensed to the Company, each of the Subsidiaries, has not been adjudged invalid or unenforceable, in whole or in part, and there is no pending or, to the knowledge of the Company, threatened action, suit, proceeding or claim by others challenging the validity or scope of any such Intellectual Property, and the Company is unaware of any facts which would form a reasonable basis for any such claim; (E) there is no pending or, to the knowledge of the Company, threatened action, suit, proceeding or claim by others that the Company or any of its Subsidiaries infringes, misappropriates or otherwise violates any Intellectual Property or other proprietary rights of others, and neither the Company nor any of the Subsidiaries has received any written notice of such claim; and (F) to the Company’s knowledge, no employee of the Company or any of its Subsidiaries is in or has ever been in violation of any term of any employment contract, patent disclosure agreement, invention assignment agreement, non-competition agreement, non-solicitation agreement, nondisclosure agreement or any restrictive covenant to or with a former employer where the basis of such violation relates to such employee’s employment with the Company or any of its Subsidiaries or actions undertaken by the employee while employed with the Company or any of its Subsidiaries. “Intellectual Property” shall mean all patents, patent applications, trade and service marks, trade and service mark registrations, trade names, copyrights, licenses, inventions, trade secrets, domain names, technology, know-how and other intellectual property.

(q) Insurance. The Company and the Subsidiaries are insured by insurers of recognized financial responsibility against such losses and risks and in such amounts as are prudent and customary in the businesses in which the Company and the Subsidiaries are engaged, including, but not limited to, directors and officers insurance coverage at least equal to the aggregate Subscription Amount. Neither the Company nor any Subsidiary has any reason to believe that it will not be able to renew its existing insurance coverage as and when such coverage expires or to obtain similar coverage from similar insurers as may be necessary to continue its business without a significant increase in cost.

(r) Transactions With Affiliates and Employees. Except as disclosed in the SEC Reports, none of the officers or directors of the Company or any Subsidiary and, to the knowledge of the Company, none of the employees of the Company or any Subsidiary is presently a party to any transaction with the Company or any Subsidiary (other than for services as employees, officers and directors), including any contract, agreement or other arrangement providing for the furnishing of services to or by, providing for rental of real or personal property to or from, providing for the borrowing of money from or lending of money to or otherwise requiring payments to or from any officer, director or such employee or, to the knowledge of the Company, any entity in which any officer, director, or any such employee has a substantial interest or is an officer, director, trustee, stockholder, member or partner, in each case in excess of $120,000 other than for (i) payment of salary or consulting fees for services rendered, (ii) reimbursement for expenses incurred on behalf of the Company and (iii) other employee benefits, including stock option agreements under any stock option plan of the Company.

(s) Sarbanes-Oxley; Internal Accounting Controls. Except as described in the Registration Statement or the Prospectus, the Company’s disclosure controls and procedures and internal controls are effective. The Company and the Subsidiaries are in material compliance with any and all applicable requirements of the Sarbanes-Oxley Act of 2002 that are effective as of the date hereof, and any and all applicable rules and regulations promulgated by the Commission thereunder that are effective as of the date hereof and as of the Closing Date. The Company and the Subsidiaries maintain a system of internal accounting controls sufficient to provide reasonable assurance that: (i) transactions are executed in accordance with management’s general or specific authorizations, (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with IFRS and to maintain asset accountability, (iii) access to assets is permitted only in accordance with management’s general or specific authorization, and (iv) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences. The Company maintains disclosure controls and procedures (as such term is defined in Rule 13a-15(e) under the Exchange Act) that comply with the requirements of the Exchange Act; such disclosure controls and procedures have been designed to ensure that material information relating to the Company is made known to the Company’s principal executive officer and principal financial officer by others within those entities; such disclosure controls and procedures are effective.

(t) Certain Fees. Except for fees payable by the Company to the Placement Agent and as set forth in the Pricing Prospectus or the Prospectus, no brokerage or finder’s fees or commissions are or will be payable by the Company, any Subsidiary or Affiliate of the Company to any broker, financial advisor or consultant, finder, placement agent, investment banker, bank or other Person with respect to the transactions contemplated by the Transaction Documents. The Purchasers shall have no obligation with respect to any fees or with respect to any claims made by or on behalf of other Persons for fees of a type contemplated in this Section that may be due in connection with the transactions contemplated by the Transaction Documents.

(u) Investment Company. The Company is not, and is not an Affiliate of, and immediately after receipt of payment for the Securities, will not be or be an Affiliate of, an “investment company” within the meaning of the Investment Company Act of 1940, as amended. The Company shall conduct its business in a manner so that it will not become an “investment company” subject to registration under the Investment Company Act of 1940, as amended.

(v) Registration Rights. No Person has any right to cause the Company or any Subsidiary to effect the registration under the Securities Act of any securities of the Company or any Subsidiary.

(w) Listing and Maintenance Requirements. The Series A Shares and Common Shares are registered pursuant to Section 12(b) or 12(g) of the Exchange Act, and the Company has taken no action designed to, or which to its knowledge is likely to have the effect of, terminating the registration of the Series A Shares or Common Shares under the Exchange Act nor has the Company received any notification that the Commission is contemplating terminating such registration. The Company has not, in the 12 months preceding the date hereof, received notice from any Trading Market on which the Series A Shares or Common Shares are or have been listed or quoted to the effect that the Company is not in compliance with the listing or maintenance requirements of such Trading Market. The Company is, and has no reason to believe that it will not in the foreseeable future continue to be, in compliance with all such listing and maintenance requirements. The Series A Shares and Common Shares are currently eligible for electronic transfer through the Depository Trust Company or another established clearing corporation and the Company is current in payment of the fees to the Depository Trust Company (or such other established clearing corporation) in connection with such electronic transfer.

(x) Disclosure. Except with respect to the material terms and conditions of the transactions contemplated by the Transaction Documents, the Company confirms that neither it nor any other Person acting on its behalf has provided any of the Purchasers or their agents or counsel with any information that it believes constitutes or might constitute material, non-public information which is not otherwise disclosed in the Pricing Prospectus or Prospectus. The Company understands and confirms that the Purchasers will rely on the foregoing representation in effecting transactions in securities of the Company. All of the disclosure furnished by or on behalf of the Company to the Purchasers regarding the Company and its Subsidiaries, their respective businesses and the transactions contemplated hereby, is true and correct and does not contain any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements made therein, in the light of the circumstances under which they were made, not misleading. The SEC Reports, when they were filed with the Commission, conformed in all material respects to the requirements of the Securities Act and the Exchange Act, as applicable, and the applicable rules and regulations, and none of such documents, when they were filed with the Commission, contained any untrue statement of a material fact or omitted to state a material fact necessary to make the statements therein (with respect to the SEC Reports incorporated by reference in the Prospectus), in light of the circumstances under which they were made not misleading; and any further documents so filed and incorporated by reference in the Prospectus, when such documents are filed with the Commission, will conform in all material respects to the requirements of the Exchange Act and the applicable rules and regulations, as applicable, and will not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in light of the circumstances under which they were made not misleading. The press releases disseminated by the Company during the twelve months preceding the date of this Agreement taken as a whole do not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made and when made, not misleading. The Company acknowledges and agrees that no Purchaser makes or has made any representations or warranties with respect to the transactions contemplated hereby other than those specifically set forth in Section 3.2 hereof. No post-effective amendment to the Registration Statement reflecting any facts or events arising after the date thereof which represent, individually or in the aggregate, a fundamental change in the information set forth therein is required to be filed with the Commission. There are no documents required to be filed with the Commission in connection with the transaction contemplated hereby that (x) have not been filed as required pursuant to the Securities Act or (y) will not be filed within the requisite time period. There are no contracts or other documents required to be described in the Preliminary Prospectus or Prospectus, or to be filed as exhibits or schedules to the Registration Statement, which have not been described or filed as required.

(y) No Integrated Offering. Assuming the accuracy of the Purchasers’ representations and warranties set forth in Section 3.2, neither the Company, nor any of its Affiliates, nor any Person acting on its or their behalf has, directly or indirectly, made any offers or sales of any security or solicited any offers to buy any security, under circumstances that would cause this offering of the Securities to be integrated with prior offerings by the Company for purposes of any applicable shareholder approval provisions of any Trading Market on which any of the securities of the Company are listed or designated.

(z) Solvency. Based on the consolidated financial condition of the Company as of the Closing Date, after giving effect to the receipt by the Company of the proceeds from the sale of the Securities hereunder, (i) the fair saleable value of the Company’s assets exceeds the amount that will be required to be paid on or in respect of the Company’s existing debts and other liabilities (including known contingent liabilities) as they mature, (ii) the Company’s assets do not constitute unreasonably small capital to carry on its business as now conducted and as proposed to be conducted including its capital needs taking into account the particular capital requirements of the business conducted by the Company, consolidated and projected capital requirements and capital availability thereof as such matters are described in the Registration Statement, and (iii) the current cash flow of the Company, together with the proceeds the Company would receive, were it to liquidate all of its assets, after taking into account all anticipated uses of the cash, would be sufficient to pay all amounts on or in respect of its liabilities when such amounts are required to be paid. The Company does not intend to incur debts beyond its ability to pay such debts as they mature (taking into account the timing and amounts of cash to be payable on or in respect of its debt). The Company has no knowledge of any facts or circumstances which lead it to believe that it will file for reorganization or liquidation under the bankruptcy or reorganization laws of any jurisdiction within one year from the Closing Date. For the purposes of this Agreement, “Indebtedness” means (x) any liabilities for borrowed money or amounts owed in excess of $50,000 (other than trade accounts payable incurred in the ordinary course of business), (y) all guaranties, endorsements and other contingent obligations in respect of indebtedness of others, whether or not the same are or should be reflected in the Company’s consolidated balance sheet (or the notes thereto), except guaranties by endorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business; and (z) the present value of any lease payments in excess of $50,000 due under leases required to be capitalized in accordance with IFRS. Neither the Company nor any Subsidiary is in default with respect to any Indebtedness.

(aa) Tax Status. Except for matters that would not, individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect, the Company and its Subsidiaries each (i) has made or filed all United States federal, state and local income and all foreign income and franchise tax returns, reports and declarations required by any jurisdiction to which it is subject, (ii) has paid all taxes and other governmental assessments and charges that are material in amount, shown or determined to be due on such returns, reports and declarations and (iii) has set aside on its books provision reasonably adequate for the payment of all material taxes for periods subsequent to the periods to which such returns, reports or declarations apply. There are no unpaid taxes in any material amount claimed to be due by the taxing authority of any jurisdiction, and the officers of the Company or of any Subsidiary know of no basis for any such claim. The provisions for taxes payable, if any, shown on the financial statements filed with or as part of the Registration Statement are sufficient for all accrued and unpaid taxes, whether or not disputed, and for all periods to and including the dates of such consolidated financial statements. The term “taxes” mean all federal, state, local, foreign, and other net income, gross income, gross receipts, sales, use, ad valorem, transfer, franchise, profits, license, lease, service, service use, withholding, payroll, employment, excise, severance, stamp, occupation, premium, property, windfall profits, customs, duties or other taxes, fees, assessments, or charges of any kind whatsoever, together with any interest and any penalties, additions to tax, or additional amounts with respect thereto. The term “returns” means all returns, declarations, reports, statements, and other documents required to be filed in respect to taxes. The Company did not qualify as a “passive foreign investment company” within the meaning of Section 1297 of the United States Internal Revenue Code of 1986, as amended, for its most recently completed taxable year.

(bb) Foreign Corrupt Practices. Neither the Company nor any Subsidiary, nor to the knowledge of the Company or any Subsidiary, any agent or other person acting on behalf of the Company or any Subsidiary, has (i) directly or indirectly, used any funds for unlawful contributions, gifts, entertainment or other unlawful expenses related to foreign or domestic political activity, (ii) made any unlawful payment to foreign or domestic government officials or employees or to any foreign or domestic political parties or campaigns from corporate funds, (iii) failed to disclose fully any contribution made by the Company or any Subsidiary (or made by any person acting on its behalf of which the Company is aware) which is in violation of Applicable Law, or (iv) violated in any material respect any provision of FCPA or any foreign equivalent. The Company has taken reasonable steps to ensure that its accounting controls and procedures are sufficient to cause the Company to comply in all material respects with the FCPA or any foreign equivalent.

(cc) Accountants. The Company’s accounting firm is KPMG LLP. To the knowledge and belief of the Company, such accounting firm (i) is an independent registered public accounting firm as required by the Exchange Act and (ii) shall express its opinion with respect to the financial statements to be included in the Company’s Annual Report for the fiscal year ending December 31, 2022.

(dd) Acknowledgment Regarding Purchasers’ Purchase of Securities. The Company acknowledges and agrees that each of the Purchasers is acting solely in the capacity of an arm’s length purchaser with respect to the Transaction Documents and the transactions contemplated thereby. The Company further acknowledges that no Purchaser is acting as a financial advisor or fiduciary of the Company (or in any similar capacity) with respect to the Transaction Documents and the transactions contemplated thereby and any advice given by any Purchaser or any of their respective representatives or agents in connection with the Transaction Documents and the transactions contemplated thereby is merely incidental to the Purchasers’ purchase of the Securities. The Company further represents to each Purchaser that the Company’s decision to enter into this Agreement and the other Transaction Documents has been based solely on the independent evaluation of the transactions contemplated hereby by the Company and its representatives.

(ee) Acknowledgment Regarding Purchaser’s Trading Activity. Anything in this Agreement or elsewhere herein to the contrary notwithstanding (except for Sections 3.2(f) and 4.12 hereof), it is understood and acknowledged by the Company that: (i) none of the Purchasers has been asked by the Company to agree, nor has any Purchaser agreed, to desist from purchasing or selling, long and/or short, securities of the Company, or “derivative” securities based on securities issued by the Company or to hold the Securities for any specified term; (ii) past or future open market or other transactions by any Purchaser, specifically including, without limitation, Short Sales or “derivative” transactions, before or after the closing of this or future private placement transactions, may negatively impact the market price of the Company’s publicly-traded securities; (iii) any Purchaser, and counter-parties in “derivative” transactions to which any such Purchaser is a party, directly or indirectly, presently may have a “short” position in the Common Shares, and (iv) each Purchaser shall not be deemed to have any affiliation with or control over any arm’s length counter-party in any “derivative” transaction. The Company further understands and acknowledges that (y) one or more Purchasers may engage in hedging activities at various times during the period that the Securities are outstanding, including, without limitation, during the periods that the value of the Warrant Shares deliverable with respect to Securities are being determined, and (z) such hedging activities (if any) could reduce the value of the existing stockholders’ equity interests in the Company at and after the time that the hedging activities are being conducted. The Company acknowledges that such aforementioned hedging activities do not constitute a breach of any of the Transaction Documents.

(ff) Regulation M Compliance. The Company has not, and to its knowledge no one acting on its behalf has, (i) taken, directly or indirectly, any action designed to cause or to result in the stabilization or manipulation of the price of any security of the Company to facilitate the sale or resale of any of the Securities, (ii) sold, bid for, purchased, or, paid any compensation for soliciting purchases of, any of the Securities, or (iii) paid or agreed to pay to any Person any compensation for soliciting another to purchase any other securities of the Company, other than, in the case of clauses (ii) and (iii), compensation paid to the Placement Agent in connection with the placement of the Securities.

(gg) Cybersecurity. (i)(x) To the Company’s knowledge, there has been no security breach or other compromise of or relating to any of the Company’s or any Subsidiary’s information technology and computer systems, networks, hardware, software, data (including the data of its respective customers, employees, suppliers, vendors and any third party data maintained by or on behalf of it), equipment or technology (collectively, “IT Systems and Data”) and (y) the Company and the Subsidiaries have not been notified of, and has no knowledge of any event or condition that would reasonably be expected to result in, any security breach or other compromise to its IT Systems and Data; (ii) the Company and the Subsidiaries are presently in compliance with all applicable laws or statutes and all judgments, orders, rules and regulations of any court or arbitrator or governmental or regulatory authority, internal policies and contractual obligations relating to the privacy and security of IT Systems and Data and to the protection of such IT Systems and Data from unauthorized use, access, misappropriation or modification, except as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect; (iii) the Company and the Subsidiaries have implemented and maintained commercially reasonable safeguards to maintain and protect its material confidential information and the integrity, continuous operation, redundancy and security of all IT Systems and Data; and (iv) the Company and the Subsidiaries have implemented backup and disaster recovery technology consistent with industry standards and practices.

(hh) Stock Option Plans. Each stock option granted by the Company under the Company’s stock option plan was granted (i) in accordance with the terms of the Company’s stock option plan and (ii) with an exercise price at least equal to the fair market value of the Common Shares on the date such stock option would be considered granted under IFRS and applicable law. No stock option granted under the Company’s stock option plan has been backdated. The Company has not knowingly granted, and there is no and has been no Company policy or practice to knowingly grant, stock options prior to, or otherwise knowingly coordinate the grant of stock options with, the release or other public announcement of material information regarding the Company or the Subsidiaries or their financial results or prospects.

(ii) Office of Foreign Assets Control. Neither the Company nor any Subsidiary nor, to the Company’s knowledge, any director, officer, agent, employee or affiliate of the Company or any Subsidiary is currently subject to any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Treasury Department (“OFAC”).

(jj) U.S. Real Property Holding Corporation. The Company is not and has never been a U.S. real property holding corporation within the meaning of Section 897 of the Internal Revenue Code of 1986, as amended, and the Company shall so certify upon Purchaser’s request.

(kk) Bank Holding Company Act. Neither the Company nor any of its Subsidiaries or Affiliates is subject to the Bank Holding Company Act of 1956, as amended (the “BHCA”) and to regulation by the Board of Governors of the Federal Reserve System (the “Federal Reserve”). Neither the Company nor any of its Subsidiaries or Affiliates owns or controls, directly or indirectly, five percent (5%) or more of the outstanding shares of any class of voting securities or twenty-five percent (25%) or more of the total equity of a bank or any entity that is subject to the BHCA and to regulation by the Federal Reserve. Neither the Company nor any of its Subsidiaries or Affiliates exercises a controlling influence over the management or policies of a bank or any entity that is subject to the BHCA and to regulation by the Federal Reserve.

(ll) Money Laundering. The operations of the Company and its Subsidiaries are and have been conducted at all times in compliance with applicable financial record-keeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970, as amended, applicable money laundering statutes and applicable rules and regulations thereunder (collectively, the “Money Laundering Laws”), and no Action or Proceeding by or before any court or Governmental Authority or body or any arbitrator involving the Company or any Subsidiary with respect to the Money Laundering Laws is pending or, to the knowledge of the Company or any Subsidiary, threatened.

(mm) Foreign Private Issuer. The Company is a “foreign private issuer” as defined in Rule 405 promulgated under the Securities Act.

(nn) Jurisdiction. The Company has the power to submit, and has legally, validly, effectively and irrevocably submitted, to the jurisdiction of any federal or state court in the State of New York, County of New York, and has the power to designate, appoint and empower, and has legally, validly and effectively designated, appointed and empowered, an agent for service of process in any suit or proceeding based on or arising under this Agreement in any federal or state court in the State of New York.

3.2 Representations and Warranties of the Purchasers. Each Purchaser, for itself and for no other Purchaser, hereby represents and warrants as of the date hereof and as of the Closing Date to the Company as follows (unless as of a specific date therein, in which case they shall be accurate as of such date):

(a) Organization; Authority. Such Purchaser is either an individual or an entity duly incorporated or formed, validly existing and in good standing under the laws of the jurisdiction of its incorporation or formation with full right, corporate, partnership, limited liability company or similar power and authority to enter into and to consummate the transactions contemplated by the Transaction Documents and otherwise to carry out its obligations hereunder and thereunder. The execution and delivery of the Transaction Documents and performance by such Purchaser of the transactions contemplated by the Transaction Documents have been duly authorized by all necessary corporate, partnership, limited liability company or similar action, as applicable, on the part of such Purchaser. Each Transaction Document to which it is a party has been duly executed by such Purchaser, and when delivered by such Purchaser in accordance with the terms hereof, will constitute the valid and legally binding obligation of such Purchaser, enforceable against it in accordance with its terms, except: (i) as limited by general equitable principles and applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general application affecting enforcement of creditors’ rights generally, (ii) as limited by laws relating to the availability of specific performance, injunctive relief or other equitable remedies and (iii) insofar as indemnification and contribution provisions may be limited by Applicable Law.

(b) Understandings or Arrangements. Such Purchaser is acquiring the Securities as principal for its own account and has no direct or indirect arrangement or understandings with any other persons to distribute or regarding the distribution of such Securities (this representation and warranty not limiting such Purchaser’s right to sell the Securities pursuant to the Registration Statement or otherwise in compliance with applicable federal and state securities laws). Such Purchaser is acquiring the Securities hereunder in the ordinary course of its business.

(c) Experience of Such Purchaser. Such Purchaser, either alone or together with its representatives, has such knowledge, sophistication and experience in business and financial matters so as to be capable of evaluating the merits and risks of the prospective investment in the Securities, and has so evaluated the merits and risks of such investment. Such Purchaser is able to bear the economic risk of an investment in the Securities and, at the present time, is able to afford a complete loss of such investment.

(d) Access to Information. Such Purchaser acknowledges that it has had the opportunity to review the Transaction Documents (including all exhibits and schedules thereto) and the SEC Reports and has been afforded, (i) the opportunity to ask such questions as it has deemed necessary of, and to receive answers from, representatives of the Company concerning the terms and conditions of the offering of the Securities and the merits and risks of investing in the Securities; (ii) access to information about the Company and its financial condition, results of operations, business, properties, management and prospects sufficient to enable it to evaluate its investment; and (iii) the opportunity to obtain such additional information that the Company possesses or can acquire without unreasonable effort or expense that is necessary to make an informed investment decision with respect to the investment. Such Purchaser acknowledges and agrees that neither the Placement Agent nor any Affiliate of the Placement Agent has provided such Purchaser with any information or advice with respect to the Securities nor is such information or advice necessary or desired. Neither the Placement Agent nor any Affiliate has made or makes any representation as to the Company or the quality of the Securities and the Placement Agent and any Affiliate may have acquired non-public information with respect to the Company which such Purchaser agrees need not be provided to it. In connection with the issuance of the Securities to such Purchaser, neither the Placement Agent nor any of its Affiliates has acted as a financial advisor or fiduciary to such Purchaser.

(e) Certain Transactions and Confidentiality. Other than consummating the transactions contemplated hereunder, such Purchaser has not, nor has any Person acting on behalf of or pursuant to any understanding with such Purchaser, directly or indirectly executed any purchases or sales, including Short Sales, of the securities of the Company during the period commencing as of the time that such Purchaser first received a term sheet (written or oral) from the Company or any other Person representing the Company setting forth the material pricing terms of the transactions contemplated hereunder and ending immediately prior to the execution hereof. Notwithstanding the foregoing, in the case of a Purchaser that is a multi-managed investment vehicle whereby separate portfolio managers manage separate portions of such Purchaser’s assets and the portfolio managers have no direct knowledge of the investment decisions made by the portfolio managers managing other portions of such Purchaser’s assets, the representation set forth above shall only apply with respect to the portion of assets managed by the portfolio manager that made the investment decision to purchase the Securities covered by this Agreement. Other than to other Persons party to this Agreement or to such Purchaser’s representatives, including, without limitation, its officers, directors, partners, legal and other advisors, employees, agents and Affiliates, such Purchaser has maintained the confidentiality of all disclosures made to it in connection with this transaction (including the existence and terms of this transaction). Notwithstanding the foregoing, for the avoidance of doubt, nothing contained herein shall constitute a representation or warranty, or preclude any actions, with respect to locating or borrowing shares in order to effect Short Sales or similar transactions in the future.

The Company acknowledges and agrees that the representations contained in this Section 3.2 shall not modify, amend or affect such Purchaser’s right to rely on the Company’s representations and warranties contained in this Agreement or any representations and warranties contained in any other Transaction Document or any other document or instrument executed and/or delivered in connection with this Agreement or the consummation of the transactions contemplated hereby. Notwithstanding the foregoing, for the avoidance of doubt, nothing contained herein shall constitute a representation or warranty, or preclude any actions, with respect to locating or borrowing shares in order to effect Short Sales or similar transactions in the future.

ARTICLE IV.

OTHER AGREEMENTS OF THE PARTIES

4.1 Warrant Shares. If all or any portion of a Warrant is exercised at a time when there is an effective registration statement to cover the issuance or resale of the Warrant Shares or if the Warrant is exercised via cashless exercise, the Warrant Shares issued pursuant to any such exercise shall be issued free of all legends. If at any time following the date hereof the Registration Statement (or any subsequent registration statement registering the sale or resale of the Warrant Shares) is not effective or is not otherwise available for the sale or resale of the Warrant Shares, the Company shall immediately notify the holders of the Warrants in writing that such registration statement is not then effective and thereafter shall promptly notify such holders when the registration statement is effective again and available for the sale or resale of the Warrant Shares (it being understood and agreed that the foregoing shall not limit the ability of the Company to issue, or any Purchaser to sell, any of the Warrant Shares in compliance with applicable federal and state securities laws). The Company shall use best efforts to keep a registration statement (including the Registration Statement) registering the issuance or resale of the Warrant Shares effective during the term of the Warrants.

4.2 Furnishing of Information. Until the earliest of the time that (i) no Purchaser owns Securities or (ii) the Warrants have expired, the Company covenants to timely file (or obtain extensions in respect thereof and file within the applicable grace period) all reports required to be filed by the Company after the date hereof pursuant to the Exchange Act even if the Company is not then subject to the reporting requirements of the Exchange Act.

4.3 Integration. The Company shall not sell, offer for sale or solicit offers to buy or otherwise negotiate in respect of any security (as defined in Section 2 of the Securities Act) that would be integrated with the offer or sale of the Securities for purposes of the rules and regulations of any Trading Market such that it would require shareholder approval prior to the closing of such other transaction unless shareholder approval is obtained before the closing of such subsequent transaction.

4.4 Securities Laws Disclosure; Publicity. The Company shall (a) by the Disclosure Time, issue a press release disclosing the material terms of the transactions contemplated hereby, and (b) file a Current Report on Form 6-K, including the Transaction Documents as exhibits thereto, with the Commission within the time required by the Exchange Act. From and after the issuance of such press release, the Company represents to the Purchasers that it shall have publicly disclosed all material, non-public information delivered to any of the Purchasers by the Company or any of its Subsidiaries, or any of their respective officers, directors, employees, Affiliates or agents, including, without limitation, the Placement Agent, in connection with the transactions contemplated by the Transaction Documents. In addition, effective upon the issuance of such press release, the Company acknowledges and agrees that any and all confidentiality or similar obligations under any agreement, whether written or oral, between the Company, any of its Subsidiaries or any of their respective officers, directors, agents, employees, Affiliates or agents, including, without limitation, the Placement Agent, on the one hand, and any of the Purchasers or any of their Affiliates on the other hand, shall terminate and be of no further force or effect. The Company understands and confirms that each Purchaser shall be relying on the foregoing covenant in effecting transactions in securities of the Company. The Company and each Purchaser shall consult with each other in issuing any other press releases with respect to the transactions contemplated hereby, and neither the Company nor any Purchaser shall issue any such press release nor otherwise make any such public statement without the prior consent of the Company, with respect to any press release of any Purchaser, or without the prior consent of each Purchaser, with respect to any press release of the Company, which consent shall not unreasonably be withheld or delayed, except if such disclosure is required by law, in which case the disclosing party shall promptly provide the other party with prior notice of such public statement or communication. Notwithstanding the foregoing, the Company shall not publicly disclose the name of any Purchaser, or include the name of any Purchaser in any filing with the Commission or any regulatory agency or Trading Market, without the prior written consent of such Purchaser, except (a) as required by federal securities law in connection with the filing of final Transaction Documents with the Commission and (b) to the extent such disclosure is required by law or Trading Market regulations, in which case the Company shall provide the Purchasers with prior notice of such disclosure permitted under this clause (b) and reasonably cooperate with such Purchaser regarding such disclosure.

4.5 Non-Public Information. Except with respect to the material terms and conditions of the transactions contemplated by the Transaction Documents, which shall be disclosed pursuant to Section 4.4, the Company covenants and agrees that neither it, nor any other Person acting on its behalf will provide any Purchaser or its agents or counsel with any information that constitutes, or the Company reasonably believes constitutes, material non-public information, unless prior thereto such Purchaser shall have consented in writing to the receipt of such information and agreed in writing with the Company to keep such information confidential. The Company understands and confirms that each Purchaser shall be relying on the foregoing covenant in effecting transactions in securities of the Company. To the extent that the Company, any of its Subsidiaries, or any of their respective officers, directors, agents, employees or Affiliates delivers any material, non-public information to a Purchaser without such Purchaser’s consent, the Company hereby covenants and agrees that such Purchaser shall not have any duty of confidentiality to the Company, any of its Subsidiaries, or any of their respective officers, directors, employees, Affiliates or agents, including, without limitation, the Placement Agent, or a duty to the Company, any of its Subsidiaries or any of their respective officers, directors, employees, Affiliates or agents, including, without limitation, the Placement Agent, not to trade on the basis of, such material, non-public information, provided that the Purchaser shall remain subject to Applicable Law. To the extent that any notice provided pursuant to any Transaction Document constitutes, or contains, material, non-public information regarding the Company or any Subsidiaries, the Company shall simultaneously with the delivery of such notice file such notice with the Commission pursuant to a Current Report on Form 6-K. The Company understands and confirms that each Purchaser shall be relying on the foregoing covenant in effecting transactions in securities of the Company.

4.6 Use of Proceeds. The Company shall use the net proceeds from the sale of the Securities hereunder as disclosed in the Prospectus and shall not use such proceeds for the settlement of any outstanding litigation or in violation of FCPA or OFAC regulations.

4.7 Indemnification of Purchasers. Subject to the provisions of this Section 4.7, the Company will indemnify and hold each Purchaser and its directors, officers, shareholders, members, partners, employees and agents (and any other Persons with a functionally equivalent role of a Person holding such titles notwithstanding a lack of such title or any other title), each Person who controls such Purchaser (within the meaning of Section 15 of the Securities Act and Section 20 of the Exchange Act), and the directors, officers, shareholders, agents, members, partners or employees (and any other Persons with a functionally equivalent role of a Person holding such titles notwithstanding a lack of such title or any other title) of such controlling persons (each, a “Purchaser Party”) harmless from any and all losses, liabilities, obligations, claims, contingencies, damages, costs and expenses, including all judgments, amounts paid in settlements, court costs and reasonable attorneys’ fees and costs of investigation that any such Purchaser Party may suffer or incur as a result of or relating to (a) any breach of any of the representations, warranties, covenants or agreements made by the Company in this Agreement or in the other Transaction Documents or (b) any action instituted against the Purchaser Parties in any capacity, or any of them or their respective Affiliates, by any stockholder of the Company who is not an Affiliate of such Purchaser Party, with respect to any of the transactions contemplated by the Transaction Documents (unless such action is solely based upon a material breach of such Purchaser Party’s representations, warranties or covenants under the Transaction Documents or any agreements or understandings such Purchaser Party may have with any such stockholder or any violations by such Purchaser Party of state or federal securities laws or any conduct by such Purchaser Party which is finally judicially determined to constitute fraud, gross negligence or willful misconduct). If any action shall be brought against any Purchaser Party in respect of which indemnity may be sought pursuant to this Agreement, such Purchaser Party shall promptly notify the Company in writing, and the Company shall have the right to assume the defense thereof with counsel of its own choosing reasonably acceptable to the Purchaser Party. Any Purchaser Party shall have the right to employ separate counsel in any such action and participate in the defense thereof, but the fees and expenses of such counsel shall be at the expense of such Purchaser Party except to the extent that (i) the employment thereof has been specifically authorized by the Company in writing, (ii) the Company has failed after a reasonable period of time to assume such defense and to employ counsel or (iii) in such action there is, in the reasonable opinion of counsel, a material conflict on any material issue between the position of the Company and the position of such Purchaser Party, in which case the Company shall be responsible for the reasonable fees and expenses of no more than one such separate counsel. The Company will not be liable to any Purchaser Party under this Agreement (y) for any settlement by a Purchaser Party effected without the Company’s prior written consent, which shall not be unreasonably withheld or delayed; or (z) to the extent, but only to the extent that a loss, claim, damage or liability is attributable to any Purchaser Party’s breach of any of the representations, warranties, covenants or agreements made by such Purchaser Party in this Agreement or in the other Transaction Documents. The indemnification required by this Section 4.7 shall be made by periodic payments of the amount thereof during the course of the investigation or defense, as and when bills are received or are incurred. The indemnity agreements contained herein shall be in addition to any cause of action or similar right of any Purchaser Party against the Company or others and any liabilities the Company may be subject to pursuant to law.

4.8 Reservation of Common Shares. As of the date hereof, the Company has reserved and the Company shall continue to reserve and keep available at all times, free of preemptive rights, a sufficient number of Common Shares for the purpose of enabling the Company to issue Series A Shares pursuant to this Agreement and Warrant Shares pursuant to any exercise of the Warrants.

4.9 Listing of Common Shares. The Company hereby agrees to use commercially reasonable best efforts to maintain the listing or quotation of the Series A Shares, Common Shares and Warrants on the Trading Market on which it is currently listed, and concurrently with the Closing, the Company shall apply to list or quote all of the Series A Shares and Warrant Shares on such Trading Market and promptly secure the listing of all of the Series A Shares and Warrant Shares on such Trading Market. The Company further agrees, if the Company applies to have the Common Shares traded on any other Trading Market, it will then include in such application all of the Shares and Warrant Shares, and will take such other action as is necessary to cause all of the Shares and Warrant Shares to be listed or quoted on such other Trading Market as promptly as possible. The Company will then take all action reasonably necessary to continue the listing and trading of its Series A Shares and Common Shares on a Trading Market and will comply in all respects with the Company’s reporting, filing and other obligations under the bylaws or rules of the Trading Market. The Company agrees to maintain the eligibility of the Series A Shares and Common Shares for electronic transfer through the Depository Trust Company or another established clearing corporation, including, without limitation, by timely payment of fees to the Depository Trust Company or such other established clearing corporation in connection with such electronic transfer.

4.10 Board Composition and Board Designations; Internal Controls. The Company shall ensure that: (i) the qualifications of the persons serving as board members and the overall composition of the Board of Directors comply with the Sarbanes-Oxley Act of 2002 and the rules promulgated thereunder and with the listing requirements of the Trading Market and (ii) if applicable, at least one member of the Board of Directors qualifies as a “financial expert” as such term is defined under the Sarbanes-Oxley Act of 2002 and the rules promulgated thereunder. The Company will maintain a system of internal accounting controls sufficient to provide reasonable assurances that: (i) transactions are executed in accordance with management’s general or specific authorization; (ii) transactions are recorded as necessary in order to permit preparation of financial statements in accordance with IFRS and to maintain accountability for assets; (iii) access to assets is permitted only in accordance with management’s general or specific authorization; and (iv) the recorded accountability for assets is compared with existing assets at reasonable intervals and appropriate action is taken with respect to any differences.

4.11 Certain Transactions and Confidentiality. Each Purchaser, severally and not jointly with the other Purchasers, covenants that neither it nor any Affiliate acting on its behalf or pursuant to any understanding with it will execute any purchases or sales, including Short Sales of any of the Company’s securities during the period commencing with the execution of this Agreement and ending at such time that the transactions contemplated by this Agreement are first publicly announced pursuant to the initial press release as described in Section 4.4. Each Purchaser, severally and not jointly with the other Purchasers, covenants that until such time as the transactions contemplated by this Agreement are publicly disclosed by the Company pursuant to the initial press release as described in Section 4.4, such Purchaser will maintain the confidentiality of the existence and terms of this transaction (other than as disclosed to its legal and other representatives). Notwithstanding the foregoing and notwithstanding anything contained in this Agreement to the contrary, the Company expressly acknowledges and agrees that (i) no Purchaser makes any representation, warranty or covenant hereby that it will not engage in effecting transactions in any securities of the Company after the time that the transactions contemplated by this Agreement are first publicly announced pursuant to the initial press release as described in Section 4.4, (ii) no Purchaser shall be restricted or prohibited from effecting any transactions in any securities of the Company in accordance with applicable securities laws from and after the time that the transactions contemplated by this Agreement are first publicly announced pursuant to the initial press release as described in Section 4.4 and (iii) no Purchaser shall have any duty of confidentiality or duty not to trade in the securities of the Company to the Company, any of its Subsidiaries, or any of their respective officers, directors, employees, Affiliates, or agent, including, without limitation, the Placement Agent, after the issuance of the initial press release as described in Section 4.4. Notwithstanding the foregoing, in the case of a Purchaser that is a multi-managed investment vehicle whereby separate portfolio managers manage separate portions of such Purchaser’s assets and the portfolio managers have no direct knowledge of the investment decisions made by the portfolio managers managing other portions of such Purchaser’s assets, the covenant set forth above shall only apply with respect to the portion of assets managed by the portfolio manager that made the investment decision to purchase the Securities covered by this Agreement.

4.12 Exercise Procedures. The form of Notice of Exercise included in the Warrants set forth the totality of the procedures required of the Purchasers in order to exercise the Warrants. No additional legal opinion, other information or instructions shall be required of the Purchasers to exercise their Warrants. Without limiting the preceding sentences, no ink-original Notice of Exercise shall be required, nor shall any medallion guarantee (or other type of guarantee or notarization) of any Notice of Exercise form be required in order to exercise the Warrants. The Company shall honor exercises of the Warrants and shall deliver Warrant Shares in accordance with the terms, conditions and time periods set forth in the Transaction Documents.

4.13 Accountants. For a period of three (3) years from the Effective Date, the Company shall continue to retain the Auditor or another nationally recognize independent registered public accounting firm.

4.14 Transfer Agent. For a period of two (2) years from the Closing Date, the Company shall retain the Transfer Agent or a nationally recognized transfer and registrar agent.

4.15 Review of Financial Statements. For a period of three (3) years from the Closing Date or until such earlier time as no Warrants remain outstanding, the Company, at its expense, shall cause its regularly engaged independent registered public accountants to review (but not audit) the Company’s financial information for its semi-annual report covering the six-month period ended June 30.

4.16 Exchange Act Registration. For a period of three years from the Closing Date, the Company will use its best efforts to maintain the registration of the Common Shares under the Exchange Act. The Company will not voluntarily deregister the Common Shares under the Exchange Act without the prior written consent of the Placement Agent.

ARTICLE V.

MISCELLANEOUS

5.1 Termination. This Agreement may be terminated by any Purchaser, as to such Purchaser’s obligations hereunder only and without any effect whatsoever on the obligations between the Company and the other Purchasers, by written notice to the other parties, if the Closing has not been consummated on or before the fifth (5th) Trading Day following the date hereof; provided, however, that no such termination will affect the right of any party to sue for any breach by any other party (or parties).

5.2 Fees and Expenses. Except as expressly set forth in the Transaction Documents to the contrary, each party shall pay the fees and expenses of its advisers, counsel, accountants and other experts, if any, and all other expenses incurred by such party incident to the negotiation, preparation, execution, delivery and performance of this Agreement. The Company shall pay all Transfer Agent fees (including, without limitation, any fees required for same-day processing of any instruction letter delivered by the Company and any exercise notice delivered by a Purchaser), stamp taxes and other taxes and duties levied in connection with the delivery of any Securities to the Purchasers.

5.3 Entire Agreement. The Transaction Documents, together with the exhibits and schedules thereto, the Pricing Prospectus and the Prospectus, contain the entire understanding of the parties with respect to the subject matter hereof and thereof and supersede all prior agreements and understandings, oral or written, with respect to such matters, which the parties acknowledge have been merged into such documents, exhibits and schedules.

5.4 Notices. Any and all notices or other communications or deliveries required or permitted to be provided hereunder shall be in writing and shall be deemed given and effective on the earliest of: (a) the time of transmission, if such notice or communication is delivered via email attachment at the email address as set forth on the signature pages attached hereto at or prior to 5:30 p.m. (New York City time) on a Trading Day, (b) the next Trading Day after the time of transmission, if such notice or communication is delivered via email attachment at the email address as set forth on the signature pages attached hereto on a day that is not a Trading Day or later than 5:30 p.m. (New York City time) on any Trading Day, (c) the second (2nd) Trading Day following the date of mailing, if sent by U.S. nationally recognized overnight courier service or (d) upon actual receipt by the party to whom such notice is required to be given. The address for such notices and communications shall be as set forth on the signature pages attached hereto. To the extent that any notice provided pursuant to any Transaction Document constitutes, or contains, material, non-public information regarding the Company or any Subsidiaries, the Company shall simultaneously file such notice with the Commission pursuant to a Current Report on Form 6-K.

5.5 Amendments; Waivers. No provision of this Agreement may be waived, modified, supplemented or amended except in a written instrument signed, in the case of an amendment, by the Company and Purchasers which purchased at least 50.1% in interest of the Shares based on the initial Subscription Amounts hereunder (or, prior to the Closing, the Company and each Purchaser) or, in the case of a waiver, by the party against whom enforcement of any such waived provision is sought, provided that if any amendment, modification or waiver disproportionately and adversely impacts a Purchaser (or group of Purchasers), the consent of such disproportionately impacted Purchaser (or group of Purchasers) shall also be required. No waiver of any default with respect to any provision, condition or requirement of this Agreement shall be deemed to be a continuing waiver in the future or a waiver of any subsequent default or a waiver of any other provision, condition or requirement hereof, nor shall any delay or omission of any party to exercise any right hereunder in any manner impair the exercise of any such right. Any proposed amendment or waiver that disproportionately, materially and adversely affects the rights and obligations of any Purchaser relative to the comparable rights and obligations of the other Purchasers shall require the prior written consent of such adversely affected Purchaser. Any amendment effected in accordance with this Section 5.5 shall be binding upon each Purchaser and holder of Securities and the Company.

5.6 Headings. The headings herein are for convenience only, do not constitute a part of this Agreement and shall not be deemed to limit or affect any of the provisions hereof.

5.7 Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties and their successors and permitted assigns. The Company may not assign this Agreement or any rights or obligations hereunder without the prior written consent of each Purchaser (other than by merger). Any Purchaser may assign any or all of its rights under this Agreement to any Person to whom such Purchaser assigns or transfers any Securities, provided that such transferee agrees in writing to be bound, with respect to the transferred Securities, by the provisions of the Transaction Documents that apply to the “Purchasers.”

5.8 No Third-Party Beneficiaries. The Placement Agent shall be the third party beneficiary of the representations and warranties of the Company in Section 3.1 and the representations and warranties of the Purchasers in Section 3.2. This Agreement is intended for the benefit of the parties hereto and their respective successors and permitted assigns and is not for the benefit of, nor may any provision hereof be enforced by, any other Person, except as otherwise set forth in Section 4.7 and this Section 5.8.

5.9 Governing Law; Venue; Agent for Process. All questions concerning the construction, validity, enforcement and interpretation of the Transaction Documents shall be governed by and construed and enforced in accordance with the internal laws of the State of New York, without regard to the principles of conflicts of law thereof. Each party agrees that all legal Proceedings concerning the interpretations, enforcement and defense of the transactions contemplated by this Agreement and any other Transaction Documents (whether brought against a party hereto or its respective affiliates, directors, officers, shareholders, partners, members, employees or agents) shall be commenced exclusively in the state and federal courts sitting in the City of New York. Each party hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in the City of New York, Borough of Manhattan for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein (including with respect to the enforcement of any of the Transaction Documents), and hereby irrevocably waives, and agrees not to assert in any Action or Proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that such Action or Proceeding is improper or is an inconvenient venue for such Proceeding. Each party hereby irrevocably waives personal service of process and, to the extent permitted by law, consents to process being served in any such Action or Proceeding by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any other manner permitted by law. In addition to and without limiting the foregoing, the Company has appointed Watson Farley & Williams LLP, 250 West 55th Street, 31st Floor, New York, New York 10019, as its authorized agent (the “Authorized Agent”) upon whom process may be served in any suit, action or proceeding arising out of or based upon the Transaction Documents or the transactions contemplated herein which may be instituted in any New York Court, and expressly accept the non-exclusive jurisdiction of any such court in respect of any such suit, action or proceeding. The Company hereby represents and warrants that the Authorized Agent has accepted such appointment and has agreed to act as said agent for service of process, and the Company agrees to take any and all action, including the filing of any and all documents that may be necessary to continue such appointment in full force and effect as aforesaid. The Company hereby authorizes and directs the Authorized Agent to accept such service. Service of process upon the Authorized Agent shall be deemed, in every respect, effective service of process upon the Company. If the Authorized Agent shall cease to act as agent for service of process, the Company shall appoint, without unreasonable delay, another such agent in the United States, and notify you of such appointment. This paragraph shall survive any termination of this Agreement, in whole or in part. The Company agrees that a final judgment in any such action, proceeding or counterclaim brought in any such court shall be conclusive and binding upon the Company and may be enforced in any other courts to the jurisdiction of which the Company is or may be subject, by suit upon such judgment.

5.10 Survival. The representations and warranties contained herein shall survive the Closing and the delivery of the Securities.

5.11 Execution. This Agreement may be executed in two or more counterparts, all of which when taken together shall be considered one and the same agreement and shall become effective when counterparts have been signed by each party and delivered to each other party, it being understood that the parties need not sign the same counterpart. In the event that any signature is delivered by e-mail delivery of a “.pdf” format data file, such signature shall create a valid and binding obligation of the party executing (or on whose behalf such signature is executed) with the same force and effect as if such “.pdf” signature page were an original thereof.

5.12 Severability. If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction to be invalid, illegal, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions set forth herein shall remain in full force and effect and shall in no way be affected, impaired or invalidated, and the parties hereto shall use their commercially reasonable efforts to find and employ an alternative means to achieve the same or substantially the same result as that contemplated by such term, provision, covenant or restriction. It is hereby stipulated and declared to be the intention of the parties that they would have executed the remaining terms, provisions, covenants and restrictions without including any of such that may be hereafter declared invalid, illegal, void or unenforceable.

5.13 Rescission and Withdrawal Right. Notwithstanding anything to the contrary contained in (and without limiting any similar provisions of) any of the other Transaction Documents, whenever any Purchaser exercises a right, election, demand or option under a Transaction Document and the Company does not timely perform its related obligations within the periods therein provided, then such Purchaser may rescind or withdraw, in its sole discretion from time to time upon written notice to the Company, any relevant notice, demand or election in whole or in part without prejudice to its future actions and rights; provided, however, that, in the case of a rescission of an exercise of a Warrant, the applicable Purchaser shall be required to return any Common Shares subject to any such rescinded exercise notice concurrently with the return to such Purchaser of the aggregate exercise price paid to the Company for such shares and the restoration of such Purchaser’s right to acquire such shares pursuant to such Purchaser’s Warrant (including, issuance of a replacement warrant certificate evidencing such restored right).

5.14 Replacement of Securities. If any certificate or instrument evidencing any Securities is mutilated, lost, stolen or destroyed, the Company shall issue or cause to be issued in exchange and substitution for and upon cancellation thereof (in the case of mutilation), or in lieu of and substitution therefor, a new certificate or instrument, but only upon receipt of evidence reasonably satisfactory to the Company of such loss, theft or destruction. The applicant for a new certificate or instrument under such circumstances shall also pay any reasonable third-party costs (including customary indemnity) associated with the issuance of such replacement Securities.

5.15 Remedies. In addition to being entitled to exercise all rights provided herein or granted by law, including recovery of damages, each of the Purchasers and the Company will be entitled to specific performance under the Transaction Documents. The parties agree that monetary damages may not be adequate compensation for any loss incurred by reason of any breach of obligations contained in the Transaction Documents and hereby agree to waive and not to assert in any Action for specific performance of any such obligation the defense that a remedy at law would be adequate.

5.16 Payment Set Aside. To the extent that the Company makes a payment or payments to any Purchaser pursuant to any Transaction Document or a Purchaser enforces or exercises its rights thereunder, and such payment or payments or the proceeds of such enforcement or exercise or any part thereof are subsequently invalidated, declared to be fraudulent or preferential, set aside, recovered from, disgorged by or are required to be refunded, repaid or otherwise restored to the Company, a trustee, receiver or any other Person under any law (including, without limitation, any bankruptcy law, state or federal law, common law or equitable cause of action), then to the extent of any such restoration the obligation or part thereof originally intended to be satisfied shall be revived and continued in full force and effect as if such payment had not been made or such enforcement or setoff had not occurred.

5.17 Independent Nature of Purchasers’ Obligations and Rights. The obligations of each Purchaser under any Transaction Document are several and not joint with the obligations of any other Purchaser, and no Purchaser shall be responsible in any way for the performance or non-performance of the obligations of any other Purchaser under any Transaction Document. Nothing contained herein or in any other Transaction Document, and no action taken by any Purchaser pursuant hereto or thereto, shall be deemed to constitute the Purchasers as a partnership, an association, a joint venture or any other kind of entity, or create a presumption that the Purchasers are in any way acting in concert or as a group with respect to such obligations or the transactions contemplated by the Transaction Documents. Each Purchaser shall be entitled to independently protect and enforce its rights including, without limitation, the rights arising out of this Agreement or out of the other Transaction Documents, and it shall not be necessary for any other Purchaser to be joined as an additional party in any Proceeding for such purpose. Each Purchaser has been represented by its own separate legal counsel in its review and negotiation of the Transaction Documents. For reasons of administrative convenience only, each Purchaser and its respective counsel have chosen to communicate with the Company through the Placement Agent Counsel. The Placement Agent Counsel does not represent any of the Purchasers and only represents the Placement Agent. The Company has elected to provide all Purchasers with the same terms and Transaction Documents for the convenience of the Company and not because it was required or requested to do so by any of the Purchasers. It is expressly understood and agreed that each provision contained in this Agreement and in each other Transaction Document is between the Company and a Purchaser, solely, and not between the Company and the Purchasers collectively and not between and among the Purchasers.

5.18 Liquidated Damages. The Company’s obligations to pay any partial liquidated damages or other amounts owing under the Transaction Documents is a continuing obligation of the Company and shall not terminate until all unpaid partial liquidated damages and other amounts have been paid notwithstanding the fact that the instrument or security pursuant to which such partial liquidated damages or other amounts are due and payable shall have been canceled.

5.19 Saturdays, Sundays, Holidays, etc. If the last or appointed day for the taking of any action or the expiration of any right required or granted herein shall not be a Business Day, then such action may be taken or such right may be exercised on the next succeeding Business Day.

5.20 Construction. The parties agree that each of them and/or their respective counsel have reviewed and had an opportunity to revise the Transaction Documents and, therefore, the normal rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall not be employed in the interpretation of the Transaction Documents or any amendments thereto. In addition, each and every reference to share prices and Common Shares in any Transaction Document shall be subject to adjustment for reverse and forward stock splits, stock dividends, stock combinations and other similar transactions of the Common Shares that occur after the date of this Agreement. All references herein to matters disclosed within filings made by the Company with the Commission shall be construed to include documents incorporated by reference into such filings.

5.21 WAIVER OF JURY TRIAL. IN ANY ACTION, SUIT, OR PROCEEDING IN ANY JURISDICTION BROUGHT BY ANY PARTY AGAINST ANY OTHER PARTY, THE PARTIES EACH KNOWINGLY AND INTENTIONALLY, TO THE GREATEST EXTENT PERMITTED BY APPLICABLE LAW, HEREBY ABSOLUTELY, UNCONDITIONALLY, IRREVOCABLY AND EXPRESSLY WAIVES FOREVER TRIAL BY JURY.

(Signature Pages Follow)

IN WITNESS WHEREOF, the parties hereto have caused this Securities Purchase Agreement to be duly executed by their respective authorized signatories as of the date first indicated above.

MCLOUD TECHNOLOGIES CORP.
By:
	Name: Russel H. McMeekin Title: Chief Executive Officer

Address for Notice:

mCloud Technologies Corp.

550-510 Burrard Street

Vancouver, BC V6C 3A8

Attention: Russel H. McMeekin, Chief Executive Officer

With a copy to (which shall not constitute notice):

Sichenzia Ross Ference LLP

1185 Avenue of the Americas, 31st Floor

New York, NY 10036

E-mail: mross@srf.law

Attention: Marc J. Ross

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK

SIGNATURE PAGE FOR PURCHASER FOLLOWS]

[PURCHASER SIGNATURE PAGES TO MCLD SECURITIES PURCHASE AGREEMENT]

IN WITNESS WHEREOF, the undersigned have caused this Securities Purchase Agreement to be duly executed by their respective authorized signatories as of the date first indicated above.

Name of Purchaser: ________________________________________________________

Signature of Authorized Signatory of Purchaser: _________________________________

Name of Authorized Signatory: _______________________________________________

Title of Authorized Signatory: ________________________________________________

Email Address of Authorized Signatory: _________________________________________

Address for Notice to Purchaser:

Address for Delivery of Securities to Purchaser (if not same as address for notice):

DWAC for Delivery of Shares:

Unit Subscription Amount: $_________________

Units: _________________

Series A Shares: _________________

Common Warrant Shares: _________________ Beneficial Ownership Blocker ☐ 4.99% or ☐ 9.99%

EIN Number: ____________________

☐ Notwithstanding anything contained in this Agreement to the contrary, by checking this box (i) the obligations of the above-signed to purchase the securities set forth in this Agreement to be purchased from the Company by the above-signed, and the obligations of the Company to sell such securities to the above-signed, shall be unconditional and all conditions to Closing shall be disregarded, (ii) the Closing shall occur on the second (2nd) Trading Day following the date of this Agreement and (iii) any condition to Closing contemplated by this Agreement (but prior to being disregarded by clause (i) above) that required delivery by the Company or the above-signed of any agreement, instrument, certificate or the like or purchase price (as applicable) shall no longer be a condition and shall instead be an unconditional obligation of the Company or the above-signed (as applicable) to deliver such agreement, instrument, certificate or the like or purchase price (as applicable) to such other party on the Closing Date.

[SIGNATURE PAGES CONTINUE]

Schedule A

Free Writing Prospectus

None.

EX-10.18

Exhibit 10.18

SECURITIES PURCHASE AGREEMENT

This SECURITIES PURCHASE AGREEMENT (the “Agreement”), dated as of October 28, 2022, is by and between mCloud Technologies Corp., a company incorporated under the Business Corporations Act (British Columbia) (the “Company”), and (the “Investor”).

RECITALS

A. The Company and the Investor are executing and delivering this Agreement in reliance upon the exemption from securities registration afforded by Rule 903 of Regulation S (“Regulation S”) as promulgated by the United States Securities and Exchange Commission (the “SEC”) under the Securities Act of 1933, as amended (the “1933 Act”).

B. The Company has authorized the issuance of [ ] Common Shares (as defined below) (the “Shares”) at a price $ of per share to the Investor.

C. The Investor wishes to purchase, and the Company wishes to sell, upon the terms and conditions stated in this Agreement, the Shares.

AGREEMENT

NOW, THEREFORE, in consideration of the premises and the mutual covenants contained herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and the Investor hereby agree as follows:

1. PURCHASE AND SALE OF SHARES.

(a) Shares. Subject to the satisfaction (or waiver) of the conditions set forth in Sections 6 and 7 below, the Company shall issue and sell to the Investor, and the Investor shall purchase from the Company on the Closing Date (as defined below), the Shares.

(b) Closing. The closing (the “Closing”) of the purchase of the Shares by the Investor shall occur at the offices of Sichenzia Ross Ference LLP, 1185 Avenue of the Americas, New York, NY 10036. The date and time of the Closing (the “Closing Date”) shall be 10:00 a.m., New York time, on the first (1^st) Business Day on which the conditions to the Closing set forth in Sections 6 and 7 below are satisfied or waived (or such later date as is mutually agreed to by the Company and the Investor). As used herein “Business Day” means any day other than a Saturday, Sunday or other day on which commercial banks in New York, New York are authorized or required by law to remain closed.

(c) Purchase Price. The aggregate purchase price for the Shares to be purchased by the Investor (the “Purchase Price”) shall be the product of (i) the number of Shares multiplied by (ii) the sum of the closing price of the Common Shares on the Nasdaq Capital Market on October 28, 2022 plus $0.01.

(d) Payment of Purchase Price; Delivery of the Shares. On the Closing Date, (i) the Investor shall pay the Purchase Price to the Company for the Shares by wire transfer of immediately available funds in accordance with the Company’s written wire instructions attached hereto as Exhibit A and (ii) the Company shall deliver to the Investor the Shares on behalf of the Company and registered in the name of the Investor or its designee.

2. INVESTOR’S REPRESENTATIONS AND WARRANTIES.

The Investor represents and warrant to the Company that:

(a) Organization; Authority. The Investor is an individual with the requisite power and authority to enter into and to consummate the transactions contemplated by this Agreement and otherwise to carry out its obligations hereunder and thereunder.

(b) No Public Sale or Distribution. The Investor is acquiring the Shares for its own account and not with a view towards, or for resale in connection with, the public sale or distribution thereof in violation of applicable securities laws, except pursuant to sales registered or exempted under the 1933 Act; provided, however, by making the representations herein, the Investor does not agree, or make any representation or warranty, to hold any of the Shares for any minimum or other specific term and reserves the right to dispose of the Shares at any time in accordance with or pursuant to a registration statement or an exemption under the 1933 Act. The Investor does not presently have any agreement or understanding, directly or indirectly, with any Person to distribute any of the Shares in violation of applicable securities laws.

(c) Regulation S Representations. The Investor hereby acknowledges and agrees that:

(i) it is not in the United States and is not a “U.S. Person” as defined in Rule 902 of Regulation S promulgated under the 1933 Act (a “U.S. Person”);

(ii) the Shares were not offered to the Investor in the United States and at the time its buy order was made, it was outside the United States;

(iii) this Agreement was delivered to, completed, executed and delivered by, the Investor (or its authorized signatory) outside the United States;

(iv) the Investor is not a “distributor” of securities, as that term is defined in Regulation S under the 1933 Act, nor a dealer in securities, and is not purchasing the Shares for the account or benefit of, directly or indirectly, any U.S. Person;

(v) the current structure of this transaction and all transactions and activities contemplated hereunder is not a scheme to evade the registration requirements of the 1933 Act; and

(vi) it has not purchased the Shares as a result of any form of “directed selling efforts” (as such term is used in Regulation S under the 1933 Act) or “general solicitation” or “general advertising” (as such terms are used under Rule 502(c) of Regulation D promulgated under the 1933 Act), including, but not limited to, any advertisements, articles, notices or other communications published in any newspaper, magazine or similar media or on the Internet or broadcast over radio, television or the Internet, or any seminar or meeting whose attendees have been invited by general solicitation or general advertising.

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(d) Reliance on Exemptions. The Investor understands that the Shares are being offered and sold to it in reliance on specific exemptions from the registration requirements of United States federal and state securities laws, that the offer and sale of the Shares are intended to be exempt from the registration requirements of the 1933 Act pursuant to Rule 903 of Regulation S under the 1933 Act, and that the Company is relying in part upon the truth and accuracy of, and the Investor’s compliance with, the representations, warranties, agreements, acknowledgments and understandings of such Investor set forth herein in order to determine the availability of such exemptions and the eligibility of the Investor to acquire the Shares.

(e) Information. The Investor and its advisors, if any, have been furnished with all materials relating to the business, finances and operations of the Company and materials relating to the offer and sale of the Shares which have been requested by the Investor. The Investor and its advisors, if any, have been afforded the opportunity to ask questions of the Company. The Investor understands that its investment in the Shares involves a high degree of risk. The Investor has sought such accounting, legal and tax advice as it has considered necessary to make an informed investment decision with respect to its acquisition of the Shares.

(f) No Governmental Review. The Investor understands that no United States federal or state agency or any other government or governmental agency has passed on or made any recommendation or endorsement of the Shares or the fairness or suitability of the investment in the Shares nor have such authorities passed upon or endorsed the merits of the offering of the Shares.

(g) Transfer or Resale. The Investor acknowledges and agrees that, pursuant to the provisions of Regulation S, the Shares cannot be sold, assigned, transferred, conveyed, pledged or otherwise disposed of to any U.S. Person or within the United States of America or its territories or possessions, unless such Shares are registered for sale in the United States pursuant to an effective registration statement under the 1933 Act or another exemption from such registration is available. Without limiting the foregoing, the Investor understands that: (i) the Shares have not been and are not being registered under the 1933 Act or any state securities laws, and may not be offered for sale, sold, assigned, transferred, conveyed or pledged, unless (A) subsequently registered under the 1933 Act and applicable states securities laws, (B) the sale, assignment or transfer is made outside the United States to a non-U.S. Person in accordance with the requirements of Rule 904 of Regulation S and in compliance with applicable local laws and regulations, (C) the sale, assignment or transfer is made in the United States or to a U.S. Person and the applicable 40-day distribution compliance period under Rule 903 of Regulation S has been satisfied, (D) such Shares to be sold, assigned or transferred may be sold, assigned or transferred pursuant to any other exemption from registration under the 1933 Act and applicable state securities laws, or (E) the Investor provides the Company with reasonable assurance that such Shares can be sold, assigned or transferred pursuant to Rule 144A promulgated under the 1933 Act (or a successor rule thereto) (collectively, “Rule 144A”); (ii) any sale of the Shares made in reliance on Rule 144A may be made only in accordance with the terms of Rule 144A, and further, if Rule 144A is not applicable, any resale of the Shares under circumstances in which the seller (or the Person (as defined below) through whom the sale is made) may be deemed to be an underwriter (as that term is defined in the 1933 Act) may require compliance with some other exemption under the 1933 Act or the rules and regulations of the SEC promulgated thereunder; and (iii) neither the Company nor any other Person is under any obligation to register the Shares under the 1933 Act or any state securities laws or to comply with the terms and conditions of any exemption thereunder.

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(h) Validity; Enforcement. This Agreement has been duly and validly authorized, executed and delivered on behalf of the Investor and constitutes the legal, valid and binding obligations of the Investor enforceable against the Investor in accordance with its terms, except as such enforceability may be limited by general principles of equity or applicable bankruptcy, insolvency, reorganization, moratorium, liquidation and other similar laws relating to, or affecting generally, the enforcement of applicable creditors’ rights and remedies.

(i) No Conflicts. The execution, delivery and performance by the Investor of this Agreement and the consummation by the Investor of the transactions contemplated hereby will not (i) conflict with, or constitute a default (or an event which with notice or lapse of time or both would become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation of, any agreement, indenture or instrument to which the Investor is a party or (ii) result in a violation of any law, rule, regulation, order, judgment or decree (including federal and state securities laws) applicable to the Investor, except in the case of clauses (ii) and (iii) above, for such conflicts, defaults, rights or violations which would not, individually or in the aggregate, reasonably be expected to have a material adverse effect on the ability of the Investor to perform its obligations hereunder.

(j) Residency. The Investor is a resident of Saudi Arabia.

(k) Certain Trading Activities. The Investor has not directly or indirectly, nor has any Person acting on behalf of or pursuant to any understanding with the Investor, engaged in any transactions in the securities of the Company (including, without limitation, any Short Sales (as defined below) involving the Company’s securities) during the period commencing as of the time that the Investor was first contacted regarding the specific investment in the Company contemplated by this Agreement and ending immediately prior to the execution of this Agreement by the Investor (it being understood and agreed that for all purposes of this Agreement, and, without implication that the contrary would otherwise be true, that neither transactions nor purchases nor sales shall include the location and/or reservation of borrowable common shares). “Short Sales” means all “short sales” as defined in Rule 200 promulgated under Regulation SHO under the Securities Exchange Act of 1934, as amended (the “1934 Act”).

(l) Experience of the Investor. The Investor, either alone or together with its representatives, has such knowledge, sophistication and experience in business and financial matters so as to be capable of evaluating the merits and risks of the prospective investment in the Shares, and has so evaluated the merits and risks of such investment. The Investor is able to bear the economic risk of an investment in the Shares and, at the present time, is able to afford a complete loss of such investment.

(m) Not a 10% Owner. The Investor is not a “beneficial owner” of more than 10% of the Common Shares (as defined for purposes of Rule 13d-3 of the 1934 Act).

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3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.

The Company represents and warrants to the Investor that:

(a) Organization and Qualification. Each of the Company and each of its Subsidiaries are entities duly organized and validly existing and in good standing under the laws of the jurisdiction in which they are formed, and have the requisite power and authorization to own their properties and to carry on their business as now being conducted and as presently proposed to be conducted. Each of the Company and each of its Subsidiaries is duly qualified as a foreign entity to do business and is in good standing in every jurisdiction in which its ownership of property or the nature of the business conducted by it makes such qualification necessary, except to the extent that the failure to be so qualified or be in good standing would not have a Material Adverse Effect. “Material Adverse Effect” means any material adverse effect on (i) the business, properties, assets, liabilities, operations (including results thereof), condition (financial or otherwise) or prospects of the Company and its Subsidiaries taken as a whole or (ii) the transactions contemplated hereby. Other than the Persons (as defined below) set forth on Schedule 3(a), the Company has no Subsidiaries. “Subsidiaries” means any Person in which the Company, directly or indirectly, (I) owns a majority of the outstanding capital stock or holds a majority of equity or similar interest of such Person or (II) controls or operates all or any part of the business, operations or administration of such Person, and each of the foregoing, is individually referred to herein as a “Subsidiary.”

(b) Authorization; Enforcement; Validity. The Company has the requisite power and authority to enter into and perform its obligations under this Agreement and to issue the Shares in accordance with the terms hereof. The execution and delivery of this Agreement by the Company, and the consummation by the Company of the transactions contemplated hereby have been duly authorized by the Company’s board of directors, and no further filing, consent or authorization is required by the Company. This Agreement has been duly executed and delivered by the Company, and constitutes the legal, valid and binding obligations of the Company, enforceable against the Company in accordance with its respective terms, except as such enforceability may be limited by general principles of equity or applicable bankruptcy, insolvency, reorganization, moratorium, liquidation or similar laws relating to, or affecting generally, the enforcement of applicable creditors’ rights and remedies and except as rights to indemnification and to contribution may be limited by federal or state securities law and public policy, and the remedy of specific performance and injunctive and other forms of equitable relief may be subject to equitable defenses and to the discretion of the court before which any proceeding therefor may be brought.

(c) Issuance of Shares. The issuance of the Shares is duly authorized and, the Shares are validly issued, fully paid and non-assessable and free from all preemptive or similar rights, taxes, liens, charges and other encumbrances with respect to the issue thereof. Subject to the accuracy of the representations and warranties of the Investor in this Agreement, the offer and issuance by the Company of the Shares is exempt from registration under the 1933 Act. “Common Shares” means the Company’s common shares, no par value per share.

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4. COVENANTS.

(a) Reasonable Best Efforts. The Investor shall use its reasonable best efforts to timely satisfy each of the conditions to be satisfied by it as provided in Section 6 of this Agreement. The Company shall use its reasonable best efforts to timely satisfy each of the conditions to be satisfied by it as provided in Section 7 of this Agreement.

(b) Conduct of Business. The business of the Company and its Subsidiaries shall not be conducted in violation of any law, ordinance or regulation of any governmental entity, except where such violations would not result reasonably be expected to result, either individually or in the aggregate, in a Material Adverse Effect.

(c) No Hedging or Short Sales During Distribution Compliance Period. The Investor shall not directly or indirectly, nor shall any Person acting on behalf of or pursuant to any understanding with the Investor, engage in any Short Sales or hedging transactions involving any securities of the Company or any other transaction which would transfer some or all of the economic or other risk of ownership of securities of the Company, including any forward contract, equity swap, put or call, put or call equivalent position, collar, non-recourse loan, or similar transaction, during the applicable distribution compliance period under Rule 903 of Regulation S, and thereafter may engage in such transactions only in compliance with the 1933 Act.

5. LEGEND.

(a) Legends. The Investor understands that the Shares have been issued pursuant to an exemption from registration or qualification under the 1933 Act and applicable state securities laws, and except as set forth in Section 5(b) below, the Shares shall bear any legend as required by the “blue sky” laws of any state and a restrictive legend in substantially the following form (and a stop-transfer order may be placed against transfer of such stock certificates and the Company shall be required to refuse to register any transfer of the Shares not made in accordance with applicable U.S. securities laws):

THESE SHARES WERE ISSUED IN AN OFFSHORE TRANSACTION TO PERSONS WHO ARE NOT U.S. PERSONS (AS DEFINED HEREIN) PURSUANT TO REGULATIONS UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “1933 ACT”). ACCORDINGLY, NONE OF THE SHARES TO WHICH THIS CERTIFICATE RELATES, HAVE BEEN REGISTERED UNDER THE 1933 ACT, OR ANY U.S. STATE SECURITIES LAWS, AND, UNLESS SO REGISTERED, NONE MAY BE OFFERED OR SOLD IN THE UNITED STATES (AS DEFINED HEREIN OR, DIRECTLY OR INDIRECTLY, TO U.S. PERSONS (AS DEFINED HEREIN) EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT OR PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE 1933 ACT AND IN EACH CASE ONLY IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS. IN ADDITION, HEDGING TRANSACTIONS INVOLVING THE SHARES MAY NOT BE CONDUCTED UNLESS IN ACCORDANCE WITH THE 1933 ACT. “UNITED STATES” AND “U.S. PERSON” ARE AS DEFINED BY REGULATION S UNDER THE 1933 ACT.

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(b) Removal of Legends. Certificates evidencing Shares shall not be required to contain the legend set forth in Section 5(a) above or any other legend (i) while a registration statement covering the resale of such Shares is effective under the 1933 Act, (ii) if such Shares are sold, assigned or transferred outside the United States to a non-U.S. Person in accordance with the requirements of Rule 904 of Regulation S and in compliance with applicable local laws and regulations, (iii) if such Shares are eligible to be sold, assigned or transferred under Rule 144A (provided that the Investor provides the Company with reasonable assurances that such Shares are eligible for sale, assignment or transfer under Rule 144A which shall not include an opinion of counsel), (iv) in connection with any other sale, assignment or other transfer of such Shares, provided that such sale, assignment or transfer of such Shares may be made without registration under the applicable requirements of the 1933 Act or (v) if such legend is otherwise not required under applicable requirements of the 1933 Act (including, without limitation, controlling judicial interpretations and pronouncements issued by the SEC). If a legend is not required pursuant to the foregoing, the Company shall no later than three (3) Trading Days following the delivery by the Investor to the Company or the transfer agent (with notice to the Company) of a legended certificate representing such Shares (endorsed or with stock powers attached, signatures guaranteed, and otherwise in form necessary to affect the reissuance and/or transfer, if applicable), as directed by such Investor, either: (A) provided that the Company’s transfer agent is participating in the DTC Fast Automated Securities Transfer Program, credit the aggregate number of Common Shares to which such Investor shall be entitled to such Investor’s or its designee’s balance account with DTC through its Deposit/Withdrawal at Custodian system or (B) if the Company’s transfer agent is not participating in the DTC Fast Automated Securities Transfer Program, issue and deliver at the Company’s expense (via reputable overnight courier) to such Investor, a certificate representing such Shares that is free from all restrictive and other legends, registered in the name of such Investor or its designee.

6. CONDITIONS TO THE COMPANY’S OBLIGATION TO SELL.

(a) The obligation of the Company hereunder to issue and sell the Shares to the Investor at the Closing is subject to the satisfaction, at or before the Closing Date, of each of the following conditions, provided that these conditions are for the Company’s sole benefit and may be waived by the Company at any time in its sole discretion by providing the Investor with prior written notice thereof:

(i) The Investor shall have executed this Agreement and delivered the same to the Company.

(ii) The Investor shall have delivered to the Company the Purchase Price for the Shares being purchased by the Investor at the Closing by wire transfer of immediately available funds pursuant to the wire instructions provided by the Company.

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(iii) The representations and warranties of the Investor shall be true and correct in all material respects as of the date when made and as of the Closing Date as though originally made at that time (except for representations and warranties that speak as of a specific date, which shall be true and correct as of such date), and the Investor shall have performed, satisfied and complied in all material respects with the covenants, agreements and conditions required by this Agreement to be performed, satisfied or complied with by such Investor at or prior to the Closing Date.

7. CONDITIONS TO THE INVESTOR’S OBLIGATION TO PURCHASE.

(a) The obligation of the Investor hereunder to purchase the Shares at the Closing is subject to the satisfaction, at or before the Closing Date, of each of the following conditions, provided that these conditions are for the Investor’s sole benefit and may be waived by the Investor at any time in its sole discretion by providing the Company with prior written notice thereof:

(i) The Company shall have duly executed and delivered to the Investor this Agreement.

(ii) Each and every representation and warranty of the Company shall be true and correct as of the date when made and as of the Closing Date as though originally made at that time (except for representations and warranties that speak as of a specific date, which shall be true and correct as of such date) and the Company shall have performed, satisfied and complied in all respects with the covenants, agreements and conditions required to be performed, satisfied or complied with by the Company at or prior to the Closing Date. The Investor shall have received a certificate, executed by the Chief Executive Officer of the Company, dated as of the Closing Date, to the foregoing effect and as to such other matters as may be reasonably requested by the Investor in the form acceptable to the Investor.

(iii) No statute, rule, regulation, executive order, decree, ruling or injunction shall have been enacted, entered, promulgated or endorsed by any court or governmental authority of competent jurisdiction that prohibits the consummation of any of the transactions contemplated by this Agreement.

(iv) Since the date of execution of this Agreement, no event or series of events shall have occurred that reasonably would have or result in a Material Adverse Effect.

Trading in the Common Shares shall not have been suspended by the SEC, TSXV or the Nasdaq Capital Market, the Company shall not have received any final and non-appealable notice that the listing or quotation of the Common Shares on the Nasdaq Capital Market or TSXV shall be terminated on a date certain, there shall not have been imposed any suspension of electronic trading or settlement services by DTC with respect to the Common Shares that is continuing, and the Company shall not have received any notice from DTC to the effect that a suspension of electronic trading or settlement services by DTC with respect to the Common Shares is being imposed or is contemplated.

8. TERMINATION.

In the event that the Closing shall not have occurred within five (5) days after the date hereof, then the Investor shall have the right to terminate its obligations under this Agreement at any time on or after the close of business on such date without liability of the Investor to any other party; provided, however, the right to terminate its obligations under this Agreement pursuant to this Section 8 shall not be available to the Investor if the failure of the transactions contemplated by this Agreement to have been consummated by such date is the result of the Investor’s breach of this Agreement; Nothing contained in this Section 8 shall be deemed to release any party from any liability for any breach by such party of the terms and provisions of this Agreement or to impair the right of any party to compel specific performance by any other party of its obligations under this Agreement.

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9. MISCELLANEOUS.

(a) Governing Law; Jurisdiction; Jury Trial. All questions concerning the construction, validity, enforcement and interpretation of this Agreement shall be governed by the internal laws of the State of New York, without giving effect to any choice of law or conflict of law provision or rule (whether of the State of New York or any other jurisdictions) that would cause the application of the laws of any jurisdictions other than the State of New York. Each party hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in The City of New York, Borough of Manhattan, for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or thereby or discussed herein or therein, and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that such suit, action or proceeding is brought in an inconvenient forum or that the venue of such suit, action or proceeding is improper. By the execution and delivery of this Agreement, the Company acknowledges that it has, by separate written instrument, irrevocably designated and appointed Sichenzia Ross Ference LLP, at 1185 Avenue of the Americas, New York, NY 10036 (together with any successor, the “Agent for Service”) as its authorized agent upon which process may be served in any suit or proceeding arising out of or relating to this Agreement or the Shares that may be instituted in any state or federal court sitting in The City of New York, Borough of Manhattan, or brought under federal or state securities laws, and acknowledges that the Agent for Service has accepted such designation. The Company further agrees to take any and all action, including the execution and filing of any and all such documents and instruments, as may be necessary to continue such designation and appointment of the Agent for Service in full force and effect. Service upon such Agent for Service in accordance with this Section 9(a) shall be deemed completed whether or not forwarded to or received by the Company. If such Agent for Service ceases to be able to act as such, resigns as such Agent for Service or to have an address in New York, New York, the Company agrees to irrevocably appoint a new agent acceptable to the Investor to receive on behalf of the Company service of any legal process and to deliver to the Investor within 14 days a copy of a written acceptance of appointment by such agent. Each party hereby irrevocably waives personal service of process and consents to process being served in any such suit, action or proceeding by mailing a copy thereof to such party at the address for such notices to it under this Agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall (i) limit, or be deemed to limit, in any way any right to serve process in any manner permitted by law, or (ii) operate, or shall be deemed to operate, to preclude the Investor from bringing suit or taking other legal action against the Company in any other jurisdiction to collect on the Company’s obligations to such Investor or to enforce a judgment or other court ruling in favor of such Investor. EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE TO, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.

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(b) Counterparts. This Agreement may be executed in two or more counterparts, all of which shall be considered one and the same agreement and shall become effective when counterparts have been signed by each party and delivered to the other party. In the event that any signature is delivered by facsimile transmission or by an e-mail which contains a portable document format (.pdf) file of an executed signature page, such signature page shall create a valid and binding obligation of the party executing (or on whose behalf such signature is executed) with the same force and effect as if such signature page were an original thereof.

(c) Headings; Gender. The headings of this Agreement are for convenience of reference and shall not form part of, or affect the interpretation of, this Agreement. Unless the context clearly indicates otherwise, each pronoun herein shall be deemed to include the masculine, feminine, neuter, singular and plural forms thereof. The terms “including,” “includes,” “include” and words of like import shall be construed broadly as if followed by the words “without limitation.” The terms “herein,” “hereunder,” “hereof” and words of like import refer to this entire Agreement instead of just the provision in which they are found.

(d) Severability. If any provision of this Agreement is prohibited by law or otherwise determined to be invalid or unenforceable by a court of competent jurisdiction, the provision that would otherwise be prohibited, invalid or unenforceable shall be deemed amended to apply to the broadest extent that it would be valid and enforceable, and the invalidity or unenforceability of such provision shall not affect the validity of the remaining provisions of this Agreement so long as this Agreement as so modified continues to express, without material change, the original intentions of the parties as to the subject matter hereof and the prohibited nature, invalidity or unenforceability of the provision(s) in question does not substantially impair the respective expectations or reciprocal obligations of the parties or the practical realization of the benefits that would otherwise be conferred upon the parties. The parties will endeavor in good faith negotiations to replace the prohibited, invalid or unenforceable provision(s) with a valid provision(s), the effect of which comes as close as possible to that of the prohibited, invalid or unenforceable provision(s).

(e) Entire Agreement; Amendments. This Agreement and the schedules and exhibits attached hereto and thereto and the instruments referenced herein supersede all other prior oral or written agreements between the Investor, the Company, its Subsidiaries, their affiliates and Persons acting on their behalf solely with respect to the matters contained herein and therein, and this Agreement, the schedules and exhibits attached hereto contain the entire understanding of the parties solely with respect to the matters covered herein and therein; provided, however, nothing contained in this Agreement shall (or shall be deemed to) (i) have any effect on any agreements the Investor has entered into with the Company or any of its Subsidiaries prior to the date hereof with respect to any prior investment made by the Investor in the Company or (ii) waive, alter, modify or amend in any respect any obligations of the Company or any of its Subsidiaries, or any rights of or benefits to the Investor or any other Person, in any agreement entered into prior to the date hereof between or among the Company and/or any of its Subsidiaries and the Investor, and all such agreements shall continue in full force and effect. Except as specifically set forth herein or therein, neither the Company nor the Investor makes any representation, warranty, covenant or undertaking with respect to such matters. For clarification purposes, the Recitals are part of this Agreement. No provision of this Agreement may be amended other than by an instrument in writing signed by the Company and the Investor, discretion).

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(f) Notices. Any notices, consents, waivers or other communications required or permitted to be given under the terms of this Agreement must be in writing and will be deemed to have been delivered: (i) upon receipt, if delivered personally; (ii) when sent, if sent by facsimile (provided confirmation of transmission is mechanically or electronically generated and kept on file by the sending party); (iii) when sent, if sent by e-mail (provided that such sent e-mail is kept on file (whether electronically or otherwise) by the sending party and the sending party does not receive an automatically generated message from the recipient’s e-mail server that such e-mail could not be delivered to such recipient) and (iv) if sent by overnight courier service, one (1) Business Day after deposit with an overnight courier service with next day delivery specified, in each case, properly addressed to the party to receive the same. The addresses, facsimile numbers and/or e-mail addresses for such communications are as follows:

If to the Company:

mCloud technologies Corp.

550-510 Burrard Street,

Vancouver, British Columbia, V6C 3A8

Telephone: +1-(284)-494-2810

E-mail address: russmcmeekin@mcloudcorp.com

Attention: Chief Executive Officer

With a copy (for informational purposes only) to:

Sichenzia Ross Ference LLP

1185 Avenue of the Americas, 31^st Floor

New York, NY 10036

Facsimile: (212) 930-9700

E-mail address: mross@srf.law

Attention: Marc J. Ross, Esq.

If to the Investor:

or to such other address, facsimile number or e-mail address and/or to the attention of such other Person as the recipient party has specified by written notice given to each other party five (5) days prior to the effectiveness of such change. Written confirmation of receipt (A) given by the recipient of such notice, consent, waiver or other communication, (B) mechanically or electronically generated by the sender’s facsimile machine containing the time, date and recipient facsimile number or (C) provided by an overnight courier service shall be rebuttable evidence of personal service, receipt by facsimile or receipt from an overnight courier service in accordance with clause (i), (ii) or (iv) above, respectively. A copy of the e-mail transmission containing the time, date and recipient e-mail address shall be rebuttable evidence of receipt by e-mail in accordance with clause (iii) above.

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(g) Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties and their respective successors and assigns, including, as contemplated below, any assignee or transferee of any of the Shares. The Company shall not assign this Agreement or any rights or obligations hereunder without the prior written consent of the Investor (which may be granted or withheld in the sole discretion of the Investor). The Investor may assign some or all of its rights hereunder in connection with any assignment or transfer of any of its Shares without the consent of the Company, in which event such assignee or transferee (as the case may be) shall be deemed to be an Investor hereunder with respect to such assigned rights.

(h) No Third Party Beneficiaries. This Agreement is intended for the benefit of the parties hereto and their respective permitted successors and assigns, and is not for the benefit of, nor may any provision hereof be enforced by, any other Person.

(i) Survival. The representations, warranties, agreements and covenants shall survive the Closing.

(j) Further Assurances. Each party shall do and perform, or cause to be done and performed, all such further acts and things, and shall execute and deliver all such other agreements, certificates, instruments and documents, as any other party may reasonably request in order to carry out the intent and accomplish the purposes of this Agreement and the consummation of the transactions contemplated hereby.

(k) Construction. The language used in this Agreement will be deemed to be the language chosen by the parties to express their mutual intent, and no rules of strict construction will be applied against any party. No specific representation or warranty shall limit the generality or applicability of a more general representation or warranty. Each and every reference to share prices, Common Shares and any other numbers in this Agreement that relate to the Common Shares shall be automatically adjusted for stock splits, stock dividends, stock combinations and other similar transactions that occur with respect to the Common Shares after the date of this Agreement.

(l) Currency(m) Unless otherwise expressly indicated, all dollar amounts referred to in this Agreement are in United States Dollars (“U.S. Dollars”). All amounts denominated in other currencies (if any) shall be converted into the U.S. Dollar equivalent amount in accordance with the Exchange Rate on the date of calculation. “Exchange Rate” means, in relation to any amount of currency to be converted into U.S. Dollars pursuant to this Agreement, the U.S. Dollar exchange rate as published in the Wall Street Journal on the relevant date of calculation.

[signature pages follow]

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IN WITNESS WHEREOF, Investor and the Company have caused their respective signature page to this Agreement to be duly executed as of the date first written above.

COMPANY:
MCLOUD TECHNOLOGIES CORP.
By:
	Name: Russel H. McMeekin
	Title: Chief Executive Officer

IN WITNESS WHEREOF, Investor and the Company have caused their respective signature page to this Agreement to be duly executed as of the date first written above.

INVESTOR:

By:

Name:

SCHEDULE 3(A)

LIST OF SUBSIDIARIES

The following chart identifies each of the Company’s wholly owned subsidiaries as of the date:

* Ownership of the above noted entities is 100% unless otherwise indicated.

EXHIBIT A

WIRING INSTRUCTIONS

Wire instruction:

mCloud Technologies Corp.

510-550 Burrard Street, Vancouver, BC, V6C 3A8

Swift Code:	HKBCCATT
Bank Account Number:	270-679626-070
Transit Number:	10270
Institution Number:	016

EX-10.19

Exhibit 10.19

Contract ID: 925719

Google Cloud Marketplace Vendor Agreement

This Google Cloud Marketplace Vendor Agreement (“Agreement”) is effective as of the Effective Date and is entered into by Google and Vendor.

“Vendor”	Full legal name:	mCloud Technologies (USA) Inc.
	Place of formation:	Delaware
	Postal address:	580 California St
		San Francisco, California 94104-1000
		United States
	Notification Email Address:	tino.lanza@mcloudcorp.com
“Google”	Full legal name: Place of formation: Postal address:	Google LLC Delaware 1600 Amphitheatre Parkway Mountain View, California 94043 Attn: Legal Department
“Effective Date”	The date of the last signature.
“Term”	Commencing on the Effective Date and continuing until terminated.

1. Definitions

1.1 “Affiliate” means an entity that directly or indirectly Controls, is Controlled by, or is under common Control with a party.

1.2 “Applicable Laws” means all applicable laws, rules, regulations or orders of any jurisdiction, including those relating to data privacy, data transfer, international communications or the export of technical or personal data.

1.3 “Brand Features” means the trade names, trademarks, service marks, logos, domain names, and other distinctive brand features of each party, respectively, as owned (or licensed) by such party from time to time.

1.4 “Control” means control of greater than 50% of the voting rights or equity interests of a party.

1.5 “Customer(s)” means any person or entity who purchases, acquires, or deploys Products from the Store. All references to ‘Customer(s)’ in the Agreement will be deemed to include ‘Resold Customer(s)’, where the context dictates.

1.6 “Customer Charges” means the charges for Customers’ purchase and use of Products from the Store, which may be subscription based or based on metrics determined by Google, for example usage.

1.7 “EULA” means Vendor’s end user license agreement applicable to a Product.

1.8 “Excluded Charges” means the charges (a) that arise through any fraudulent or invalid means (as determined by Google in its reasonable discretion), including the fraudulent use of credit cards or other means of payment; (b) that are subject to chargebacks, reversals, adjustments or rejections, whether by a bank, Customer action or otherwise, including related fees; (c) for Customer’s use of GCP; or (d) for Google’s or its Affiliates’ use of the Products in (i) its operation of the Store, including for developing and testing the Store and addressing and assessing Customer issues; or (ii) in connection with marketing, including, demonstrating Products to prospective customers and use by sales personnel for education regarding the Product.

1.9 “GCP” means the services that comprise the Google Cloud Platform at https://cloud.google.com/cloud/services or such other URL as Google may determine (including any associated APIs).

1.10 “GCP Reseller(s)” means an authorized reseller and/or supplier of GCP, including resellers and/or suppliers purchasing GCP via a Google authorized distributor for onward resale.

1.11 “Google” means the entity specified in the information table above.

1.12 “Google-Provided Data” means information relating to a Customer that Google provides or makes available to Vendor.

1.13 “including” means including but not limited to.

1.14 “Marketplace Data” means, collectively, Google-Provided Data and Vendor-Collected Data.

1.15 “Open Source Material(s)” means any materials that are available under an open source license, including those licenses identified by the Open Source Initiative at https://opensource.org/licenses/alphabetical, that are included or used in any of the Products.

1.16 “Payment Account” means the Vendor-owned payment account approved by Google and set up by Vendor through the Google vendor management system located at the following URL: https://console.cloud.google.com/partner/payments or such other URL as Google may determine.

1.17 “Product(s)” means the Vendor software or services identified by Vendor and approved by Google for listing in the Store (and any related Brand Features).

1.18 “Reseller Agreement” means the written agreement under which Google has appointed GCP Reseller as a reseller and/or supplier of GCP under the Google channel partner program.

1.19 “Resold Customer(s)” means an entity to whom a GCP Reseller is permitted to resell GCP under the Reseller Agreement.

1.20 “Rev Split Base” means the Customer Charges collected by Google minus any Taxes, foreign exchange costs, and Excluded Charges.

1.21 “Revenue Split” means 97% of the Rev Split Base.

1.22 “Store” means “GCP Marketplace”, “Google Cloud Launcher”, “Google Cloud Marketplace”, or other GCP online marketplace operated by Google, which allows the procurement or deployment by customers of software or services.

1.23 “Tax(es)” means all applicable taxes, except for taxes based on either party’s net income, net worth, employment, or assets (including personal and real property).

1.24 “Third Party Material(s)” means any materials not owned solely by Vendor or Google that are included, incorporated or used in any of the Products.

1.25 “UBB Products” has the meaning described in Attachment B.

1.26 “Vendor” means the person or entity specified in the information table above who is registered with and approved by Google for listing of software or services via the Store in accordance with the terms of this Agreement.

1.27 “Vendor Account” means an account issued by Google to Vendor that enables the listing of Products via the Store.

1.28 “Vendor-Collected Data” means any information, content or data that Vendor obtains directly from Customer in connection with providing a Product.

1.29 “Vendor Console” means the console or other online tool that may be provided by Google to Vendor to manage administrative functions related to the Store.

1.30 “Vendor GCP Agreement” means the agreement under which Google or its Affiliate has agreed to provide GCP to Vendor.

2. Provision of Products

2.1 Listing Requirements. Google will display and make Products available for procurement, purchase, deployment, and use (as applicable) by Customers. In order for Products to be available via the Store, Vendor will: (a) accept this Agreement and the Vendor GCP Agreement; (b) have a Vendor Account and Payment Account in good standing; (c) comply with Section 7.5.4 (Third Party Materials and Open Source), and (d) provide complete and accurate information to Google in the Vendor Console (or otherwise requested by Google). Vendor will (i) ensure that all non-container-based Products run or are deployed on, as applicable, GCP infrastructure and (ii) upon Google’s request, verify to Google, through the provision of supporting documentation, that all such Products purchased by Customers run on GCP.

2.2 Merchant of Record. The parties agree that Google is the merchant of record relative to the business contemplated by this Agreement. If Google is not deemed to be the “merchant of record”, “seller of record”, or other equivalent for the sale of any Product in any jurisdiction, then Vendor will be merchant of record for that jurisdiction and Product, and Vendor agrees that Google is assisting Vendor as Vendor’s authorized and disclosed agent and is acting on Vendor’s behalf under this Agreement with Vendor as merchant of record.

2.3 Marketing. The parties will work together on a marketing plan.

3. Payments and Pricing.

3.1 Payment Terms.

3.1.1 Payments. Subject to Section 3.1.2 (Minimum Payment), Google will, on or before the last business day of each calendar month during the Term of this Agreement, pay Vendor the Revenue Split for the previous calendar month. All payments of the Revenue Split will be made directly to the Payment Account. Payments will be transferred by the ACH Network (or by other means determined by Google).

3.1.2 Minimum Payment. Google will not be obligated to make a payment to Vendor under Section 3.1.1 (Payments) if the Revenue Split at the time to be paid is less than $100.00 USD or foreign currency equivalent. Such unpaid Revenue Split will carry over and be included in the Revenue Split for the following calendar month.

3.1.3 Conditions. Upon the termination of this Agreement and any applicable Wind Down Period that follows, Google will pay any remaining Revenue Split to Vendor within 90 days after termination. In no event will Google be obligated to make payments for any balance less than $1.00 USD or foreign currency equivalent. Google is not responsible for any delay, inaccuracy or non-payment caused by incorrect or incomplete information provided by Vendor or a bank, or for failure of a bank to credit Vendor’s account for the correct amount.

3.2 Pricing. Google will set the price for Products based on a Google defined billing structure.

3.3 Reports. On a monthly basis during the Term, Google will provide Vendor with reports of Customer Charges in the form generally made available to other Store vendors. Google’s measurement of the usage metrics is final.

3.4 Refunds to Customers. Google may provide Customers a partial or full refund of Customer Charges if the Customer requests the refund and Google determines that the refund should be given. Customer refunds may be exclusive of taxes previously included in Customer Charges.

3.5 Right to Offset Payment. Google may withhold payments for, offset against payments due, or require Vendor to pay to Google within 60 days of receipt of a related invoice from Google for, any amounts that are or were (a) subject to billing disputes for Products, except in cases when Google reasonably determines that the Customer initiating the dispute has an abnormal dispute history, (b) an Excluded Charge under Section 1.8(a) or (b); (c) based on Customer Charges for Products that are not delivered to the Customer, for example due to termination of the Agreement or take down or modification of the Products; (d) refunded in accordance with Section 3.4; or (e) overpaid by Google to Vendor in prior periods whether as a result of miscalculation by Google or Vendor or otherwise.

3.6 Fraud. Vendor will not, and will not authorize or encourage any third party to directly or indirectly purchase or otherwise obtain access to the Store through (a) any automated, deceptive, fraudulent or other invalid means, (b) the use of robots or other automated query tools or computer-generated search requests, or (c) the fraudulent use of software or credit cards. Vendor will cooperate with Google in any investigation of any of the above circumstances, regardless of whether encouraged, authorized, or perpetrated by Vendor or not.

3.7 Taxes. If Vendor is legally obligated to collect transaction Taxes, Vendor will notify Google of this requirement and state each Tax as a separate line item on an invoice to Google. Google will be required to pay transaction Tax only on receipt of a tax invoice that meets all of the relevant tax authority’s requirements (to allow Google to obtain relief from such Tax if available). Google will pay Taxes separately on the Revenue Split, unless Google provides Vendor with a valid tax exemption certificate. If Google is obligated to withhold any Taxes from the Revenue Split, Google will pay the Revenue Split net of the withheld amounts. Google will provide Vendor with sufficient evidence of such Tax payments withheld on behalf of Vendor to allow Vendor to apply for a refund of the withheld Tax if available.

4. Support

4.1 Vendor Support of Customers. Vendor will provide and maintain complete and up to date information in the Vendor Console. Such information, including Vendor contact information, may be made available to Customers and other users of the Store. Customers will be instructed to contact Vendor concerning any defects or performance issues related to Products. Vendor will be solely responsible for, and Google will have no responsibility for handling support and maintenance of Products or any complaints about Products. Vendor’s response to Customer support inquiries should be no less urgent, inclusive or responsive than the response Vendor offers or provides to similarly situated customers outside of the Store. Google may direct Customers to Vendor to complete setup of Products. If Vendor offers direct management of its Products through Vendor’s own systems, Vendor will support such system and make it available to Customers on substantially similar terms and with substantially similar capabilities as it does for customers outside of the Store. Google will support Customer issues related to GCP.

4.2 Product Updates and Patches.

4.2.1 Vendor will update, or will provide Google with updates to, as applicable, Products in the Store within five days of release of those updates to the public (or through any other online marketplace) and within 24 hours if those updates include critical security patches, as determined by Google.

4.2.2 If Google requests a critical security matter be patched, Vendor will respond to Google within 24 hours of such request with either a resolution or a written resolution plan, contact information for person(s) managing the resolution, and the estimated time for delivery of a resolution. Google may choose to hide or prohibit access to any Product until Vendor provides any security patch determined necessary by Google.

4.2.3 Failure to provide the information, support, or updates for Products described in this Section 4.2 (Product Updates and Patches) may result in consequences including less prominent Product exposure or placement in the Store, removal of the Product from the Store, or Google’s termination of this Agreement.

4.3 Redeployments. So long as Customers pay the applicable, required Customer Charges, Customers are allowed unlimited deployments of each deployable Product.

5. Vendor Responsibilities

5.1 Authorized Purpose. Vendor will use the Store only for purposes that are permitted by (a) this Agreement, and (b) any Applicable Law.

5.2 Prohibited Actions. Vendor will not engage in any activity with the Store that interferes with, disrupts, damages, or accesses in an unauthorized manner the devices, servers, networks, or other properties or services of Google; Google’s Affiliates; or any third party, including GCP users, Store users, or any network operator.

5.3 Vendor Responsibility for Products. Vendor is solely responsible for (and Google has no responsibility to Vendor or any third party for) (a) any Products, including their interaction with the Store, Store APIs, or GCP; or (b) the consequences of any Vendor actions (including any loss or damage which Google may suffer) related to the Products, including with respect to Vendor’s use of the Store, Store APIs, or GCP, except to the extent resulting solely from an unforeseeable malfunction (e.g., a bug) of the Store, Store APIs, or GCP. Except as described in this Agreement, Vendor has no responsibility for the Store.

5.4 Vendor Responsibility for Breach. Vendor is solely responsible for (and Google has no responsibility to Vendor or any third party for) any breach by Vendor of its obligations under this Agreement, any applicable third-party contract or terms of service between Vendor and its Customer(s), or any Applicable Law.

5.5 Product Display. Google may use and publish performance measurements for Products, such as uninstall or refund rates. Google may display Products to Customers in a manner determined by Google.

5.6 Product Information. Vendor will be responsible for providing Google with all information and materials necessary to sell and deploy the Products via the Store, including accurate and complete Product information and support information for Customer. Google may immediately hide, prohibit access to, or remove any Products from the Store if Vendor fails to comply with this Section 5.6 (Product Information).

5.7 Restricted Content and Store Use. Google may upon 30 days prior notice impose generally applicable Vendor Use Policies (“VUP”) related to Product content and Vendor’s use of the Store. Google will email Vendor if it imposes any VUP, and the VUP will be binding on Vendor on the date stated in the email notice to Vendor.

5.8 Public Storage. Vendor understands that container based Products may be available from a public location, and as such, a third party who is not a Customer may be able to access, including download, and use such Product. Vendor acknowledges that Google and its Affiliates are not responsible for any access, including download, or use of the Product by such third party.

5.9 Security and Privacy.

5.9.1 Marketplace Data. Vendor will Process (as defined in Attachment D) any Marketplace Data solely in accordance with (a) the applicable EULA, (b) a clear, conspicuous and legally compliant privacy policy and, where applicable, consents from Customer’s end users; and (c) Applicable Laws. Without limiting the foregoing, Vendor may Process (as defined in Attachment D) Marketplace Data as necessary to provide the Product to Customer and for other purposes for which the Customer has provided express authorization. The terms of the EULA and privacy policy will not limit Vendor’s obligations under this Agreement.

5.9.2 Google-Provided Data. Without limiting Section 5.9.1 (Marketplace Data), Vendor will comply with Attachment D (Data Protection Addendum) in its Processing (as defined in Attachment D) of any personal information contained in the Google-Provided Data.

5.9.3 Security. Vendor will use industry-standard technical, administrative and physical security measures to protect the security and privacy of all Marketplace Data.

5.9.4 Security Incidents. Without limiting any breach or incident reporting obligations in Attachment D (Data Processing Addendum), Vendor will immediately notify Google of any Security Incident and provide necessary information and documentation about the Security Incident and Vendor’s compliance with this Section 5.9 (Security and Privacy). Vendor will use all reasonable efforts to assist Google in investigating and remediating the Security Incident and mitigating its effects. Vendor must obtain Google’s approval for any Security Incident notifications to Customers that refer directly or indirectly to Google. As used in this Section 5.9.4, “Security Incident” means an actual or reasonable degree of certainty of unauthorized use, destruction, loss, control, alteration, acquisition, exfiltration, theft, retention, disclosure of, or access to, Marketplace Data for which Vendor is responsible. Security Incidents do not include unsuccessful access attempts or attacks that do not compromise the confidentiality, integrity, or availability of Marketplace Data, including unsuccessful log-in attempts, pings, port scans, denial of service attacks, and other network attacks on firewalls or networked systems.

6. License Grants

6.1 Products.

6.1.1 Grant to Google. Vendor grants to Google a non-exclusive, worldwide, and royalty-free (except for payment of Revenue Split by Google) license to distribute, deploy, reproduce, perform, display, configure, and use the Products in connection with (a) a Customer’s use and deployment of the Product, (b) the operation and marketing of the Store, and (c) the marketing of GCP products and services that interact with the Products.

6.1.2 Limitations. Except for the license rights granted by Vendor in Section 6 (License Grants) Google obtains no right, title or interest from Vendor (or its licensors) under this Agreement to any of the Products.

6.1.3 Customer License. Vendor will grant Customers a non-exclusive, worldwide, royalty-free, license to use the Product. Vendor will provide Google (in a manner and format specified by Google) with theEULA for the Product. If Vendor provides the EULA via a URL link, Vendor will ensure that the link is functional and points to the EULA. In no event will Vendor’s EULA limit Google’s or Customers’ rights under, or described in, this Agreement or any Customer facing terms of service for the Store. Vendor will comply with its obligations in the EULA.

6.1.4 Reseller Grant to Google. Vendor grants to Google a non-exclusive, worldwide, and royalty-free (except for payment of Revenue Split by Google) license to sell the Products to GCP Resellers in connection with GCP Resellers’ resale of the Products to Resold Customers. The license granted herein includes the right to grant a limited, non-exclusive, worldwide, royalty-free sublicense to GCP Resellers to use and display Vendor Brand Features in connection with GCP Resellers’ marketing, distribution and resale of the Products to Resold Customers.

6.2 Brand Features.

6.2.1 Ownership. Google and Vendor each owns all right, title and interest, including all intellectual property rights, in its own Brand Features. Except as expressly provided in this Section 6.2 (Brand Features) neither party grants any right, title or interest in any Brand Features of the other party. Except as expressly stated in Section 6.2.3 (Store Brand Features) nothing in this Agreement gives Vendor a right to use any of Google’s Brand Features. Any use of a party’s Brand Features will inure to the benefit of the party holding intellectual property rights to those Brand Features.

6.2.2 Vendor Brand Features. Vendor grants to Google a limited, non- exclusive, worldwide, royalty-free license to use and display Vendor Brand Features (a) in connection with the marketing, distribution and sale of the Product through the Store and its availability for use on GCP, including by including Vendor’s name or Brand Features in online or in promotional materials for the Store and verbally referencing Vendor as a provider of the Products, or (b) as otherwise necessary to exercise Google’s or its Affiliates’ rights under this Agreement. If a Product is removed from the Store, Google and its Affiliates will stop using the Brand Features associated solely with the discontinued Products, except as necessary to allow Google to effectuate the Wind Down Period.

6.2.3 Store Brand Features. Google grants to Vendor a limited, non-exclusive, worldwide, royalty-free license to use the Store Brand Features for the Term of this Agreement solely for marketing purposes specifically related to the Store with the prior approval of Google and in accordance with Google’s trademark guidelines located at http://www.google.com/permissions/guidelines.html.

7. Vendor Representations & Warranties

7.1 Anti-Bribery. Vendor represents and warrants that it will comply with all applicable commercial and public anti-bribery laws, including the U.S. Foreign Corrupt Practices Act of 1977 and the UK Bribery Act of 2010, which prohibit corrupt offers of anything of value, either directly or indirectly to anyone, including Government Officials, to obtain or keep business or to secure any other improper commercial advantage. “Government Officials” include any government employee; candidate for public office; and employee of government-owned or government-controlled companies, public international organizations, and political parties. Furthermore, Vendor will not make any facilitation payments, which are payments to induce officials to perform routine functions they are otherwise obligated to perform. Vendor will use commercially reasonable and good faith efforts to comply with Google’s due diligence process, including providing requested information.

7.2 Discrimination. Vendor represents and warrants that it is an equal-opportunity employer and does not discriminate on the basis of age, race, creed, color, religion, sex, sexual orientation, gender identity, national origin, disability, marital or veteran status, or any other basis that is prohibited by Applicable Law.

7.3 Equal Employment Opportunities. Because Google is an equal employment opportunity employer and a U.S. federal contractor or subcontractor, Vendor warrants that it will, to the extent applicable, comply with the requirements of 41 CFR 60-1.4(a), 41 CFR 60-300.5(a), and 41 CFR 60-741.5(a), all of which are incorporated into this Agreement by reference. These regulations prohibit discrimination against qualified individuals based on their status as protected veterans or individuals with disabilities, and prohibit discrimination against all individuals based on their race, color, religion, sex, sexual orientation, gender identity or national origin. As applicable, Vendor will also abide by the requirements of Executive Order 13496 (29 CFR Part 471, Appendix A to Subpart A), relating to the notice of employee rights under federal labor laws.

7.4 Employment; Occupational Health and Safety. Vendor represents and warrants that it will comply with all other applicable employment and occupational health and safety laws and regulations.

7.5 Product Representations and Warranties.

7.5.1 Applicable Law. In connection with the Agreement, Vendor represents and warrants that Vendor and the Products comply and will comply with Applicable Laws.

7.5.2 Rights and Infringement. Vendor represents and warrants that Vendor owns or has valid and enforceable licenses to the intellectual property, including patent, trademark, trade secret, copyright and other proprietary rights, in and to the Products to allow their sale and distribution in the Store and use by Customer. Vendor represents and warrants that the Product does not violate any person’s rights, including intellectual property, privacy, and security rights. If Vendor reasonably determines, or becomes aware of any allegation that any Product, its use, sale or distribution, infringes the intellectual property of any individual or entity, Vendor will notify Google immediately.

7.5.3 Viruses. Vendor also represents and warrants that Products do not include any viruses, spyware, Trojan horses, or other malicious code of any kind.

7.5.4 Third Party Materials and Open Source.

a. If Vendor makes use of Third Party Materials or Open Source Materials, Vendor represents and warrants that Vendor has the right to distribute the Third Party Material or Open Source Material. Vendor further represents and warrants that, as of each Product’s listing via the Store, Vendor has provided in writing to Google the names and license information for all Open Source Materials.

b. Vendor will comply with, and will cooperate in any manner necessary (as determined by Google) to assist Google in complying with, any obligations contained in any licenses related to Third Party Material or Open Source Material. Vendor will not include or use any material licensed under AGPL or SSPL. To the extent required by the applicable license and/or for Open Source Material licensed under GPL, LGPL, or MPL, Vendor will include a .zip file within the Product of the full source code and license terms for such Open Source Material and any third party component or library to which such is linked or with which it is distributed.

c. Vendor will notify Google by email to external-opensource-licensing@google.com, with a copy to cloud-partners@google.com, of any Open Source Materials. Vendor will make such notification before or when Vendor submits or identifies potential Products to Google for consideration, and in all cases before Products are made available through the Store. Vendor will not cause to be listed on the Store any software or service that is not a Product. Google retains the right to reject a Product because of Open Source Material or Third Party Material on any grounds.

8. DISCLAIMER OF WARRANTIES

8.1 STORE. VENDOR’S USE OF THE STORE IS AT VENDOR’S SOLE RISK. THE STORE IS PROVIDED “AS IS” AND “AS AVAILABLE” WITHOUT WARRANTY OF ANY KIND.

8.2 MATERIALS. VENDOR’S USE OF ANY MATERIAL DOWNLOADED OR OTHERWISE OBTAINED THROUGH THE STORE IS AT VENDOR’S OWN RISK, AND VENDOR IS SOLELY RESPONSIBLE FOR ANY DAMAGE TO VENDOR’S COMPUTER SYSTEMS, SOFTWARE, NETWORK OR OTHER PROPERTY, OR LOSS OF ANY DATA THAT RESULTS FROM SUCH USE.

8.3 DISCLAIMER. TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, GOOGLE AND ITS AFFILIATES FURTHER DISCLAIM ALL WARRANTIES AND CONDITIONS OF ANY KIND, WHETHER EXPRESS, IMPLIED, STATUTORY OR OTHERWISE, INCLUDING IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE AND NON-INFRINGEMENT.

9. Confidential Information

9.1 “Confidential Information” means information that one party (or an Affiliate) discloses to the other party under this Agreement, and that is marked as confidential or would normally be considered confidential information under the circumstances. It does not include information that was independently developed by the recipient, is or becomes public through no fault of the recipient, or is rightfully known by the recipient without confidentiality obligations. The terms of this Agreement are Confidential Information.

9.2 Duty. The recipient will not disclose the discloser’s Confidential Information, except to employees, Affiliates, contractors, agents, or professional advisors (“Delegates”) who need to know it and who have a legal obligation to keep it confidential. The recipient will use the discloser’s Confidential Information only to exercise rights and fulfill obligations under this Agreement, and will ensure that such people and entities use the discloser’s Confidential Information only to exercise rights and fulfill obligations under this Agreement while using reasonable care to protect the Confidential Information. The recipient will ensure that its Delegates are also subject to the same non-disclosure and use obligations. The recipient may disclose Confidential Information when required by Applicable Law after giving reasonable notice to the discloser, if permitted by Applicable Law.

9.3 Return. Upon termination of this Agreement, and if requested by a party, the other party will use commercially reasonable efforts to return or destroy all Confidential Information of such requesting party.

10. Product Takedowns.

10.1 Removal by Vendor. Vendor may remove any Product from the Store at any time by providing Google with (a) at least 30 days prior notice and (b) a transition or migration plan for Customers. All such removed Products are subject to the obligations in Section 12.5 (Wind Down).

10.2 Removal by Google. While Google is not obligated to monitor the Products or their content, if Google is notified by Vendor, becomes aware, or determines that a Product or Vendor Brand Feature: (a) violates the intellectual property rights or any other rights of Google or any third party; (b) violates any Applicable Law or is subject to an injunction; (c) is pornographic, obscene or otherwise violates Store policies or other terms of service as may be updated by Google from time to time; (d) may create liability for Google; (e) is deemed by Google to have a virus or to be malware, spyware or other malicious code; (f) violates this Agreement (g) is impacting the integrity of Google’s or Customer’s network or servers (e.g., Customers are unable to access the Product or otherwise experience difficulty); (h) is not meeting acceptable standards, including based on performance measurements such as uninstall and/or refund rates, as determined solely by Google; or (i) in the case of UBB Products, is the subject of repeated errors in Metrics calculation or measurement, Google may immediately hide, prohibit access to, or remove the Product from the Store. Google may hide, prohibit access to, or remove any Product from or bar any vendor from the Store at any time.

10.3 Cure. Google will use commercially reasonable efforts to provide 7 days’ notice to Vendor instructing Vendor to cure its failures before Google removes a Product from the Store unless the agreement is terminated or in Google’s opinion the provision of such notice is restricted by Applicable Law or would otherwise harm Google, or such failure is not reasonably capable of cure.

11. Vendor Account Credentials

Vendor is responsible for maintaining the confidentiality of any Vendor Account credentials. Vendor will be solely responsible for all actions related to its credentials, including all Products that are distributed through the Store. Google may limit the number of Vendor Accounts issued to Vendor.

12. Term and Termination

12.1 Term. This Agreement will start on the Effective Date and continue for the Term.

12.2 Termination for Convenience. Either party may terminate this Agreement on 30 days prior notice.

12.3 Termination by Google. Under the following circumstances Google may immediately terminate this Agreement if, in Google’s opinion, the provision of notice under Section 12.2 (Termination for Convenience) is restricted by Applicable Law; would otherwise harm Google, Vendor or Customers; or such circumstance is not reasonably capable of cure:

12.3.1 Vendor has breached any provision of this Agreement or another agreement with Google;

12.3.2 Google is required to do so by Applicable Law;

12.3.3 Vendor has a Product that violates any Applicable Law;

12.3.4 Vendor ceases to have a Vendor Account and Payment Account in good standing; or

12.3.5 Google no longer provides the Store.

12.4 Effects of Termination.

12.4.1 Subject to Section 12.5 (Wind Down) as applicable, upon termination of this Agreement: (a) all Products will be removed from the Store; and (b) Vendor must cease Vendor’s use of any Vendor Account credentials except as needed to fulfill Vendor’s obligations during the Wind Down Period.

12.4.2 Survival. All terms of this Agreement will remain valid and enforceable, as applicable with respect to the removed Product, during any Wind Down Period. The obligations in Sections 3.4 (Refunds to Customers), 3.5 (Right to Offset Payment), 5.9 (Security and Privacy), 8 (Disclaimer of Warranties), 9 (Confidential Information), 12.5 (Wind Down), 13 (Limitations of Liability), 14 (Indemnification) and 16 (General Legal Terms), and any remaining payment obligations under this Agreement will survive any expiration or termination of this Agreement.

12.5 Wind Down.

12.5.1 Except where prohibited by law and unless otherwise requested by Google, when a Product is removed from the Store (due to termination of the Agreement or otherwise), a wind down period will apply as to any such Products that were purchased by Customers prior to the date of removal (“Wind Down Products”), starting from the date the Product was removed and ending on the later of (a) six months after such date and (b) the date that the last Customer subscription term for such Wind Down Product expires or terminates (the “Wind Down Period”). Notwithstanding the preceding sentence, (i) the Wind Down Period will not apply if Google terminates the Agreement pursuant to Section 12.3, (ii) Google may terminate the Wind Down Period if any of the circumstances set forth in Section 12.3 occurs during the Wind Down Period, (iii) Google may terminate an individual Customer’s subscription for a Wind Down Product upon the Customer’s request, and (iv) the parties may mutually agree to terminate the Wind Down Period prior to its expiration. If the Wind Down Period is terminated early pursuant to this Section 12.5.1, Google may provide a full or partial refund to Customers who prepaid fees for the affected Wind Down Products pursuant to Section 3.4.

12.5.2 Subject to Section 12.5.3, during the Wind Down Period, the terms of the Agreement will continue to apply as to all Wind Down Products, including the following: (a) Vendor will continue to allow the procurement and deployment of Wind Down Products via the Store by existing Customers for such Products and will continue to support any such Products, in each case in accordance with the terms of this Agreement; and (b) all licenses granted under this Agreement with respect to any Wind Down Products will continue in full force and effect.

12.5.3 During the Wind Down Period, the listing for the removed Product will be removed from the Store, and users of the Store who have not already acquired the Product may not acquire or deploy the removed Product through the Store.

12.5.4 After the Wind Down Period expires, no user of the Store may acquire or deploy the removed Product through the Store. Google will have no responsibility or liability to Customer or Vendor for any Customer’s use of the Product after the end of the Wind Down Period.

13. LIABILITY

13.1 Definition. “LIABILITY” MEANS ANY LIABILITY, WHETHER UNDER CONTRACT, TORT (INCLUDING NEGLIGENCE), OR OTHERWISE, REGARDLESS OF WHETHER FORESEEABLE OR CONTEMPLATED BY THE PARTIES.

13.2 Limited Liabilities.

13.2.1 TO THE EXTENT PERMITTED BY APPLICABLE LAW AND SUBJECT TO SECTION 13.3 (UNLIMITED LIABILITIES), NEITHER PARTY WILL HAVE ANY LIABILITY ARISING OUT OF OR RELATING TO THIS AGREEMENT FOR ANY

(A) INDIRECT, CONSEQUENTIAL, SPECIAL, INCIDENTAL, OR PUNITIVE DAMAGES; OR

(B) LOST REVENUES, PROFITS, SAVINGS, OR GOODWILL.

13.2.2 EACH PARTY’S TOTAL LIABILITY FOR DAMAGES PER INCIDENT ARISING OUT OF OR RELATING TO THIS AGREEMENT IS LIMITED TO THE GREATER OF $15 THOUSAND OR THE TOTAL CUSTOMER CHARGES FOR THE 12 MONTH PERIOD BEFORE THE INCIDENT GIVING RISE TO LIABILITY.

13.3 Unlimited Liabilities. NOTHING IN THIS AGREEMENT EXCLUDES OR LIMITS EITHER PARTY’S LIABILITY FOR:

(A) DEATH, PERSONAL INJURY, OR TANGIBLE PERSONAL PROPERTY DAMAGE RESULTING FROM ITS NEGLIGENCE OR THE NEGLIGENCE OF ITS EMPLOYEES OR AGENTS;

(B) ITS FRAUD OR FRAUDULENT MISREPRESENTATION;

(C) ITS BREACH OF SECTIONS 5.9 (SECURITY AND PRIVACY), 7.5 (PRODUCT REPRESENTATIONS AND WARRANTIES), OR 9, (CONFIDENTIAL INFORMATION);

(D) ITS OBLIGATIONS UNDER SECTION 14 (INDEMNIFICATION);

(E) ITS INFRINGEMENT OF THE OTHER PARTY’S INTELLECTUAL PROPERTY RIGHTS; OR

(F) MATTERS FOR WHICH LIABILITY CANNOT BE EXCLUDED OR LIMITED UNDER APPLICABLE LAW.

14. Indemnification

14.1 Indemnity. To the maximum extent permitted by Applicable Law, Vendor will defend and indemnify Google, its Affiliates and their respective directors, officers, employees, agents and Customers against any and all losses, liabilities, damages, costs, fees (including legal fees) and expenses relating to any third-party allegation or third-party legal proceeding arising from or related to: (a) the procurement and deployment of Product via the Store, including any claims of violation of Applicable Law or the violation of the privacy or security rights of any Customers or other third parties, but not including anything to the extent arising out of or accruing solely from the Store and its design, (b) Vendor’s use of the Store or any Marketplace Data, (c) any Product infringing any copyright, trademark, trade secret, trade dress, patent or other intellectual property right of any person or defames any person or violates a person’s rights of publicity or privacy, or (d) Vendor’s breach of any Vendor warranty under this Agreement.

14.2 Remedies. If an injunction preventing continued use of Products is threatened or granted, Vendor will do the following at its sole expense: (a) procure the right to continue providing the Products in compliance with this Agreement; (b) modify the Products to make them non-infringing; or (c) remove the affected Product under Section 10.1 (Removal by Vendor).

14.3 Exclusions. The indemnity provided by Vendor under this Agreement does not extend to claims to the extent arising solely from breach by Google of its material obligations hereunder.

15. Modifications to the Agreement

Google may make changes to this Agreement from time to time. Google will provide at least 30 days’ advance notice before the change becomes effective. If Vendor does not agree to the revised Agreement, Vendor should within 30 days of the notice (a) notify Google of its rejection of the modifications in total, (b) terminate this Agreement under Section 12.2 (Termination for Convenience), and (c) stop using the Store. So long as Vendor timely and properly rejects the modifications in total and terminates the Agreement, then the terms of the Agreement before the notified modification will continue to apply, including during any Wind Down Period.

16. General Legal Terms

16.1 Notices. Google will provide notices under the Agreement to the Vendor by sending an email to the Notification Email Address. Vendor will provide notices under the Agreement to Google by sending an email to legal-notices@google.com. Notice will be treated as received when the email is sent. Vendor is responsible for keeping its Notification Email Address current throughout the term.

16.2 Emails. The parties may use emails to satisfy written approval and consent requirements under the Agreement.

16.3 Assignment. Neither party may assign the Agreement without the written consent of the other, except to an Affiliate where (a) the assignee has agreed in writing to be bound by the terms of this Agreement, (b) the assigning party has notified the other party of the assignment, and (c) if the Vendor is the assigning party, the assignee is established in the same country as Vendor. Any other attempt to assign is void.

16.4 Change of Control. If a party experiences a change of Control other than an internal restructuring or reorganization, then (a) that party will give written notice to the other party within 30 days after the change of Control (such notice to include the identity of the acquiring or successor party) and (b) the other party may immediately terminate this Agreement any time within 30 days after it receives that written notice.

16.5 Other User Rights & Subcontracting. Google may use Affiliates, consultants, and other contractors in connection with its performance of obligations and exercise of rights under this Agreement. These Affiliates, consultants, and contractors will be subject to the same obligations as Google. Either party may subcontract any of its obligations under this Agreement, but will remain liable for all subcontracted obligations and its subcontractor’s acts or omissions.

16.6 Force Majeure. Neither party will be liable for failure or delay in performance of its obligations to the extent caused by circumstances beyond its reasonable control, including acts of God, natural disasters, terrorism, riots, or war.

16.7 No Agency. The Agreement does not create any agency, partnership, or joint venture between the parties.

16.8 No Waiver. Neither party will be treated as having waived any rights by not exercising (or delaying the exercise of) any rights under this Agreement.

16.9 No Third-Party Beneficiaries. This Agreement does not confer any benefits on any third party unless it expressly states that it does.

16.10 Counterparts. The parties may execute this Agreement in counterparts, including facsimile, PDF, and other electronic copies, which taken together will constitute one instrument.

16.11 Amendments. Any amendment must be in writing. Except for amendments made under Section 15 (Modifications to the Agreement), any amendment must also be signed by both parties and expressly state that it is amending this Agreement.

16.12 Independent Development. Nothing in the Agreement will be construed to limit or restrict either party from independently developing, providing, or acquiring any materials, services, products, programs, or technology that are similar to the subject of the Agreement, provided that the party does not breach its obligations under the Agreement in doing so.

16.13 Entire Agreement. This Agreement states all terms agreed between the parties relating to its subject matter, and completely replaces any prior agreements between Vendor and Google in relation to the subject matter of the Agreement. If any Products have been listed in the Store before the Effective Date, then, as of the Effective Date, such Products will be governed by this Agreement. In entering into this Agreement, neither party has relied on, and neither party will have any right or remedy based on, any statement, representation or warranty (whether made negligently or innocently), except those expressly stated in this Agreement.

16.14 Severability. If any term (or part of a term) of this Agreement is invalid, illegal or unenforceable, the rest of this Agreement will remain in effect.

16.15 Equitable Relief. Nothing in the Agreement will limit either party’s ability to seek equitable relief.

16.16 EXPORT RESTRICTIONS. PRODUCTS MAY BE SUBJECT TO UNITED STATES EXPORT LAWS AND REGULATIONS. VENDOR WILL COMPLY WITH ALL APPLICABLE EXPORT AND RE-EXPORT LAWS AND REGULATIONS, INCLUDING (a) THE EXPORT ADMINISTRATION REGULATIONS (“EAR”) MAINTAINED BY THE U.S. DEPARTMENT OF COMMERCE, (b) TRADE AND ECONOMIC SANCTIONS MAINTAINED BY THE U.S. TREASURY DEPARTMENT’S OFFICE OF FOREIGN ASSETS CONTROL, AND (c) THE INTERNATIONAL TRAFFIC IN ARMS REGULATIONS (“ITAR”) MAINTAINED BY THE U.S. DEPARTMENT OF STATE. VENDOR WILL PROVIDE GOOGLE WITH ALL ACCURATE INFORMATION NEEDED TO COMPLY WITH ALL APPLICABLE EXPORT CONTROL LAWS RELATED TO THE DISTRIBUTION OF PRODUCTS IN THE STORE.

16.17 Conflicting Languages. If this Agreement is translated into any other language, and there is a discrepancy between the English text and the translated text, the English text will govern.

16.18 Governing Law. All claims arising out of or relating to the Agreement will be governed by California law, excluding that state’s conflict of laws rules, and will be litigated exclusively in the federal or state courts of Santa Clara County, California; the parties consent to personal jurisdiction in those courts.

16.19 Electronic Signatures. The parties consent to electronic signature.

16.20 Headers. Headings and captions used in the Agreement are for reference purposes only and will not have any effect on the interpretation of the Agreement.

Signed by the parties’ authorized representatives on the dates below.

Vendor
By:	/s/ Costantino Lanza
Name:	Costantino Lanza
Title:	Chief Growth Officer
Date:	12-Oct-2022

Google LLC
By:	/s/ Philipp Schindler
Name:	Philipp Schindler
Title:	Authorized Signatory
Date:	12-Oct-2022
MVA v2.7

Attachment A

BYOL RIDER

This BYOL Rider (“Attachment A”) applies to all BYOL Products offered as Products.

1. Order of Precedence. This Attachment A is part of the Agreement. The terms of Attachment A apply to BYOL Products only. For BYOL Products, the terms of this Attachment A prevail over any other, conflicting terms in the remainder of the Agreement.

2. Definitions.

a. “BYOL Products” means a bring-your-own-license Product(s) (also known as BYOL) for which a Customer obtains the right to deploy and enable in the Store using a Product license key that is separately provisioned or purchased outside of the Store.

3. Updated Terms.

a. Vendor will describe all BYOL Products as BYOL in the Store and to Google. Vendor will not make a BYOL Product available through the Store unless Vendor has made a non-BYOL Product available through the Store.

b. All BYOL Products are offered without a charge to Customer through the Store and without any revenue sharing with Google. Google has no obligation to track usage or collect payments from Customers with respect to BYOL Products.

c. For all BYOL Products, the following terms in the Agreement do not apply:

i. All of Section 1.6 (Customer Charges);

ii. All of Section 1.16 (Payment Account), as well as the phrase “and Payment Account” from Sections 2.1(b) and 12.3.4;

iii. All of Section 1.21 (Revenue Split), as well as the phrase “(except for payment of Revenue Split by Google)” from Section 6.1.1;

iv. All of Section 2.2 (Merchant of Record);

v. All of Section 3 (Pricing and Payments), other than Section 3.6 (Fraud); and

vi. The phrase “So long as Customers pay the applicable, required Customer Charges” in the first sentence of Section 4.3 (Redeployments).

d. Any calculations using “Customer Charges” or “Revenue Split” in the remainder of the Agreement will use “$0” as the Customer Charge for purposes of all BYOL Product-related obligations or liabilities.

4. Vendor is responsible for all BYOL Product related activities, including, provisioning a temporary or free trial Product license, requiring a redirection to purchase a BYOL Product license, and all BYOL Product error handling.

5. To offer BYOL Products, Vendor will ensure that all related BYOL functionality is operational for Customers.

6. Vendor specifically acknowledges and agrees for all BYOL Products that Google will not provide Vendor with any Customer information or any analytics.

Attachment B

USAGE BASED BILLING RIDER

This Usage Based Billing Rider (“Attachment B”) applies to all UBB Products offered as Products.

1. Order of Precedence. This Attachment B is part of the Agreement. The terms of Attachment B apply to UBB Products only. For UBB Products, the terms of this Attachment B prevail over any other, conflicting terms in the remainder of the Agreement.

2. Definitions.

a. “Metric Unit(s)” means one or more of the following: (i) for time, seconds, (ii) for data, bytes, (iii) for storage, byte-seconds, or (iv) for count, integers.

b. “Metrics” means the measure of the consumption of a Resource in Metric Unit(s).

c. “Reporting Cycle” means the period of time and frequency for which the Metrics of a UBB Product are reported to Google. The Reporting Cycle must be no less frequent than once per hour.

d. “Resource” means one or more of the following: (i) time, (ii) data, (iii) storage, or (iv) count.

e. “UBB Order” means each individual order for a UBB Product.

f. “UBB Product” means a consumption Product offered by Vendor in the Store and under a usage based pricing model for which a Customer obtains the right from Google to deploy and enable, with such Product’s usage metrics tracked by the Product, Vendor, or Vendor’s agent(s) rather than Google.

3. Usage.

a. Product-Specific Metrics and Reporting Cycle. Prior to Vendor listing a UBB Product in the Store, Google and Vendor will determine which Metric Units and Reporting Cycle to apply to that UBB Product.

b. Reporting. For each Reporting Cycle during the Term plus any applicable Wind Down Period, and for one Reporting Cycle that follows, Vendor will provide to Google accurate and complete Metrics of each UBB Product for the previous Reporting Cycle, broken down by Customer and, if applicable, UBB Order. Vendor will provide Metrics in a format chosen by Google, and using the service control system and protocols established by Google, in each case as Google communicates to Vendor and which may be updated from time to time by Google at its discretion. Vendor acknowledges that reported Metrics will be used by Google for billing Customers, making it critical that Vendor provide Metrics free of errors or omissions.

c. Error Correction.

i. Vendor Discovered. During the Term plus any applicable Wind Down Period, and for 90 days thereafter, Vendor will monitor its Metrics collection, calculation and reporting system and if Vendor discovers any tampering of or errors in such Metrics system, or has reason to believe that a Metric may have been unreported to Google or that a Metric previously reported to Google may have been inaccurate, Vendor will promptly notify Google of this circumstance, including all relevant details, and keep Google fully apprised of Vendor’s findings as to the root cause of the issue, the correction, and any recalculation made necessary as a result of this circumstance. As necessary, Vendor will issue a new report with revised Metrics.

ii. Google or Customer Discovered. If at any time Google or a Customer reasonably believes that a Metric reported to Google by Vendor or to Customer by Google may have been inaccurate, Google will notify Vendor of this circumstance, including all relevant details. Once Google disputes any Metrics, the parties will confer and determine what adjustments, if any, are necessary.

iii. Google’s determination in the case of disputed Metrics is final.

d. Credit. Vendor will not issue credits directly to Customers for use of UBB Products in the Store. Subject to the obligations of Section 3(c) (Error Correction) of this Attachment B, if Vendor believes that any Customers qualify for a usage credit or other credits for overcharges as determined in good faith by Vendor, Vendor will share this with Google so that Google may directly apply any valid credit. Vendor will not modify the Metrics to account for such credit or report Metrics to Google that are negative. The minimum reportable Metric is ZERO.

4. Applicability.

a. Customer Charges. Customer Charges do not include, and no Revenue Split will be due on, any payments due or made for (i) any UBB Product usage which has not been properly and timely reported under Section 3(b) (Reporting) of this Attachment B or (ii) Metrics for which Google has required a correction (e.g., faulty or broken reporting).

Attachment C

INDIRECT LISTINGS RIDER

1. Application; Order of Precedence. This Indirect Listings Rider is part of the Agreement and governs all Indirect Listings and Indirect Products. The terms of Indirect Listings Rider apply to Indirect Listings and Indirect Products only. For Indirect Listings and Indirect Products, the terms of this Indirect Listings Rider prevail over any conflicting terms in the remainder of the Agreement.

2. Definitions.

a. “Indirect Customer” means a customer who purchases or licenses an Indirect Product after being directed to the Vendor’s website or other online property from an Indirect Listing.

b. “Indirect Listing” means a listing for a Product in the Store, which listing directs potential customers for such Products to a website or other online property operated by Vendor where such potential customers can complete the purchase or license of the Product directly from the Vendor.

c. “Indirect Product” means a Product featured in an Indirect Listing.

3. Updated Terms.

a. Procurement from the Vendor. Notwithstanding anything to the contrary in the Agreement, Indirect Customers purchase or license Indirect Products directly from the Vendor, and Google will have no contractual relationship with Indirect Customers with respect to their purchase or license of an Indirect Product.

b. Updated Terms.

i. Clause (a) of Section 14.1 is amended to read as follows: (a) the Product;

c. Inapplicable Terms. The following clauses and sections of the Agreement do not apply to Indirect Listings or Indirect Products: clause (c) of 2.1; 2.2; 3; 4.2; 4.3; 5.5; 6.1; 7.5.4; clause (b) of 10.1; and 12.5.

d. Applicability of Remainder of Agreement. Any terms of the Agreement not referenced in clause (b) or (c) of this Section 3 (Updated Terms) (“Applicable Terms”), will apply to Indirect Listings and Indirect Products. Any references to “Products” or “Customers” in the Applicable Terms will be deemed to mean “Indirect Products” and “Indirect Customers,” respectively, as they apply to this Indirect Listings Rider.

Attachment D

Data Protection Addendum

1) General.

a) Agreement. This Data Protection Addendum (the “DPA”) forms part of the Agreement and incorporates the mandatory terms in the DPA and the Applicable Standard Contractual Clauses (as defined below) to the extent applicable.

b) End Controller. Where Google is not the Google Controller, Google will ensure the Google Controller complies with the representations, warranties, and obligations under the DPA applicable to Google.

c) Order of Precedence. To the extent the DPA conflicts with the Agreement, the DPA will govern.

d) Interpretation. The Agreement’s defined terms apply unless the DPA expressly states otherwise. Capitalized terms used but not defined will have the meanings given to them in the Agreement.

2) Defined Terms. In this DPA:

a) “Alternative Transfer Solution” means a mechanism other than the Applicable Standard Contract Clauses that enables the lawful transfer of Personal Information from the EEA, UK, or Switzerland to a third country in accordance with Applicable Data Protection Law, including as applicable, the Swiss-U.S. or UK-U.S. Privacy Shield self-certification programs approved and operated by the U.S. Department of Commerce (the “Privacy Shield”).

b) “Applicable Data Protection Laws” means privacy, data security, and data protection laws, directives, and regulations in any jurisdiction applicable to the Personal Information Processed for the Services including the GDPR, CCPA, and LGPD.

c) “Applicable Standard Contractual Clauses” means the European Commission’s standard contractual clauses which are standard data protection terms for the transfer of personal data to controllers established in third countries that do not ensure an adequate level of data protection, as described in Article 46 of the EU GDPR including (i) the Controller-Controller SCCs, or (ii) the UK Controller-Controller SCCs, each as defined in this DPA.

d) “Applicable Standards” mean government standards, industry standards, codes of practice, guidance from Regulators, and best practices applicable to the parties’ Processing of Personal Information for the Services, including Alternative Transfer Solutions and the Payment Card Industry Data Security Standards (“PCI DSS”).

e) “CCPA” means, as applicable: (i) the California Consumer Privacy Act of 2018, California Civil Code 1798.100 et seq. (2018); (ii) the California Privacy Rights Act of 2020, and (iii) Applicable Data Protection Laws modeled on either of the foregoing.

f) “Controller-Controller SCCs” means the terms at https://business.safety.google/gdprcontrollerterms/sccs/eu-c2c/.

g) “Data Controller” means the legal entity or party to the Agreement that determines the purposes and means of Processing Personal Information. Data Controller also means “controller” as defined by Applicable Data Protection Laws.

h) “GDPR” means (i) the European Union General Data Protection Regulation (EU) 2016/679 (the “General Data Protection Regulation”) on data protection and privacy for all individuals within the European Union (“EU”) and the European Economic Area (“EEA”); (ii) the General Data Protection Regulation as incorporated into United Kingdom (“UK”) law by the Data Protection Act 2018 and amended by the Data Protection, Privacy and Electronic Communications (Amendments etc.) (EU Exit) Regulations 2019 (“UK GDPR”); and (iii) the Federal Data Protection Act of 19 June 1992 (Switzerland) (each as amended, superseded, or replaced).

i) “Google Controller” means the Google Entity that Processes Personal Information as a Data Controller as specified in Google’s applicable privacy policy at https://policies.google.com/privacy, or as otherwise notified to You.

j) “Google Entity” means Google LLC (formerly known as Google Inc.), Google Ireland Limited, or another affiliate of Google LLC.

k) “includes” or “including” means “including but not limited to”.

l) “individual” or “individuals” mean natural persons who can be readily identified, directly or indirectly, or data subjects as defined by Applicable Data Protection Laws.

m) “LGPD” means Brazilian Law no. 13,709 for the protection of personal data.

n) “Personal Information” means (i) any information about an individual; or (ii) information that is not specifically about an individual but, when combined with other information, may identify an individual. Personal Information includes names, email addresses, postal addresses, telephone numbers, government identification numbers, financial account numbers, payment card information, credit report information, biometric information, online identifiers (including IP addresses and cookie identifiers), network and hardware identifiers, and geolocation information, and any information that constitutes “personal data” or “personal information” within the meaning of Applicable Data Protection Laws.

o) “Process” or “Processing” means to access, handle, create, collect, acquire, receive, record, combine, consult, use, process, alter, store, retain, maintain, retrieve, disclose, or dispose of. Process also includes “processing” within the meaning of Applicable Data Protection Laws.

p) “reasonable” means reasonable and appropriate to (i) the size, scope, and complexity of Your business; (ii) the nature of Personal Information being Processed; and (iii) the need for privacy, confidentiality, and security of Personal Information.

q) “Regulator” or “Regulatory” means an entity with supervisory or regulatory authority over Google under Applicable Data Protection Laws.

r) “Secondary Use” means any Processing of Personal Information for purposes other than as necessary to fulfill Your obligations set forth in the Agreement, including: (i) Processing Personal Information for purposes other than specified in the Services; (ii) Processing Personal Information in combination with any Personal Information that You Process outside of the Services; or (iii) Processing Personal Information in a manner that would constitute a sale, targeted advertising, or cross-context behavioral advertising of Personal Information as defined by Applicable Data Protection Laws.

s) “Services” means any goods, services, operations, or activities for which You Process Personal Information under the Agreement.

t) “Third-Party Provider” means an agent or other entity that You authorize to act on Your behalf in connection with the Services. “Third Party Provider” includes “processor” within the meaning of the Applicable Standard Contractual Clauses.

u) “UK Controller-Controller SCCs” means the terms at https://business.safety.google/gdprcontrollerterms/scc/uk-c2c.

v) “You” or “Your” means the Vendor (including any personnel, contractor, or agent acting on behalf of that party).

3) Representations and Warranties. You represent and warrant to Google that You:

a) are an independent Data Controller with respect to the Personal Information and will not Process the Personal Information as a joint Data Controller with Google; and

b) will determine the purposes and means of Your Processing of Personal Information received from Google as described in the Agreement.

4) Data Protection Obligations. In fulfilling Your obligations under the Agreement, You will comply with Applicable Data Protection Laws, including to the extent applicable:

a) Processing Personal Information only where You maintain a lawful basis of Processing;

b) providing all required notices or obtaining all required consents from individuals before Processing the Personal Information;

c) providing individuals with rights in connection with Personal Information in a timely manner, including the ability of individuals to: (i) access or receive their Personal Information in an agreed upon format; and (ii) correct, amend, or delete Personal Information where it is inaccurate, or has been Processed in violation of Applicable Data Protection Laws;

d) responding to individual requests or a Regulator concerning Your Processing of Personal Information; and

e) maintaining appropriate age verification mechanisms in compliance with Applicable Standards and Applicable Data Protection Laws where You Process Personal Information related to individuals under the age of 18.

5) Additional Obligations.

a) Limitation on Secondary Use. As required by Applicable Data Protection Laws, You will (i) provide explicit notice to individuals in writing of the Secondary Use and maintain a mechanism enabling individuals to opt out of the Secondary Use at any time; (ii) obtain lawful consent from the individuals prior to Processing Personal Information for a Secondary Use; or (iii) not Process Personal Information for a Secondary Use.

b) Safeguards. You will have in place reasonable technical and organizational measures to protect Personal Information against accidental, unauthorized, or unlawful destruction, loss, alteration, disclosure, or access. You will ensure that such measures provide a level of security reasonable to the risk represented by the processing and the nature of the data to be protected including:

i) maintaining reasonable controls to ensure that access to Personal Information will be limited to personnel or Third-Party Providers who have a legitimate need to Process Personal Information under the Agreement;

ii) promptly terminating personnel and Third-Party Provider access to Personal Information when such access is no longer required for performance under the Agreement;

iii) using reasonable and secure data transfer methods to transfer any Personal Information across any network other than an internal company network owned and managed by You;

iv) assuming responsibility for any unauthorized access to Personal Information under Your custody or control (or Third-Party Provider(s)’ custody or control);

v) providing reasonable ongoing privacy and information protection training and supervision for all personnel (including Third-Party Providers) who Process Personal Information; and

vi) maintaining a reasonable incident response program to respond to security incidents, publish a point of contact for security reports on Your website, and monitor security reports.

c) Security Incident Response; Statements. You will promptly inform Google if a security incident requires notice to end users. Except as required by law, You will not make (or permit any Third-Party Provider under Your control to make) any statement concerning the security incident that directly or indirectly references Google unless Google provides its written authorization.

d) Third-Party Providers. You will contractually require each ThirdParty Provider that Processes Personal Information to protect the privacy, confidentiality, and security of Personal Information using all reasonable measures as required by this DPA and Applicable Data Protection Laws. You will regularly assess Your ThirdParty Providers’ compliance with these contractual requirements.

e) Owned or Managed Systems. To the extent You access Google’s owned or managed networks, systems, or devices (including APIs, corporate email accounts, equipment, or facilities) to Process Google’s Personal Information, You will comply with Google’s written instructions.

f) Assessments of Compliance with this DPA. Within 15 days of Google’s written request to assess Your compliance with the DPA, You will, as relevant, provide certification, audit reports, or other reports regarding Your compliance with this DPA and Applicable Standards as defined by the International Organization for Standardization (ISO), International Electrotechnical Commission (IEC), or Statement on Standards for Attestation Engagements (SSAE) and International Standard on Assurance Engagements (ISAE) as published by the American Institute of Certified Public Accountants (AICPA), Payment Card Industry Data Security Standards, and International Auditing and Assurance Standards Board (IAASB), respectively. Examples of acceptable reports include: (1) SOC 1 Type II (based on SSAE 16, 18 or ISAE 3402); (2) SOC 2 Type II (based on SSAE 16, 18 or ISAE 3402); (3) ISO/IEC 27001:2013 certification; and (4) PCI DSS certification.

6) Legal Process. If a court or other government authority legally compels You to disclose Personal Information, then to the extent permitted by law, You will promptly inform Google of the request and reasonably cooperate with its efforts to challenge the disclosure or seek an appropriate protective order.

7) Data Transfers. Each party may transfer Personal Information if it complies with applicable provisions on the transfer of Personal Information required by Applicable Data Protection Laws.

a) To the extent You or a Google Controller transfers Personal Information relating to individuals within the UK, EEA, or Switzerland to Google or You (as applicable) and the receiving party is not: (i) subject to the binding obligations of a valid Alternative Transfer Mechanism, or (ii) located in a jurisdiction that is subject to a valid adequacy decision (as determined by the Applicable Data Protection Laws regarding the individuals about whom the Personal Information is Processed), You and Google expressly agree to the Applicable Standard Contractual Clauses including the warranties and undertakings contained therein as the “data exporter” and “data importer” as applicable to the transfer contemplated by the parties.

b) To the extent Section 7(a) applies: (i) if Google or You transfer Personal Information relating to individuals within the EEA or Switzerland to the other party, You and Google (on its own behalf or on behalf of the Google Controller) agree to the Controller-Controller SCCs; and (ii) if Google or You transfer Personal Information relating to individuals within the UK to the other party, then You and Google (on its own behalf or on behalf of the Google Controller) agree to the UK Controller-Controller SCCs.

c) To the extent You or a Google Controller transfers Personal Information to Google or You (as applicable) in accordance with an Alternative Transfer Solution, the receiving party will: (i) provide at least the same level of protection for the Personal Information as is required by the Agreement and the applicable Alternative Transfer Solution; (ii) promptly notify the disclosing party in writing if the receiving party determines that it can no longer provide at least the same level of protection for the Personal Information as is required by the Agreement and applicable Alternative Transfer Solution; and (iii) upon making such a determination, cease Processing Personal Information until the receiving party is able to continue providing at least the same level of protection as required by the Agreement and the applicable Alternative Transfer Solution.

d) Google LLC has certified under the Privacy Shield on behalf of itself and certain wholly-owned US subsidiaries. Google’s certification and status are available at https://www.commerce.gov/page/eu-us-privacy-shield.

e) Where Google is not the Google Controller, Google will ensure that it is authorized by the Google Controller to (i) enter into the Applicable Standard Contractual Clauses on behalf of the Google Controller, and (ii) exercise all rights and obligations on behalf of the Google Controller, each as if it were the Data Controller.

8) Termination. In addition to the suspension and termination rights in the Agreement, Google may terminate the Agreement if it reasonably determines that (a) You have failed to cure material noncompliance with the DPA within a reasonable time; or (b) it needs to do so to comply with Applicable Data Protection Laws.

9) Survival. This DPA will survive expiration or termination of the Agreement as long as You continue to Process Personal Information.

EX-10.20

Exhibit 10.20

THE SECURITIES REPRESENTED HEREBY AND THE SECURITIES DELIVERABLE UPON EXERCISE HEREOF HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “U.S. SECURITIES ACT”) OR U.S. STATE SECURTIES LAWS. BY PURCHASING OR OTHERWISE HOLDING SUCH SECURITIES, THE HOLDER AGREES FOR THE BENEFIT OF mCLOUD TECHNOLOGIES CORP. (THE “CORPORATION”) THAT THESE SECURITIES MAY BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED, DIRECTLY OR INDIRECTLY, ONLY (A) TO THE CORPORATION; OR (B) OUTSIDE THE UNITED STATES IN COMPLIANCE WITH RULE 904 OF REGULATION S UNDER THE U.S. SECURITIES ACT, IF AVAILABLE, AND IN COMPLIANCE WITH APPLICABLE LOCAL LAWS AND REGULATIONS; OR (C) IN COMPLIANCE WITH THE EXEMPTION FROM THE REGISTRATION REQUIREMENTS UNDER THE U.S. SECURITIES ACT PROVIDED BY (I) RULE 144 OR (II) RULE 144A THEREUNDER, IF AVAILABLE, AND IN EACH CASE IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS; OR (D) IN ANOTHER TRANSACTION THAT DOES NOT REQUIRE REGISTRATION UNDER THE U.S. SECURITIES ACT OR ANY APPLICABLE STATE SECURITIES LAWS; OR (E) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE U.S. SECURITIES ACT, PROVIDED THAT, IN THE CASE OF TRANSFERS PURSUANT TO (C) OR (D) ABOVE, THE HOLDER HAS, PRIOR TO SUCH TRANSFER, FURNISHED TO THE CORPORATION AN OPINION OF COUNSEL OR OTHER EVIDENCE OF EXEMPTION, IN EITHER CASE REASONABLY SATISFACTORY TO THE CORPORATION. DELIVERY OF THIS CERTIFICATE MAY NOT CONSTITUTE “GOOD DELIVERY” IN SETTLEMENT OF TRANSACTIONS ON STOCK EXCHANGES IN CANADA.

THESE SECURITIES AND THE SECURITIES ISSUABLE UPON EXERCISE THEREOF HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “U.S. SECURITIES ACT”), OR THE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES. THESE SECURITIES MAY NOT BE EXERCISED IN THE UNITED STATES OR BY OR FOR THE ACCOUNT OR BENEFIT OF A U.S. PERSON OR A PERSON IN THE UNITED STATES UNLESS THESE SECURITIES AND THE UNDERLYING SECURITIES HAVE BEEN REGISTERED UNDER THE U.S. SECURITIES ACT AND ANY APPLICABLE STATE SECURITIES LAWS OR UNLESS AN EXEMPTION FROM SUCH REGISTRATION REQUIREMENTS IS AVAILABLE. “UNITED STATES” AND “U.S. PERSON” ARE AS DEFINED BY REGULATION S UNDER THE U.S. SECURITIES ACT.

UNLESS PERMITTED UNDER SECURITIES LEGISLATION, THE HOLDER OF THIS SECURITY MUST NOT TRADE THE SECURITY BEFORE FEBRUARY •, 2023.

WARRANTS TO PURCHASE COMMON SHARES OF

mCLOUD TECHNOLOGIES CORP.

(a company existing pursuant to the laws of British Columbia)

Warrant Certificate Number: W-2022-10-01 Representing • Warrants to purchase • Common Shares

THIS IS TO CERTIFY THAT for value received [insert name of registered holder] (the “Warrantholder”) has the right to purchase in respect of each whole warrant (individually a “Warrant” and collectively the “Warrants”) represented by this certificate or by a replacement certificate (in either case this “Warrant Certificate”), one fully paid and non-assessable common share (individually, a “Common Share” and collectively, the “Common Shares” and which terms shall include any shares or other securities to be issued in addition thereto or in substitution or replacement therefor as provided herein) of mCloud Technologies Corp. (the “Corporation”), a corporation existing under the Business Corporations Act (British Columbia), as constituted on the date hereof at a purchase price (the purchase price in effect from time to time being called the “Exercise Price”) of USD$• per Common Share, subject to adjustment as provided herein. Subject to the terms and conditions of this Warrant, this Warrant may be exercised at any time, in whole or in part, up to 5:00 p.m. Vancouver time, on •.

The Corporation agrees that the Common Shares purchased pursuant to the exercise of the Warrants shall be and be deemed to be issued to the Warrantholder as of the close of business on the date on which this Warrant Certificate shall have been surrendered and payment made for such Common Shares as aforesaid.

Nothing contained herein shall confer any right upon the Warrantholder to subscribe for or purchase any Common Shares at any time after the Expiry Time and from and after the Expiry Time the Warrants and all rights under this Warrant Certificate shall be void and of no value.

The above provisions are subject to the following:

1. Exercise: In the event that the Warrantholder desires to exercise the right to purchase Common Shares conferred hereby, the Warrantholder shall (a) complete to the extent possible in the manner indicated and execute a subscription form in the form attached as Schedule A to this Warrant Certificate, (b) surrender this Warrant Certificate to the Corporation in accordance with Section 9 of this Warrant Certificate, and (c) pay the amount payable upon the exercise of such Warrants in respect of the Common Shares subscribed for by bank draft, money order or wire transfer in lawful money of the United States payable to the Corporation or by transmitting same day funds in lawful money of the United States by wire to such account as the Corporation shall direct the Warrantholder. Upon such surrender and payment as aforesaid, the Warrantholder shall be deemed for all purposes to be the holder of record of the number of Common Shares to be so issued and the Warrantholder shall be entitled to delivery of a certificate or certificates representing such Common Shares and the Corporation shall cause such certificate or certificates to be delivered to the Warrantholder at the address specified in the subscription form within three business days after such surrender and payment as aforesaid. No fractional Common Shares will be issuable upon any exercise of the Warrants and the Warrantholder will not be entitled to any cash payment or compensation in lieu of a fractional Common Share.

2. Partial Exercise: The Warrantholder may from time to time subscribe for and purchase any lesser number of Common Shares than the number of Common Shares expressed in this Warrant Certificate. In the event that the Warrantholder subscribes for and purchases any such lesser number of Common Shares prior to the Expiry Time, the Warrantholder shall be entitled to receive a replacement certificate representing the unexercised balance of the Warrants.

3. Not a Shareholder: The holding of the Warrants shall not constitute the Warrantholder as a shareholder of the Corporation nor entitle the Warrantholder to any right or interest in respect thereof except as expressly provided in this Warrant Certificate; provided, however, that upon the issuance of Common Shares upon the exercise of the Warrants in accordance with the terms hereof, the Warrantholder shall be a holder of Common Shares in all respects.

4. Covenants, Representations and Warranties: The Corporation hereby represents and warrants that it is authorized to create and issue the Warrants, which are valid and enforceable against the Corporation, and covenants and agrees that it will cause the Common Shares from time to time subscribed for and purchased in the manner provided in this Warrant Certificate and the certificate or certificates representing such Common Shares to be issued and that, at all times prior to the Expiry Time, it will reserve and there will remain unissued a sufficient number of Common Shares to satisfy the right of purchase provided for in this Warrant Certificate. The Corporation hereby further covenants and agrees that, while any of the Warrants shall be outstanding, the Corporation shall (a) comply in all material respects with the securities legislation applicable to it; and (b) use commercially reasonable efforts to do or cause to be done all things necessary to preserve and maintain its corporate existence. All Common Shares which are issued upon the exercise of the right of purchase provided in this Warrant Certificate, upon payment therefor of the amount at which such Common Shares may be purchased pursuant to the provisions of this Warrant Certificate, shall be deemed to be fully paid and non-assessable shares and free from all taxes, liens and charges with respect to the issue thereof. The Corporation hereby represents and warrants that this Warrant Certificate is a valid and enforceable obligation of the Corporation, enforceable in accordance with the provisions of this Warrant Certificate.

5. Anti-Dilution Protection:

(1) Definitions: For the purposes of this Section 4, unless there is something in the subject matter or context inconsistent therewith, the words and terms defined below shall have the respective meanings specified therefor in this Section 4(1):

(i) “Adjustment Period” means the period commencing on the date of issue of the Warrants and ending at the Expiry Time;

(ii) “Auditors” means such firm of chartered accountants duly appointed as auditors of the Corporation;

(iii) “Current Market Price” of the Common Shares at any date means the weighted average of the trading price per Common Share for such Common Shares for each day there was a closing price for the twenty consecutive Trading Days ending immediately prior to such date on the TSX Venture Exchange or if on such date the Common Shares are not listed on the TSX Venture Exchange, on such stock exchange upon which such Common Shares are listed, or, if such Common Shares are not listed on any stock exchange then on such over-the-counter market as may be selected for such purpose by the directors;

(iv) “Exchange Rate” means the number of Common Shares subject to the right of purchase under each Warrant;

(v) “director” or “director of the Corporation” means a director of the Corporation for the time being and, unless otherwise specified herein, a reference to action “by the directors” means action by the directors of the Corporation as a board or, whenever empowered, action by any committee of the directors of the Corporation; and

(vi) “Trading Day” means, with respect to a stock exchange, a day on which such exchange is open for the transaction of business and with respect to the over-the-counter market means a day on which the TSX Venture Exchange is open for the transaction of business.

(2) Adjustments: The Exercise Price and the number of Common Shares issuable to the Warrantholder pursuant to this Warrant Certificate shall be subject to adjustment from time to time in the events and in the manner provided as follows:

(i) if, at any time during the Adjustment Period, the Corporation shall:

(A) subdivide, re-divide or change its outstanding Common Shares into a greater number of Common Shares;

(B) reduce, combine or consolidate its outstanding Common Shares into a smaller number of Common Shares; or

(C) issue Common Shares or securities exchangeable for, or convertible into, Common Shares to all or substantially all of the holders of Common Shares by way of distribution (other than a distribution of Common Shares upon the exercise of Warrants);

the Exercise Price in effect on the effective date of such subdivision, re-division, change, reduction, combination, consolidation or on the record date of such distribution, as the case may be, shall in the case of the events referred to in Sections 5(2)(i)A or 5(2)(i)C be decreased in proportion to the number of outstanding Common Shares resulting from such subdivision, re-division, change or distribution, or shall, in the case of the events referred to in Section 5(2)(i)B, be increased in proportion to the number of outstanding Common Shares resulting from such reduction, combination or consolidation. Such adjustment shall be made successively whenever any event referred to in this Section 5(2)(i) shall occur. Upon any adjustment of the Exercise Price pursuant to Section 5(2)(i), the Exchange Rate shall be contemporaneously adjusted by multiplying the number of Common Shares theretofore obtainable on the exercise thereof by a fraction of which the numerator shall be the Exercise Price in effect immediately prior to such adjustment and the denominator shall be the Exercise Price resulting from such adjustment;

(ii) if and whenever at any time during the Adjustment Period, the Corporation shall fix a record date for the issuance of rights, options or warrants to all or substantially all the holders of its outstanding Common Shares entitling them, for a period expiring not more than 45 days after such record date, to subscribe for or purchase Common Shares (or securities convertible or exchangeable into Common Shares) at a price per Common Share (or having a conversion or exchange price per Common Share) less than 95% of the Current Market Price on such record date (a “Rights Offering”), the Exercise Price shall be adjusted immediately after such record date so that it shall equal the amount determined by multiplying the Exercise Price in effect on such record date by a fraction, of which the numerator shall be the total number of Common Shares outstanding on such record date plus a number of Common Shares equal to the number arrived at by dividing the aggregate price of the total number of additional Common Shares offered for subscription or purchase (or the aggregate conversion or exchange price of the convertible or exchangeable securities so offered) by such Current Market Price, and of which the denominator shall be the total number of Common Shares outstanding on such record date plus the total number of additional Common Shares offered for subscription or purchase or into which the convertible or exchangeable securities so offered are convertible or exchangeable; any Common Shares owned by or held for the account of the Corporation shall be deemed not to be outstanding for the purpose of any such computation; such adjustment shall be made successively whenever such a record date is fixed; to the extent that no such rights or warrants are exercised prior to the expiration thereof, the Exercise Price shall be readjusted to the Exercise Price which would then be in effect if such record date had not been fixed or, if any such rights or warrants are exercised, to the Exercise Price which would then be in effect based upon the number of Common Shares (or securities convertible or exchangeable into Common Shares) actually issued upon the exercise of such rights or warrants, as the case may be. Upon any adjustment of the Exercise Price pursuant to this Section 5(2)(ii), the Exchange Rate will be adjusted immediately after such record date so that it will equal the rate determined by multiplying the Exchange Rate in effect on such record date by a fraction, of which the numerator shall be the Exercise Price in effect immediately prior to such adjustment and the denominator shall be the Exercise Price resulting from such adjustment. Such adjustment will be made successively whenever such a record date is fixed, provided that if two or more such record dates or record dates referred to in this Section 5(2)(ii) are fixed within a period of 25 Trading Days, such adjustment will be made successively as if each of such record dates occurred on the earliest of such record dates;

(iii) if and whenever at any time during the Adjustment Period the Corporation shall fix a record date for the making of a distribution to all or substantially all the holders of its outstanding Common Shares of (i) securities of any class, whether of the Corporation or of any other entity (other than Common Shares), (ii) rights, options or warrants to subscribe for or purchase Common Shares (or other securities convertible into or exchangeable for Common Shares), other than pursuant to a Rights Offering; (iii) evidences of its indebtedness or (iv) any property or other assets then, in each such case, the Exercise Price shall be adjusted immediately after such record date so that it shall equal the price determined by multiplying the Exercise Price in effect on such record date by a fraction, of which the numerator shall be the total number of Common Shares outstanding on such record date multiplied by the Current Market Price on such record date, less the excess, if any, of the fair market value on such record date, as determined by the Corporation (whose determination shall be conclusive), of such securities or other assets so issued or distributed over the fair market value of any consideration received therefor by the Corporation from the holders of the Common Shares, and of which the denominator shall be the total number of Common Shares outstanding on such record date multiplied by such Current Market Price; and Common Shares owned by or held for the account of the Corporation shall be deemed not to be outstanding for the purpose of any such computation; such adjustment shall be made successively whenever such a record date is fixed; to the extent that such distribution is not so made, the Exercise Price shall be readjusted to the Exercise Price which would then be in effect if such record date had not been fixed. Upon any adjustment of the Exercise Price pursuant to this Section 5(2)(iii), the Exchange Rate will be adjusted immediately after such record date so that it will equal the rate determined by multiplying the Exchange Rate in effect on such record date by a fraction, of which the numerator shall be the Exercise Price in effect immediately prior to such adjustment and the denominator shall be the Exercise Price resulting from such adjustment;

(iv) if and whenever at any time during the Adjustment Period, there is a reclassification of the Common Shares or a capital reorganization of the Corporation other than as described in Section 5(2)(i) or a consolidation, amalgamation, arrangement or merger of the Corporation with or into any other body corporate, trust, partnership or other entity, or a sale or conveyance of the property and assets of the Corporation as an entirety or substantially as an entirety to any other body corporate, trust, partnership or other entity, any Warrantholder who has not exercised its right of acquisition prior to the effective date of such reclassification, capital reorganization, consolidation, amalgamation, arrangement or merger, sale or conveyance, upon the exercise of such right thereafter, shall be entitled to receive upon payment of the Exercise Price and shall accept, in lieu of the number of Common Shares that prior to such effective date the Warrantholder would have been entitled to receive, the number of shares or other securities or property of the Corporation or of the body corporate, trust, partnership or other entity resulting from such merger, amalgamation or consolidation, or to which such sale or conveyance may be made, as the case may be, that such Warrantholder would have been entitled to receive on such reclassification, capital reorganization, consolidation, amalgamation, arrangement or merger, sale or conveyance, if, on the effective date thereof, as the case may be, the Warrantholder had been the registered holder of the number of Common Shares to which prior to such effective date it was entitled to acquire upon the exercise of the Warrants. If determined appropriate by the directors of the Corporation, relying on advice of counsel, to give effect to or to evidence the provisions of this Section 5(2)(iv), the Corporation, its successor, or such purchasing body corporate, partnership, trust or other entity, as the case may be, shall, prior to or contemporaneously with any such reclassification, capital reorganization, consolidation, amalgamation, arrangement, merger, sale or conveyance, enter into a certificate which shall provide, to the extent possible, for the application of the provisions set forth in this Warrant Certificate with respect to the rights and interests thereafter of the Warrantholder to the end that the provisions set forth in this Warrant Certificate shall thereafter correspondingly be made applicable, as nearly as may reasonably be, with respect to any shares, other securities or property to which a Warrantholder is entitled on the exercise of its acquisition rights thereafter. Any certificate entered into between the Corporation, any successor to the Corporation or such purchasing body corporate, partnership, trust or other entity and the Warrantholder shall provide for adjustments which shall be as nearly equivalent as may be practicable to the adjustments provided in this Section 5(2)(iv) and which shall apply to successive reclassifications, capital reorganizations, amalgamations, consolidations, mergers, sales or conveyances;

(v) in any case in which this Section 5(2) shall require that an adjustment shall become effective immediately after a record date for an event referred to herein, the Corporation may defer, until the occurrence of such event, issuing to the Warrantholder of any Warrant exercised after such event the additional Common Shares issuable upon such conversion by reason of the adjustment required by such event before giving effect to such adjustment; provided, however, that the Corporation shall deliver to such Warrantholder an appropriate instrument evidencing such Warrantholder’s right to receive such additional Common Shares upon the occurrence of the event requiring such adjustment and the right to receive any distributions made on such additional Common Shares declared in favour of holders of record of Common Shares on and after the relevant date of exercise or such later date as such Warrantholder would, but for the provisions of this Section 5(2)(v), have become the holder of record of such additional Common Shares pursuant to Section 5(2);

(vi) in any case in which Section 5(2)(i)C, Section 5(2)(ii) or Section 5(2)(iii) require that an adjustment be made to the Exercise Price, no such adjustment shall be made if the Warrantholder receives, subject to the approval of the TSX Venture Exchange if required, the rights or warrants referred to in Section 5(2)(i)C, Section 5(2)(ii) or the shares, rights, options, warrants, evidences of indebtedness or assets referred to in Section 5(2)(iii), as the case may be, in such kind and number as they would have received if they had been holders of Common Shares on the applicable record date or effective date, as the case may be, by virtue of their outstanding Warrant having then been exercised into Common Shares at the Exercise Price in effect on the applicable record date or effective date, as the case may be;

(vii) the adjustments provided for in this Section 5(2) are cumulative, and shall, in the case of adjustments to the Exercise Price be computed to the nearest whole cent and shall apply to successive subdivisions, re-divisions, reductions, combinations, consolidations, distributions, issues or other events resulting in any adjustment under the provisions of this Section 5(2), provided that, notwithstanding any other provision of this Section, no adjustment of the Exercise Price shall be required unless such adjustment would require an increase or decrease of at least 1% in the Exercise Price then in effect; provided, however, that any adjustments which by reason of this Section 5(2)(vii) are not required to be made shall be carried forward and taken into account in any subsequent adjustment; and

(viii) after any adjustment pursuant to this Section 5(2), the term “Common Shares” where used in this Warrant Certificate shall be interpreted to mean securities of any class or classes which, as a result of such adjustment and all prior adjustments pursuant to this Section 5(2), the Warrantholder is entitled to receive upon the exercise of his Warrant, and the number of Common Shares indicated by any exercise made pursuant to a Warrant shall be interpreted to mean the number of Common Shares or other property or securities a Warrantholder is entitled to receive, as a result of such adjustment and all prior adjustments pursuant to this Section 5(2), upon the full exercise of a Warrant.

(3) Entitlement to Common Shares on Exercise of Warrant: All Common Shares or shares of any class or other securities, which a Warrantholder is at the time in question entitled to receive on the exercise of its Warrant, whether or not as a result of adjustments made pursuant to this Section 4, shall, for the purposes of the interpretation of this Warrant Certificate, be deemed to be Common Shares which such Warrantholder is entitled to acquire pursuant to such Warrant.

(4) No Adjustment for Certain Transactions: Notwithstanding anything in this Section 4, no adjustment shall be made in the acquisition rights attached to the Warrants if the issue of Common Shares is being made pursuant to this Warrant Certificate or in connection with (a) any equity incentive plan, share purchase plan or similar plan in force from time to time for directors, officers, employees, consultants or other service providers of the Corporation; (b) the satisfaction of existing convertible instruments outstanding as at the date hereof; or (c) payment of dividends in the ordinary course.

(5) Determination by Auditors: In the event of any question arising with respect to the adjustments provided for in this Section 4 such question shall be conclusively determined by an independent firm of chartered accountants which may be the Auditors, who shall have access to all necessary records of the Corporation, and such determination shall be binding upon the Corporation, the directors of the Corporation, all holders and all other persons interested therein.

(6) Proceedings Prior to any Action Requiring Adjustment: As a condition precedent to the taking of any action which would require an adjustment in any of the acquisition rights pursuant to any of the Warrants, including the number of Common Shares which are to be received upon the exercise thereof, the Corporation shall take any action which may, in the opinion of counsel, be necessary in order that the Corporation has unissued and reserved in its authorized capital and may validly and legally issue as fully paid and non-assessable all the Common Shares which the holders of such Warrants are entitled to receive on the full exercise thereof in accordance with the provisions hereof.

(7) Certificate of Adjustment: The Corporation shall from time to time immediately after the occurrence of any event which requires an adjustment or readjustment as provided in Section 4, deliver a certificate of the Corporation to the Warrantholder specifying the nature of the event requiring the same and the amount of the adjustment or readjustment necessitated thereby and setting forth in reasonable detail the method of calculation and the facts upon which such calculation is based, which certificate shall be supported by a certificate of the Corporation’s Auditors verifying such calculation.

(8) Notice of Special Matters: The Corporation covenants with the Warrantholder that, so long as any Warrant remains outstanding, it will give notice to the Warrantholder of its intention to fix a record date that is prior to the Expiry Time for any matter for which an adjustment may be required pursuant to Section 5(2). Such notice shall specify the particulars of such event and the record date for such event, provided that the Corporation shall only be required to specify in the notice such particulars of the event as shall have been fixed and determined on the date on which the notice is given. The notice shall be given in each case not less than 14 days prior to such applicable record date. If notice has been given and the adjustment is not then determinable, the Corporation shall promptly, after the adjustment is determinable give notice to the Warrantholder of such adjustment computation.

(9) No Action after Notice: The Corporation covenants that it will not close its transfer books or take any other corporate action which might deprive the Warrantholder of the opportunity to exercise its right of acquisition pursuant thereto during the period of 14 days after the giving of the certificate or notices set forth in Section 5(7) and Section 5(8).

(10) Other Adjustments: If the Corporation after the date hereof shall take any action affecting the Common Shares, other than an action described in this Section 4 which, in the opinion of the directors, would have a material adverse effect on the rights of Warrantholder, the Exercise Price or the Exchange Rate, there shall be an adjustment in such manner, if any, and at such time, by action of the directors, acting reasonably and in good faith, as they may reasonably determine to be equitable to the Warrantholder in such circumstances, provided that no such adjustment will be made unless prior approval of any stock exchange on which the Common Shares are listed for trading has been obtained.

(11) Participation by Warrantholder: No adjustments shall be made pursuant to this Section 4 if the Warrantholder is entitled to participate in any event described in this Section 4 on the same terms, mutatis mutandis, as if the Warrantholder had exercised its Warrants prior to, or on the effective date or record date of, such event.

6. Further Assurances: The Corporation hereby covenants and agrees that it will do, execute, acknowledge and deliver, or cause to be done, executed, acknowledged and delivered, all and every such other act, deed and assurance as the Warrantholder shall reasonably require for the better accomplishing and effectuating of the intentions and provisions of this Warrant Certificate.

7. Time of Essence: Time shall be of the essence of this Warrant Certificate.

8. Governing Laws: This Warrant Certificate shall be construed in accordance with the laws of the Province of British Columbia and the federal laws of Canada applicable therein.

9. Notices: All notices or other communications to be given under this Warrant Certificate shall be delivered by hand or by email and, if delivered by hand, shall be deemed to have been given on the delivery date and, if sent by email, on the date of transmission if sent before 5:00 p.m., Vancouver time, on a business day or, if sent after 5:00 p.m., Vancouver time, or such day is not a business day, on the first business day following the date of transmission.

10. Lost Certificate: If this Warrant Certificate or any replacement hereof becomes stolen, lost, mutilated or destroyed, the Corporation shall, on such terms as it may in its discretion impose, acting reasonably, issue and deliver a new certificate, in form identical hereto but with appropriate changes, representing any unexercised portion of the subscription rights represented hereby to replace the certificate so stolen, lost, mutilated or destroyed.

11. Transfer: The Warrants are non-transferable.

12. Successors and Assigns: This Warrant Certificate shall enure to the benefit of the Warrantholder and the successors and permitted assignees thereof and shall be binding upon the Corporation and the successors thereof.

[The remainder of this page is intentionally left blank.]

IN WITNESS WHEREOF the Corporation has caused this Warrant Certificate to be signed by an authorized officer as of the ___ day of _____________, 2022.

mCLOUD TECHNOLOGIES CORP.
By:
	Authorized Signing Officer

SCHEDULE A

TO: MCLOUD TECHNOLOGIES CORP.

SUBSCRIPTION FORM

The undersigned hereby subscribes for _______________ common shares (“Common Shares”) of mCloud Technologies Corp. (the “Corporation”) (or such other number of Common Shares or other securities to which such subscription entitles the undersigned in lieu thereof or in addition thereto pursuant to the provisions of the warrant certificate (the “Warrant Certificate”) dated ________________, 2022 issued by the Corporation) at the purchase price of US$_________ per Common Share (or at such other purchase price as may be in effect under the provisions of the Warrant Certificate) and on and subject to the other terms and conditions specified in the Warrant Certificate and hereunder and encloses herewith a bank draft or money order in lawful money of the United States payable to the Corporation or has transmitted same day funds by wire to such account as the Corporation directed the undersigned in payment of the subscription price.

In connection with the exercise of these Warrants, the undersigned represents, warrants and certifies to the Corporation as follows (check one):

☐ 1. The undersigned (i) is not a U.S. person, (ii) is not exercising the Warrants within the United States or for the account or benefit of a U.S. person or a person in the United States, (iii) is not executing this warrant with the intent to distribute either directly or indirectly any of the Common Shares acquired hereunder in the United States, and (iv) has in all other respects complied with the terms of Regulation S promulgated by the United States Securities and Exchange Commission under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”)); or

☐ 2. The undersigned (a) is the original U.S. purchaser who purchased unsecured debentures directly from the Corporation on ____________, 2022, and who executed and delivered a U.S. accredited investor certificate in the form annexed to the subscription agreement in connection with the purchase of convertible debentures, (b) is exercising the Warrants for its own account or for the account of a disclosed principal, (c) is, and such disclosed principal, if any, is a U.S. “accredited investor” within the meaning of Rule 501(a) of Regulation D under the U.S. Securities Act at the time of exercise of these Warrants, (d) confirms the representations and warranties of the holder in the U.S. accredited investor certificate remain true and correct as of the date of exercise of these Warrants and re-affirms the representations and warranties thereto; or

☐ 3. The undersigned holder is (i) a holder in the United States, (ii) a U.S. Person, (iii) a person exercising for the account or benefit of a U.S. Person, (iv) executing or delivering this exercise form in the United States, or (v) requesting delivery of the underlying Common Shares in the United States, the undersigned holder has delivered to the Corporation and the Corporation’s transfer agent (1) a completed and executed U.S. Purchaser Letter in substantially the form attached to the Warrant Certificate as Schedule C, or (2) an opinion of counsel (which will not be sufficient unless it is in form and substance reasonably satisfactory to the Corporation) or such other evidence reasonably satisfactory to the Corporation to the effect that with respect to the Common Shares to be delivered upon exercise of the Warrants, the issuance of such securities has been registered under the U.S. Securities Act and applicable state securities laws, or an exemption from such registration requirements is available..

The terms “U.S. person” and “United States” are as defined in Regulation S under the U.S. Securities Act.

The undersigned holder understands that unless Box 1 above is checked, the certificate representing the Common Shares issued upon exercise of this Warrant will bear a legend set forth below:

THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “U.S. SECURITIES ACT”) OR U.S. STATE SECURTIES LAWS. BY PURCHASING OR OTHERWISE HOLDING SUCH SECURITIES, THE HOLDER AGREES FOR THE BENEFIT OF mCLOUD TECHNOLOGIES CORP. (THE “CORPORATION”) THAT THESE SECURITIES MAY BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED, DIRECTLY OR INDIRECTLY, ONLY (A) TO CORPORATION; OR (B) OUTSIDE THE UNITED STATES IN COMPLIANCE WITH RULE 904 OF REGULATION S UNDER THE U.S. SECURITIES ACT, IF AVAILABLE, AND IN COMPLIANCE WITH APPLICABLE LOCAL LAWS AND REGULATIONS; OR (C) IN COMPLIANCE WITH THE EXEMPTION FROM THE REGISTRATION REQUIREMENTS UNDER THE U.S. SECURITIES ACT PROVIDED BY (I) RULE 144 OR (II) RULE 144A THEREUNDER, IF AVAILABLE, AND IN EACH CASE IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS; OR (D) IN ANOTHER TRANSACTION THAT DOES NOT REQUIRE REGISTRATION UNDER THE U.S. SECURITIES ACT OR ANY APPLICABLE STATE SECURITIES LAWS; OR (E) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE U.S. SECURITIES ACT, PROVIDED THAT, IN THE CASE OF TRANSFERS PURSUANT TO (C) OR (D) ABOVE, THE HOLDER HAS, PRIOR TO SUCH TRANSFER, FURNISHED TO THE CORPORATION AN OPINION OF COUNSEL OR OTHER EVIDENCE OF EXEMPTION, IN EITHER CASE REASONABLY SATISFACTORY TO THE CORPORATION. DELIVERY OF THIS CERTIFICATE MAY NOT CONSTITUTE “GOOD DELIVERY” IN SETTLEMENT OF TRANSACTIONS ON STOCK EXCHANGES IN CANADA.

In addition, the undersigned holder understands that the certificates representing the Common Shares issued on the exercise of this Warrant may bear the following legend:

UNLESS PERMITTED UNDER SECURITIES LEGISLATION, THE HOLDER OF THIS SECURITY MUST NOT TRADE THE SECURITY BEFORE FEBRUARY •, 2023.

The undersigned hereby directs that the Common Shares subscribed for be registered and delivered as follows:

Name in Full Address Number of Common Shares

DATED this ___ day of _____________, 20____.

EX-10.21

Exhibit 10.21

UNLESS PERMITTED UNDER SECURITIES LEGISLATION, THE HOLDER OF THIS SECURITY MUST NOT TRADE THE SECURITY BEFORE [THE DATE THAT IS FOUR MONTHS PLUS ONE DAY FROM THE CLOSING DATE].

THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “U.S. SECURITIES ACT”), OR ANY STATE SECURITIES LAWS. THE HOLDER HEREOF, BY PURCHASING THESE SECURITIES, AGREES FOR THE BENEFIT OF mCLOUD TECHNOLOGIES CORP. (THE “COMPANY”) THAT THESE SECURITIES MAY BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY (A) TO THE COMPANY, (B) OUTSIDE THE UNITED STATES IN ACCORDANCE WITH RULE 904 OF REGULATION S (“REGULATION S”) UNDER THE U.S. SECURITIES ACT AND IN COMPLIANCE WITH APPLICABLE LOCAL LAWS AND REGULATIONS, (C) WITHIN THE UNITED STATES IN ACCORDANCE WITH (1) RULE 144A UNDER THE U.S. SECURITIES ACT OR (2) RULE 144 UNDER THE U.S. SECURITIES ACT, IF AVAILABLE, AND, IN EACH CASE, IN COMPLIANCE WITH APPLICABLE STATE SECURITIES LAWS, OR (D) IN ANOTHER TRANSACTION THAT DOES NOT REQUIRE REGISTRATION UNDER THE U.S. SECURITIES ACT OR ANY APPLICABLE STATE SECURITIES LAWS, PROVIDED THAT IN THE CASE OF TRANSFERS PURSUANT TO (C)(2) OR (D) ABOVE, A LEGAL OPINION SATISFACTORY TO THE COMPANY MUST FIRST BE PROVIDED TO THE COMPANY’S TRANSFER AGENT.

THESE SECURITIES MAY NOT CONSTITUTE “GOOD DELIVERY” IN SETTLEMENT OF TRANSACTIONS ON CANADIAN STOCK EXCHANGES. IF THE COMPANY IS A “FOREIGN ISSUER” WITHIN THE MEANING OF REGULATION S AT THE TIME OF TRANSFER PURSUANT TO RULE 904 OF REGULATION S, A NEW CERTIFICATE, BEARING NO LEGEND, MAY BE OBTAINED FROM THE COMPANY’S TRANSFER AGENT UPON DELIVERY OF THIS CERTIFICATE AND A DULY EXECUTED DECLARATION, IN A FORM SATISFACTORY TO THE COMPANY’S TRANSFER AGENT AND THE COMPANY AND, IF SO REQUIRED BY THE COMPANY’S TRANSFER AGENT, AN OPINION OF COUNSEL TO THE EFFECT THAT THE SALE OF THE SECURITIES REPRESENTED HEREBY IS BEING MADE IN COMPLIANCE WITH RULE 904 OF REGULATION S UNDER THE U.S. SECURITIES ACT.

mCLOUD TECHNOLOGIES CORP.

15% UNSECURED DEBENTURE DUE •

DEBENTURE CERTIFICATE NUMBER: CD-2022-• PRINCIPAL AMOUNT: USD$[•]

mCLOUD TECHNOLOGIES CORP., a corporation incorporated under the laws of British Columbia (the “Company”), for value received, hereby acknowledges itself indebted and promises to pay to or to the order of [•] (the “Holder”), the principal amount of $[•] (the “Principal Amount”) in lawful money of the United States of America in the manner hereinafter provided at the address of the Holder on record with the Company, or at such other place or places as the Holder may designate by notice in writing to the Company, on •, or such earlier date as the Principal Amount may become due and payable (the “Maturity Date”), and to pay interest to the Holder on the Principal Amount outstanding from time to time owing hereunder to the date of payment as hereinafter provided, both before and after maturity or demand, default and judgment.

The Principal Amount owing, together with all accrued and unpaid interest owing thereon and all other amounts now or hereafter payable hereunder (collectively, the “Obligations”), shall be due and payable on the Maturity Date in accordance with the terms hereof. This Debenture is issued subject to the terms and conditions attached hereto as Schedule A.

(See terms and conditions attached hereto)

IN WITNESS WHEREOF, the Company has caused this Debenture to be executed by a duly authorized officer of the Company.

DATED for reference this _____ day of ________________, 2022.

mCLOUD TECHNOLOGIES CORP.
Per:
	Authorized Signatory

Schedule A – Terms and Conditions for 15% Unsecured Debenture

ARTICLE 1 – INTERPRETATION

Section 1.1 Definitions

In this Debenture, the following terms shall have the following meanings:

(1) “Blockage Event” means the giving of written notice by the Company or any holder of Senior Indebtedness to the Holder specifying: (a) the occurrence of a default or event of default under any of the terms of any agreement relating to, or instrument evidencing, any Senior Indebtedness; or (ii) the payment proposed to be made with respect to any amount owing under this Debenture which, if made, would give rise to the occurrence of any default or event of default under any of the terms of any agreement relating to, or instrument evidencing, any Senior Indebtedness;

(2) “Business Day” means a day other than a Saturday, Sunday or other day on which commercial banks in Vancouver, British Columbia are authorized by law to close;

(3) “Canadian Securities Laws” means the Securities Act (Ontario) and the securities laws of any other province or territory of Canada, if applicable, and the rules, regulations and policies of any Canadian securities regulatory authority administering such securities laws, as the same shall be in effect from time to time;

(4) “Change of Control” means:

(a) any transaction (whether by purchase, merger or otherwise) whereby a Person or Persons acting jointly or in concert directly or indirectly acquires the right to cast, at a general meeting of shareholders of the Company, more than 50% of the votes attached to the Common Shares that may be ordinarily cast at such meeting;

(b) the Company’s arrangement, amalgamation, consolidation or merger with or into any other Person, any merger of another Person into the Company, unless the holders of voting securities of the Company immediately prior to such arrangement, amalgamation, consolidation or merger hold securities representing 50% or more of the voting control or direction in the Company or the successor entity upon completion of the arrangement, amalgamation, consolidation or merger; or

(c) any conveyance, transfer, sale lease or other disposition of all or substantially all of the Company’s and the Company’s subsidiaries’ assets and properties, taken as a whole, to a Person acting at arm’s length to the Company;

(5) “Closing Date” means •, 2022;

(6) “Common Shares” means the common shares in the capital of the Company, or the common shares of the continuing corporation or other resulting issuer formed as a result of a Merger;

(7) “Debentures” means this 15% unsecured debenture and any other 2022 15% Debenture;

(8) “Interest Payment Date” means the last day of March, June, September and December in each year commencing on December 31, 2022, as well as the Maturity Date;

(9) “Majority Holders” means, at any time, the holders of more than 50% of the principal amount of all 2022 15% Debentures which are then outstanding;

(10) “Merger” means any transaction (whether by way of arrangement, amalgamation, merger, transfer, sale or lease) whereby all or substantially all of the Company’s assets would become the property of any other Person, or, in the case of any such arrangement, amalgamation or merger, of the continuing corporation or other entity resulting therefrom;

(11) “Offering” means the offering of 2022 15% Debentures to be issued by the Company;

(12) “Person” means an individual, partnership, corporation, limited liability company, association, trust, unincorporated organization, or a government or agency or political subdivision thereof; and

(13) “Senior Indebtedness” means, unless expressly subordinated to or made on a parity with the amounts due under this Debenture and each other 2022 15% Debenture, all amounts due in connection with: (a) indebtedness of the Company or any subsidiary thereof to banks or other lending institutions regularly engaged in the business of lending money; and (b) any such indebtedness or any debentures, notes or other evidence of indebtedness issued in exchange for such Senior Indebtedness, or any indebtedness arising from the satisfaction of such Senior Indebtedness by a guarantor.

Section 1.2 Headings

The inclusion of headings in this Debenture is for convenience of reference only and shall not affect the construction or interpretation hereof.

Section 1.3 Currency and bank information

Unless otherwise indicated, all amounts in this Debenture are stated, and shall be paid, in currency of the United States of America.

Wires to be sent to:

Bank name: HSBC BANK CANADA

Beneficiary Name: mCloud Technologies Corp.

Beneficiary Address: #550—510 Burrard Street, Vancouver, BC V6C 3A8

Account number: 270-679626-070

Swift code: HKBCCATT

2

Section 1.4 Number, Gender and Persons

Unless the context otherwise requires, words importing the singular in number only shall include the plural and vice versa, words importing the use of gender shall include the masculine, feminine and neuter genders and words importing Persons shall include individuals, corporations, partnerships, associations, trusts, unincorporated organizations, governmental bodies and other legal or business entities.

Section 1.5 Severability

If any provision of this Debenture is determined by a court of competent jurisdiction to be invalid, illegal or unenforceable in any respect, such determination shall not impair or affect the validity, legality or enforceability of the remaining provisions hereof, and each such provision shall be interpreted in such a manner as to render them valid, legal and enforceable to the greatest extent permitted by applicable law. Each provision of this Debenture is declared to be separate, severable and distinct.

Section 1.6 Entire Agreement

This Debenture, including any schedules attached hereto, constitutes the entire agreement between the Company and the Holder relating to the subject matter hereof, and supersedes all prior agreements, representations, warranties, statements, promises, information, arrangements, understandings, conditions or collateral agreements, whether oral or written, express or implied, with respect to the subject matter hereof.

Section 1.7 2022 15% Debentures

This Debenture is one of a series of duly authorized and validly issued unsecured debentures of the Company, ranking pari passu with each other and differing only as to principal amount, issued by the Company under the Offering (collectively, the “2022 15% Debentures”).

ARTICLE 2 – PAYMENT OF PRINCIPAL AND INTEREST

Section 2.1 Repayment of Principal

Subject to the terms and conditions hereof, the Principal Amount outstanding under this Debenture, together with any accrued and unpaid interest owing thereon, shall be repaid by the Company to the Holder on the Maturity Date.

Section 2.2 Interest Payable

Interest on the Principal Amount outstanding under this Debenture shall be at the simple rate of 15% per annum, calculated and payable quarterly, not in advance, on the last day of March, June, September and December in each year, accrued from and including the Closing Date, and shall be first payable on December 31, 2022. The December 31, 2023 interest payment will represent accrued interest from the Closing Date to December 31, 2023. For greater certainty, such interest shall be payable before, during or after the occurrence of an Event of Default.

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Section 2.3 Method of Paying of Interest

The Company shall satisfy its obligation to pay interest on the Debenture in cash on each applicable Interest Payment Date. For greater certainty, if the Principal Amount is repaid in full within 180 days following the Closing Date (such date being an “Early Repayment Date”), the Company will, contemporaneously with the payment of the Principal Amount, pay to the Holder such amount as would result in the aggregate interest paid to the Holder under this Debenture (inclusive of all interest paid up to the Early Repayment Date) being equal to 6 months of interest on the Principal Amount.

Section 2.4 Rank

(1) The 2022 15% Debentures will constitute direct unsecured obligations of the Company. Each 2022 15% Debenture will rank pari passu with each other 2022 15% Debenture in right of payment of principal and interest (regardless of their actual date or terms of issue). Notwithstanding anything in this Debenture to the contrary, the indebtedness evidenced by this Debenture and each other 2022 15% Debenture is subordinated in right of payment to the prior payment in full of any Senior Indebtedness in existence on the Closing Date or hereafter incurred.

(2) While this Debenture remains issued and outstanding, the Holder shall at the request of the Company, in respect of the Obligations, enter into a postponement and subordination agreement with any lender to the Company in connection with the incurrence by the Company of any Senior Indebtedness, provided such postponement and subordination agreement is on customary terms and conditions.

(3) Except as set forth in Section 2.4(4), until all Senior Indebtedness has been indefeasibly paid in full in cash and all financing arrangements between the Company and any holder of Senior Indebtedness have been terminated, the Holder (whether individually or through any action by the Majority Holders) will not accelerate, ask, demand, sue for, participate with others in any suit, action or proceeding against the Company for, take or receive from the Company, by set-off or in any other manner, the whole or any part of the Obligations, including, without limitation, the taking or foreclosure upon or selling of any negotiable instruments evidencing such amounts, or any security for any of the Obligations.

(4) Notwithstanding Section 2.4(3), until the occurrence of a Blockage Event the Company shall pay to the Holder all payments owing under this Debenture as and when such amounts become due and owing.

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ARTICLE 3. – REDEMPTION OR PURCHASE OF DEBENTURE

Section 3.1 Redemption on Change of Control

The Company shall notify the Holder of a pending Change of Control or Merger in accordance with Section 3.2, and the Holder shall, in its sole discretion, have the right to require the Company to either: (a) purchase this Debenture at 100% of the then outstanding Principal Amount thereof plus all accrued but unpaid interest thereon to and including the Maturity Date; or (b) if the Change of Control results in a new issuer, convert the Debenture into a replacement debenture of the new issuer in the aggregate principal amount of 101% of the Principal Amount of the Debenture then outstanding on substantially equivalent terms to the terms contained in this Debenture.

Section 3.2 Notice of Change of Control

Upon the occurrence of an event constituting or reasonably likely to constitute a Change of Control or Merger, the Company shall give written notice to the Holder of such Change of Control or Merger at least 30 days, or as soon as reasonably possible, prior to the effective date of any such Change of Control or Merger and another written notice on or immediately after the effective date of such Change of Control or Merger.

Section 3.3 Purchases for Cancellation

The Company will have the right at any time and from time to time to purchase the Debentures in the market, by tender, or by private contract.

ARTICLE 4 – RIGHTS OF HOLDER

Section 4.1 Distribution on Dissolution, Etc.

Subject to applicable law and the rights of any holders of any Senior Indebtedness ranking rateably or in priority to the Holder, upon any sale, in one transaction or a series of transactions, of all, or substantially all, of the assets of the Company or distribution of the assets of the Company upon any dissolution or winding-up or total liquidation of the Company, whether in bankruptcy, liquidation, re-organization, insolvency, receivership or other similar proceedings or upon an assignment to or for the benefit of creditors of the Company or otherwise any payment or distribution of assets of the Company, whether in cash, property or security, shall be paid or delivered by the trustee in bankruptcy, receiver, assignee of or for the benefit of creditors or other liquidating agent of the Company making such payment or distribution, directly to the holder of this Debenture or its representatives, to the extent necessary, to pay all Obligations pursuant to this Debenture in full.

Section 4.2 Certificate Regarding Creditors

Upon any payment or distribution of assets of the Company referred to in this Section 4.2, the Holder shall be entitled to rely upon a certificate of the trustee in bankruptcy, receiver, assignee of or for the benefit of creditors or other liquidating agent of the Company making such payment or distribution, delivered to the Holder, for the purpose of ascertaining the Persons entitled to participate in such distribution, and other indebtedness of the Company, the amount thereof or payable thereon, the amount or amounts paid or distributed thereon and all other facts pertinent thereto or to this Section 4.2.

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Section 4.3 Rights of Holder Reserved

Nothing contained in this Article 4 or elsewhere in this Debenture is intended to or shall impair, as between the Company and the Holder, the obligation of the Company, which is absolute and unconditional, to pay to the Holder the Principal Amount and all interest thereon, as and when the same shall become due and payable in accordance with the terms of this Debenture, nor shall anything herein prevent the Holder from exercising all remedies otherwise permitted by applicable law in the event of a default by the Company under this Debenture.

ARTICLE 5 – COVENANTS OF THE COMPANY

Section 5.1 Covenants

The Company covenants and agrees, for as long this Debenture remains outstanding, that:

(1) Maintain Corporate Existence. Each of the Company and its Subsidiaries shall maintain its corporate existence, and preserve its rights, powers, licenses and privileges which are necessary or material to the conduct of its business, and not materially change the nature of its business;

(2) Compliance with Laws. The Company shall, and shall cause each of its Subsidiaries to, comply in all material respects with all applicable laws, rules, governmental restrictions and regulations;

(3) Maintain Books and Records. The Company shall, and shall cause each of its Subsidiaries to, keep adequate and accurate records and books of account;

(4) Payment of Obligations. The Company shall pay the Obligations owing to the Holder hereunder promptly when due; and

(5) Performance of Covenants. The Company shall promptly perform and satisfy all covenants and obligations to be performed by it under this Debenture.

ARTICLE 6 – EVENTS OF DEFAULT

Section 6.1 Events of Default

(1) Any of the following shall constitute an Event of Default under this Debenture (each an “Event of Default”):

(a) if the Company fails to pay when due any portion of the Principal Amount or any interest thereon, or any other amount owing by the Company to the Holder hereunder, and such breach or default continues for a period of 10 Business Days following the date on which such payment became due;

6

(b) if the Company fails to observe, perform or comply with any material term, covenant, condition or obligation of the Company contained herein or is otherwise in default of any of the material provisions contained herein (other than a payment default referred in Section 6.1(1)(a)) and such default, if capable of being remedied, is not remedied within 30 days after the Company receives written notice of such default from the Majority Holders;

(c) if a decree or order of a court having jurisdiction is entered adjudging the Company a bankrupt or insolvent;

(d) if the Company shall apply for, consent to or acquiesce in the appointment of a trustee, receiver, or other custodian for the Company or for a substantial part of the property thereof, or make a general assignment for the benefit of creditors;

(e) if the Company shall in the absence of such application, consent or acquiescence, become subject to the appointment of a trustee, receiver, or other custodian for the Company or for a substantial part of the property thereof, or have a distress, execution, attachment, sequestration or other legal process levied or enforced on or against a substantial part of the property of the Company; or

(f) if the Company shall permit or suffer to exist the commencement of any bankruptcy, reorganization, debt arrangement or other case or proceeding under any bankruptcy or insolvency law, or any dissolution, winding up or liquidation proceeding, in respect of the Company and, if any such case or proceeding is not commenced by the Company, such case or proceeding, if contested by the Company is not dismissed within 30 days.

(2) If an Event of Default described in Section 6.1(1)(e) or Section 6.1(1)(f) shall occur, the entire unpaid Principal Amount and all accrued but unpaid interest thereon shall become immediately due and payable without any declaration or other act on the part of the Holder.

(3) If any other Event of Default shall occur for any reason, whether voluntary or involuntary, and be continuing, the Majority Holders may by notice to the Company declare all or any portion of the outstanding Principal Amount of this Debenture to be due and payable, whereupon the outstanding Principal Amount, and all accrued but unpaid interest thereon, shall become immediately due and payable without further notice, demand or presentment.

ARTICLE 7 – MUTILATION, LOSS, THEFT OR DESTRUCTION OF DEBENTURE CERTIFICATE

In case this Debenture certificate shall become mutilated or be lost, stolen or destroyed, the Company, shall issue and deliver, a new replacement debenture certificate upon surrender and cancellation of the mutilated Debenture certificate or, in the case of a lost, stolen or destroyed Debenture certificate, in lieu of and in substitution for the same. In the case of loss, theft or destruction, the applicant for a substituted debenture certificate shall furnish to the Company such evidence of the loss, theft or destruction of the Debenture certificate as shall be satisfactory to the Company in its discretion and shall also furnish an indemnity and surety bond satisfactory to the Company in its discretion. The applicant shall pay all reasonable expenses incidental to the issuance of any substituted debenture certificate.

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ARTICLE 8 – GENERAL

Section 8.1 Change of Control of Company

By its acceptance hereof, each of the Company and the Holder acknowledges and agrees that if a Change of Control or a Merger occurs, then all references herein to the Company shall extend to and include the entity resulting therefrom or which thereafter will carry on the business of the Company.

Section 8.2 Amendments

Any provision of this Debenture may be amended, waived or modified upon the written consent of the Company and the Majority Holders. Any such amendment, waiver or modification effected in accordance with this paragraph shall be binding upon the Company, the Holder and each other holder of 2022 15% Debentures, it being understood and agreed that such written consent will affect all 2022 15% Debentures and be binding on all holders thereof regardless of whether any particular holder executed such consent.

Section 8.3 Waivers

The Holder shall not, by any act, delay, omission or otherwise, be deemed to have expressly or impliedly waived any of its rights, powers and/or remedies unless such waiver shall be in writing and executed by the Majority Holders. Any such waiver shall be enforceable only to the extent specifically set forth therein. A waiver by the Majority Holders of any right, power and/or remedy contained herein shall be binding upon the Holder and each other holder of 2022 15% Debentures, it being understood and agreed that such waiver will affect all 2022 15% Debentures and be binding on all holders thereof regardless of whether any particular holder executed such waiver.

Section 8.4 Registration of Debentures

The Company shall cause to be kept at the head office of the Company, or at such other location as may be determined by the Company in accordance with applicable law, a register in which shall be entered the name and latest known address of the Holder and any other holder of 2022 15% Debentures. Such register shall at all reasonable times during regular business hours of the Company be open for inspection by the Holder and any other of 2022 15% Debentures. The Company shall not be charged with notice of or be bound to see to the performance of any trust, whether express, implied, or constructive, in respect of this Debenture and may act on the direction of the Holder, whether named as trustee or otherwise, as though the Holder were the beneficial owner of this Debenture.

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Section 8.5 Transfer of Debenture

No transfer of this Debenture shall be valid unless made in accordance with applicable laws, including all applicable Canadian Securities Laws. If the Holder intends to transfer this Debenture or any portion thereof, it shall deliver to the Company the transfer form attached to this Debenture as Schedule B, duly executed by the Holder. Upon compliance with the foregoing conditions and the surrender by the Holder of this Debenture, the Company shall execute and deliver to the applicable transferee a new Debenture registered in the name of the transferee. If less than the full Principal Amount of this Debenture is transferred, the Holder shall be entitled to receive, in the same manner, a new Debenture registered in its name evidencing the portion of the Principal Amount of this Debenture not so transferred. Prior to registration of any transfer of this Debenture, the Holder and the applicable transferee shall be required to provide the Company with necessary information and documents, including certificates and statutory declarations, as may be required to be filed under applicable laws.

Section 8.6 Release and Discharge

If the Company pays all of the Obligations in full to the Holder, the Holder shall release this Debenture and the Company shall be, and shall be deemed to have, discharged of all its obligations under this Debenture.

Section 8.7 Successors and Assigns

This Debenture shall enure to the benefit of the Holder and its successors and assigns, and shall be binding upon the Company and its successors and permitted assigns.

Section 8.8 Time

Time shall be of the essence of this Debenture.

Section 8.9 Governing Law

This Debenture shall be governed by and interpreted in accordance with the laws of the Province of British Columbia and the federal laws of Canada applicable therein. The Company and, by its acceptance hereof, the Holder each hereby irrevocably submit and attorn to the nonexclusive jurisdiction of the courts of the Province of British Columbia in connection with this Debenture.

Section 8.10 Further Assurances

The Company shall forthwith, at its own expense and from time to time, do or file, or cause to be done or filed, all such things and shall execute and deliver all such documents, agreements, opinions, certificates and instruments reasonably requested by the Holder or its counsel as may be necessary or desirable to complete the transactions contemplated by this Debenture and carry out its provisions and intention.

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Schedule B – Form of Transfer

FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers to:

(Name)

(Address)

(the “Transferee”), of $_______________ principal amount of 15% Unsecured Debenture of mCloud Technologies Corp. issued on _____________________, 2022 registered in the name of the undersigned on the register of Debentures represented by the attached Debenture, and irrevocably appoints _________________________ as the attorney of the undersigned to transfer to the Transferee the said principal amount of the Debenture on the books or register of transfer, with full power of substitution.

DATED the ________ day of _____________________, __________.

By:
	Name:
	Title:

Note to Holder: In order to transfer the Debenture, this transfer form must be delivered to mCloud Technologies Corp.

B-1

EX-23.3

Exhibit 23.3

Consent of Independent Registered Public Accounting Firm

The Board of Directors of mCloud Technologies Corp.

We consent to the use of our report dated August 22, 2022, on the consolidated financial statements of mCloud Technologies Corp., which comprise the consolidated statements of financial position as of December 31, 2021 and December 31, 2020, the related consolidated statements of loss and comprehensive loss, changes in equity and cash flows for each of the years in the three-year period ended December 31, 2021, and the related notes, which is included herein and to the reference to our firm under the heading “Experts” in the prospectus included in the registration statement on Amendment No. 8 to Form F-1 dated November 7, 2022 of mCloud Technologies Corp.

/s/ KPMG LLP

Chartered Professional Accountants

November 7, 2022

Calgary, Canada

EX-FILING FEES

Exhibit 107

Calculation of Filing Fee Tables

FORM F-1

(Form Type)

mCloud Technologies Corp.

(Exact Name of Registrant as Specified in its Charter)

Table 1: Newly Registered Securities

CALCULATION OF REGISTRATION FEE

Security Type	Security Class Title	Fee Calculation or Carry Forward Rule	Amount Registered	Proposed Maximum Offering Price Per Unit	Maximum Aggregate Offering Price (1)	Fee Rate	Amount of Registration Fee
Newly Registered Securities
Fees to Be Paid	Equity	Series A Preferred Shares, no par value per share	Rule 457(o)	—	$5,000,000	$0.00011020	$551
Fees Previously Paid	Equity	Series A Preferred Shares, no par value per share	Rule 457(o)	—	$30,000,000	$0.0000927	$2,781
	Equity	Warrants to purchase Common Shares (2)	Rule 457(g)	—	—	—	—
	Equity	Common Shares, no par value per share, underlying the Series A Preferred Shares (3) (4)	Rule 457(i)	—	—	—	—
Fees to Be Paid	Equity	Common Shares, no par value per share, underlying the Warrants (4) (5)	Rule 457(i)	—	$103,550,000	$0.00011020	$11,411.21
Fees Previously Paid	Equity	Common Shares, no par value per share, underlying the Warrants (4) (5)	Rule 457(i)	—	$62,700,000	$0.0000927	$5,812.29
	Total Offering Amount:				$201,250,000		$20,555.5
	Total Fees Previously Paid						$8,593.29
	Total Fee Offsets						—
	Net Fees Due:						$11,962.21

(1) Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(o) under the Securities Act of 1933.

(2) No fee required in accordance with Rule 457(g) under the Securities Act.

(3) No registration fee required pursuant to Rule 457(i) under the Securities Act.

(4) Pursuant to Rule 416, the securities being registered hereunder include such indeterminate number of additional securities as may be issued after the date hereof as a result of stock splits, stock dividends or similar transactions.

(5) Estimated solely for purpose of calculating the registration fee pursuant to Rule 457(i) under the Securities Act. There will be issued 25 Warrants to purchase one Common Share for every one Series A Preferred Share offered. The Warrants are exercisable at a per-share price equal to $4.75.

XML

Cover Page	6 Months Ended
	Jun. 30, 2022
Document Information [Line Items]
Document Type	F-1/A
Amendment Flag	true
Entity Registrant Name	MCLOUD TECHNOLOGIES CORP.
Entity Central Index Key	0001756499
Entity Emerging Growth Company	true
Entity Ex Transition Period	false
Amendment Description	Amendment No. 8 to FORM F-1 REGISTRATION STATEMENT

XML

Consolidated Statements of Financial Position - CAD ($)	Jun. 30, 2022	Dec. 31, 2021	Dec. 31, 2020
Current assets
Cash and cash equivalents	$ 4,405,948	$ 4,588,057	$ 1,110,889
Trade and other receivables	12,134,992	14,566,975	12,312,814
Current portion of prepaid expenses and other assets	2,679,472	2,355,350	1,326,319
Current portion of long-term receivables	390,398	397,060	445,213
Total current assets	19,610,810	21,907,442	15,195,235
Non-current assets
Prepaid expenses and other assets	402,838	622,577	1,011,847
Long-term receivables	318,360	343,371	2,091,059
Right-of-use assets	7,298,424	916,028	3,660,717
Property and equipment	518,185	649,403	506,387
Intangible assets	17,429,695	20,585,833	27,766,839
Goodwill	27,119,177	27,081,795	27,086,727
Total non-current assets	53,086,679	50,199,007	62,123,576
Total assets	72,697,489	72,106,449	77,318,811
Current liabilities
Bank indebtedness	3,679,631	3,460,109	976,779
Trade payables and accrued liabilities	16,343,347	12,421,309	12,924,256
Deferred revenue	4,813,199	2,811,408	1,771,120
Current portion of loans and borrowings	10,399,574	12,447,939	3,431,251
Current portion of convertible debentures	23,457,500	22,185,170	0
Warrant liabilities	3,017,643	8,880,038	710,924
Current portion of lease liabilities	554,895	410,674	835,472
Current portion of other liabilities		0	6,003,838
Current portion of business acquisition payable	1,399,580	1,398,972	1,594,297
Total current liabilities	63,665,369	64,015,619	28,247,937
Non-current liabilities
Convertible debentures	85,091	110,540	19,534,988
Lease liabilities	7,123,723	634,798	3,109,604
Loans and borrowings	19,586,233	767,662	9,721,049
Deferred income tax liabilities	827,672	2,291,057	4,168,905
Other liabilities		0	232,577
Business acquisition payable		0	845,232
Total liabilities	91,288,088	67,819,676	65,860,292
EQUITY (DEFICIT)
Share capital	118,327,722	118,195,363	83,120,611
Contributed surplus	11,547,919	11,040,751	8,518,476
Accumulative other comprehensive income	291,811	1,227,269	1,435,384
Deficit	(146,501,130)	(128,671,898)	(83,909,198)
Total shareholders' equity (deficit)	(16,333,678)	1,791,485	9,165,273
Non-controlling interest	(2,256,921)	2,495,288	2,293,246
Total equity (deficit)	(18,590,599)	4,286,773	11,458,519
Total liabilities and equity	$ 72,697,489	$ 72,106,449	$ 77,318,811

XML

Consolidated Statements of Loss and Comprehensive Loss - CAD ($)	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Profit or loss [abstract]
Revenue	$ 2,269,026	$ 6,556,463	$ 6,698,629	$ 13,992,029	$ 25,596,972	$ 26,928,439	$ 18,340,249
Cost of sales	(1,933,442)	(2,060,784)	(3,865,798)	(5,319,514)	(9,683,748)	(10,281,922)	(7,583,127)
Gross profit	335,584	4,495,679	2,832,831	8,672,515	15,913,224	16,646,517	10,757,122
Expenses
Salaries, wages and benefits	5,059,254	6,333,270	10,373,584	11,203,665	21,691,774	20,885,044	10,313,803
Sales and marketing	1,139,984	328,354	1,902,215	513,053	1,377,255	1,536,420	3,166,788
Research and development	568,334	711,715	1,100,284	1,460,879	3,179,353	1,078,164	498,099
General and administration	2,065,443	1,556,068	4,617,456	2,893,429	8,538,854	5,741,872	3,294,550
Professional and consulting fees	3,560,346	2,490,612	6,736,389	4,230,033	9,085,436	8,886,341	4,351,812
Share-based compensation	191,528	360,645	444,461	735,919	1,867,915	1,454,235	1,468,361
Depreciation and amortization	1,826,415	1,993,021	3,769,628	3,963,971	8,924,812	6,778,100	4,044,143
Total expenses	14,411,304	13,773,685	28,944,017	25,000,949	54,665,399	46,360,176	27,137,556
Operating loss	14,075,720	9,278,006	26,111,186	16,328,434	38,752,175	29,713,659	16,380,434
Other expenses (income)
Finance costs	2,229,993	1,946,586	4,088,630	4,182,513	8,618,794	6,033,510	3,217,500
Foreign exchange loss (gain)	(1,116,052)	164,355	(493,543)	531,783	(267,294)	1,198,372	494,404
Business acquisition costs and other expenses		11,610		336,020	346,420	1,811,682	9,880,170
Impairment							600,657
Fair value (gain) loss on derivatives	(2,538,329)	(1,113,106)	(5,031,599)	451,043	6,040,121
Other income	(264,024)	(1,155,002)	(662,292)	(3,065,308)	(7,126,097)	(2,932,342)	(167,913)
Loss before tax	12,387,308	9,132,449	24,012,382	18,764,485	46,364,119	35,824,881	30,405,252
Current tax expense (recovery)	(184,181)	240,562	104,682	479,359	157,303	(295,709)	181,895
Deferred tax (recovery) expense	(591,418)	(372,600)	(1,482,234)	(491,824)	(1,822,109)	(668,209)	(2,692,313)
Net loss for the year	11,611,709	9,000,411	22,634,830	18,752,020	44,699,313	34,860,963	27,894,834
Other comprehensive (income) loss
Foreign subsidiary translation differences	1,531,158	(523,979)	882,069	(909,326)	69,460	(1,209,006)	(607,302)
Comprehensive loss for the year	13,142,867	8,476,432	23,516,899	17,842,694	44,768,773	33,651,957	27,287,532
Net loss (income) for the year attributable to:
mCloud Technologies Corp. shareholders	8,051,662	8,930,312	17,829,232	19,201,037	44,762,700	36,447,551	28,484,890
Non-controlling interest	3,560,047	70,099	4,805,598	(449,017)	(63,387)	(1,586,588)	(590,056)
Net loss for the year	11,611,709	9,000,411	22,634,830	18,752,020	44,699,313	34,860,963	27,894,834
Comprehensive loss (income) for the year attributable to:
mCloud Technologies Corp. shareholders	9,617,122	8,487,838	18,764,690	18,513,256	44,970,815	35,398,294	28,054,299
Non-controlling interest	3,525,745	(11,406)	4,752,209	(670,562)	(202,042)	(1,746,337)	(766,767)
Comprehensive loss for the year	$ 13,142,867	$ 8,476,432	$ 23,516,899	$ 17,842,694	$ 44,768,773	$ 33,651,957	$ 27,287,532
Loss per share attributable to mCloud shareholders – basic and diluted	$ 0.5	$ 0.88	$ 1.1	$ 1.89	$ 3.76	$ 5.01	$ 6.97
Weighted average number of common shares outstanding - basic and diluted	16,154,794	10,154,320	16,151,197	10,154,320	11,898,183	7,272,464	4,085,322

XML

Consolidated Statements of Changes in Equity - CAD ($)	Total	Share Capital [Member]	Contributed Surplus [Member]	Accumulated Other Comprehensive Income [Member]	Deficit [Member]	Total Shareholder's Equity [Member]	Non- controlling Interest [Member]
Beginning balance at Dec. 31, 2018	$ 2,553,170	$ 19,815,174	$ 1,759,217	$ (44,464)	$ (18,976,757)	$ 2,553,170
Beginning balance (Shares) at Dec. 31, 2018		3,030,021
Share-based payments	1,468,361		1,468,361			1,468,361
RSUs exercised		$ 142,277	(142,277)
RSUs exercised (Shares)		11,905
Stock options exercised	543,249	$ 658,074	(114,825)			543,249
Stock options exercised (Shares)		50,838
Warrants exercised	1,727,202	$ 1,865,773	(138,571)			1,727,202
Warrants exercised (Shares)		133,176
Shares issued for transaction costs - kanepi	8,880,000	$ 8,880,000				8,880,000
Shares issued for transaction costs - kanepi (Shares)		800,000
Shares issued on Debentures conversion, net	3,673,214		3,673,214			3,673,214
Net (loss) income for the year	(27,894,834)				(28,484,890)	(28,484,890)	$ 590,056
Other comprehensive (loss) income for the year	607,302			430,591		430,591	176,711
Shares issued on business combination	13,320,000	$ 13,320,000				13,320,000
Shares issued on business combination (Shares)		1,200,000
Shares issued to extinguish the loan from Flow Capital (Shares)		50,000
Shares issued to extinguish the loan from Flow Capital	606,495	$ 606,495				606,495
Shares Issued to Settle Liabilities Shares		6,964
Shares issued to settle liabilities	84,252	$ 84,252				84,252
Share issuance costs	(3,300)	(3,300)				(3,300)
Warrants issued	61,000		61,000			61,000
Equity component of convertible debentures	3,673,214		3,673,214			3,673,214
Contingent shares issuable to Flow Capital	712,000		712,000			712,000
Non-controlling interest recognized in business combination	(219,858)						(219,858)
Ending balance at Dec. 31, 2019	6,118,253	$ 45,368,745	7,278,119	386,127	(47,461,647)	5,571,344	546,909
Ending balance (Shares) at Dec. 31, 2019		5,282,904
Share-based payments	1,454,235		1,454,235			1,454,235
RSUs exercised	(144,393)	$ 384,613	(529,006)			(144,393)
RSUs exercised (Shares)		35,877
Stock options exercised	70,000	$ 166,400	(96,400)			70,000
Stock options exercised (Shares)		7,639
Warrants exercised	1,495,692	$ 1,923,118	(427,426)			1,495,692
Warrants exercised (Shares)		117,977
Shares issued in business combination - CSA	2,304,073	$ 2,304,073				2,304,073
Shares issued in business combination - CSA (Shares)		126,737
Shares issued in business combination - kanepi	5,882,547	$ 5,882,547				5,882,547
Shares issued in business combination - kanepi (Shares)		867,631
Shares issued in public offering, net of costs	14,526,300	$ 13,854,348	671,952			14,526,300
Shares issued in public offering, net of costs (Shares)		1,415,526
Shares issued for transaction costs - kanepi	149,596	$ 149,596				149,596
Shares issued for transaction costs - kanepi (Shares)		22,064
Shares issued for asset acquisition - AirFusion	820,000	$ 820,000				820,000
Shares issued for asset acquisition - AirFusion (Shares)		66,667
Shares issued on Debentures conversion, net	74,000	$ 50,000	24,000			74,000
Shares issued on Debentures conversion, net (Shares)		3,333
Issue of special warrants, net	12,217,171		12,217,171			12,217,171
Conversion of special warrants		$ 12,217,171	(12,217,171)
Conversion of special warrants (Shares)		1,222,063
Settlement of debt with RSUs	143,002		143,002			143,002
Net (loss) income for the year	(34,860,963)				(36,447,551)	(36,447,551)	1,586,588
Other comprehensive (loss) income for the year	1,209,006			1,049,257		1,049,257	159,749
Equity component of convertible debentures	74,000	$ 50,000	24,000			74,000
Ending balance at Dec. 31, 2020	11,458,519	$ 83,120,611	8,518,476	1,435,384	(83,909,198)	9,165,273	2,293,246
Ending balance (Shares) at Dec. 31, 2020		9,168,416
Share-based payments	735,919		735,919			735,919
RSUs exercised		$ 129,814	(129,814)
RSUs exercised (Shares)		10,773
Broker warrants issued	372,947		372,947			372,947
Shares issued in public offering, net of costs	12,395,918	$ 12,395,918				12,395,918
Shares issued in public offering, net of costs (Shares)		2,300,000
Warrants issued in public offering, net of costs	619,796		619,796			619,796
Net (loss) income for the year	(18,752,020)				(19,201,037)	(19,201,037)	449,017
Other comprehensive (loss) income for the year	909,326			687,781		687,781	221,545
Ending balance at Jun. 30, 2021	7,740,405	$ 95,646,343	10,117,324	2,123,165	(103,110,235)	4,776,597	2,963,808
Ending balance (Shares) at Jun. 30, 2021		11,479,189
Beginning balance at Dec. 31, 2020	11,458,519	$ 83,120,611	8,518,476	1,435,384	(83,909,198)	9,165,273	2,293,246
Beginning balance (Shares) at Dec. 31, 2020		9,168,416
Share-based payments	1,867,915		1,867,915			1,867,915
RSUs exercised	(86,173)	$ 337,104	(423,277)			(86,173)
RSUs exercised (Shares)		71,190
Broker warrants issued	294,894		294,894			294,894
Shares issued in public offering, net of costs	12,395,918	$ 12,395,918				12,395,918
Shares issued in public offering, net of costs (Shares)		2,300,000
Warrants issued in public offering, net of costs	619,796		619,796			619,796
Shares issued in private placement	420,000	$ 420,000				420,000
Shares issued in private placement (Shares)		75,676
Shares issued on Debentures conversion, net	14,436,728	$ 14,436,728				14,436,728
Shares issued on Debentures conversion, net (Shares)		2,107,787
Shares issued in settlement of interest payable	7,485,002	$ 7,485,002				7,485,002
Shares issued in settlement of interest payable (Shares)		2,415,000
Underwriter warrants issued in USD public offering	162,947		162,947			162,947
Net (loss) income for the year	(44,699,313)				(44,762,700)	(44,762,700)	63,387
Other comprehensive (loss) income for the year	(69,460)			(208,115)		(208,115)	138,655
Equity component of convertible debentures	14,436,728	$ 14,436,728				14,436,728
Ending balance at Dec. 31, 2021	4,286,773	$ 118,195,363	11,040,751	1,227,269	(128,671,898)	1,791,485	2,495,288
Ending balance (Shares) at Dec. 31, 2021		16,138,069
Share-based payments	444,461		444,461			444,461
RSUs exercised		$ 132,359	(132,359)
RSUs exercised (Shares)		17,585
Warrants issued in financing	195,066		195,066			195,066
Net (loss) income for the year	(22,634,830)				(17,829,232)	(17,829,232)	(4,805,598)
Other comprehensive (loss) income for the year	(882,069)			(935,458)		(935,458)	53,389
Ending balance at Jun. 30, 2022	$ (18,590,599)	$ 118,327,722	$ 11,547,919	$ 291,811	$ (146,501,130)	$ (16,333,678)	$ (2,256,921)
Ending balance (Shares) at Jun. 30, 2022		16,155,654

XML

Consolidated Statements of Cash Flows - CAD ($)	6 Months Ended		12 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Operating activities
Net loss	$ (22,634,830)	$ (18,752,020)	$ (44,699,313)	$ (34,860,963)	$ (27,894,834)
Items not affecting cash:
Depreciation and amortization	3,769,628	3,963,971	8,924,812	6,778,100	4,044,143
Share-based compensation	444,461	735,919	1,867,915	1,454,235	1,468,361
Finance costs	4,088,630	4,182,513	8,618,794	6,020,636	3,217,500
Fair value (gain) loss on derivatives	(5,031,599)	451,043	6,040,121
Impairment					600,657
Other income	(5,265)	(873,950)	(2,675,671)	(92,535)	(167,913)
Provision for expected credit loss	(64,337)		1,159,742	223,129	432,073
Unrealized foreign currency exchange (gain) loss	65,086	611,061	(534,993)	1,034,501	542,016
Business acquisition costs				149,596	8,880,000
Current tax expense (recovery)	104,682	479,359	157,303	(295,709)	181,895
Deferred income tax recovery	(1,482,234)	(491,824)	(1,822,109)	(668,209)	(2,692,313)
Gain on settlement of lease liability					(99,979)
Increase (decrease) in working capital	6,880,330	(1,647,105)	(1,988,521)	(904,212)	(2,131,240)
Interest paid	(2,284,458)	(1,613,861)	(3,377,851)	(3,535,805)	(1,992,496)
Taxes paid				(158,564)	(376,093)
Net cash used in operating activities	(16,149,906)	(12,954,894)	(28,329,771)	(24,855,800)	(15,988,223)
Investing activities
Acquisition of property and equipment	(35,935)	(337,784)	(625,202)	(127,688)	(138,123)
Acquisition of and expenditure on intangible assets		(436,555)	(438,725)	(809,764)
Acquisition of royalty agreement					(204,604)
Acquisition of assets of AirFusion				(835,302)
Acquisition of business, net of cash acquired				(4,622,400)	(20,389,426)
Net cash used in investing activities	(35,935)	(774,339)	(1,063,927)	(6,395,154)	(20,732,153)
Financing activities
Payment of lease liabilities	(268,359)	(592,372)	(1,095,327)	(814,072)	(422,783)
Repayment of loans	(8,224,068)	(7,009,073)	(9,781,554)	(9,011,638)	(6,787,528)
Proceeds from loans and bank indebtedness, net of transaction costs	25,376,844	8,760,673	13,752,698	8,726,766	16,539,700
Net (repayments) advances of bank indebtedness			(1,004,211)	(495,026)	1,471,805
Repayments of bank indebtedness	(857,816)	(953,584)
Proceeds from issuance of shares, net of issuance costs		12,395,918	20,300,920	14,526,300
Proceeds from issuance of convertible debentures, net of costs			5,424,661	5,285,997	22,865,049
Proceeds from issuance of convertible debentures, net of costs		5,527,298
Advance from subscription of units		420,000
Proceeds from issuance of warrants, net of issuance costs			5,415,864	12,217,171	1,727,202
Proceeds from the exercise of stock options, net of issuance costs				70,000	543,249
Proceeds from exercise of warrants, net		619,796		1,495,692
Income tax withholding on RSUs			(86,173)	(144,393)
Net cash provided by financing activities	16,026,601	19,168,656	32,926,878	31,856,797	35,936,694
Net (decrease) increase in cash and cash equivalents	(159,240)	5,439,423	3,533,180	605,843	(783,682)
Effect of exchange rate fluctuations on cash held	(22,869)	(20,604)	(56,012)	(24,144)	(12,922)
Cash and cash equivalents, beginning of year	4,588,057	1,110,889	1,110,889	529,190	1,325,794
Cash and cash equivalents, end of year	$ 4,405,948	$ 6,529,708	$ 4,588,057	$ 1,110,889	$ 529,190

XML

Nature of Operations

6 Months Ended

12 Months Ended

Jun. 30, 2022

Dec. 31, 2021

Text Block [Abstract]

Nature of Operations

NOTE 1 – NATURE OF OPERATIONS

mCloud Technologies Corp. (“mCloud” or the “Company”), is a provider of proprietary technology solutions, AssetCare. Customers use AssetCare software-as-a-service (“SaaS”) and data solutions to ensure assets continuously operate at peak performance. AssetCare is an asset management platform combining IoT, AI and the cloud to drive next-level performance and efficiency. mCloud offers foundational enterprise technology solutions enabling capabilities such as secure communications, connected work, and remote monitoring.

The Company is domiciled in Vancouver, Canada with its head office in Calgary, Alberta and its registered offices located at 550-510 Burrard Street, Vancouver, British Columbia, V6C 3A8.

The Company’s common shares trade on the TSX.V trading in Canadian dollars under the symbol MCLD, on the Nasdaq Stock Market LLC (“NASDAQ”) in U.S. dollars under the symbol MCLD, and on the OTCQB Venture Market under the symbol MCLDF.

NOTE 1 – NATURE OF OPERATIONS

mCloud Technologies Corp. (“mCloud” or the “Company”), is a provider of proprietary technology solutions, AssetCare. Customers use AssetCare software-as-a-service (“SaaS”) and data solutions to ensure assets continuously operate at peak performance. AssetCare is an asset management platform combining IoT, AI and the cloud to drive next-level performance and efficiency. mCloud offers foundational enterprise technology solutions enabling capabilities such as secure communications, connected work, and remote monitoring.

The Company is domiciled in Vancouver, Canada with its head office in Calgary, Alberta and its registered offices located at 550-510 Burrard Street, Vancouver, British Columbia, V6C 3A8.

The Company met the listing requirements of the Nasdaq Stock Market LLC (“NASDAQ”) and received approval to be listed on November 23, 2021. On November 24, 2021, the Company’s shares began trading on the NASDAQ under the stock symbol MCLD in U.S. dollars (Note 31). The Company’s shares also trade on the TSX.V trading in Canadian dollars under the symbol MCLD and on the OTCQB Venture Market under the symbol MCLDF.

XML

Basis of Accounting

6 Months Ended

12 Months Ended

Jun. 30, 2022

Dec. 31, 2021

Text Block [Abstract]

Basis of Accounting

NOTE 2 – BASIS OF ACCOUNTING

Basis of preparation

These condensed consolidated interim financial statements of the Company include the accounts of the Company, the ultimate parent company of its consolidated group, and its subsidiaries, and are prepared in accordance with International Accounting Standard 34 - Interim Financial Reporting (“IAS 34”) as issued by the International Accounting Standards Board (“IASB”). Certain disclosures included in the annual financial statements prepared in accordance with International Financial Reporting Standards (“IFRSs”) as issued by the IASB have been condensed or omitted as they are not required for interim financial statements. Accordingly, these condensed consolidated interim financial statements should be read in conjunction with the Company’s audited consolidated annual financial statements and notes thereto for the year ended December 31, 2021 (the “2021 Annual Financial Statements”), which are available on SEDAR at www.sedar.com. Selected explanatory notes are included in the interim financial statements to explain events and transactions that are significant to the understanding of changes in the Company’s financial position and performance since the last annual financial statements. The accounting policies applied in the preparation of these condensed consolidated interim financial statements are consistent with those applied in the 2021 Annual Financial Statements.

The Company’s presentation currency is Canadian dollars, and all amounts are presented in Canadian dollars unless otherwise stated. Certain disclosures include the use of U.S. Dollars (“USD” or “US$”) in describing certain financing transactions. These condensed consolidated interim financial statements have been prepared on a going-concern basis, under the historical cost convention except for certain financial instruments that have been measured at fair value. There were no changes in the entities contained in the consolidated results or the equity percentage held by the Company from December 31, 2021.

Total revenues recognized in the consolidated statement of loss and comprehensive loss during the year ended December 31, 2021, have been corrected between the four quarters ended March 31, 2021, June 30, 2021, September 30, 2021 and December 31, 2021. The adjustment to the previously reported amounts for the three and six months ended June 30, 2021, resulted in a decrease to revenue of $945,470 and $1,597,134, respectively, and a corresponding increase to net loss and net loss attributable to mCloud shareholders. During the three and six months ended June 30, 2021, basic and diluted net loss per share increased to a net loss of $0.88 per share from $0.75 per share and $1.89 per share from $1.73 per share, respectively.

The Company has reclassified certain expenses during the six months ended June 30, 2021 in the condensed consolidated interim statements of loss and comprehensive loss. These adjustments impacted previously reported amounts for the six months ended by decreasing cost of sales by $539,776, increasing sales, wages and benefits by $749,688 and decreasing professional and consulting fees by $209,912.

The Company has corrected net income (loss) and other comprehensive income (loss) attributable to mCloud shareholders and non-controlling interest for the years ended December 31, 2019, 2020 and 2021. This resulted in a reclassification between non-controlling interest, accumulated other comprehensive income, and accumulated deficit in the condensed consolidated statements of financial position at December 31, 2020, June 30, 2021 and December 31, 2021. At December 31, 2020, on the condensed consolidated statement of financial position, accumulated other comprehensive income decreased by $234,212, deficit decreased by $1,777,168, and non-controlling interest decreased by $1,542,956. At June 30, 2021, on the condensed consolidated statement of changes in equity, accumulated other comprehensive income decreased by $102,247, and non-controlling interest increased by $102,247. At December 31, 2021, on the condensed consolidated statement of financial position, accumulated other comprehensive income decreased by $344,729, deficit decreased by $1,344,175, and non-controlling interest decreased by $999,446 taking into consideration the cumulative impacts of prior period adjustments.  

In addition, the comparative disclosures as at December 31, 2021 in Note 14, Non-controlling interest, reflect the corrected balances for non-current assets, current liabilities and non-current liabilities of the non-controlling interest arising from the above noted attribution of net income (loss) and other comprehensive income (loss) errors as well as certain other disclosure errors.

These condensed consolidated interim financial statements were authorized for issue by the Audit Committee, on behalf of the Board of Directors, on August 15, 2022.

Going Concern

The outbreak of the COVID-19 pandemic and the measures adopted by governments in countries worldwide to mitigate the pandemic’s spread have impacted the Company. These measures required the Company to restrict deployment of technical services due to the in-person nature of these activities and delayed the start of certain projects throughout 2021 and into 2022. This negatively impacted the Company’s financial performance and liquidity position. While restrictions continue to ease there have been increased cases of COVID-19 and there is still uncertainty over how COVID-19 will impact the Company’s business and the timing of future revenues.

During the six months ended June 30, 2022, the Company generated a net loss of $22,634,830 and negative cash flows from operating activities of $16,149,906. At June 30, 2022, the Company had a working capital deficiency of $44,054,559. Working capital deficiency is a non-IFRS measure which is calculated as current assets less current liabilities. Current liquidity levels and available sources of capital are not adequate to fund the working capital deficiency. The most significant expected cash outflows included in current liabilities at June 30, 2022 include the 2019 Convertible Debentures of $23,652,979 (Note 10); loans and borrowings of $12,721,061 including principal and interest payments; payment of trade and other payables of $16,343,347; and payments associated with leases of approximately $1,408,243.

Based on the Company’s liquidity position at the date of authorization of these condensed consolidated interim financial statements and considering the uncertainty surrounding the impact of the pandemic, management estimates that it will need additional financing to meet its financial obligations. The Company is currently working with stakeholders and others to address the working capital deficiency. In the long-term, the ability of the Company to operate as a going concern is dependent on its ability to achieve and maintain profitable operations and positive cash flow from operations, and, as necessary, to obtain the necessary equity or debt financing to continue with operations. To date, the Company has funded its operations through debt and equity financing. While the Company has been successful in raising capital in the past and anticipates the lenders will not accelerate repayment of loans with covenant breaches as of June 30, 2022, and potential breaches forecasted over the coming year, there is no assurance that it will be successful in closing further financings in the future or obtaining waivers of the covenant breaches.

As a result, these factors are indicators that material uncertainties exist that raises significant doubt about the Company’s ability to continue as a going concern and, therefore, its ability to realize assets and discharge liabilities in the normal course of business.

In making their assessment, management considered all available information, together with forecasts and other mitigating strategies, about the future which is at least, but not limited to, 12 months from the end of the reporting period. Management has considered the following in its assessment that the going concern assumption remains appropriate:

• the plan for the repayment of the 2019 Convertible Debentures;

• the repayment of the term loan in full on or before October 31, 2022 (Note 8);

• the likelihood that undrawn funds under the revolving operating facility will be available and will not be required to be repaid (Note 9);

• the required cash principal and interest payments on indebtedness;

• the likelihood of payments required under contingent consideration arrangements;

• cash inflows from current operations and expected increases in revenues and cash flows resulting from new revenue contracts expected over the next 12 months due to the anticipated reduction of COVID-19 related restrictions; and

• future debt and equity raises.

These condensed consolidated interim financial statements have been prepared on a going concern basis, which contemplates that the Company will continue in operation and be able to realize its assets and discharge its liabilities and commitments in the normal course of business for the foreseeable future. These condensed consolidated interim financial statements do not include any adjustments to the carrying amounts and classifications of assets, liabilities and reported expenses that may otherwise be required if the going concern basis was not appropriate.

NOTE 2 – BASIS OF ACCOUNTING

The consolidated financial statements include the accounts of mCloud, the ultimate parent of the consolidated group, and its subsidiaries and are prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”), effective as of December 31, 2021.

These consolidated financial statements of the Company were approved by the Company’s Board of Directors and authorized for issue on August 22, 2022.

Basis of preparation

These consolidated financial statements were prepared on a going-concern basis, under the historical cost convention except for derivative financial instruments classified as at fair value through profit or loss. The Company’s accounting policies are described in Note 32 and these policies are consistently applied to all the periods presented.

The Company’s presentation currency is Canadian dollars, and all amounts are presented in Canadian dollars unless otherwise stated. The consolidated financial statements include the accounts of the Company and those of its subsidiaries which are entities over which the Company has control (Note 32(A)). In addition to the Canadian dollar presentation, certain disclosures include the use of U.S. Dollars (“USD” or “US$”) in describing certain financing transactions.

The Company has reclassified certain comparative figures in the consolidated financial statements to conform to the current year presentation.

The Company has corrected net income (loss) and other comprehensive income (loss) attributable to mCloud shareholders and non-controlling interest for the years ended December 31, 2019, 2020 and 2021. This resulted in a reclassification between non-controlling interest, accumulated other comprehensive income, and accumulated deficit in the consolidated statements of financial position at December 31, 2019, December 31, 2020, and December 31, 2021. At December 31, 2019, on the consolidated statement of financial position, accumulated other comprehensive income increased by $22,877, deficit decreased by $1,354,452, and non-controlling interest decreased by $1,377,329. At December 31, 2020, on the consolidated statement of financial position, accumulated other comprehensive income decreased by $234,212, deficit decreased by $1,777,168, and non-controlling interest decreased by $1,542,956 taking into consideration the cumulative impacts of prior period adjustments. At December 31, 2021, on the consolidated statement of financial position, accumulated other comprehensive income decreased by $344,729, deficit decreased by $1,344,175, and non-controlling interest decreased by $999,446 taking into consideration the cumulative impacts of prior period adjustments.

In addition this resulted in a reclassification between net loss attributable to mCloud shareholders and non-controlling interest, other comprehensive loss attributable to mCloud shareholders and non-controlling interest and impacted basic and diluted loss per share for the years ended December 31, 2019, 2020 and 2021. During the years ended:

• December 31, 2019, net loss attributable to mCloud shareholders decreased by $1,354,452, net income attributable to noncontrolling interest decreased by $1,354,452, and loss per share attributable to mCloud shareholders - basic and diluted decreased by $0.33 per share.

• December 31, 2020, net loss attributable to mCloud shareholders increased by $422,716, net income attributable to noncontrolling interest decreased by $422,716, and loss per share attributable to mCloud shareholders - basic and diluted increased by $0.06 per share.

• December 31, 2021, net loss attributable to mCloud shareholders increased by $432,993, net loss attributable to non-controlling interest decreased by $432,993 and loss per share attributable to mCloud shareholders - basic and diluted increased by $0.03 per share.

In addition, the comparative disclosures as at December 31, 2021, 2020 and 2019 in Note 21, Non-controlling interest, reflect the corrected balances for non-current assets, current liabilities and non-current liabilities of the non-controlling interest arising from the above noted attribution of net income (loss) and other comprehensive income (loss) errors as well as certain other disclosure errors.

Share consolidation

On November 19, 2021, the Company initiated a 3-to-1 consolidation of the Company’s issued and outstanding common shares which took effect at market opening on November 24, 2021. This share consolidation was approved by the Company’s shareholders in connection with the Company’s NASDAQ listing. The Company’s issued and outstanding convertible debentures, stock options, warrants and restricted share units were also subject to this share consolidation. The par value of the common shares was not adjusted as a result of this share consolidation. Accordingly, all share and per share amounts for the periods presented in these consolidated financial statements and notes thereto have been adjusted retrospectively to reflect this share consolidation.

Going Concern

The outbreak of the COVID-19 pandemic and the measures adopted by governments in countries worldwide to mitigate the pandemic’s spread have impacted the Company. These measures required the Company to restrict deployment of technical services due to the in-person nature of these activities and delay the start of certain projects for a duration of the year. This negatively impacted the Company’s financial performance and liquidity position.

During the year ended December 31, 2021, the Company generated a net loss of $44,699,313 and negative cash flows from operating activities of $28,329,771. At December 31, 2021, the Company had a working capital deficiency of $42,108,177. Working capital deficiency is a non-IFRS measure which is calculated as current assets less current liabilities. Current liquidity levels and available sources of capital are not adequate to fund the working capital deficiency.

The most significant cash outflows included in current liabilities include the repayment of the 2019 Convertible Debentures of $23,457,500 together with interest payable (Note 14(a)); loans and borrowings of $11,763,697 including principal and interest payments; payment of trade and other payables of $12,421,309; and payments associated with leases of approximately $1,000,000.

While restrictions started to ease in the three months ended December 31, 2021, there is still uncertainly over how COVID-19 will impact the Company’s business and the timing of future revenues. Based on the Company’s liquidity position at the date of authorization of these consolidated financial statements and considering the uncertainty surrounding the impact of the pandemic, management estimates that it will need additional financing to meet its financial obligations. The Company is currently working with stakeholders and others to address the working capital deficiency. In the long-term, the ability of the Company to operate as a going concern is dependent on its ability to achieve and maintain profitable operations and positive cash flow from operations, and, as necessary, to obtain the necessary equity or debt financing to continue with operations. To date, the Company has funded its operations through debt and equity financing. While the Company has been successful in raising capital in the past and anticipates the lenders will not accelerate repayment of loans with covenant breaches as of December 31, 2021, March 31, 2022, and June 30, 2022 and potential breaches forecasted over the coming year, there is no assurance that it will be successful in closing further financings in the future or obtaining waivers of the covenant breaches.

As a result, these factors are indicators that material uncertainties exist that raises significant doubt about the Company’s ability to continue as a going concern and, therefore, its ability to realize assets and discharge liabilities in the normal course of business.

In making their assessment, management considered all available information, together with forecasts and other mitigating strategies, about the future which is at least, but not limited to, 12 months from the end of the reporting period. Management has considered the following in its assessment that the going concern assumption remains appropriate:

• the plan for the repayment of the 2019 Convertible Debentures;

• the repayment of the term loan in full on or before October 31, 2022 (Note 31);

• the likelihood that undrawn funds under the revolving operating facility will be available and will not be required to be repaid (Note 13);

• the required cash principal and interest payments on indebtedness;

• the likelihood of payments required under contingent consideration arrangements;

• cash inflows from current operations and expected increases in revenues and cash flows resulting from new revenue contracts expected over the next 12 months due to the anticipated reduction of COVID-19 related restrictions; and future debt and equity raises.

These consolidated financial statements have been prepared on a going concern basis, which contemplates that the Company will continue in operation and be able to realize its assets and discharge its liabilities and commitments in the normal course of business for the foreseeable future. These consolidated financial statements do not include any adjustments to the carrying amounts and classifications of assets, liabilities and reported expenses that may otherwise be required if the going concern basis was not appropriate.

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Critical Accounting Estimates And Judgements

6 Months Ended

12 Months Ended

Jun. 30, 2022

Dec. 31, 2021

Text Block [Abstract]

Critical Accounting Estimates And Judgements

NOTE 3 – CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS

In the preparation of the condensed consolidated interim financial statements and the application of the Company’s accounting policies, management is required to make judgments, estimates and assumptions that affect the carrying amounts of assets and liabilities and disclosure of contingent liabilities at the dates of the consolidated financial statements, and the reported amounts of revenues and expenses during each reporting period. The estimates and associated assumptions are limited by the relevance of historical data and uncertainty of future events. Actual results could differ from those estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to estimates are recognized in the period in which the estimates are revised and in any future period.

The Company applied critical judgements and estimates, including significant areas of estimation uncertainty in applying policies, in preparing these condensed consolidated interim financial statements.

NOTE 3 – CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS

In the preparation of the consolidated financial statements and the application of the Company’s accounting policies, management is required to make judgements, estimates and assumptions that affect the carrying amounts of assets and liabilities and disclosure of contingent liabilities at the dates of the consolidated financial statements, and the reported amounts of revenues and expenses during each reporting period. The estimates and associated assumptions are limited by the relevance of historical data and uncertainty of future events. Actual results could differ from those estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to estimates are recognized in the period in which the estimates are revised and in any future period.

Beginning in March 2020, the COVID-19 pandemic has had a substantial impact on economies around the world. As a result of the uncertainty associated with the unprecedented nature of the pandemic, certain of the Company’s significant assumptions may be impacted. Uncertain environments make estimating several items in the consolidated financial statements more challenging and are likely to result in more frequent changes in management’s expectations about the future. The long-term impact on the Company’s financial results and cash flows is unknown at this time. The Company has received government assistance in Canada, the United States and Australia to help temper the financial impact of COVID-19 (Note 24).

(a) Critical judgements in applying accounting policies

Judgement is used in situations when there is a choice and/or assessment required by management. Information about judgements made in applying accounting policies that have the most significant effect on the amounts recognized in the consolidated financial statements, are as follows:

Determination of control of subsidiaries

Judgement is required to determine when the Company has control of subsidiaries. This requires an assessment of the relevant activities of the investee, being those activities that significantly affect the investee’s returns. Despite owning no shares, or having any voting rights, the Company determined that it exercises control over Agnity Global, Inc. (“Agnity”) as the Company has the right to nominate a majority of the members of Agnity’s Operations Committee and therefore the right and ability to direct the relevant activities of Agnity and to significantly affect its returns through the use of its rights. The Company has the right to receive royalty payments from Agnity on a monthly basis in perpetuity and the Company has credit risk with respect to the collectability of these royalty payments.

Assessment of indicators of impairment of goodwill, long-lived assets and intangible assets

Management reviews goodwill, depreciable long-lived assets and intangible assets for impairment triggers to determine if any events or changes in circumstances exist that would indicate that the carrying amount of an asset may not be recoverable over time. If impairment indicators exist, impairment assessments are conducted as the asset level or level of cash generating units (“CGUs”) as appropriate.

Leases

In measuring the Company’s leases judgement is required to determine the lease term of the contract including whether the Company is reasonably certain to exercise extension options where it is the lessee. A longer lease term results in a larger lease liability and right-of-use asset to be recognized by the Company and future changes in this lease term will result in modifications. In addition, estimates and assumptions are required to determine the incremental borrowing rate used to measure lease liabilities at inception of a lease.

Contingent consideration

Management uses judgement to assess the existence of contingencies. By their nature, contingencies will only be resolved when one or more future events occur or fail to occur. At initial recognition at the date of a business combination and at the end of each reporting period, management also uses judgement to assess the likelihood of the occurrence of one or more future events which impacts the fair value of the contingent consideration.

Determination of CGUs

For the purposes of assessing impairment of goodwill and non-financial assets, the Company must identify CGUs. Assets and liabilities are grouped into CGUs at the lowest level of separately identified cash flows. Determination of what constitutes a CGU is subject to management judgment. The composition of a CGU can directly impact the recoverability of non-financial assets included within the CGU. Management has determined that the Company has two CGUs: Agnity and the rest of mCloud.

(b) Key sources of estimation uncertainty

Information about assumptions and estimation uncertainties that have a significant risk of resulting in a material adjustment to the carrying amounts of assets and liabilities and results of operations where a different estimate or assumption is used, are as follows:

Value of components for convertible debt and equity offerings

Management makes judgements related to the measurement of the fair value of the convertible debentures and equity offerings issued in the period, including the determination of the allocation of the proceeds between the components of the instrument. At inception of an instrument, the Company determines the value of each piece of the instrument and judgement is required in determining the inputs used in the fair value calculations and in determining the probability of certain outcomes.

Determination of stand-alone selling price

The total transaction price of certain revenue contacts is allocated to each performance obligation on a relative stand-alone selling price (“SSP”) basis, representing the selling price as if it was sold separately. This is a formal process involving judgement which could impact the timing of recognized revenue. In most cases, the SSP is based on observable data. If the SSP is not directly observable, the amount is estimated using either the expected cost plus a margin or residual approach. The SSP for perpetual software licenses is highly variable and therefore the Company applies the residual approach (Note 32(C)).

Expected credit loss allowance and provision

The Company recognizes an amount equal to the lifetime expected credit loss (“ECL”) on trade and long-term receivables, other receivables, unbilled revenue and amounts due from related parties for which there has been a significant increase in credit risk since initial recognition. Loss allowances are measured based on historical experience and forecasted economic conditions. The amount of ECL is sensitive to changes in circumstances of forecast economic conditions.

Impairment of goodwill and other non-financial assets

Goodwill is reviewed annually on December 31 or more frequently if changes in circumstances indicate that the carrying value may be impaired. The Company completed its annual impairment testing at December 31, 2021 and determined there was no impairment. Determining whether an impairment has occurred requires the valuation of the recoverable amount of the CGUs as described in Note 10(b).

Share-based payment arrangements

The Company uses the Black-Scholes option-pricing model (“Black-Scholes model”) to determine the fair value of stock options and other equity instruments where the goods and services cannot be valued. In estimating the fair value, management is required to make certain assumptions and estimates such as the expected life of options, volatility of the Company’s future share price, risk-free rate, future dividend yields and estimated forfeitures at the initial measurement date. Changes in assumptions used to estimate fair value could result in different outcomes.

Business combinations - purchase price allocation

The consideration transferred and acquired assets and assumed liabilities are recognized at fair value on the date the Company effectively obtains control. The measurement of each business combination is based on the information available on the acquisition date. The estimate of fair value of the consideration transferred and acquired intangible assets (including goodwill), property and equipment, other assets and the liabilities assumed are based on estimates and assumptions. The measurement is largely based on projected cash flows, discount rates and market conditions at the date of acquisition.

Taxation

Calculations for current and deferred taxes require management’s interpretation of tax regulations and legislation in the various tax jurisdictions in which the Company operates, which are subject to change. The measurement of deferred tax assets and liabilities requires estimates of the timing of the reversal of temporary differences identified and management’s assessment of the Company’s ability to utilize the underlying future tax deductions against future taxable income before they expire, which involves estimating future taxable income.

The Company is subject to assessments by various taxation authorities in the tax jurisdictions in which it operates, and these taxation authorities may interpret the tax legislation and regulations differently. In addition, the calculation of income taxes involves many complex factors. As such, income taxes are subject to measurement uncertainty and actual amounts of taxes may vary from the estimates made by management.

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Segment Reporting

12 Months Ended

Dec. 31, 2021

Text Block [Abstract]

Segment Reporting

NOTE 4 – SEGMENT REPORTING

The Company operates in one operating segment. For the purpose of segment reporting, the Company’s Chief Executive Officer (“CEO”) is the Chief Operating Decision Maker. The determination of the Company’s operating segment is based on its organization structure and how the information is reported to the CEO on a regular basis.

The Company’s revenue by location of the ultimate customer or consumer of product solution are as follows:

	Year ended December 31,
	2021		2020		2019
Canada	$	10,733,922	$	13,832,691	$	10,889,542
United States		6,564,271		5,691,202		7,450,707
Japan		5,849,967		6,446,939		–
Australia		993,933		152,301		–
Other		1,454,879		805,306		–
Total revenue	$	25,596,972	$	26,928,439	$	18,340,249

The table below presents significant customers who accounted for greater than 10% of total revenues.

For the years ended December 31,	2021	2020	2019
Customer A	Less than 10%	14  %	n/a
Customer B	Less than 10%	13  %	11  %
Customer C	11  %	Less than 10%	20  %
Customer D	11  %	Less than 10%	n/a

The Company’s non-current assets by country are as follows:

	December 31, 2021		December 31, 2020
Canada	$	30,812,581	$	37,966,772
Australia		10,372,410		11,731,960
United States		9,014,016		12,424,844
Total non-current assets	$	50,199,007	$	62,123,576

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Revenue

6 Months Ended

12 Months Ended

Jun. 30, 2022

Dec. 31, 2021

Text Block [Abstract]

Revenue

NOTE 4 - REVENUE

All of the Company’s revenue is derived from contracts with customers. In the following tables, revenue is disaggregated by major service line and timing of revenue recognition.

	Three months ended June 30,					Six months ended June 30,
	2022			2021		2022			2021
AssetCare Initialization 1	$	28,979		$	303,321	$	443,470		$	818,564
AssetCare Solutions 2		4,695,074			6,079,949		8,684,202			12,514,458
Engineering Services 3		116,649			173,193		142,633			659,007
Contract modification revenue reversal 4		(2,571,676	)		—		(2,571,676	)		—
	$	2,269,026		$	6,556,463	$	6,698,629		$	13,992,029

1  Revenues from initial implementation and activation of AssetCare projects, including the sale of hardware.

2 Revenues include sales of subscriptions to AssetCare, other subscriptions, post contract support and maintenance, perpetual software licenses, and installation and engineering services.

3 Revenues includes consulting, implementation and integration services entered into on a time and materials basis or fixed fee basis without the use of AssetCare.

4 During the three months ended June 30, 2022, the Company cancelled a multi-year customer contract for which services had been performed in prior periods, resulting in a contract modification. As a result, revenue from AssetCare Initialization of $2,037,014 and AssetCare Solutions of $534,662 which were recorded in prior periods was reversed during the three and six months ended June 30, 2022.

	Three months ended June 30,					Six months ended June 30,
Revenue recognized	2022			2021		2022			2021
Over time 1	$	3,783,459		$	6,253,142	$	7,645,663		$	11,701,851
At a point in time upon completion 1		(1,514,433	)		303,321		(947,034	)		2,290,178
	$	2,269,026		$	6,556,463	$	6,698,629		$	13,992,029

1  See table above and related footnote 4. The three and six months ended June 30, 2022 reflects the reversal of $534,662 of revenue recognized over time and $2,037,014 of revenue recognized at point in time upon completion.

The Company’s revenue by location of the ultimate customer or consumer of product solution are as follows:

	Three months ended June 30,					Six months ended June 30,
	2022			2021		2022		2021
Canada 1	$	(767,709	)	$	3,440,590	$	1,271,267	$	7,852,189
Americas		1,647,854			1,422,069		3,167,929		2,671,673
Asia Pacific		1,027,989			1,579,435		1,705,857		3,298,173
Other		360,892			114,369		553,576		169,994
Total revenue	$	2,269,026		$	6,556,463	$	6,698,629	$	13,992,029

1  Impact of previously recognized revenue for contract modification as explained in tables above.

Significant changes in unbilled revenue and deferred revenue balances are as follows:

	Unbilled revenue			Deferred revenue
Balance at December 31, 2021	$	756,042		$	2,811,408
Additions		3,057,402			5,805,365
Less: transferred to trade and other receivables		(2,952,031	)		—
Less: recognized in revenue		—			(3,853,163	)
Effect of movements in exchange rates		—			49,589
Balance at June 30, 2022	$	861,413		$	4,813,199

	Year ended December 31,
	2021		2020		2019
AssetCare Initialization 1	$	1,250,181	$	7,689,232	$	5,964,663
AssetCare Solutions 2		23,461,748		12,809,054		2,939,582
Engineering Services 3		885,043		6,430,153		9,436,004
	$	25,596,972	$	26,928,439	$	18,340,249

1  Revenues from initial implementation and activation of AssetCare projects, including the sale of hardware.

2  Revenues include sales of subscriptions to AssetCare, other subscriptions, post contract support and maintenance, perpetual software licenses, and installation and engineering services.

3  Revenues includes consulting, implementation and integration services entered into on a time and materials basis or fixed fee basis without the use of AssetCare.

	Year ended December 31,
Timing of revenue recognition	2021		2020		2019
Over time	$	24,422,749	$	18,551,736	$	12,375,586
At a point in time upon completion		1,174,223		8,376,703		5,964,663
	$	25,596,972	$	26,928,439	$	18,340,249

Significant changes in unbilled revenue and deferred revenue balances are as follows:

	Unbilled revenue			Deferred revenue
Balance at January 1, 2019	$	—		$	133,678
Acquired in business combination (Note 17(c))		2,347,207			133,556
Acquired in business combination (Note 17(b))		—			457,259
Additions		9,595,535			5,309,436
Less: transferred to trade and other receivables		(11,278,312	)		—
Less: recognized in revenue		—			(4,878,419	)
Less: Loss allowance		(5,499	)		—
Effect of movement in exchange rates		—			(17,229	)
Balance at December 31, 2019	$	658,931		$	1,138,281
Acquired in business combination		117,686			–
Additions		11,478,436			6,316,586
Less: transferred to trade and other receivables		(11,557,665	)		–
Less: write-offs		(146,489	)		–
Less: recognized in revenue		–			(5,612,896	)
Less: applied to outstanding trade receivables		–			(30,586	)
Effect of movement in exchange rates		3,841			(40,265	)
Balance at December 31, 2020	$	554,740		$	1,771,120
Additions		7,470,881			10,616,893
Less: transferred to trade and other receivables		(7,269,579	)		–
Less: recognized in revenue		–			(9,585,211	)
Effect of movement in exchange rates		–			8,606
Balance at December 31, 2021 1	$	756,042		$	2,811,408

1  Unbilled revenue is included in trade and other receivables (Note 6) and relates to the Company’s right to consideration for work completed but not billed at the reporting date. Unbilled revenue is transferred to trade and other receivables when services are billed to customers.

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Trade and Other Receivables and Long-Term Receivables

6 Months Ended

12 Months Ended

Jun. 30, 2022

Dec. 31, 2021

Text Block [Abstract]

Trade and Other Receivables and Long-Term Receivables

NOTE 5 - TRADE AND OTHER RECEIVABLES AND LONG-TERM RECEIVABLES

	June 30, 2022			December 31, 2021
Trade receivables from contracts with customers	$	11,532,760		$	14,204,320
Unbilled revenue (Note 4)		861,413			756,042
Indirect taxes receivable		293,320			148,200
Income taxes receivable		11,404			2,217
Other receivables		920,419			919,954
Contract asset		46,812			86,777
Loss allowance		(1,531,136	)		(1,550,535	)
Total trade and other receivables - current	$	12,134,992		$	14,566,975

Long-term receivables

Long-term receivables represent receivables associated with revenue contracts whereby certain customers make fixed monthly installment payments over a period of time, ranging from one to three years, for performance obligations delivered upfront. For contracts where all performance obligations were completed except for monthly post contract and support maintenance, amounts due are included in trade receivables from contracts with customers.

	June 30, 2022		December 31, 2021
Current portion of long-term receivables 1	$	390,398	$	397,060
Non-current portion of long-term receivables 2		318,360		343,371
Total long-term receivables	$	708,758	$	740,431

1 Net of expected credit loss allowance of $95,518 at June 30, 2022 (December 31, 2021 - $95,064).

2 Net of expected credit loss allowance of $61,619 at June 30, 2022 (December 31, 2021 - $61,619).

NOTE 6 - TRADE AND OTHER RECEIVABLES AND LONG-TERM RECEIVABLES

	December 31, 2021			December 31, 2020
Trade receivables from contracts with customers	$	14,204,320		$	10,182,229
Unbilled revenue (Note 5)		756,042			554,740
Indirect taxes receivable		148,200			341,583
Income taxes receivable		2,217			594,036
Other receivables		919,954			961,714
Contract asset 1		86,777			153,178
Loss allowance (Note 26(b))		(1,550,535	)		(474,666	)
Total trade and other receivables - current	$	14,566,975		$	12,312,814

1  At December 31, 2021, the total contract assets were $90,200 with the non-current portion of $3,423 included in other assets (December 31, 2020 - $314,894 total and $161,716 non-current). No new contract assets were recognized and amortization to cost of sales over the life of the contract assets continues to occur until June 30, 2023.

Long-term receivables

Long-term receivables represent receivables associated with revenue contracts whereby certain customers make fixed monthly installment payments over a period of time, ranging from one to three years, for performance obligations delivered upfront. For contracts where all performance obligations were completed except for monthly post contract and support maintenance, amounts due are included in trade receivables from contracts with customers.

	December 31, 2021		December 31, 2020
Current portion of long-term receivables 1	$	397,060	$	445,213
Non-current portion of long-term receivables 2		343,371		2,091,059
Total long-term receivables	$	740,431	$	2,536,272

1  Net of expected credit loss allowance of $95,064 at December 31, 2021 and $131,364 at December 31, 2020 (Note 26(b)).

2  Net of expected credit loss allowance of $61,619 at December 31, 2021 and nil at December 31, 2020 (Note 26(b)).

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Prepaid Expenses And Other Assets

12 Months Ended

Dec. 31, 2021

Text Block Abstract [Abstract]

Prepaid Expenses And Other Assets

NOTE 7 - PREPAID EXPENSES AND OTHER ASSETS

	December 31, 2021		December 31, 2020
Prepaid insurance	$	348,063	$	122,893
Advances		121,806		38,593
Deposits		862,338		189,734
Prepaid licenses		938,887		1,075,797
Prepaid services		505,448		292,552
Other prepaid costs		197,962		325,481
Other assets		3,423		293,116
Prepaid expenses and other assets	$	2,977,927	$	2,338,166
Current portion	$	2,355,350	$	1,326,319
Non-current portion		622,577		1,011,847
	$	2,977,927	$	2,338,166

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Leases

6 Months Ended

12 Months Ended

Jun. 30, 2022

Dec. 31, 2021

Text Block [Abstract]

Leases

NOTE 6 - LEASES

In October 2021, the Company executed a 12-year lease for office space in Calgary, Alberta. Basic rent and estimated common area expense payments commence in December 2022, preceded by a fixturing period which the Company will use to build out the space. Effective January 2022, the Company recognized a right-of-use asset associated with this office space of $6,322,509 and a related lease liability of $6,221,749.

The carrying value of all right-of-use assets at June 30, 2022 was $7,298,424 (December 31, 2021 - $916,028). Total lease liabilities were $7,678,618 at June 30, 2022 (December 31, 2021 - $1,045,472). The change in undiscounted contractual cash flows associated with new premise leases are described in Note 15(c).

NOTE 8 - LEASES

The Company leases buildings for its office space, vehicles and other office equipment. The length of a lease depends on the location of the office, with leases generally ranging from three to five years with an option to renew the lease after that date. The majority of office leases require the payment of variable rent for operating costs and taxes which are not based on an index or rate and are recognized as rent expense. Lease payments for short-term leases and low-value assets are recognized as rent expense on a straight-line basis over the lease term. The maturity analysis of the undiscounted cash flows for lease liabilities is included in Note 26(a).

a) Right-of-use assets

The following table presents the change in carrying amount of the Company’s right-of-use assets:

	Office			Equipment and Vehicles			Total
Balance at January 1, 2019	$	285,086		$	–		$	285,086
Acquired right-of-use assets (Note 17)		4,207,837			95,378			4,303,215
Additions to right-of-use assets		–			183,617			183,617
Depreciation charge for the year		(433,617	)		(48,360	)		(481,977	)
Impairment charge for the year		(78,764	)		–			(78,764	)
Effect of movement in exchange rates		(4,369	)		–			(4,369	)
Balance at January 1, 2020	$	3,976,173		$	230,635		$	4,206,808
Acquired right-of-use assets (Note 17)		509,290			–			509,290
Additions to right-of-use assets		84,413			6,158			90,571
Depreciation charge for the year		(780,767	)		(145,661	)		(926,429	)
Impact of lease modification		(221,590	)		–			(221,590	)
Effect of movement in exchange rates		2,648			(582	)		2,067
Balance at December 31, 2020	$	3,570,167		$	90,550		$	3,660,717
Depreciation charge for the year		(748,058	)		(80,198	)		(828,256	)
Impact of lease modification		(1,924,504	)		–			(1,924,504	)
Effect of movement in exchange rates		8,122			(51	)		8,071
Balance at December 31, 2021	$	905,727		$	10,301		$	916,028

b) Amounts recognized in consolidated statements of loss and comprehensive loss

	Year ended December 31,
	2021		2020		2019
Accretion of lease liabilities included in finance costs	$	137,272	$	350,792	$	168,571
Depreciation of right-of-use assets 1		828,256		926,429		481,977
Expense related to variable lease payments 2		825,212		824,062		–
Expense related to short-term leases 2		4,550		–		–
	$	1,795,290	$	2,101,283	$	650,548

1  Included in depreciation and amortization expense.

 2 Included in rent expense within general and administrative expense.

c) Amounts recognized in consolidated statements of cash flows

	Year ended December 31,
	2021		2020		2019
Total cash outflows included in operating activities	$	137,272	$	350,792	$	168,571
Total cash outflows included in financing activities	$	1,095,327	$	814,072	$	422,783

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Property and Equipment

12 Months Ended

Dec. 31, 2021

Text Block [Abstract]

Property and Equipment

NOTE 9 - PROPERTY AND EQUIPMENT

	Office Furniture and Equipment			Leasehold Improvements			Computer Equipment			Total
Cost:
At January 1, 2019	$	10,117		$	239,555		$	52,966		$	302,638
Additions		30,529			74,641			32,952			138,122
Acquisitions		253,057			64,366			232,175			549,598
Impairment		–			–			(14,460	)		(14,460	)
Effect of movement in exchange rates		(1,339	)		(1,973	)		(6,990	)		(10,302	)
At December 31, 2019	$	292,364		$	376,589		$	296,643		$	965,596
Additions		30,543			–			97,145			127,688
Effect of movement in exchange rates		(917	)		(1,351	)		(6,964	)		(9,232	)
Balance at December 31, 2020	$	321,990		$	375,238		$	386,824		$	1,084,052
Additions		–			–			626,841			626,841
Disposals		(29,459	)		(43,409	)		(124,544	)		(197,412	)
Effect of movement in exchange rates		(504	)		(744	)		(4,588	)		(5,836	)
Balance at December 31, 2021	$	292,027		$	331,085		$	884,533		$	1,507,645
Accumulated depreciation:
At January 1, 2019	$	410		$	13,433		$	13,318		$	27,161
Depreciation		44,729			71,143			123,272			239,144
Effect of movement in exchange rates		(1,321	)		(1,577	)		(8,363	)		(11,261	)
At December 31, 2019	$	43,818		$	82,999		$	128,227		$	255,044
Depreciation		78,289			77,906			175,027			331,222
Effect of movement in exchange rates		(923	)		(1,436	)		(6,242	)		(8,601	)
Balance at December 31, 2020	$	121,184		$	159,469		$	297,012		$	577,665
Depreciation		75,117			73,864			336,765			485,746
Disposals		(29,458	)		(43,409	)		(123,240	)		(196,107	)
Other movements		6,746			–			(6,746	)		–
Effect of movement in exchange rates		(505	)		(744	)		(7,813	)		(9,062	)
Balance at December 31, 2021	$	173,084		$	189,180		$	495,978		$	858,242
Carrying amounts:
Balance at December 31, 2020	$	200,806		$	215,769		$	89,812		$	506,387
Balance at December 31, 2021	$	118,943		$	141,905		$	388,555		$	649,403

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Intangible Assets and Goodwill

12 Months Ended

Dec. 31, 2021

Text Block [Abstract]

Intangible Assets and Goodwill

NOTE 10 - INTANGIBLE ASSETS AND GOODWILL

a) Intangible assets

	Patents and trademarks			Customer relationships			Technology			Total
Cost:
At January 1, 2019	$	192,032		$	2,118,739		$	1,590,958		$	3,901,729
Additions		–			–			–			–
Acquisitions		–			14,168,830			10,212,390			24,381,220
Effect of movements in exchange rates		(9,374	)		(46,579	)		(47,366	)		(103,319	)
Balance at December 31, 2019	$	182,658		$	16,240,990		$	11,755,982		$	28,179,630
Additions		–			–			2,333,666			2,333,666
Acquisitions		–			3,434,334			3,846,189			7,280,523
Effect of movements in exchange rates		(2,957	)		(38,494	)		(32,016	)		(73,467	)
Balance at December 31, 2020	$	179,701		$	19,636,830		$	17,903,821		$	37,720,352
Additions		–			–			440,965			440,965
Effect of movement in exchange rates		(343	)		(3,217	)		1,556			(2,004	)
Balance at December 31, 2021	$	179,358		$	19,633,613		$	18,346,342		$	38,159,313
Accumulated amortization and impairments:
At January 1, 2019	$	51,238		$	333,430		$	349,188		$	733,856
Amortization 1		36,564			1,668,090			1,618,368			3,323,022
Impairment		–			–			507,433			507,433
Effect of movements in exchange rates		(3,219	)		(23,895	)		(28,656	)		(55,770	)
Balance at December 31, 2019	$	84,583		$	1,977,625		$	2,446,333		$	4,508,541
Amortization 1		35,243			2,696,767			2,753,602			5,485,612
Effect of movements in exchange rates		(3,078	)		(19,774	)		(17,788	)		(40,640	)
Balance at December 31, 2020	$	116,748		$	4,654,618		$	5,182,147		$	9,953,513
Amortization 1		32,073			3,099,234			4,479,503			7,610,810
Effect of movement in exchange rates		85			3,820			5,252			9,157
Balance at December 31, 2021	$	148,906		$	7,757,672		$	9,666,902		$	17,573,480
Carrying amounts:
Balance at December 31, 2020	$	62,953		$	14,982,212		$	12,721,674		$	27,766,839
Balance at December 31, 2021	$	30,452		$	11,875,941		$	8,679,440		$	20,585,833

1  Amortization charges are included in depreciation and amortization in the consolidated statements of loss and comprehensive loss.

b) Goodwill

Goodwill is tested for impairment on an annual basis at December 31, and when there are indicators the carrying amount may be impaired. In reviewing indicators of impairment, the Company considers the relationship between its market capitalization and its book value, among other qualitative and quantitative factors. At December 31, 2021, the Company had two CGUs, mCloud Technologies Corp. and Agnity (December 31, 2020 - two CGUs). Goodwill is all allocated to mCloud Technologies Corp. as this CGU benefits from prior business combinations. Furthermore, the Company has no ownership of the Agnity CGU but instead 100% non-controlling interest and this CGU does not include goodwill. The carrying amount of goodwill is as follows:

	December 31, 2021		December 31, 2020
Opening balance	$	27,086,727	$	18,758,975
Acquisitions, business combinations (Note 18)		–		8,405,341
Effect of movements in exchange rates		(4,932)		(77,589)
Total goodwill	$	27,081,795	$	27,086,727

The recoverable amount of the mCloud CGU was determined using fair value less costs of disposal (“FVLCD”) with reference to the market capitalization of the Company. The impairment test of goodwill at December 31, 2021, concluded that the recoverable amount exceeded the carrying amount of the CGU, including goodwill, and as such no goodwill impairment existed. At December 31, 2021, the enterprise value implied by market capitalization of the Company was $146,500,000 compared to a net asset carrying value of $36,160,000.

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Trade Payables And Accrued Liabilities

6 Months Ended

12 Months Ended

Jun. 30, 2022

Dec. 31, 2021

Text Block [Abstract]

Trade Payables And Accrued Liabilities

NOTE 7 - TRADE PAYABLES AND ACCRUED LIABILITIES

	June 30, 2022		December 31, 2021
Trade payables		$              8,697,912		$                    5,591,316
Accrued liabilities		5,453,285		5,398,389
Interest payable		228,222		233,854
Mastercard facility		372,374		296,669
Due to related parties		217,795		265,074
Income taxes payable		278,813		266,753
Indirect taxes payable		279,993		150,577
Other 1		814,953		218,677
Total trade payables and accrued liabilities		$            16,343,347		$                  12,421,309

1 At June 30, 2022, includes $718,092 associated with previous warrant liability (Note 11(c)).

NOTE 11 - TRADE PAYABLES AND ACCRUED LIABILITIES

	December 31, 2021		December 31, 2020
Trade payables	$	5,591,316	$	5,903,789
Accrued liabilities		5,398,389		4,795,742
Interest payable		233,854		425,054
Mastercard facility (Note 13)		296,669		600,590
Due to related parties (Note 28)		265,074		846,228
Income taxes payable		266,753		21,752
Indirect taxes payable		150,577		242,703
Other		218,677		88,398
Total trade payables and accrued liabilities	$	12,421,309	$	12,924,256

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Loans And Borrowings

6 Months Ended

12 Months Ended

Jun. 30, 2022

Dec. 31, 2021

Text Block [Abstract]

Loans And Borrowings

NOTE 8 - LOANS AND BORROWINGS

The carrying value of loans and borrowings by entities controlled by the Company are as follows. Note 17(b) includes the reconciliation of cash flows associated with borrowing activities.

	June 30, 2022		December 31, 2021
Term loan (a)		$              6,623,292		$                    9,275,683
Promissory notes (b)		19,342,593		—
Nations Interbanc facility 1		2,975,021		2,639,143
Debenture payable to Industry Canada		—		26,412
Loan payable to related party 2		349,980		335,860
Oracle financing		632,034		826,418
Other loans and financing		62,887		112,085
Total		$            29,985,807		$                  13,215,601
Current		$            10,399,574		$                  12,447,939
Non-current		$            19,586,233		$767,662
Total		$            29,985,807		$                  13,215,601

1 Nations advanced $5,433,688 under the factor and security agreement and was repaid $5,454,108 in the six months ended June 30, 2022 (six months ended June 30, 2021 - $4,842,450 advances and $6,020,883 repayments).

2 Loan which originally matured in January 2023 was repaid in full in August 2022.

Loan repayment terms vary depending on the nature of the debt. Total interest expense associated with loans and borrowings recognized in net loss was $734,854 and $1,131,557 for the three and six months ended June 30, 2022 (three and six months ended June 30, 2021 - $286,144 and $533,508) (Note 16(a)). All of the Company’s loans have fixed interest rates, with the exception of its credit facility (Note 9).

a) Term Loan

In May 2022, the Company and Fiera Private Debt Fund VI LP (“Fiera”) executed an Accommodation Agreement (the “Accommodation Agreement”) and the Company paid a total of $2,044,086 representing a portion of the outstanding principal amount under the term loan and a prepayment penalty and accommodation fee. The parties agreed that the remainder of the principal and interest due under the term loan would be paid on or before October 31, 2022 (the “Repayment Date”) and not the original maturity date of August 7, 2026. The term loan was amended to increase the interest rate charged from 6.85% to 9.5% per annum. The Company may be required to repay the loan before the Repayment Date if the Company is in default or breach of the Accommodation Agreement. As part of the Accommodation Agreement, Fiera signed an agreement, whereby Fiera’s security against certain assets of the Company is subordinate to the security granted to Carbon Royalty Corp. (Note 8(b)).

Blended payments of principal and interest of $2,987,535, inclusive of the lump sum principal repayment, were paid for the six months ended June 30, 2022 (six months ended June 30, 2021 - $1,171,518). A modification loss associated with the change in terms of $161,698 is included in finance costs in the consolidated statement of loss for the six months ended June 30, 2022 with an offsetting increase in the carrying value of the term loan. Transaction costs were incurred and netted against the value of the term loan.

The term loan was classified as current at December 31, 2021 as the Company did not meet certain minimum covenants set forth in the November 2021 amendment to the term loan and therefore the term loan was due on demand. There are no financial covenants under the Accommodation Agreement and the Company is no longer required to maintain the previous financial covenants.

b)  Financing of Electric Vehicle Development Projects

In conjunction with the Company’s agreements to provide AssetCare solutions to optimize Electric Vehicle (“EV”) charging efficiency at auto dealerships in certain U.S. States (the “EV Dealership Projects”), on March 28, 2022, a subsidiary of the Company executed a promissory note in the aggregate principal amount of US$15,000,000 (the “Note”) with Carbon Royalty Corp. (“Carbon”). EV Dealership Projects are the design, installation and operation of integrated power systems consisting of solar, batteries and EV charging power stations for auto dealerships.

The initial principal amount under the Note of US$5,000,000 was funded on April 1, 2022 and an additional US$10,000,000 was funded on May 5, 2022 (the “Loans”). The Loans mature on March 31, 2025, with 10% per annum interest payable monthly in arrears in USD. In addition to the interest payments, certain income-based payments, including tax incentives, are required to be made from the borrower to the lender based on income resulting from the EV dealership projects over their 20-year term. The Loans may not be prepaid unless authorized by the lender. The Loans contain representations, warranties and covenants which must be complied with to avoid an event of default which will allow the lender to demand repayment and increase the interest rate to 18%, amongst other implications.

On May 5, 2022, the Company, Carbon and Fiera executed a Subordination and Postponement Agreement (the “Subordination Agreement”), whereby the parties agreed that the security previously held by Fiera would be subordinate to the security granted to Carbon commencing on the date of the agreement. The security granted to Carbon includes, to the extent related to the EV Dealership Projects, all accounts, equipment and machinery, contracts and contract rights, including contracts with auto dealerships, inventory, cash and proceeds, rent and profits.

NOTE 12 - LOANS AND BORROWINGS

The carrying value of loans and borrowings by entities controlled by the Company are as follows:

	December 31, 2021		December 31, 2020
Term loan	$	9,275,683	$	10,928,055
Nations Interbanc facility		2,639,143		1,137,360
Debenture payable to Industry Canada		26,412		76,227
Loan payable to related party 1		335,860		318,428
Oracle financing 2		826,418		427,250
Other loans and financing		112,085		264,980
Total 3	$	13,215,601	$	13,152,300
Current		12,447,939		3,431,251
Non-current		767,662		9,721,049
	$	13,215,601	$	13,152,300

1  Loan assumed as part of CSA Acquisition (Note 17(d)) which bears interest at 6% and matures in January 2023. Interest is payable annually and accrued interest is included in trade payables and accrued liabilities.

2  Financing arrangements provided by Oracle Credit Corporation (“Oracle”) bearing interest between 6.2% and 6.6%. Interest is due in quarterly installments with loans maturing in May 2023 and February 2024. During the year ended December 31, 2021, proceeds from additional funding received was $577,378 (December 31, 2020 - $495,944)

3  Note 30(b) includes the reconciliation of movements of liabilities to cash flows arising from financing activities.

Term loan

In 2019, a subsidiary of the Company, mCloud Technology Services Inc. (“MTS”), entered into a term loan facility with Fiera Private Debt Fund VI LP (“Fiera”, formerly Integrated Private Debt Fund VI LP) in the amount of $13,000,000. The term loan payments are blended payments of principal and interest until maturity in August 2026 and the loan is secured against the assets of MTS. The Company and certain subsidiaries are guarantors.

On November 9, 2021, the Company amended its term loan and amended the associated intercreditor agreement between Fiera, ATB Financial (“ATB”) and the Company. The intercreditor agreement determines the priority of security interests in the case of default, with Fiera having first priority on all assets other than accounts receivable (Note 13). The amendments to the term loan include: increase in interest rate from 6.85% to 7.5% per annum; certain changes to financial covenants which are applicable for the period from July 1, 2021 to December 31, 2022; and, the addition of two mCloud subsidiaries as additional guarantors. See Note 31 (a) and (b) for subsequent changes to Fiera loan. 

The principal amount of the loan and the maturity date of August 7, 2026 remained the same. During the year ended December 31, 2021 there were $2,343,036 of principal and interest payments made. A modification loss associated with this change in terms of $138,908 is included in finance costs in the consolidated statement of loss for the year ended December 31, 2021 with an offsetting increase in the carrying value of the term loan. Transaction costs of $191,310 were incurred and are netted against the carrying value of the term loan.

Breach of loan covenants

The term loan contains covenants with quarterly and quarter end metrics. For the quarter ended December 31, 2021, the Company did not meet certain minimum covenants and therefore the term loan is due on demand and has been classified as current until such time as the covenants are in compliance. For the quarter ended March 31, 2022, the Company continued not to meet certain minimum covenants and did not receive a waiver from the lender. See Note 31 (b) for subsequent change to Fiera loan covenants.

Nations Interbanc facility

Under a factoring and security agreement with Nations Interbanc (“Nations”), Agnity, an entity controlled by the Company, receives advances up to a maximum of US$2,000,000 at any one time from Nations for providing them the right to collect cash flows from factored accounts receivable and charges a fee for this service. This is a financing agreement and the accounts receivables factored still carry credit risk, are not sold, and are not derecognized from Agnity’s statement of financial position. Nations advances funds up to a value of 85% of the accounts receivables factored. Nations charges a factoring fee of 1.5% of the gross face invoice amount for the first 30 days and a daily proration of 0.06% per day thereafter. The amount of funds advanced varies and is dependent on the cash requirements of Agnity. During the year ended December 31, 2021, Nations advanced $9,246,693 and Agnity repaid $7,954,698 of this balance.

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Bank Indebtedness

6 Months Ended

12 Months Ended

Jun. 30, 2022

Dec. 31, 2021

Text Block [Abstract]

Bank Indebtedness

NOTE 9 – BANK INDEBTEDNESS

	June 30, 2022		December 31, 2021
ATB Financial revolving operating facility	$	3,679,631	$	3,460,109

ATB Financial Facility

The Company’s secured revolving operating facility (“ATB Facility”) with ATB Financial (“ATB”) is due on demand, bears interest at the prime rate plus 2% per annum with interest and fees due at the end of each month. During the six months ended June 30, 2022, additional draws of $1,077,338 were made and principal repayments of $863,502 were made in accordance with the agreement.

The ATB Facility is subject to certain reporting and financial covenants. The Company was not in compliance with these covenants at June 30, 2022.

NOTE 13 – BANK INDEBTEDNESS

	December 31, 2021		December 31, 2020
ATB Financial revolving operating facility	$	3,460,109	$	–
Operating loan facility 1		–		923,461
Bank overdraft 1		–		53,318
Total	$	3,460,109	$	976,779

1  At December 31, 2020, the Company had access to an operating loan facility and Mastercard facility. On April 15, 2021, the operating loan facility was repaid and closed. The Mastercard facility remains in place and at December 31, 2021, $296,669 was drawn (December 31, 2020 - $600,590) and this amount is included in trade payables and accrued liabilities on the consolidated statements of financial position. The bank overdraft at December 31, 2020 was repaid in October 2021.

ATB Financial Facility

On May 17, 2021, one of the Company’s subsidiaries executed a commitment letter for a $5,000,000 secured revolving operating facility with ATB which is a financial institution wholly owned by the Province of Alberta. The facility is available by way of a variety of instruments. On June 24, 2021, $2,500,000 was drawn which was the maximum amount under the intercreditor agreement with Fiera at that time. The facility is due on demand, bears interest at the prime rate plus 2% per annum with interest and fees due at the end of each month and may be prepaid without penalty.

On November 8, 2021, the Company and ATB amended the commitment letter between the parties governing the revolving operating facility. The amendment added an accordion feature which allows the Company to request ATB to increase the maximum principal amount of the facility from $5,000,000 to $10,000,000, funded in increments of $1,250,000, subject to certain requirements and approval from Fiera and ATB under an intercreditor agreement.

The facility is subject to certain reporting and financial covenants. The Company was in compliance with these covenants at December 31, 2021, but not at March 31, 2022 and June 30, 2022. The facility is secured against certain assets of the Company and its principal subsidiaries. In addition, the Company and certain of its subsidiaries have provided an unlimited guarantee for repayment of all amounts due under the facility. As part of the commitment letter amendment, the Company agreed to issue warrants to ATB (Note 15).

On November 9, 2021, Fiera, ATB and the Company amended the intercreditor agreement which allows the Company to draw the full $5,000,000 of the facility subject to a limit which is equal to the lesser of $5,000,000 and the aggregate of eligible accounts receivable less priority payables as defined in the agreement. An additional $950,000 was drawn under the facility on November 12, 2021. At December 31, 2021, as a result of the Fiera covenant breach and at March 31, 2022 and June 30, 2022 as a result of non-compliance with covenants on the ATB Financial revolving operating facility, ATB has the ability to restrict further advances under the ATB facility. 

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Convertible Debentures

6 Months Ended

12 Months Ended

Jun. 30, 2022

Dec. 31, 2021

Text Block [Abstract]

Convertible Debentures

NOTE 10 – CONVERTIBLE DEBENTURES

2019 Convertible debentures

	June 30, 2022		December 31, 2021
Opening balance	$	22,380,649	$	19,767,472
Interest paid		(1,172,875)		(2,345,750)
Accreted interest at effective interest rate		2,445,205		4,958,927
Carrying amount of liability component	$	23,652,979	$	22,380,649
Less: interest payable		(195,479)		(195,479)
Total - current	$	23,457,500	$	22,185,170

The Company completed a private placement offering of convertible unsecured subordinated debentures (the “2019 Debentures”) for total aggregate gross proceeds of $23,507,500 in July 2019. The 2019 Debentures bear interest at a rate of 10% per annum, paid quarterly, and matured on June 30, 2022, at which time the principal amount of $23,457,500 and any unpaid interest was repayable in cash because the conversion option was not exercised by the holders as of that date.

NOTE 14 – CONVERTIBLE DEBENTURES

	December 31, 2021		December 31, 2020
2019 Convertible debentures liability (a)	$	22,185,170	$	19,534,988
2021 Convertible debentures liability (b)		69,034		–
2021 Convertible debentures embedded derivative (b)		41,506		–
Total	$	22,295,710	$	19,534,988

Current debentures	$	22,185,170	$	–
Non-current debentures		110,540		19,534,988
	$	22,295,710	$	19,534,988

a) 2019 Convertible debentures

	December 31, 2021		December 31, 2020
Opening balance	$	19,767,472	$	17,753,016
Conversion of debentures into common shares		–		(50,000)
Interest paid		(2,345,750)		(2,345,750)
Accreted interest at effective interest rate		4,958,927		4,410,206
Carrying amount of liability component	$	22,380,649	$	19,767,472
Less: interest payable		(195,479)		(232,484)
Total	$	22,185,170	$	19,534,988

In July 2019, the Company completed a private placement offering of convertible unsecured subordinated debentures (the “2019 Debentures”) for total aggregate gross proceeds of $23,507,500 and net cash proceeds of $22,865,049. The 2019 Debentures bear interest at a rate of 10% per annum, paid quarterly, and mature on May 31, 2022, at which time the outstanding principal amount of $23,457,500 and any unpaid interest is repayable in cash if the 2019 Debentures have not been converted at the option of the holder or otherwise extinguished.

The principal amount of the 2019 Debentures is convertible into 1,563,833 units of the Company at the option of the holder at any time prior to maturity at a conversion price of $15.00 per unit. At June 30, 2022, no units had been converted. Each unit is comprised of one common share and one share purchase warrant. Each warrant is exercisable to acquire one common share at an exercise price of $22.50 until June 2024.

b) 2021 Convertible debentures

Issuance of Convertible Debentures

On December 7, 2020, the Company commenced efforts to raise an aggregate of US$10,000,000 through a private placement offering (the “Offering”) of convertible unsecured subordinated debentures (the “2021 Debentures”) at a price of US$100 per debenture. At December 31, 2020, total proceeds of $5,285,997 (US$4,146,825) had been received associated with two tranches of the Offering; however, as the debenture certificates were not yet issued the proceeds were recorded as other liabilities in the consolidated statement of financial position at December 31, 2020 (Note 16).

The Offering closed in six tranches between December 7, 2020 and May 25, 2021 with total gross proceeds of $11,328,870 (US$8,884,000). Each tranche had a specific maturity date and USD conversion price which was set at the date of close. The conversion prices ranged between $4.11 (US$3.42) and $8.28 (US$6.60) depending on the tranche.

Up until the date of conversion as described below under Conversion of Convertible Debentures, the maturity date of the 2021 Debentures was 36 months following the closing date of the applicable tranche. The principal amounts of the 2021 Debentures were convertible into common shares at the option of the holder at any time prior to maturity at the calculated conversion price stated in the debenture. The 2021 Debentures bore interest at 8% per annum, payable, at the option of the Company, in cash or common shares of the Company calculated in accordance with the debenture agreement which considered such factors as the price of the common stock on the TSX.V converted into USD at the date of record. The Company elected to pay all accrued interest in common shares which were issued on the conversion date.

On initial recognition, the 2021 Debentures included a host liability and embedded derivative conversion option. The fair value of the embedded derivative was determined first, with the residual amount of the total fair value of the convertible debentures allocated to the host liability. The host liability was classified as a financial liability recognized at amortized cost and the embedded derivative conversion option was an embedded derivative classified as fair value through profit or loss (“FVTPL”). The fair value measurement is further described in Note 26(b) - Financial Instruments under Valuation methodologies used in the measurement of fair value for Level 3 financial liabilities.

Conversion of Convertible Debentures

On July 12, 2021, the Company announced that it had entered into Debt Conversion and Exchange Agreements (“Conversion Agreements”) with holders of more than 99.2% of the outstanding principal amount of the 2021 Debentures subject to a number of conditions including TSX.V approval. The Conversion Agreements provided for certain changes in terms including a reduced conversion price on certain tranches of the 2021 Debentures and the addition of a common share purchase warrant for each common share to be issued upon conversion.

On August 13, 2021, the Company received TSX.V approval and issued an aggregate of 2,107,787 common shares and 2,107,787 common share purchase warrants (Note 19(a)) to extinguish 99.2% of the principal and accrued interest thereon to the date of the Conversion Agreements.

The following reconciliation includes: (a) the original issuance of and accounting for the convertible debentures up to July 12, 2021; (b) the derecognition of the host liability and embedded derivative on July 12, 2021 as the change in terms of the agreement was determined to be a substantial modification and resulted in recognition of a new financial liability at this date; (c) the extinguishment of the amount due under the 2021 Debentures on August 13, 2021 in exchange for common shares and warrants; and (d) the accounting for the remaining debenture which was not converted. The warrants issued continue to be financial liabilities of the Company as further described in Note 15.

	December 31, 2021
Proceeds from issue of convertible debentures	$	11,328,870
Fair value adjustments (Note 23)		1,615,102
Total fair value of convertible debentures		12,943,972
Less: fair value of embedded derivative		(5,060,776	)
Less: transaction costs 1		(660,604	)
Carrying value of liability at inception		7,222,592
Interest expense associated with liability		813,615
Debt extinguishment, including interest payable		(7,735,230	)
Foreign exchange adjustments		(224,286	)
		76,691
Less: accrued interest included in accrued liabilities		(7,657	)
Carrying value of liability at end of period 2	$	69,034

1  Total transaction costs were $1,061,854 which include cash compensation paid to brokers and the value of 115,760 broker warrants issued. Transaction costs of $401,250 allocated to the embedded derivative portion of the convertible debentures were expensed in finance costs in the consolidated statements of loss and comprehensive loss for the year ended December 31, 2021.

2  Convertible debt in the principal amount of US$75,000 which matures January 2024, bears interest at 8% per annum and is convertible to the Company’s shares at a conversion price of $5.84 (US$4.59).

	December 31, 2021
Fair value of embedded derivative at inception	$	5,060,776
Fair value decrease 1		(784,261	)
Derecognition of embedded derivative on conversion		(4,214,198	)
Foreign exchange adjustments		(20,811	)
Balance, embedded derivative	$	41,506

1 The fair value of the embedded derivative is remeasured at the end of each reporting period and on conversion and recognized in fair value (gain) loss on derivatives in the consolidated statements of loss and comprehensive loss (Note 23).

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Warrant Liabilities

6 Months Ended

12 Months Ended

Jun. 30, 2022

Dec. 31, 2021

Text Block [Abstract]

Warrant Liabilities

NOTE 11 - WARRANT LIABILITIES

	June 30, 2022		December 31, 2021
Derivative warrant liabilities - 2021 Debentures (a)	$	367,019	$	1,868,541
Derivative warrant liabilities - USD equity financing (b)		2,650,624		6,106,596
Warrant liability related to business acquisition (c)		—		709,835
Other warrant liability (c)		—		195,066
Total, all current	$	3,017,643	$	8,880,038

Derivative warrant liabilities

The Company issued warrants in conjunction with debt and equity transactions. Certain of these warrants are classified as derivatives which are recognized as financial liabilities. At the issuance date and each reporting date until warrants are exercised, the fair value of the liability is remeasured, with changes in the fair value recorded as gains or losses in the consolidated statements of loss and comprehensive loss. There were no new derivative warrants issued or warrants exercised in the three and six months ended June 30, 2022.

a)  Warrants associated with 2021 Debentures

The 2,107,787 common share purchase warrants entitle the holder to purchase one common share of the Company at an exercise price of US$6.87 and expire August 13, 2024. At June 30, 2022, the warrants were remeasured at a fair value of $367,019, resulting in a $853,068 and $1,509,069 gain on remeasurement for the three and six months ended June 30, 2022. The fair value of derivative warrants at June 30, 2022 of $0.17 per warrant was calculated using the Black-Scholes option pricing model (“Black-Scholes model”) with the following inputs and assumptions: share price of $4.05, Canadian dollar equivalent exercise price of $8.87, risk-free rate of 2.93%, expected life of 2.1 years, expected volatility of 43%, and no expected dividends. These warrants are classified as a Level 3 fair value measurement.

b)  Warrants associated with USD equity financing

The 2,415,000 common share purchase warrants entitle the holder to purchase one common share of the Company at an exercise price of US$4.75 and expire November 29, 2026. On February 15, 2022, these warrants commenced trading on the NASDAQ, under the symbol MCLDW, and as a result, these warrants are classified as a Level 1 fair value measurement (previously Level 3) at June 30, 2022 (Note 15(b)). At June 30, 2022, the warrants were remeasured at a fair value of $2,650,624, resulting in a $1,652,742 and $3,490,011 gain on remeasurement for the three and six months ended June 30, 2022. The fair value of derivative warrants at June 30, 2022 of $1.10 (US$0.85) per warrant was based on the closing price of the warrants.

c) Other warrant liabilities

Warrant liability related to business acquisition - During 2019, the Company assumed a warrant liability whereby the holder of the warrant has the option to convert the warrant into shares of Agnity, not the Company, by April 15, 2022, or receive a cash payment of US$552,250 at any time before the expiry of the warrant. The liability is measured at the Canadian dollar equivalent to its cash redemption amount which varies as a function of movements in exchange rates. The warrant holder elected to receive cash repayment and the C$ equivalent of the cash payment has been reclassified to trade payables and accrued liabilities at June 30, 2022.

Warrant liability related to ATB Financial - At December 31, 2021, the Company had an obligation to issue warrants to ATB. The fair value of the warrants was measured at the date the services were received in the amount of $195,066. On January 17, 2022, the Company issued 183,486 share purchase warrants to ATB which gives them the ability to purchase an equivalent number of common shares of the Company at an exercise price of $5.45 per share, maturing one year from date of issuance (Note 12(b)).

NOTE 15 - WARRANT LIABILITIES

	December 31, 2021		December 31, 2020
Derivative warrant liabilities - 2021 Debentures (a)	$	1,868,541	$	–
Derivative warrant liabilities - USD equity financing (b)		6,106,596		–
Warrant liability related to business acquisition (c)		709,835		710,924
Other warrant liability (c)		195,066		–
Total, all current	$	8,880,038	$	710,924

Derivative warrant liabilities

The Company issued warrants in conjunction with debt and equity transactions. Certain of these warrants are classified as derivatives which are recognized as financial liabilities. The estimated fair value of the derivative warrant liabilities has been calculated using the Black-Scholes model. At the issuance date and each reporting date until warrants are exercised, the fair value of the liability is remeasured, with changes in the fair value recorded as gains or losses in the consolidated statements of loss and comprehensive loss.

In conjunction with the USD equity offering described at (b) below, the Company agreed to list the warrants issued as part of the unit offering on the NASDAQ. On February 15, 2022, these warrants commenced trading under the symbol MCLDW (Note 31).

Derivative warrant liabilities are classified as a Level 3 fair value measurement as further described in Note 26. There were no exercises of the warrants described below since issuance.

a) Warrants associated with 2021 Debentures

On August 13, 2021, the Company issued 2,107,787 common share purchase warrants in conjunction with the conversion and extinguishment of the 2021 Debentures (Note 14(b); 19(b)). The common share purchase warrants entitle the holder to purchase one common share of the Company at an exercise price of US$6.87 and mature in August 2024. The fair value of the warrants at August 13, 2021 was $5,947,689.

At December 31, 2021, the warrants were remeasured at a fair value of $1,868,541 and the Company recorded a gain on remeasurement since initial recognition of $4,177,825. The Black-Scholes model inputs and assumptions include:

	December 31, 2021		August 13, 2021
Share price at date of valuation	$	6.18	$	6.90
Exercise price	$	8.74	$	8.74
Risk free rate		0.88 %		0.43 %
Expected life (years)		2.62		3.00
Expected volatility 1		45.0 %		71.5 %
Fair value per warrant 2	$	0.89	$	2.82

1  Expected volatility at December 31, 2021 measured at implied volatility of traded warrants.

2  Considers a liquidity discount of 20% in determining the fair value per warrant as these warrants are not publicly traded.

b) Warrants associated with USD equity financing

On November 29, 2021, the Company issued 2,415,000 common share purchase warrants in conjunction with the November 2021 USD unit offering (Note 19). The common share purchase warrants entitle the holder to purchase one common share of the Company at an exercise price of US$4.75 and mature five years after issuance. The fair value of the warrants at issuance was $5,302,004 (US4,158,396) and at December 31, 2021, the remeasured fair value was $6,106,596. The Black-Scholes model inputs and assumptions include:

	December 31, 2021		November 29, 2021
Share price at date of valuation	$	6.18	$	5.70
Exercise price	$	6.04	$	6.05
Risk free rate		1.25 %		1.18 %
Expected life (years)		4.92		5.00
Expected volatility 1		45.0 %		45.0 %
Fair value per warrant	$	2.53	$	2.19

1  Expected volatility at represents implied volatility of the Company’s traded warrants.

c) Other warrant liabilities

Warrant liability related to business acquisition - Associated with the acquisition of Agnity, the Company assumed a warrant liability whereby the holder of the warrant has the option to convert the warrant into shares of Agnity, not the Company, by April 15, 2022, or receive a cash payment of US$552,250 at any time before the expiry of the warrant. The liability is measured at the Canadian dollar equivalent to its cash redemption amount which varies as a function of movements in exchange rates. The warrant holder elected to receive cash repayment resulting in the C$ equivalent of the cash payment being reclassed to trade payables and accrued liabilities at June 30, 2022.

Warrant liability related to ATB Financial - At December 31, 2021, the Company had an obligation to issue warrants to ATB (Note 13). The fair value of the warrants was measured at the date the services were received in the amount of $195,066. On January 17, 2022, the Company issued 183,486 share purchase warrants to ATB to purchase an equivalent number of common shares of the Company at an exercise price of $5.45 per share, maturing one year from date of issuance (Note 31).

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Other Liabilities

12 Months Ended

Dec. 31, 2021

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Other Liabilities

NOTE 16 - OTHER LIABILITIES

	December 31, 2021		December 31, 2020
US Government loans	$	–	$	950,418
2021 Debentures subscriptions payable (Note 14(b))		–		5,285,997
Total	$	–	$	6,236,415
Current portion 1	$	–		6,003,838
Non-current portion		–		232,577
	$	–	$	6,236,415

1  Includes US Government loans of $717,841 at December 31, 2020. These forgivable loans are considered to be government grants when there is reasonable assurance that they will be forgiven.

During the year ended December 31, 2021, the Company received two additional US Government loans as part of the Paycheck Protection Program (“PPP”) totaling $840,845 (US$668,689), each bearing interest at 1% per annum with maturity dates in February and May 2026. During the year ended December 31, 2020, the Company received four PPP US Government loans totaling $1,120,139 (US$805,246). A portion or the entirety of the amounts funded may be forgiven if all the funds are used for qualifying expenses which include payroll costs, rent and utility costs, and employment and compensation levels are maintained. The Company has used the entire loan amounts for qualifying expenses and as such expects these loans will be forgiven and no principal or interest payments will be made. During the year ended December 31, 2021, five government loans were forgiven resulting in $1,825,237 being included in other income (Note 24).

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Business Acquisitions

12 Months Ended

Dec. 31, 2021

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Business Acquisitions

NOTE 17 - BUSINESS ACQUISITIONS

a) Acquisition of Royalty interests

On January 22, 2019, the Company executed a Purchase Agreement with Flow Capital Corp. (“Flow”) pursuant to which the Company acquired Flow’s interest in a Royalty Purchase Agreement (“Royalty Agreement”) with Agnity Global, Inc. (“Agnity”). According to the Purchase Agreement, the Company assumed the Royalty agreement and acquired an interest in a financial asset with the following characteristics:

i. a receivable owing by Agnity to Flow of USD $2,834,750;

ii. a monthly royalty payment stream until October 31, 2020 equal to the greater of:

• A monthly amount of USD $41,667; or

• 4.25% of Agnity’s revenue for each calendar month; and

iii. commencing November 1, 2020, a monthly royalty payment stream equal to 4.25% of Agnity’s revenue for each calendar month in perpetuity.

The Royalty Agreement includes a formula by which the royalty percentage is proportionately adjusted for any subsequent further advances to or repayments from Agnity.

As consideration for acquiring the interest in the Royalty Agreement, the Company paid $204,604 (USD $153,227) in cash at the closing date and entered into the following agreements with Flow:

(i) A secured loan agreement for USD $2,000,000. The loan bears interest at 25% per annum and is due on demand. The Company had the option to repay 100% of the loan, at any time, by paying an amount equal to the principal of the loan and any unpaid interest. Upon prepayment of the loan, the Company, at the option of Flow (the “Flow’s option”), was obligated to pay either:

• Cash of USD $525,000; or

• Issue 50,000 common shares of the Company (“repayment shares”)

The fair value of the loan was initially determined to be $2,670,600 (USD $2,000,000) which is equivalent to its face value as it is due on demand. It is classified as other financial liabilities and subsequently measured at amortized cost. The fair value of Flow’s option to receive either USD $525,000 in cash or repayment shares upon prepayment of the loan by the Company was determined to be USD $606,495 on initial recognition. The option was accounted for as a compound instrument which includes a liability component of USD $525,000 and an equity conversion option of USD $81,495. The liability component was classified as other financial liabilities and subsequently measured at the amortized cost while the equity component was accounted for as an equity instrument in contribute surplus. The Company used the Black-Scholes option model to determine the fair value of the option using the following inputs at January 22, 2019:

Share price	$10.50
Risk free rate	1.90%
Expected life	0.5 years
Expected volatility	60.00%
Expected dividends	Nil

On July 26, 2019, the Company settled the USD $2,000,000 loan and Flow’s option in cash of $2,703,148 and the issuance of 50,000 common shares. The value attributable to the option of USD $606,495 was reclassified from liabilities and contributed surplus to share capital (note 19a)).

(i) The Company also agreed to issue a quantity of its common shares based on the trading price of the Company. Specifically, for the period after January 22, 2019 and prior to January 22, 2025, if the five-day volume weighted average trading price of the Company’s common shares equals or exceeds:

• $30.00, 50,000 common shares will be issued;

• $60.00, 33,333 common shares will be issued;

• $90.00, 33,333 common shares will be issued.

The fair value of these shares issuable to Flow was determined to be $712,000 on initial recognition. They are accounted for as equity instruments and recorded in contributed surplus. The Company used Black-Scholes option model to determine the fair value of these shares using the following inputs at January 22, 2019:

Barrier share price	$30 - $90
Risk free rate	1.90%
Expected life	6 years
Expected volatility	80.00%
Expected dividends	Nil

As of December 31, 2021, 2020 and 2019, none of the share trading price thresholds noted above have been met.

b) Acquisition of Agnity

On April 22, 2019, the Company executed an amending agreement with Agnity to modify the terms of the Royalty Agreement acquired. Pursuant to the amending agreement, both parties agreed to establish an Operations Committee for which at all times the Company has the right to nominate a majority of the members. As consideration for the amendment, the Company agreed to fix the royalty payment at US$10,000 per month commencing March 2019 and to assume $43,050 of Agnity’s liabilities payable to a third party.

Pursuant to the amending agreement the Company determined that it had obtained control over Agnity and its subsidiaries pursuant to IFRS 10 Consolidated Financial Statements. The Company considered several factors in determining if and when it gained control over Agnity including, if it had the right and ability to direct the relevant activities of the entity, the ability to significantly affect its returns through the use of its rights, and whether it had exposure to variable returns.

Factors evaluated included, but were not limited to, delegation of power by Agnity’s Board for the Company to direct Agnity’s relevant activities through the formation and activities of the Operations Committee controlled by the Company. Determination of whether the Company has obtained control over Agnity involves judgement based on interpretation of the amending agreement with Agnity and identification and analysis of the relevant facts. In addition, judgement was required to determine if the acquisition represented a business combination or an asset purchase. The Company determined that Agnity and its related subsidiaries represented a business as the assets were an integrated set of activities with inputs, processes and outputs.

Accordingly, the acquisition of Agnity is accounted as a business combination effective on April 22, 2019 using the acquisition method in accordance with IFRS 3 Business Combinations. Given the Company owns nil voting interests in Agnity, the non-controlling interest is measured at the 100% of the acquired net identifiable assets of Agnity.

Agnity develops and sells software applications and technology services that enable telecommunication service providers, network equipment manufacturers and enterprises to design, develop, and deploy communication-centric application solutions on a world-wide basis. Taking control of Agnity has enabled the Company to gain access to Agnity’s patented technology and its customer base. In addition, Agnity’s communication platform ensures that AssetCare™ deployments around the globe are assured of connectivity, supported by Agnity telecommunication solutions.

The following table summarizes the acquisition-date fair value of each major class of consideration transferred, the recognized amounts of the identifiable assets acquired, and liabilities assumed, and the resulting measurement of 100% NCI recorded by the Company at the date of acquisition:

Consideration transferred:		Final
Change in fair-value of interest in Royalty Agreement (i)	$	167,488
Assumption of Agnity’s liabilities		43,050
Total consideration transferred	$	210,538

(i) The fair value of interest in the Royalty Agreement at April 22, 2019 was estimated using the discounted cash flow model. The major inputs employed in the model include forecasted royalty payments and the discount rate of 16%.

Fair value of assets and liabilities recognized:		Final
Cash and cash equivalents	$	33,524
Trade and other receivables		1,387,723
Prepaid expenses and deposits		46,483
Long term receivable		–
Property and equipment		1,281
Intangible Asset – Technology		8,412,390
Intangible Asset – Customer Relationship		1,468,830
Accounts payable and accrued liabilities		(3,232,910	)
Deferred revenue		(457,259	)
Loans and borrowings		(5,556,587	)
Warrant liability (i)		(737,419	)
Due to related party		(930,608	)
Deferred income tax liability		(444,768	)
Net identifiable assets acquired (liabilities assumed)		(9,320	)
Allocation to non-controlling interest	$	219,858

(i) A warrant was issued by Agnity in 2015 which entitles the warrant holder to acquire 6,324,660 common shares of Agnity at the exercise price of $0.000036 per share at any time until April 15, 2022. The exercise price of the warrant is subject to certain anti-dilution adjustment provisions in the event of certain capital or business transactions. The warrant holder has the option to demand a cash settlement of the warrant for US$552,250 at any time prior to its expiry date if the warrant is not exercised. It is classified as other financial liabilities and measured at its redemption amount of US$552,250 or $737,419 in Canadian dollars on acquisition date, which is equivalent to its assessed acquisition date fair value. The fair value in Canadian dollar equivalent as at December 31, 2021 was $709,835 (December 31, 2020 - $710,924; December 31, 2019 - $725,086).

There have been no adjustments to the preliminary purchase price allocation recognized at December 31, 2019 in the period ended December 31, 2020.

There are no acquisition costs associated with this transaction as the business combination with Agnity was effected by way of assessed control in accordance with IFRS 3 and 10.

c) Acquisition of mCloud Technologies Services Inc.

On July 10, 2019, the Company closed a series of merger and acquisition transactions resulting in the acquisition of 100% control of mCloud Technologies Services Inc. (“MTS”), formerly known as Autopro Automation Consultants Ltd. (“Autopro”). The acquisition was completed by way of an amalgamation between 2199027 Alberta Ltd., a subsidiary of the Company, and Fulcrum Automated Technologies Ltd. (“Fulcrum”), an entity established to facilitate the acquisition, with the amalgamated entity being a wholly owned subsidiary of the Company, named Autopro Automation Ltd. Immediately prior to the amalgamation, Fulcrum acquired MTS. The consideration transferred to the original shareholders of MTS included cash, issuance of promissory notes and 1,200,000 common shares of the Company.

MTS is a professional engineering and integration firm that specializes in design and implementation of industrial automation solutions, focusing on Canadian oil and gas companies. The acquisition has provided the Company with an increased share of the market through access to MTS’ customer base in the Canadian oil and gas industry, petrochemical, and process manufacturing markets.

The following table summarizes the acquisition-date fair value of each major class of consideration transferred, the recognized amounts of the identifiable assets acquired, and liabilities assumed, and the resulting value of goodwill:

Consideration transferred:		Final
Cash consideration	$	4,650,689
Fair value of demand promissory notes issued(1)		18,000,000
Fair value of common shares transferred(2)		13,320,000
Total consideration transferred	$	35,970,689

(1) Comprised of two promissory notes with fair-value of $6,000,000 and $12,000,000 which were fully repaid and settled on July 10 and August 8, 2019 respectively; there was no gain or loss on settlement.

(2) The fair value of shares transferred as consideration is based on the quoted share price on the date of acquisition

Fair value of assets and liabilities recognized:		Final
Cash and cash equivalents	$	2,227,739
Trade and other receivables (includes Unbilled revenue of $2,347,207)		5,120,830
Prepaid expenses and deposits		611,104
Right-of-use assets		4,303,215
Property and equipment		548,317
Intangible asset – Customer relationships		12,700,000
Intangible asset – Technology		1,800,000
Accounts payable and accrued liabilities		(2,030,470)
Deferred revenue		(133,556	)
Lease liabilities		(4,303,215	)
Deferred income tax liability		(3,632,250	)
Fair value of net assets acquired		17,211,714
Goodwill	$	18,758,975
	$	35,970,689

There have been no adjustments to the preliminary purchase price allocation recognized at December 31, 2019 or in the periods ended December 31, 2020.

Goodwill arising from the acquisition is attributable mainly to the skills and technical talent of MTS’ work force and the synergies expected to be achieved from integrating MTS into the Company’s existing business. The talent and domain expertise of MTS’ workforce has enabled the Company to establish credibility in the oil and gas, petrochemical, and process manufacturing markets, and accelerate the development of artificial intelligence applications geared toward process industries. None of the goodwill recognized is expected to be deductible for tax purposes.

Transaction costs of $9,869,589 were incurred in connection with the acquisition including consulting fees of $750,000, legal and professional fees of $239,589 and fair value of $8,880,000 for 800,000 common shares issued to the original shareholders of Fulcrum for brokering and due diligence services and were recognized in the consolidated statement of loss and comprehensive loss.

d) Acquisition of Construction Systems Associates, Inc. USA

On January 24, 2020, the Company completed its acquisition of all the outstanding and issued common shares of Construction Systems Associates, Inc. USA (“CSA”). The acquisition was accounted for as a business combination using the acquisition method whereby the assets acquired, and the liabilities assumed were recorded at fair value. At acquisition date the fair values assigned to intangible assets, goodwill and the deferred tax liabilities were measured on a provisional basis and were revised by the Company as additional information was received.

On January 24, 2021, the measurement period for the acquisition ended and there were no further measurement period adjustments during the year ended December 31, 2021. The following table summarizes the final balances of each major class of consideration transferred, the recognized amounts of the identifiable assets acquired and liabilities assumed, and the resulting value of goodwill.

	Final
Consideration transferred:
Cash consideration	$	703,212
Fair value of common share consideration		2,304,073
Fair value of contingent consideration payable		879,066
Total consideration	$	3,886,351

Fair value of assets and liabilities recognized:
Cash	$	181,408
Trade and other receivables		262,846
Prepaid expenses and other deposits		13,863
Property and equipment		2,098
Right of use assets		242,894
Intangible - technology		551,880
Intangible - customer relationships		801,540
Accounts payable and accrued liabilities		(168,542	)
Short-term loan		(371,610	)
Lease liabilities		(242,894	)
Deferred tax liabilities		—
Fair value of net assets acquired	$	1,273,483
Goodwill	$	2,612,868

The fair value of common shares transferred as consideration is based on the quoted share price on the date of acquisition, which is at $18.18 per common share.

The fair value of the contingent consideration payable was based on an estimated weighted probability of certain revenue and EBITDA targets being met in the 2-year period following the acquisition date. At December 31, 2021, the Company assessed the fair value of the contingent consideration to be nil as these targets were not expected to be met and as such $838,932 was recognized in other income in the consolidated statements of loss and comprehensive loss for the year ended December 31, 2021 (Note 24).

The Company is required during the measurement period to retrospectively adjust the provisional amounts recognized at the acquisition date to reflect new information obtained about facts and circumstances that existed as of the acquisition date. The measurement period adjustments from acquisition date to the end of the measurement period are reflected above with the cumulative changes increasing goodwill. The impact on net income (loss) of recognizing these adjustments to the provisional amounts as if the accounting had been completed at the acquisition date are limited to a decrease in amortization of intangibles and related foreign currency translation differences.

e) Acquisition of kanepi

On October 8, 2020, the Company completed its acquisition of all the outstanding and issued common shares of kanepi. kanepi provides advanced visual analytics solutions designed to deliver an immediate and positive impact on the industrial operations of asset intensive industries. The acquisition was accounted for as a business combination using the acquisition method whereby the net assets acquired, and the liabilities assumed were recorded at fair value. At acquisition date the fair values assigned to intangible assets, goodwill and the deferred tax liabilities were measured on a provisional basis.

The Company is required during the measurement period to retrospectively adjust the provisional amounts recognized at the acquisition date to reflect new information obtained about facts and circumstances that existed as of the acquisition date. On October 8, 2021, the measurement period for the acquisition ended and the following table summarizes the acquisition-date fair value and the final balances of each major class of consideration transferred, the recognized amounts of the identifiable assets acquired and liabilities assumed, and the resulting value of goodwill. The preliminary balances were reported in the consolidated financial statements for the year ended December 31, 2020 and there were no measurement period adjustments.

	Final
Consideration transferred:
Cash consideration	$	4,657,512
Fair value of common share consideration		5,882,547
Fair value of contingent consideration payable		568,638
Total consideration	$	11,108,697

Fair value of assets and liabilities recognized:
Cash	$	556,880
Trade and other receivables		598,059
Other current assets		13,149
Property and equipment		1,224
Right of use assets		266,396
Intangible - technology		3,294,309
Intangible - customer relationships		2,632,794
Accounts payable and accrued liabilities		(643,385	)
Lease liabilities		(266,396	)
Deferred tax liabilities		(1,136,806	)
Fair value of net assets acquired	$	5,316,224
Goodwill	$	5,792,473

The fair value of the contingent consideration payable is based on an estimated weighted probability of certain revenue or customer acquisition targets being met in a two-year period from the acquisition date. At acquisition date and December 31, 2020, the fair value of the contingent consideration was determined to be $568,638 based on estimates of achievement of targets. The fair value of the contingent consideration is determined using a discounted cash flow model at a discount rate of 27%. At December 31, 2021, the Company assessed the likelihood of achievement of the targets and determined the fair value of the contingent consideration decreased by $171,092 and this amount was recognized in other income in the consolidated statements of loss and comprehensive loss for the year ended December 31, 2021 (Note 24).

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Business Acquisition Payable

12 Months Ended

Dec. 31, 2021

Text Block [Abstract]

Business Acquisition Payable

NOTE 18 - BUSINESS ACQUISITION PAYABLE

	December 31, 2021			December 31, 2020
Opening balance	$	2,439,529		$	1,043,314
Contingent consideration changes related to CSA (Note 17)		(853,308	)		879,066
Contingent consideration changes related to kanepi (Note 17)		(171,092	)		568,638
Effect of foreign exchange differences		(16,157	)		(51,489	)
		1,398,972			2,439,529
Current portion		1,398,972			1,594,297
Non-current portion		—			845,232
	$	1,398,972		$	2,439,529

During the year ended December 31, 2021, the Company determined that the amount of the contingent consideration recognized at the date of acquisition of Construction Systems Associates, Inc. USA (“CSA”) would not be payable as the operational performance metrics were not expected to be achieved. In addition, the fair value of the contingent consideration recognized at the date of acquisition for kanepi Group Pty Ltd. and its subsidiaries (“kanepi”) was remeasured based on management’s estimate of the likelihood the performance metrics would be met by October 2022, resulting in a decrease in fair value and an offsetting amount recognized as other income.

At December 31, 2021, $383,368 of contingent consideration payable remains associated with the kanepi acquisition. The remaining balance of $1,015,604 relates to the acquisition consideration payable associated with the Field Diagnostic Services, Inc. (“FDSI”) acquisition completed in 2017.

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Share Capital

6 Months Ended

12 Months Ended

Jun. 30, 2022

Dec. 31, 2021

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Share Capital

NOTE 12 - SHARE CAPITAL

a)   Common shares

The Company has an unlimited number of authorized voting common shares with no par value. During the six months ended June 30, 2022, the Company issued 17,585 common shares on exercise of Restricted Share Units (Note 13(b)).

Common shares in escrow

At June 30, 2022, the Company has 441,913 (December 31, 2021 - 681,024) common shares subject to escrow conditions resulting from business combinations and asset acquisitions in prior years.

b)   Warrants

The Company’s warrants outstanding as at June 30, 2022 are as follows and include both warrants classified as equity-settled and warrants classified as financial liabilities (Note 11):

	Number of Warrants			Weighted Average  Exercise Price
Balance, December 31, 2021		8,481,929		$	8.83
Issued		183,486			5.45
Expired		(19,318	)		15.00
Balance, June 30, 2022		8,646,097		$	8.74

On January 17, 2022, the Company issued warrants to ATB to purchase an equivalent number of common shares of the Company and the warrant liability of $195,066 described in Note 11(c) was derecognized with an offsetting credit to contributed surplus for the value assigned to the warrants. The weighted average remaining contractual life of outstanding warrants was 2.6 years at June 30, 2022 (December 31, 2021 - 3.1 years).

NOTE 19 - SHARE CAPITAL

a) Common shares

The Company has an unlimited number of authorized voting shares with no par value. The following is a summary of shares issued during the year ended December 31, 2021. The Company issued 71,190 common shares on exercise of Restricted Share Units (“RSUs”) (Note 20(b)).

Brokered public offering

On April 15, 2021, the Company closed a public offering of 2,300,000 units of the Company at a price of $6.30 per unit for aggregate gross proceeds of $14,490,000. Each unit consists of one common share and one common share purchase warrant. Each warrant entitles the holder to purchase one common share at an exercise price of $8.55 for 36 months following closing subject to adjustment in certain events.

The public offering was brokered, and the underwriting agent received cash commissions of $1,014,300 or 7% of the gross proceeds under the offering. In addition, the Company also incurred $459,986 of share issuance costs in connection with the offering, for total net proceeds of $13,015,714. Net proceeds were allocated $12,395,918 to share capital with the residual of $619,796 allocated to warrants which is included in contributed surplus in the consolidated statement of changes in equity for the year ended December 31, 2021.

Non-brokered private placement offering

On August 13, 2021, the Company completed a non-brokered private placement, pursuant to a subscription agreement dated July 12, 2021, of 75,676 units of the Company at a unit price of $5.55 for gross proceeds of $420,000. Each unit consists of one common share and one share purchase warrant at an exercise price of $8.55 per common share with warrants expiring April 2024. Net proceeds of $420,000 were allocated fully to the common shares.

Conversion of 2021 Convertible Debentures

On August 13, 2021, the Company extinguished 99.2% of the principal and accrued interest of the 2021 Debentures (Note 14(b)). The principal and interest payable balance of converted debentures was settled by issuing an aggregate of 2,107,787 common shares and 2,107,787 common share purchase warrants. The value of the common shares at August 13, 2021, net of transaction costs was $14,436,728. See Note 15 for description of warrants issued.

USD Brokered public offering

On November 29, 2021, the Company closed a public offering of 2,100,000 units of the Company at US$4.50 per unit for aggregate gross proceeds of $12,040,198 (US$9,450,000) and net proceeds of $10,912,251 after underwriting discounts and commissions payable. On December 3, 2021, an additional 315,000 units, representing the over-allotment option under the offering, were issued for aggregate gross proceeds of $1,820,070 (US$1,417,450) and net proceeds of $1,674,464. Each unit consists of one common share of the Company and one common share purchase warrant. Each warrant entitles the holder to purchase one common share, a warrant share, at an exercise price of US$4.75 per warrant share for five years following closing subject to adjustment in certain circumstances. The common shares and the share purchase warrants were issued separately.

Gross proceeds were allocated $5,302,004 to the warrants with the residual of $8,558,264 allocated to share capital. Transaction costs of $1,738,087 associated with the issuance of the units were allocated proportionately with the allocation of gross proceeds with $1,073,262 net against share capital and $664,825 allocated to finance costs (Note 22).

The Company also issued warrants to the underwriter of the offering to purchase 126,000 common shares at an exercise price of US$4.95 which are exercisable to May 22, 2025. The fair value of these warrants of $162,947 were recorded to contributed surplus and are considered transaction costs of which a portion is expensed in the consolidated statements of loss and comprehensive loss.

In addition to the transaction costs associated with the issuance of the units, the Company incurred additional expenses related to the registration process and listing of its common shares on the NASDAQ which are included in general and administrative costs in the consolidated statements of loss and comprehensive loss.

Common shares in escrow

At December 31, 2021, the Company has 681,024 (December 31, 2020 - 1,674,284; December 31, 2019 - 2,381,826) common shares subject to escrow conditions resulting from business combinations and asset acquisitions in prior years. There were no additional common shares subject to escrow conditions added during the year ended December 31, 2021. Escrow restrictions will be released on 458,599 shares in the year ending December 31, 2022, and the remaining 222,425 shares in the year ending December 31, 2023.

Shares issued for debt settlement

During February and September 2019, the Company issued 1,964 and 5,000 common shares respectively for settlement of outstanding debt to vendors for services provided. The Company valued these common shares based on the trading price of the Company’s shares on the date of issuance.

b)  Warrants

The Company’s warrants outstanding at December 31, 2021, 2020 and 2019 are as follows and includes warrants classified as equity-settled and warrants classified as financial liabilities (Note 15):

	Number of Warrants	Weighted Average   Exercise Price   $
December 31, 2018	1,104,378	$                                        13.50
Issued	19,957	$                                        14.46
Exercised	(133,176)	$                                        12.96
Expired	(209,899)	13.50
December 31, 2019	781,260	$                                        13.80
Issued	2,433,081	13.72
Exercised	(1,228,935)	12.06
Expired	(53,880)	13.31
December 31, 2020	1,931,526	$                                        14.82
Issued	7,140,223	7.64
Expired	(589,820)	13.97
December 31, 2021	8,481,929	$                                          8.83

During the year ended December 31, 2021, the Company issued share purchase warrants in conjunction with the following transactions:

Equity classified warrants

• 115,760 warrants to brokers in connection with the issuance of the 2021 Debentures (Note 14(b)). Warrants issued to brokers are denominated in USD with exercise prices that range between $4.12 (US$3.42) and $8.28 (US$6.60) and are exercisable for 24 months with maturity dates ranging from December 2022 to May 2023.

The total fair value of warrants issued to brokers of $294,894 was calculated using the Black-Scholes model with the following weighted average inputs and assumptions: issue date share price of $6.39; exercise price of $5.85; risk-free rate of 0.26%; expected life of 1.88 years; expected volatility of 69%; and no expected dividends.

• 2,300,000 warrants in connection with the April 15, 2021 public offering (Note 19(a));

• 75,676 warrants in connection with the non-brokered private placement offering (Note 19(a)); and

• 126,000 warrants issued to the underwriter of the November 2021 USD public offering (Note 19(a)). The total fair value of warrants of $162,947 was calculated using the Black-Scholes model with the following inputs and assumptions: issue date share price of $5.70; exercise price of $6.31; risk-free rate of 1.04%; expected life of 3.48 years; expected volatility of 45%; and no expected dividends.

Derivative liability warrants

• 2,107,787 warrants in connection with the August 13, 2021, conversion and interest settlement of the majority of the 2021 Debentures (Note 14(b)); and

• 2,415,000 warrants in connection with the November 2021 USD public offering (Note 19(a); Note 15).

Warrants outstanding at December 31, 2021 were as follows:

Expiry Date	Exercise Price $	Outstanding Warrants
June 2022	15.00	19,584
July 2022	14.25	525,114
December 2022	5.63	1,000
January 2023	5.72	37,400
January 2023	6.97	25,400
February 2023	7.80	8,000
March 2023	8.28	9,000
May 2023	4.12	34,960
April 2024	8.55	2,375,676
June 2024	22.50	3,333
August 2024	8.60	2,107,787
January 2025	16.20	611,027
May 2025	6.31	126,000
July 2025	14.25	182,648
November 2026	6.05	2,415,000
	$                                            8.83	8,481,929

The weighted average remaining contractual life of outstanding warrants was 3.09 years at December 31, 2021 (December 31, 2020 - 2.29 years; December 31, 2019 - 1.37 years). Exercise prices for warrants denominated in USD as presented above were converted to the C$ equivalent exercise prices on the date of the applicable transaction.

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Share-Based Payment Arrangements

6 Months Ended

12 Months Ended

Jun. 30, 2022

Dec. 31, 2021

Text Block [Abstract]

Share-Based Payment Arrangements

NOTE 13 – SHARE BASED PAYMENT ARRANGEMENTS

The Company recorded share-based compensation as follows:

	Three months ended June 30,				Six months ended June 30,
	2022		2021		2022		2021
Stock options (a)	$	128,441	$	116,892	$	320,588	$	247,790
Restricted share units (b)		63,087		243,753		123,873		488,129
Total	$	191,528	$	360,645	$	444,461	$	735,919

a)   Stock Options

	Number of Options			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (years)
Outstanding, December 31, 2021		866,789		$	8.81		7.5
Granted		167,699		$	4.70		9.6
Forfeited		(137,526	)	$	7.11		9.3
Expired		(40,648	)	$	10.46		1.1
Outstanding, June 30, 2022		856,314		$	8.20		7.7

At June 30, 2022, 263,202 stock options were exercisable at a weighted average exercise price of $10.94. Exercise prices of stock options range from $3.46 to $18.02 per option. As at June 30, 2022, unrecognized share-based compensation expense related to non-vested stock options granted is $1,202,934 (December 31, 2021 - $1,824,812).

The weighted average fair value of stock options granted during the six months ended June 30, 2022 of $482,514, or $2.88 per option, was calculated at the date of grant using the Black-Scholes model with the following weighted average assumptions and inputs: grant date share price of $4.70, exercise price of $4.70, risk-free rate of 2.23%, expected life of 6.5 years, expected volatility of 74%, forfeiture rate of 10%, and no expected dividends. Expected volatility is estimated taking into account historical share price volatility.

b)   Restricted Share Units (“RSUs”)

The Company’s obligation to issue shares on the vesting of RSUs is an unfunded and unsecured obligation of the Company. A continuity of RSUs is as follows:

	Number of RSUs
Outstanding, December 31, 2021		208,674
Granted		98,417
Exercised		(17,585	)
Forfeited		(35,893	)
Outstanding, June 30, 2022		253,613
Exercisable at June 30, 2022		108,992

During the six months ended June 30, 2022, 17,585 common shares were issued on the exercise of 17,585 RSUs at a weighted average share price at exercise of $7.53. The fair value of each RSU is based on the market price of the Company’s common shares on the date of grant and the total fair value of RSUs granted in six months ended June 30, 2022 was $491,999. As at June 30, 2022, unrecognized share-based compensation expense related to non-vested RSUs granted was $310,434 (December 31, 2021 - $277,686).

NOTE 20 – SHARE-BASED PAYMENT ARRANGEMENTS

The Company has an equity incentive plan (the “Plan”) which allows management to grant incentive stock options, non-statutory stock options, share appreciation rights, restricted share awards, restricted share unit awards, and other share awards to selected directors, employees, and consultants. A maximum of 10% of the issued and outstanding common shares of the Company may be reserved for issuance under the Plan.

The Company recorded share-based compensation as follows.

	Year Ended December 31,
	2021		2020		2019
Stock options (a)	$	908,293	$	677,452	$	820,613
Restricted share units (b)		959,622		776,783		647,748
Total	$	1,867,915	$	1,454,235	$	1,468,361

a) Stock Options

The board of directors or designated committee set the terms of the share-based payment arrangements under the Plan; however, the general terms of stock options are as follows. The options have a maximum term of 10 years and vest as to 33% on each anniversary date of the date of grant over three years. In limited cases, options vest immediately. For the majority of grants, the exercise price is equal to the closing price of the Company’s common shares on the grant date. On the date the option holder ceases to be employed, vested options are exercisable for a period of three months following that date, and unvested options are forfeited. Compensation is recognized on a graded vesting basis over the vesting period.

Movement in the number of stock options outstanding and their related weighted-average exercise prices were as follows:

	Number of Options			Weighted Average Exercise Price		Number of Options			Weighted Average Exercise Price		Number of Options			Weighted Average Exercise Price
	2021			2021		2020			2020		2019			2019
Opening balance		423,303		$	11.01		349,657		$	11.48		95,000		$	11.70
Granted		487,775			7.10		153,828			9.99		323,278			11.20
Exercised		–			–		(7,639	)		10.50		(50,838	)		10.62
Forfeited		(40,088	)		9.87		(32,777	)		11.52		(17,783	)		10.35
Expired		(4,201	)		11.03		(6,433	)		10.67		–			–
Cancelled		–			–		(33,333	)		10.50		–			–
Outstanding at December 31		866,789		$	8.81		423,303		$	11.01		349,657		$	11.48
Exercisable at December 31		275,473		$	11.10		161,244		$	11.70		17,014		$	12.87

The following summarizes information about the Company’s stock options outstanding at December 31, 2021:

	Options Outstanding						Options exercisable
Range of prices	Number		Weighted average exercise price		Weighted average life (years)		Number		Weighted average exercise price
$5.67 - $8.70		506,502	$	6.88		9.0		25,389	$	6.56
$8.71 - $10.95		200,706	$	10.67		4.9		138,622	$	10.57
$10.96 - $12.59		104,303	$	11.78		6.1		71,461	$	11.78
$12.60 - $18.02		55,278	$	14.11		6.4		40,001	$	14.59
		866,789	$	8.81		7.5		275,473	$	11.10

At December 31, 2021, if all exercisable options were exercised total cash received would be $3,057,750 (December 31, 2020 - $1,886,555; December 31, 2019 - $1,206,687). Unrecognized share-based compensation expense related to unvested stock options granted was $1,824,812 at December 31, 2021 (December 31, 2020 - $710,934; December 31, 2019 - $1,061,013).

Measurement of fair values for equity-settled arrangements

The weighted average fair value of stock options granted during the year ended December 31, 2021 of $4.25 per option, or $2,061,007 (December 31, 2020 - $4.54 per option or $698,949; December 31, 2019 - $4.91 per option or $1,597,043) was calculated at the grant date using the Black-Scholes model with the following weighted average assumptions and inputs.

	2021	2020	2019
Grant date share price	$                                    7.00	$                                    8.93	$                                10.88
Exercise price	$                                    7.10	$                                    9.74	$                                11.13
Risk-free rate	1.32  %	0.36  %	1.57  %
Expected life, years	6.2 years	5.0 years	3.9 years
Expected volatility	75  %	66  %	54  %
Expected dividends	–  %	–  %	–  %
Forfeiture rate	7  %	–  %	10  %

Expected volatility is based on an evaluation of the historical volatility of the Company’s share prices since the Company commenced trading which is a reasonable approximation of the volatility over the expected term of the stock option. The expected term of the options has been based on historical experience and general option holder behavior. The forfeiture rate reflects the anticipated level of forfeitures of options in the future.

b) Restricted Share Units (“RSUs”)

RSUs are granted to directors, employees and consultants and each RSU entitles the holder to one common share at the end of the vesting period. RSUs have various terms ranging from immediate vesting to vesting on either the first, second or third anniversary of the grant date, or as to 33% on each anniversary date of the grant over three years. Compensation is recognized on a graded vesting basis over the vesting period. The Company issues common shares to the RSU holder equal to the number of vested RSUs at the RSU holders’ request.

The Company’s obligation to issue shares on the vesting of RSUs is an unfunded and unsecured obligation of the Company. A continuity of RSUs is as follows:

Number of RSUs	2021	2020	2019
Outstanding at January 1	222,222	151,790	101,778
Granted	73,164	123,797	71,640
Exercised 1	(71,190)	(35,877)	(11,905)
Forfeited	(7,074)	(3,332)	(9,723)
Withheld 1	(8,448)	(14,156)	–
Outstanding at December 31	208,674	222,222	151,790
Exercisable at December 31	115,468	33,516	32,036

1  71,190 common shares issued on exercise of 79,638 RSUs at a weighted average grant date exercise price of $8.87. Certain RSU holders elected for RSUs exercised to be settled net of any tax withholding obligations.

The fair value of each RSU is based on the market price of the Company’s common shares on the date of grant and the total fair value of RSUs granted in the year ended December 31, 2021 was $528,028 (December 31, 2020 - $1,069,042; December 31, 2019 - $829,976). Unrecognized share-based compensation expense related to unvested RSUs was $277,686 at December 31, 2021 (December 31, 2020 - $807,830; December 31, 2019 - $702,373).

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Non-Controlling Interest

6 Months Ended

12 Months Ended

Jun. 30, 2022

Dec. 31, 2021

Text Block [Abstract]

Non-Controlling Interest

NOTE 14 – NON-CONTROLLING INTEREST

In April 2019, the Company obtained control over Agnity as a party to the modified Royalty Purchase Agreement (“Royalty Agreement”). The transaction was accounted for as a business combination, and given the Company had no voting rights, the non-controlling interest (“NCI”) was measured at 100% of the acquired net identifiable assets of Agnity at the transaction date. See Note 18(a) for activity subsequent to June 30, 2022.

	June 30, 2022			December 31, 2021
					Recast (Note 2)
NCI percentage		100%			100%
Current assets	$	8,923,871		$	11,906,502
Non-current assets		4,512,625			5,111,714
Current liabilities		(11,141,684	)		(8,752,552	)
Non-current liabilities		(4,510,938	)		(5,598,783	)
Net assets (liabilities) attributable to NCI	$	(2,216,126	)	$	2,666,881
For the six months ended	June 30, 2022			June 30, 2021
					Recast (Note 2)
Revenue	$	1,761,613		$	6,010,328
(Loss) income allocated to NCI		(4,805,598	)		449,017
Other comprehensive income allocated to NCI		53,389			221,545
Total comprehensive (loss) income attributable to NCI	$	(4,752,209	)	$	670,562
Cash flows (used in) provided by operating activities	$	(209,162	)		1,396,859
Cash flows (used in) investing activities		(8,790	)		(309,586	)
Cash flows provided by (used in) financing activities		90,633			(387,222	)
Foreign exchange impact on cash held in USD		125			15,283
Net (decrease) increase in cash and cash equivalents	$	(127,194	)	$	715,334

NOTE 21 – NON-CONTROLLING INTEREST

In April 2019, the Company obtained control over Agnity and its subsidiaries via a business combination and the non-controlling interest (“NCI”) was measured at 100% of the acquired net identifiable assets of Agnity at the date of acquisition. Agnity develops and sells software applications and technology services that enable telecommunication service providers, network equipment manufacturers and enterprises to design, develop, and deploy communication-centric application solutions on a world-wide basis. Having control of Agnity has enabled the Company to gain access to Agnity’s patented technology and its customer base. In addition, Agnity’s communication platform ensures that AssetCare deployments around the globe are assured of connectivity, supported by Agnity telecommunication solutions.

The movement in the equity attributable to the non-controlling interest in the Company is detailed in the consolidated statements of changes in equity. There was no change to the non-controlling interest percentage in the years ended December 31, 2021, 2020 or 2019.

The following table summarizes the information relating to Agnity before any intercompany eliminations.

						December 31, 2021			December 31, 2020
NCI percentage						100%			100%
				Recast (Note 2)			Recast (Note 2)
Current assets					$	11,906,502		$	7,778,252
Non-current assets						5,111,714			8,081,135
Current liabilities						(8,752,552)			(7,107,244)
Non-current liabilities						(5,598,783)			(6,185,049)
Net assets attributable to NCI					$	2,666,881		$	2,567,094
For the years ended			December 31, 2021			December 31, 2020			December 31, 2019
	Recast (Note 2)			Recast (Note 2)			Recast (Note 2)
Revenue		$	11,966,226		$	11,548,811		$	6,010,753
Income (loss) allocated to NCI			63,387			1,586,588			590,056
Other comprehensive income allocated to NCI			138,655			159,749			176,711
Total comprehensive income attributable to NCI		$	202,042		$	1,746,337		$	766,767
Cash flows (used in) provided by operating activities		$	(1,859,900)			(405,548)			483,245
Cash flows used in investing activities			(578,483)			–			(3,731)
Cash flows (used in) provided by financing activities			2,081,137			655,347			(417,068)
Foreign exchange impact on cash held in USD			(6,383)			155,274			5,976
Net (decrease) increase in cash and cash equivalents		$	(363,629)		$	405,073		$	68,422

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Finance Costs

12 Months Ended

Dec. 31, 2021

Text Block [Abstract]

Finance Costs

NOTE 22 - FINANCE COSTS

	Year Ended December 31,
	2021		2020		2019
Interest on loans and borrowings (Note 12)	$	1,179,234	$	1,272,512	$	918,682
Interest on convertible debentures (Note 14)		5,740,346		4,410,206		2,130,247
Interest on lease liabilities (Note 8)		137,245		350,792		168,571
Transaction costs expensed 1		1,471,219		–		–
Other finance costs		90,750		–		–
Total finance costs	$	8,618,794	$	6,033,510	$	3,217,500

1  Transaction costs include costs incurred associated with financing or equity transactions that are not otherwise netted against the debt or equity instrument. The majority of costs are associated with the USD brokered public offering (Note 19(a)), the 2021 Debentures (Note 14(b)), the Fiera term loan amendment (Note 12) and the ATB facility amendment (Note 13). See Note 31 (a) and (b) for subsequent changes to Fiera loan. 

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Fair Value Loss (Gain) On Derivatives

12 Months Ended

Dec. 31, 2021

Text Block [Abstract]

Fair Value Loss (Gain) On Derivatives

NOTE 23 - FAIR VALUE LOSS (GAIN) ON DERIVATIVES

Year Ended December 31,

	2021
Gain on embedded derivatives 1	$	(784,261	)
Deferred charge loss 1		1,615,102
Loss on substantial modification and conversion 1		8,571,881
Gain on warrant liability remeasurement (Note 15) 2		(3,362,601	)
Total	$	6,040,121

1  Associated with the 2021 Debentures (Note 14(b)) of which the majority is realized at December 31, 2021.

2  Change in fair value unrealized (Note 26).

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Other Income

12 Months Ended

Dec. 31, 2021

Text Block [Abstract]

Other Income

NOTE 24 - OTHER INCOME

	Year Ended December 31,
	2021		2020		2019
Government assistance 1	$	(4,201,822)	$	(2,775,677)	$	–
US Government loan forgiveness 2 (Note 16)		(1,825,237)		(124,507)		–
Derecognition of contingent consideration (Note 18)		(1,010,024)		–		–
Other		(89,014)		(32,158)		(167,913)
Total other income	$	(7,126,097)	$	(2,932,342)	$	(167,913)

1  Majority represents amounts received from the Canadian Government for wage and rental subsidies associated with COVID-19. The amount of government assistance available is dependent on the programs in place and the Company’s eligibility for these programs.

2  Includes other income recognized as below market interest rate benefit.

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Income Taxes

12 Months Ended

Dec. 31, 2021

Text Block [Abstract]

Income Taxes

NOTE 25 - INCOME TAXES

a) Amounts recognized in net loss

	Year Ended December 31,
	2021			2020			2019
Current tax expense
Current year		157,303			(295,709	)		181,895
Changes in estimates related to prior years		–			–			–
		157,303			(295,709)			181,895
Deferred tax expense (recovery)
Origination and reversal of temporary differences		(13,161,689	)		(10,744,803	)		(6,261,674	)
Change in unrecognized deferred income tax assets		11,339,580			10,076,594			3,569,361
		(1,822,109)			(668,209)			(2,692,313)
Tax expense (recovery)	$	(1,664,806)		$	(963,918)		$	(2,510,418)

b) Reconciliation of effective tax rate

The following table is a reconciliation of income tax expense (recovery), at the Canadian income tax rate and the amount of reported income tax recovery in the consolidated statements of loss and comprehensive loss. The Company’s operations are subject to income taxes primarily in Canada and the United States.

	Year Ended December 31,
	2021			2020			2019
Loss before taxes	$	(46,364,119)		$	(35,824,882)		$	(30,405,252)
Statutory income tax rate 1		27	%		27	%		27	%
Income tax recovery at statutory rate		(12,518,312)			(9,672,718)			(8,209,418)
Increase (decrease) in taxes resulting from:
Change in deferred tax assets not recognized		11,339,580			10,076,594			3,569,361
Foreign tax rate and other foreign tax differences		(2,089,761)			(2,293,503)			(1,015,536)
Change in enacted rates		608,064			(58,050)			–
Share issuance costs and other		(828,082)			126,247			49,210
Non-deductible transaction costs		38,776			424,828			2,664,789
Other non-deductible items		1,784,929			432,684			431,176
Tax expense (recovery)	$	(1,664,806)		$	(963,918)		$	(2,510,418)

1  Comprised of the Canadian Federal effective corporate tax rate of 15.0% and blended provincial tax rates.

c) Movement in deferred tax balances

The significant components of the Company’s deferred income tax asset (liabilities) are as follows:

	At December 31, 2020		Recovery/ (expense) through earnings		Recovery/ (expense) through equity		Recovery/ (expense) through OCI		At December 31, 2021
Property and equipment	$	261,661	$	(195,977)	$	–	$	2,575	$	68,259
Intangible assets		(5,012,355)		1,415,370		–		73,801		(3,523,184)
Loans and accrued liabilities		(1,714,850)		1,471,654		–		(1,816)		(245,012)
Share issuance costs		27,453		25,467		–		–		52,920
Foreign exchange		–		(6,765)		–		24		(6,741)
Non-capital losses/net operating losses		2,269,186		(887,640)		–		(18,845)		1,362,701
Total	$	(4,168,905)	$	1,822,109	$	–	$	55,739	$	(2,291,057)

	At December 31, 2019		Acquired in business combinations		Recovery/ (expense) through earnings		Recovery/ (expense) through equity		Recovery/ (expense) through OCI		At December 31, 2020
Property and equipment	$	–	$	(376)	$	263,436	$	–	$	(1,399)	$	261,661
Intangible assets		(5,321,008)		(1,136,429)		1,280,692		–		164,390		(5,012,355)
Loans and accrued liabilities		(1,696,435)		–		(41,233)		24,000		(1,182)		(1,714,850)
Share issuance costs		–		–		27,453		–		–		27,453
Foreign exchange		(39,533)		–		39,533		–		–		0
Non-capital losses/net operating losses		3,202,361		–		(901,672)		–		(31,503)		2,269,186
Total	$	(3,854,615)	$	(1,136,805)	$	668,209	$	24,000	$	130,306	$	(4,168,905)

d) Deferred tax assets not recognized and tax losses carried forward

The Company recognizes deferred tax assets to the extent that it is probable that future taxable profit will be available against which the Company can utilize the benefits of the deductible temporary differences and unused tax losses. Deductible temporary differences and unused tax losses for which a future benefit has not been recognized as a deferred tax asset include the following:

	Year Ended December 31,
	2021		2020
Net operating losses - United States	$	77,415,498	$	55,395,751
Non-capital losses - Canada		68,018,286		45,619,846
Foreign tax losses		157,602		865,599
Investment tax credits and research and development expenditures		6,603,163		6,603,287
Property and equipment		948,765		753,467
Share issuance costs		6,510,677		1,282,965
Other		2,046,890		1,922,194
	$	161,700,881	$	112,443,109

The Company has net operating losses of approximately US$60,837,326 and non-capital losses of approximately $70,204,681 (2020: US$44.1 million and $49.6 million) which are available to reduce future year’s taxable income in the United States and Canada, respectively. The net operating losses will start expiring in 2029 while the non-capital losses will start expiring in 2027 if not utilized.

The Company has foreign tax losses in various jurisdictions of approximately $2,307,882 (2020 - $1.2 million) which are available to reduce future year’s taxable income in their respective countries. The losses have expiry dates ranging from five years to indefinite life. The investment tax credit balance is $500,000 (2020 - $500,000) which is available to reduce future year’s taxes payable in Canada. The investment tax credits begin to expire in 2022 if not utilized.

Management estimates future income using forecasts based on the best available current information. No deferred tax liability has been recognized at December 31, 2021 or December 31, 2020 on temporary differences associated with earnings retained in the Company’s investments in foreign subsidiaries in which it has an equity percentage. The Company is able to control the timing of the reversal of these differences and currently has no plans in the foreseeable future to repatriate any funds in excess of its foreign investment.

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Financial Instruments and Financial Risk Management

6 Months Ended

12 Months Ended

Jun. 30, 2022

Dec. 31, 2021

Text Block [Abstract]

Financial Instruments

NOTE 26 - FINANCIAL INSTRUMENTS

a) Classification and measurement of financial assets and liabilities by category

The following represents the carrying values of the financial assets and liabilities of the Company and the associated measurement basis for each balance.

Financial assets	Measurement basis	December 31, 2021		December 31, 2020
Cash and cash equivalents	Amortized cost	$	4,588,057	$	1,110,889
Trade and other receivables 1	Amortized cost		14,329,781		11,224,017
Long-term receivables	Amortized cost		740,431		2,536,272
Derivative asset	FVTPL		—		131,400
		$	19,658,269	$	15,002,578
Financial liabilities
Bank indebtedness	Amortized cost	$	3,460,109	$	976,779
Trade payables and accrued liabilities 1	Amortized cost		12,003,979		12,693,256
Loans and borrowings	Amortized cost		13,215,601		13,152,300
Lease liabilities 2	Amortized cost		1,045,472		3,945,076
2019 Debentures - host liability 3	Amortized cost		22,185,170		19,534,988
2021 Debentures - host liability 3	Amortized cost		69,034		—
2021 Debentures embedded derivative	FVTPL		41,506		—
Warrant liability - business acquisition	FVTPL		709,835		710,924
Warrant liabilities - derivatives (Note 15)	FVTPL		7,975,137		—
Business acquisition payable	Amortized cost		1,398,972		2,439,529
Other liabilities	Amortized cost		—		6,236,415
		$	62,104,815	$	59,689,267

1  Excludes amounts for indirect taxes, income taxes and contract asset, where applicable. Note 27 describes credit risk associated with trade receivables including reconciliation of expected credit loss allowance.

2  Lease liabilities are not subject to classification in the fair value hierarchy.

3  2019 Debentures (Note 14(a)) and 2021 Debentures host liability (Note 14(b)).

Financial instruments not measured at fair value

The carrying values of the financial assets and liabilities where the measurement basis is other than FVTPL approximate their fair values due to the immediate or short-term nature of these instruments considering there have been no significant changes in credit and market interest rates since origination date.

b) Measurement of fair value

The fair value hierarchy establishes three levels to classify the significance of inputs to valuation techniques used in making fair value measurements of all financial assets and liabilities (Note 32(L)). At December 31, 2021 and 2020, there were no financial assets or financial liabilities measured and recognized at fair value on a non-recurring basis subsequent to initial recognition.

The Company’s policy for determining when a transfer between levels of the fair value hierarchy occurs is to assess the impact at the date of the event or change in circumstance that could result in the transfer. During the year ended December 31, 2021, subscriptions payable included in other liabilities of $5,285,997 were transferred from Level 2 to Level 3 on issuance of the 2021 Debentures, of which only $110,540 remain at December 31, 2021 (Note 14(b)). There were no other transfers between levels during the year ended December 31, 2021.

Valuation methodologies used in the measurement of fair value for Level 2 financial assets and financial liabilities

The measurement of Level 2 financial assets and liabilities is made by reference to the inputs used to determine the fair value of each instrument using an appropriate valuation method. The fair value of long-term receivables is based on the present value considering the expected time of collection of the long-term contracts.

The fair value of loans and borrowings approximates their carrying value and has been determined by discounting the contractual cash flows using implied yields of obligations with similar credit risk and maturities. The fair value of the host liability for the 2019 Debentures approximates the carrying value and the fair value was initially calculated using a discount rate of 25% for an equivalent, non-convertible loan at the date of issue. The warrant liability associated with a previous business combination is measured based on the amount of cash that is payable in certain circumstances. A portion of other liabilities at December 31, 2020, represent subscriptions payable and the carrying amount of these balances approximates fair value.

Valuation methodologies used in the measurement of fair value for Level 3 financial liabilities

2021 Debentures

The fair value of the entire financial instrument associated with the 2021 Debentures was determined using a partial differential equation model for convertible debt which considered that the convertible debt consists of two components, each having different default risks. The model calculates the value based on key inputs, which impact the value of the convertible debt including: yield to maturity, principal and coupon payments, share price, exercise price, volatility, term, risk free rates and dividends. The risk adjusted discount rate was applied in determining yield to maturity and this is the most significant unobservable input, and the estimated fair value would increase (decrease) if the risk-adjusted discount rate were lower (higher).

The 2021 Debentures include an embedded derivative for the conversion option. The fair value of the embedded derivative was determined using the same methodology as above adjusted for the nature of the instrument. The embedded derivative includes a foreign currency component which reflects the foreign exchange exposure to convert a USD denominated liability to common shares which are denominated in Canadian dollars. The fair value of the embedded derivative was determined first with the residual of the total fair value of the instrument allocated to the host debt. The embedded derivative will be remeasured at each period end with changes in the fair value recognized in the consolidated statements of loss and comprehensive loss.

The Company determined that at the initial recognition date, which was the date of issuance of the debentures, that the fair value of the financial instruments was in excess of the transaction price for tranches one through five (i.e., the fair value of the proceeds received) and the fair value of the tranche six financial instrument was equal to the proceeds received. There were fluctuations in the fair value inputs that arose in the period between the closing of tranches one through five of the Offering and the date of the actual issuance of the debenture certificates. As such the difference between the fair value and transaction price was deferred at initial recognition and the deferred difference was recognized as a loss as factors including the passage of time were met which required recognition. The reconciliation of the opening to closing balances associated with the 2021 Debentures is presented in Note 14(b) including fair value changes.

The 2021 Debentures were derecognized at July 12, 2021 (with the exception of the US$75,000 principal balance which did not convert) as the instruments were substantially modified, and a new financial liability measured at FVTPL was recognized. The fair value was based on the price of common shares at July 12, 2021 and the warrant value was determined using the Black-Scholes model. These instruments were remeasured directly before conversion to equity. The remaining instruments are warrant liabilities as described following.

Warrant liabilities

With the exception of the warrant liability associated with a previous acquisition, the fair value of warrant liabilities is measured on a recurring basis using the Black-Scholes model based on the quoted price of the Company’s common stock in an active market, expected volatility, expected life and risk-free rate (Note 15).

Business acquisition payable

The business acquisition payable consists of contingent consideration payable, the values of which were determined using a discounted cash flow model based on the present value of probability weighted average amount of expected payments discounted at an appropriate discount rate. The reconciliation of the opening to closing balances for Level 3 fair values are presented in Note 18.

Financial Instruments and Financial Risk Management

NOTE 15 - FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT

a)  Classification and measurement of financial assets and liabilities by category

The following represents the carrying values of the financial assets and liabilities of the Company and the associated measurement basis for each balance.

Financial assets	Measurement basis	June 30, 2022		December 31, 2021
Cash and cash equivalents	Amortized cost	$	4,405,948	$	4,588,057
Trade and other receivables 1	Amortized cost		11,783,456		14,329,781
Long-term receivables	Amortized cost		708,758		740,431
		$	16,898,162	$	19,658,269
Financial liabilities
Bank indebtedness	Amortized cost	$	3,679,631	$	3,460,109
Trade payables and accrued liabilities 1	Amortized cost		15,784,541		12,003,979
Loans and borrowings	Amortized cost		29,985,807		13,215,601
Lease liabilities	Amortized cost		7,678,618		1,045,472
2019 Debentures - host liability	Amortized cost		23,457,500		22,185,170
2021 Debentures - host liability	Amortized cost		75,491		69,034
2021 Debentures embedded derivative	FVTPL		9,600		41,506
Warrant liability - business acquisition	FVTPL		–		709,835
Warrant liabilities - derivatives (Note 11)	FVTPL		3,017,643		7,975,137
Business acquisition payable	FVTPL		1,399,580		1,398,972
		$	85,088,411	$	62,104,815

1   Excludes amounts for indirect taxes, income taxes and contract assets, where applicable.

Financial instruments not measured at fair value

The carrying values of the financial assets and liabilities where the measurement basis is other than FVTPL approximate their fair values due to the immediate or short-term nature of these instruments considering there have been no significant change in credit and market interest rates since origination date.

b)  Measurement of fair value

The fair value hierarchy establishes three levels to classify the significance of inputs to valuation techniques used in making fair value measurements of all financial assets and liabilities. At June 30, 2022 and December 31, 2021, there were no financial assets and financial liabilities measured and recognized at fair value on a non-recurring basis subsequent to initial recognition.

The Company’s policy for determining when a transfer between levels of the fair value hierarchy occurs is to assess the impact at the date of the event or change in circumstance that could result in the transfer. During the six months ended June 30, 2022, the warrant liabilities associated with the USD Equity financing were transferred from Level 3 to Level 1 as these warrants are now measured by reference to the closing price of the traded warrants (Note 11(b)). There were no other transfers between any of the levels during the six months ended June 30, 2022.

Valuation methodologies used in the measurement of fair value for Level 2 financial assets and financial liabilities

The measurement of Level 2 financial assets and liabilities is made by reference to the inputs used to determine the fair value of each instrument using an appropriate valuation method. There were no changes in the valuation methodologies from those at December 31, 2021.

Valuation methodologies used in the measurement of fair value for Level 3 financial liabilities

There were no changes in the valuation methodologies for Level 3 financial liabilities from those at December 31, 2021, except from the transfer from Level 3 to Level 1 described above. The Black-Scholes model remains in use for the warrants issued on conversion of the 2021 Debentures and is based on the quoted price of the Company’s common stock in an active market, expected volatility, expected life and risk-free rate.

c)  Financial instruments risk

There were no significant changes in the Company’s exposure to those risks during the six months ended June 30, 2022, except for the additional commitments as noted below which impacts liquidity risk and a change to foreign currency risk.

Contractual Obligations and Commitments

During the six months ended June 30, 2022, the most significant changes in contractual obligations were: (a) the addition of new premise leases with lease obligations for base rent of approximately $10,200,000 and variable lease payments of approximately $8,600,000, the majority of which were previously included as commitments; (b) new financing of US$15,000,000 (Note 8(b)) which is classified as non-current at June 30, 2022; and (c) increase in trade payables and accrued liabilities, which includes the cash payment election made by the holder for the settlement of a previous warrant liability (Note 7). Contractual obligations at December 31, 2021, have been reduced by normal course payments made during the six months ended June 30, 2022.

Foreign currency risk

At June 30, 2022, the C$ equivalent carrying amount of the Company’s USD denominated monetary assets and liabilities was $12,015,544 and $32,282,233, respectively (December 31, 2021 - $14,554,193 and $11,685,160) with the majority of the change associated with the Carbon promissory note denominated in USD. Assuming all other variables remain constant, a fluctuation of +/- 5.0% in the exchange rate between the C$ and USD would impact the net loss for the period by approximately $1,013,334 (December 31, 2021 - $143,452).

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Capital And Risk Management

12 Months Ended

Dec. 31, 2021

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Capital And Risk Management

NOTE 27 – CAPITAL AND RISK MANAGEMENT

Capital and Risk Management

The Company’s objective and polices for managing capital are to safeguard its ability to continue as a going concern in order to provide returns for shareholders and benefits for other stakeholders and to maintain an optimal capital structure to reduce the cost of capital. The Company manages its capital structure and makes changes based on economic conditions including the impact of the ongoing pandemic, risks that impact the consolidated operations and future significant capital investment opportunities. In order to maintain or adjust its capital structure, the Company may issue new equity instruments or raise additional debt financing.

The Company is exposed to a variety of financial risks by virtue of its activities: liquidity risk, credit risk, interest rate risk and currency risk. The Board of Directors has overall responsibility for the determination of the Company’s capital and risk management objectives and policies while retaining ultimate responsibility for them. The Company’s overall capital and risk management program has not changed throughout the year. It focuses on the unpredictability of financial markets and seeks to minimize potential adverse effects on financial performance. Risk management is carried out by the finance department under policies approved by the Board of Directors. The finance department identifies and evaluates financial risks in close cooperation with management.

The Company’s risks related to financial instruments and the Company’s strategy to manage risks, are described below.

a) Liquidity risk

Liquidity risk is the risk that the Company will not have sufficient cash resources to meet its financial obligations as they come due in the normal course of business. The Company generally relies on funds generated from operations and external financing to provide sufficient liquidity to meet expected operating requirements. The Company manages its liquidity risk by monitoring its operating requirements, reducing costs where possible and applying for any available government COVID-19 support to support its business. The Company also engaged in fundraising activities throughout the year. Cash and cash equivalents as at December 31, 2021 were $4,588,057 (December 31, 2020 - $1,110,889).

Total working capital deficit increased to $42,108,177 at December 31, 2021 from $13,052,702 at December 31, 2020. Current assets increased by $6,712,207 at December 31, 2021 from December 31, 2020, the majority of which are increases in cash and cash equivalents and trade and other receivables. Current liabilities increased by $35,767,682 at December 31, 2021 from December 31, 2020; however, management anticipates a portion of this amount will not be paid in cash due to the nature of the instruments as detailed in the table following. Liquidity risk has increased during the year ended December 31, 2021, and current liquidity levels are not adequate to fund the working capital deficiency at December 31, 2021. The Company anticipates it will need additional financing to meet its current and future demands and the Company is in the process of securing additional financing; however, a material uncertainty exists that may cast doubt on the Company’s ability to continue as a going concern (Note 2).

Maturities of financial liabilities

The Company’s carrying values of financial liabilities and the contractual undiscounted cash flows associated with these liabilities broken into relevant maturity grouping based on their contractual maturities are as follows:

At December 31, 2021			Undiscounted Contractual Cash Flows
	Carrying Amount		< 1 year		1 – 2 years		> 2 years		Total
Bank indebtedness 1	$	3,460,109	$	3,460,109	$	–	$	–	$	3,460,109
Trade payables and accrued liabilities		12,421,309		12,421,309		–		–		12,421,309
Loans and borrowings 2		13,215,601		11,763,697		786,123		–		12,549,820
Lease liabilities 3		1,045,472		521,506		534,241		179,281		1,235,028
2019 Debentures		22,185,170		24,630,375		–		–		24,630,375
2021 Debentures		110,540		7,635		103,073		–		110,708
Warrant liabilities 4		8,880,038		709,835		–		–		709,835
Business acquisition payable		1,398,972		1,398,972		–		–		1,398,972
	$	62,717,211	$	54,913,438	$	1,423,437	$	179,281	$	56,516,156

1  No contractual maturity. Excludes interest charged on facility as detailed in Note 13.

2  Includes term loan with a carrying value of $9,275,683 classified as current due to covenant breach. Assuming term loan is repaid in accordance with agreement to maturity, the undiscounted contractual cash flows for loans and borrowings would be $2,933,739, $5,472,193, and $4,143,888 , respectively for the periods presented above.

3  Variable costs due under leases not included in this amount. Minimum payment related to leases which have not yet commenced are not included in this amount. See Note 29.

4  Majority of liability will be settled by issuing common shares of the Company when warrants are exercised during the year. The remaining amount may be settled in cash or common shares of Agnity (Note 15).

As at December 31, 2020			Undiscounted Contractual Cash Flows
	Carrying Amount		< 1 year		1 – 2 years		> 2 years		Total
Bank indebtedness	$	976,779	$	976,779	$	–	$	–	$	976,779
Trade payables and accrued liabilities		12,924,256		12,924,256		–		–		12,924,256
Loans and borrowings		13,152,300		4,248,351		2,617,443		8,796,757		15,662,551
Lease liabilities		3,945,076		1,131,528		939,108		2,815,695		4,886,331
2019 Debentures		19,534,988		2,350,750		24,629,655		–		26,980,405
Warrant liabilities		710,924		710,924		–		–		710,924
Business acquisition payable		2,439,529		1,594,297		845,232		–		2,439,529
Other liabilities		6,236,415		6,003,838		232,577		–		6,236,415
	$	59,920,267	$	29,940,723	$	29,264,015	$	11,612,452	$	70,817,190

b) Credit risk

Credit risk is the risk that a third party might fail to discharge its obligations under the terms of a financial contract. Credit risk is limited to the following instruments and the Company’s maximum exposure to credit risk is the carrying value of the financial assets (Note 26(a)).

The Company is mainly exposed to credit risk from credit sales. Management of the Company monitors the creditworthiness of its customers by performing background checks on all new customers. Further, management monitors the frequency of payments from ongoing customers and performs frequent reviews of outstanding balances. The Company considers that there has been a significant increase in credit risk when contractual payments are more than 90 days past due.

Provisions for outstanding balances are established based on forward-looking information and revised when there are changes in circumstances that would create doubt over the receipt of funds. Such reviews are conducted on a continued basis through the monitoring of outstanding balances as well as the frequency of payments received. Accounts receivable amounts are completely written off once management determines the probability of collection to be remote.

Trade and other receivables, unbilled revenue and long-term receivables are from individual customers and are not assessed based on external credit rating agencies. The Company uses a provision matrix to measure the lifetime expected credit loss (“ECL”) of these balances. Receivables are grouped based on similar credit risk profiles and days past due. Loss rates are based on actual credit loss experience and reflect the forward looking conditions over the expected life of the receivable. As of December 31, 2021, substantially all of the Company’s trade receivables were outstanding for less than 60 days and a loss rate of 1% was applied in determining the ECL. The majority of the ECL is based on specific provisions related to specific customers.

The movement in the ECL allowance related to trade receivables and long-term receivables was as follows (Note 6):

	December 31, 2021			December 31, 2020
Beginning balance	$	606,030		$	382,901
Increase in loss allowance		1,162,537			443,961
Amounts written off during the year as uncollectible		(65,930	)		(220,832	)
Effects of movement in exchange rates		4,581			–
Total	$	1,707,218		$	606,030

c) Market risk

Market risk is the risk that changes in market prices such as interest rates or foreign exchange rates will affect the Company’s results or value as a result of holding these financial instruments. The object of market risk management is to manage and control market risk exposures within acceptable parameters given the nature of the business.

Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of the Company’s financial instruments will fluctuate because of changes in market interest rates. The Company is exposed to interest rate risk on its credit facility and as this instrument is subject to variable rate interest. Management does not believe interest rate risk is currently material to its business.

Foreign currency risk

Currency risk is the risk that the fair values or future cash flows of the Company’s financial instruments will fluctuate because of changes in foreign currency rates and the degree of volatility of these rates. The Company conducts its business in the regions of Canada, Asia-Pacific, the United States and Europe, the Middle East and Africa, which gives rise to exposure to markets from changes in foreign currency rates. Currently, the Company does not use derivative instruments or other measures to reduce its exposure to foreign currency risk.

At December 31, 2021, the C$ equivalent carrying amount of the Company’s USD denominated monetary assets and liabilities was $14,554,193 (December 31, 2020 - $8,291,005) and $11,685,160 (December 31, 2020 - $16,398,521), respectively. Assuming all other variables remain constant, a fluctuation of +/- 5.0% in the exchange rate between C$ and USD would impact the net loss for the period by approximately $143,452 (December 31, 2020 - $405,376).

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Related Party Transactions

12 Months Ended

Dec. 31, 2021

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Related Party Transactions

NOTE 28 – RELATED PARTY TRANSACTIONS

The Company’s related parties includes its subsidiaries and key management personnel. During its normal course of operations, the Company enters into transactions with its related parties for goods and services that are measured at the amount exchanged.

Key management personnel compensation

Key management personnel include those persons having authority and responsibility for planning, directing, and controlling the activities of the Company as a whole. The Company defines key management personnel as key officers and directors.

For the years ended December 31,	2021		2020		2019
Salaries, management and directors’ fees	$	1,613,502	$	1,683,015	$	1,460,296
Share-based payments		432,098		628,019		388,398
Total	$	2,045,600	$	2,311,034	$	1,848,694

Other related party balances and transactions 1

	December 31, 2021		December 31, 2020
Due to principal owner of Agnity 2	$	234,278	$	813,023
Due to officer of Company for working capital loan 2		30,796		33,205
Due to key management personnel 2		121,852		116,091
Due to Agnity Communications Private Ltd. 3		1,111,521		1,138,630
Loan due to former shareholder of CSA 4		335,860		318,428
Amount due to related parties	$	1,834,307	$	2,419,377

1  Unless otherwise noted, all amounts due are unsecured, non-interest bearing and due on demand.

2  Included in trade accounts payable and accrued liabilities on the consolidated statements of financial position.

3  Associated with consulting services paid to a company partially owned by the principal owner of Agnity. Consulting services were $3,765,201 for the year ended December 31, 2021 (December 31, 2020 - $2,532,550; December 31, 2019 - $1,630,119). Balance due included in trade accounts payable and accrued liabilities on the consolidated statements of financial position.

4  Included in loans and borrowings (Note 12) on the consolidated statements of financial position.

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Commitments And Contingencies

12 Months Ended

Dec. 31, 2021

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Commitments And Contingencies

NOTE 29 – COMMITMENTS AND CONTINGENCIES

Commitments

The Company has the following minimum payments for contractual commitments that are not recognized as liabilities at December 31, 2021, which are disclosed in Note 27(a) - Risk Management, Liquidity Risk.

	Undiscounted Contractual Cash Flows
	< 1 year		2 - 3 years		4 - 5 years		More than 5 years		Total
Variable lease payments 1	$	396,719	$	477,562	$	125,275	$	12,999	$	1,012,555
Lease payments related to leases which have not yet commenced 2		104,702		2,589,330		2,762,597		12,636,454		18,093,083
	$	501,421	$	3,066,892	$	2,887,872	$	12,649,453	$	19,105,638

1  Variable lease payments associated lease liabilities (Note 8).

2  In October 2021, the Company executed a 12-year lease for office space in Calgary, Alberta. Basic rent and estimated common expense payments commence in December 2022, preceded by a fixturing period which the Company will use to build out the space. The Company will receive a tenant improvement allowance which is expected to cover the majority of the costs.

Contingencies

The Company may be party to legal proceedings and claims that arise in the ordinary course of business as either a plaintiff or defendant. The Company analyzes all legal proceedings and the allegations therein. The outcome of any proceedings, either individually or in the aggregate, is not expected to have a material adverse effect on the Company’s financial position, results of operations or liquidity.

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Other Income / Expense

6 Months Ended

Jun. 30, 2022

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Other Income / Expense

NOTE 16 - OTHER INCOME / EXPENSE

a)  Finance Costs

	Three months ended June 30,					Six months ended June 30,
	2022		2021			2022		2021
Interest on loans and borrowings	$	734,854	$	286,144		$	1,131,557	$	533,508
Interest on convertible debentures		1,126,304		1,592,597			2,454,350		3,105,233
Interest on lease liabilities		118,368		75,179			201,417		154,854
Transaction costs expensed		229,716		87,070			248,645		454,574
Other finance costs		20,751		(94,404	)		52,661		(65,656	)
Total finance costs	$	2,229,993	$	1,946,586		$	4,088,630	$	4,182,513

b)  Fair value gain (loss) on derivatives

	Three months ended June 30,						Six months ended June 30,
	2022			2021			2022			2021
Gain on warrant liability remeasurement 1	$	(2,505,810	)	$	—		$	(4,999,080	)	$	—
Gain on embedded derivatives 2		(32,519	)		(1,107,784	)		(32,519	)		(1,164,059	)
Deferred charge loss 2		—			(5,322	)		—			1,615,102
Total fair value (gain) loss on derivatives	$	(2,538,329	)	$	(1,113,106	)	$	(5,031,599	)	$	451,043

1 Unrealized change in fair value (Note 11).

2 Associated with the 2021 Debentures. Transactions detailed in the 2021 Annual Financial Statements.

c) Other income

	Three months ended June 30,						Six months ended June 30,
	2022			2021			2022			2021
Government assistance 1	$	(258,296	)	$	(941,369	)	$	(637,942	)	$	(2,117,743	)
Government loan forgiveness		—			(181,770	)		—			(299,082	)
Derecognition of contingent consideration		—			8,855			—			(572,262	)
Other		(5,728	)		(40,718	)		(24,350	)		(76,221	)
Total other income	$	(264,024	)	$	(1,155,002	)	$	(662,292	)	$	(3,065,308	)

1 Majority of government assistance are grants from the Canadian Government for wage and rental subsidies.

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Supplemental Cash Flow Information

6 Months Ended

12 Months Ended

Jun. 30, 2022

Dec. 31, 2021

Text Block [Abstract]

Supplemental Cash Flow Information

NOTE 17 – SUPPLEMENTAL CASH FLOW INFORMATION

a)  Changes in non-cash working capital

	Six months ended June 30,
	2022			2021
Trade and other receivables decrease (increase)	$	2,567,218		$	(721,406	)
Long-term receivables decrease		37,442			806,434
Prepaid expenses and other assets (increase)		(106,582	)		(926,225	)
Trade payables and accrued liabilities increase (decrease)		2,419,693			(2,231,429	)
Deferred revenue increase		1,962,559			1,425,521
Increase (decrease) in working capital	$	6,880,330		$	(1,647,105	)

b)  Changes in liabilities arising from financing activities

	Six months ended June 30,
	2022			2021
Balance of loans, borrowings and PPP loans, beginning of period	$	13,215,601		$	14,102,718
New advances		24,600,213			6,260,673
Repayments of principal		(8,224,068	)		(7,009,073	)
Repayments of interest		(1,055,673	)		(377,648	)
Liability related items
Forgiveness of PPP Loans 1		—			(175,790	)
Finance fees paid		(300,707	)		—
Non-cash related items
Accretion of interest and debt issuance costs		836,182			460,411
Loss on debt modification		161,698			—
Benefit from below market interest rate		—			(117,482	)
Foreign exchange and other		752,561			(9,354	)
Balance of loans, borrowings and PPP loans, end of period	$	29,985,807		$	13,134,455

1 Paycheck Protection Plan (“PPP”) loans as described in the 2021 Annual Financial Statements.

c) Non-cash investing and financing activities

	Six months ended June 30,
	2022		2021
Non-cash accretion of interest included in finance costs 1	$	1,274,689	$	1,572,967
Addition of right-of-use assets 2		6,874,258		—
Addition to lease liabilities 2		6,758,036		—
Non-cash broker warrants compensation		—		372,947

1 Associated mainly with convertible debentures.

2 Associated mainly with Calgary lease described in Note 6 and one other new lease in the six months ended June 30, 2022.

NOTE 30 – SUPPLEMENTAL CASH FLOW INFORMATION

a) Changes in non-cash working capital

	2021		2020		2019
Trade and other receivables (increase)		$        (3,342,737)		$        (2,006,780)		$            (169,896)
Long-term receivables decrease (increase)		1,682,646		(924,625)		(3,662,207)
Prepaid expenses and other assets decrease (increase)		(591,737)		(1,119,123)		150,991
Trade payables and accrued liabilities (decrease) increase		(782,561)		2,513,477		1,102,361
Deferred revenue increase		1,045,868		632,839		447,511
Decrease in working capital		$        (1,988,521)		$           (904,212)		$         (2,131,240)

b) Changes in liabilities arising from financing activities

	2021		2020		2019
Balance of loans, borrowings and PPP loans, beginning of year		$        14,102,718		$        13,973,055		$                78,285
New advances		10,664,916		8,726,766		16,539,700
Repayments of principal		(9,781,554)		(9,011,638)		(6,787,528)
Repayments of interest		(757,950)		(642,809)		(500,413)
Liability assumed		–		–		2,904,355
Liability related items
Assumption of loans in business combination		–		371,609		1,339,546
Forgiveness of PPP Loans		(1,835,237)		(124,507)		–
Finance fees paid		(191,310)		–
Non-cash related items
Accretion of interest and debt issuance costs		869,567		959,058		445,762
Loss on debt modification		138,908		–		–
Foreign exchange and other		5,543		(148,816)		(46,652)
Balance of loans, borrowings and PPP loans, end of year		$        13,215,601		$        14,102,718		$        13,973,055

c) Non-cash investing and financing activities

For the years ended December 31,		2021		2020		2019
Value of shares issued in business combination		$	–	$	8,186,620	$	13,320,000
Value of shares issued on conversion of 2021 Debentures	14(b)	$	14,436,728	$	–	$	–
Value of share issued on conversion of 2019 Debentures		$	–	$	50,000	$	–
Value of shares issued on AirFusion asset acquisition		$	–	$	820,000	$	–
Settlement of liabilities through issuance of common shares or RSUs		$	–	$	143,002	$	84,252
Non-cash accretion of interest included in finance cost		$	3,015,294	$	2,145,706	$	909,158
Non-cash broker warrants compensation	19(b)	$	294,894	$	–	$	–
Non-cash underwriter warrants compensation	19(b)	$	162,947	$	–	$	–
Non-cash warrants consideration associated with credit facility		$	195,066	$	–	$	–
Shares issued to extinguish the loan from Flow Capital		$	–	$	–	$	606,495
Addition to right-of-use assets		$	–	$	599,861	$	468,703
Addition to lease liabilities		$	–	$	599,861	$	586,000

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Events After The Reporting Period

6 Months Ended

12 Months Ended

Jun. 30, 2022

Dec. 31, 2021

Text Block [Abstract]

Events After The Reporting Period

NOTE 18 – EVENTS AFTER THE REPORTING PERIOD

a) Loss of control of subsidiary

On July 29, 2022, the Company entered into a Technology Continuation Agreement (the “Technology Continuation Agreement”) with Agnity, which replaced the Royalty Agreement, as amended, executed between the parties in April 2019. Under the terms of the Technology Continuation Agreement, the Company received a payment on July 29, 2022 of approximately US$6.0 million which includes amounts to settle the net receivable due from Agnity for advances, net of services received. Concurrent with the signing of the Technology Continuation Agreement, a third party acquired all of the outstanding shares in Agnity from its shareholder. As a result of these events, the Company no longer has the right to nominate the majority of the members of the Operations Committee and no longer has control of Agnity. As a result of the loss of control, effective as of July 29, 2022, the Company will no longer include any of Agnity’s operating results in mCloud’s financial statements and Agnity will no longer be consolidated. See Note 14 for additional information at June 30, 2022 and for the six months ended June 30, 2022 related to Agnity.

b) Share capital and equity awards

On July 6, 2022, 525,114 warrants with an exercise price of $14.25 expired unexercised. On July 29, 2022, the Company granted an aggregate amount of 161,300 stock options and 151,550 RSU’s under the Company’s equity incentive plan.

NOTE 31 – EVENTS AFTER THE REPORTING PERIOD

a) Financing of Electric Vehicle Development Projects

In conjunction with the Company’s agreements to provide AssetCare solutions to optimize Electric Vehicle (“EV”) charging efficiency at auto dealerships in the states of New York and California, on March 28, 2022, a subsidiary of the Company executed a promissory note with the Noteholder in the aggregate principal amount of US$15,000,000 (the “Note”).

The initial principal amount of US$5,000,000 (the “Loan”) was funded on April 1, 2022 and an additional US$10,000,000 was funded on May 5, 2022. The Loan matures on March 31, 2025, with 10% per annum interest payable monthly in arrears in USD. The Loan may not be prepaid unless authorized by the lender and is unsecured until certain conditions are met. The Loan contains representations, warranties and covenants which must be complied with to avoid an event of default which will allow the lender to demand repayment and increase the interest rate to 18%, amongst other implications.

The use of proceeds of is solely for the development of the Company’s EV dealership projects. In addition to the Loan, the Note requires certain income based payments, including sharing on a 50/50% basis, all EV, solar and carbon reduction related tax credits and incentives, be made from the borrower to the lender based on income resulting from this project over the term of the 20-year EV dealership projects. The Note is subject to change of control provisions and right of first refusal provisions for additional financing related to the EV projects.

On May 5, 2022, the Company, Carbon and Fiera executed a Subordination and Postponement Agreement (the “Subordination Agreement”), whereby the parties agreed that the security previously held by Fiera would be subordinate to the security to be granted to Carbon commencing on the date of the agreement. The security granted to Carbon means the EV Dealership Projects and to the extent related to the EV Dealership projects, all accounts, equipment and machinery, contracts and contract rights, including contracts with auto dealerships, inventory, cash and proceeds, rent and profits for each of the preceding.

b) Loans and Borrowings – Change to Term Loan

On May 5, 2022, the Company and Fiera executed an Accommodation Agreement (the “Accommodation Agreement”) and the parties agreed that a portion of the outstanding principal amount under the term loan would be paid in addition to a prepayment penalty and accommodation fee. The Company paid a total of $2,044,086 on May 6, 2022. The parties also agreed that the remainder of the principal and interest due under the loan would be paid on or before October 31, 2022 (the “Repayment Date”). The term loan was amended to increase the interest rate charged from 6.85% to 9.5% effectively immediately and clarified that the Company is not required to maintain the financial covenants set out in the November 9, 2021 amending agreement. The Company may be required to repay the loan before the Repayment Date if the Company is in default or breach of the Accommodation Agreement. As part of the Accommodation Agreement, Fiera signed an agreement, whereby Fiera’s security is subordinate to the security granted to Carbon.

There are no financial covenants under the Accommodation Agreement and the Company is no longer required to maintain the previous financial covenants.

c) Warrant activity

On February 15, 2022, the Company’s warrants associated with the USD equity offering described in Note 15(b), commenced trading under the symbol MCLDW (Notes 1 and 15).

On January 17, 2022, the Company issued warrants to ATB to purchase an equivalent number of common shares of the Company and the warrant liability of $195,066 described in Note 15(c) was derecognized with an offsetting credit to contributed surplus for the value assigned to the warrants.

d) Loss of control of subsidiary

On July 29, 2022, the Company entered into a Technology Continuation Agreement (the “Technology Continuation Agreement”) with Agnity, which replaced the Royalty Agreement, as amended, executed between the parties in April 2019. Under the terms of the Technology Continuation Agreement, the Company received a payment on July 29, 2022 of approximately US$6.0 million which includes amounts to settle the net receivable due from Agnity for advances, net of services received. Concurrent with the signing of the Technology Continuation Agreement, a third party acquired all of the outstanding shares in Agnity from its shareholder. As a result of these events, the Company no longer has the right to nominate the majority of the members of the Operations Committee and no longer has control of Agnity. As a result of the loss of control, effective as of July 29, 2022, the Company will no longer include any of Agnity’s operating results in mCloud’s financial statements and Agnity will no longer be consolidated.

e) Contract modification revenue reversal

In April, 2022, the Company agreed to cancel a multi-year customer contract for which services had been performed in prior periods, resulting in a contract modification. As a result, revenue totalling $2,571,676 which was recorded in prior periods was reversed during the six months ended June 30, 2022. Of this amount, $2,037,014 is associated with the AssetCare Initialization service line and $534,662 is associated with the AssetCare Solutions service line.

f) Share capital and equity awards

On June 30, 2022, 19,318 warrants with an exercise price of $15.00 expired unexercised. On July 6, 2022, 525,114 warrants with an exercise price of $14.25 expired unexercised. On July 29, 2022, the Company granted an aggregate amount of 161,300 stock options and 151,550 RSU’s under the Company’s equity incentive plan.

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Significant Accounting Policies

12 Months Ended

Dec. 31, 2021

Text Block [Abstract]

Significant Accounting Policies

NOTE 32 – SIGNIFICANT ACCOUNTING POLICIES

The Company has consistently applied the following accounting policies to all periods presented in these consolidated financial statements.

A. Basis of Consolidation

The consolidated financial statements include the financial statements of the Company and all its subsidiaries as at December 31, 2021. Control exists over an investee when the Company is exposed, or has rights, to variable returns from its investee and has the ability to affect those returns through its power over the investee. Subsidiaries are included in the consolidated financial results of the Company from the effective date of acquisition up to the effective date of disposition or loss of control. Unless otherwise stated, the subsidiaries have share capital consisting solely of ordinary shares and the proportion of ownership interests held equals the voting rights held by the entity.

Subsidiaries

The Company’s principal subsidiaries include the following entities many of which have 100% ownership in other entities. The Company directly and indirectly owns 100% of all subsidiaries except for the Agnity group of companies. While the Company does not have an ownership interest in the Agnity entities, the Company controls them and as such the financial results are consolidated into the Company’s consolidated financial statements.

	Principle activity	Place of business and operations	Functional currency
mCloud Technologies Corp.	Parent company	Canada		CDN $
mCloud Technologies (USA) Inc.	Operations	United States		USD $
mCloud Technologies (Canada) Inc.	Operations	Canada		CDN $
Field Diagnostic Services, Inc. (“FDSI”)	Operations	United States		USD $
Construction Systems Associates, Inc. (“CSA”)	Operations	United States		USD $
mCloud Technologies Services Inc. (“MTS”)	Operations	Canada		CDN $
NGRAIN (Canada) Corporation (“NGRAIN”)	Operations	Canada		CDN $
kanepi Group Pty. Ltd.	Operations	Australia		AUD $
kanepi Services Pty. Ltd.	Operations	Australia		AUD $
mCloud Technologies Singapore Pte. Ltd.	Operations	Singapore		SGD $
mCloud Corp (HK) Ltd.	Operations	China		RMB ¥
mCloud Technologies (Saudi Arabia)	Operations	Saudi Arabia		SAR $
Agnity Global, Inc. (“Agnity”)	Operations	United States		USD $
Agnity Communications, Inc. (“ACI”)	Operations	United Stated		USD $
Agnity Healthcare, Inc. (“AHI”)	Operations	United States		USD $

When the Company loses control over a subsidiary, it derecognizes the assets and liabilities of the subsidiary and any related non-controlling interests and other components of equity. Any resulting gain or loss is recognized in net income (loss). Any interest retained by the former subsidiary is measured at fair value when control is lost.

All intercompany transactions, balances, revenues and expenses have been eliminated on consolidation. Amounts reported in the financial statements of subsidiaries have been adjusted where necessary to ensure consistency with the accounting policies adopted by the Company. Profit or loss and other comprehensive income of subsidiaries acquired or disposed of during the year are recognized from the effective date of acquisition, or up to the effective date of disposal, as applicable.

Non-controlling interests

Non-controlling interests arise from business combinations in which the Company acquires less than 100% ownership interest. Non-controlling interests, presented as part of equity, represent the portion of a subsidiary’s profit or loss and net assets that is not attributable to the common shareholders of the Company. The entire portion of the Agnity operations is a non-controlling interest. The interests of the non-controlling shareholders are initially measured at either fair value or at the non-controlling interests’ proportionate share of the recognized amounts of the acquiree’s identifiable net assets. Any subsequent income/loss, dividends and foreign translation adjustments attributable to the non-controlling interests is recognized as part of the non-controlling interests’ income or equity. When changes in ownership interests are disproportionate to cumulative contributions, distributions and income (loss) allocations, non-controlling interest are adjusted through direct charges to equity. The Company attributes total comprehensive income or loss of subsidiaries between the owners of the parent and the non-controlling interests based on their respective ownership interests. Changes in the Company’s interest in a subsidiary that do not result in a loss of control are accounted for as equity transactions.

Business combinations

Acquisitions of subsidiaries and assets that meet the definition of a business under IFRS are accounted for using the acquisition method. The consideration transferred in the acquisition is measured at acquisition date fair value. The identifiable assets acquired and liabilities assumed that meet the conditions for recognition under IFRS 3 Business Combinations are recognized at their fair values at the acquisition date. Any excess consideration over the fair value of the identifiable net assets is recognized as goodwill. Acquisition-related costs, other than those associated with the issuance of debt or equity, are recognized in profit or loss as incurred.

If the initial accounting for a business combination is incomplete by the end of the reporting period in which the combination occurs, the Company reports provisional amounts for the items for which the accounting is incomplete. Those provisional amounts are adjusted retrospectively during the measurement period, or additional assets or liabilities are recognized, to reflect new information obtained about facts and circumstances that existed as of the acquisition date that, if known, would have affected the amounts recognized as of that date. The measurement period is the period from the date of acquisition to the date the Company obtains complete information about facts and circumstances that existed as of the acquisition date up to a maximum of one year.

Any contingent consideration is measured at fair value at the acquisition date. If contingent consideration that meets the definition of a financial instrument is classified as equity, it is not remeasured and its subsequent settlement is accounted for within equity. Other contingent consideration is remeasured at fair value at each reporting date with changes in fair value recognized in profit or loss.

B. Foreign currency

Functional currency is the currency of the primary economic environment in which an entity operates. The functional currency of the parent company and its material subsidiaries are presented in the table in Note 32(A). These consolidated financial statements are presented in Canadian dollars.

Foreign currency transactions. In preparing the financial statements of each individual subsidiary, transactions in currencies other than the entity’s functional currency (foreign currencies) are recognized at the rates of exchange prevailing at the dates of the transactions. At the end of each reporting period, monetary items denominated in foreign currencies are retranslated at the rates prevailing at that date. Non-monetary items carried at fair value that are denominated in foreign currencies are retranslated at the rates prevailing at the dates those fair values are determined. Non-monetary items that are measured in terms of historical cost in a foreign currency are not retranslated. Exchange differences on monetary items are recognized in profit or loss in the period in which they arise.

Presentation currency translations. For the purposes of presenting consolidated financial statements, the assets and liabilities of the Company’s foreign operations are translated into Canadian dollars using exchange rates prevailing at the end of each reporting period. Income and expense items are translated at the average exchange rates for the period, unless exchange rates fluctuate significantly during that period, in which case the exchange rates at the dates of the transactions are used. Exchange differences arising, if any, are recognized in other comprehensive income (loss) and accumulated in equity (attributed to non-controlling interests as appropriate).

C. Revenue recognition

The Company’s revenues are derived from the sales of perpetual software licenses, subscriptions to AssetCare, installation and engineering services, hardware and post contract support and maintenance (“PCS”).

Revenue from the sale of hardware and perpetual software licenses is recognized at the point in time when control is transferred to the customer, generally upon delivery at the customer’s location.

Installation services involve the installation and implementation of energy efficient hardware, perpetual software licenses and IoT connections which feed information to the AssetCare platform. Engineering services include consulting, implementation and integration services entered into either on a time and materials basis or fixed fee basis. Revenue from installation and engineering services is recognized overtime, using an input method based on direct labour hours to measure progress towards complete satisfaction of the service.

Revenues from PCS and subscriptions to the AssetCare platform are recognized ratably overtime over the term of the PCS or subscription. Any amounts received for which performance obligations have not been completed are recognized as deferred revenue.

The Company’s contracts often include a number of promised goods or services, which are typically distinct from other performance obligations, and are therefore accounted for separately. A good or service is distinct if the customer can benefit from it on its own or together with other readily available resources, and the Company’s promise to transfer the good or service is separately identifiable from other promises in the contractual arrangement with the customer.

In determining the transaction price of a contract with a customer, the Company considers the effects of variable consideration, existence of a significant financing component, non-cash consideration, and any consideration payable to the customer. The total transaction price is allocated to each performance obligation on a relative stand-alone selling price (“SSP”) basis, representing the selling price as if it was sold separately. This is a formal process involving judgement which could impact the timing of recognized revenue.

In most cases, the SSP is based on observable data. Where possible, a narrow SSP range for each product and service is established and this range is assessed on a periodic basis or when material changes in facts and circumstances warrant a review. If the SSP is not directly observable, the amount is estimated using either the expected cost plus a margin or residual approach. The SSP for perpetual software licenses is highly variable and therefore the Company applies the residual approach, which determines the SSP by subtracting the SSP of hardware, installation and other services in the contract from the total transaction price.

Long-term contracts

The Company enters into multi-year contracts with some customers for goods and services. Under the terms of these contracts, the customer is billed an equal monthly amount over the term of the contract. Revenue is recognized as performance obligations are completed, generally with a significant portion of the transaction price being recognized at the beginning of the contract based on the calculated SSP for performance obligations that are satisfied at the point in time at which goods are delivered to customers. The remainder of the revenue is recognized over the life of the contract over time or as services are completed.

D. Financial Instruments

i. Recognition and initial measurement

On initial recognition, all financial assets and liabilities are classified and recorded at fair value, net of attributable transaction costs, except for financial assets and liabilities classified as at fair value through profit or loss (“FVTPL”).

Cash and bank indebtedness

Cash is held in bank accounts. The Company considers only those investments that are highly liquid, readily convertible to cash with original maturities of three months or less at date of purchase as cash equivalents.

Bank indebtedness consists of bank overdrafts and draws from the credit facility account repayable on demand for cash management purposes.

ii. Classification and subsequent measurement

Financial Assets

On initial recognition, a financial asset is classified as measured at: amortized cost; fair value through other comprehensive income; or fair value through profit or loss, depending on the business model in which a financial asset is managed and its contractual cash flow characteristics. Financial assets that do not meet the below classifications are classified as fair value through profit or loss.

A financial asset is measured at amortized cost if it meets both of the following conditions and is not designated as FVTPL:

• it is held within a business model whose objective is to hold assets to collect contractual cash flows; and

• its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

A financial asset is measured at fair value through other comprehensive income if it meets both of the following conditions and is not designated as at FVTPL:

• it is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets; and

• its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

Financial Liabilities

Financial liabilities are classified as measured at amortized cost or FVTPL. A financial liability is classified as at FVTPL if it is classified as held-for-trading, it is a derivative, or it is designated as such on initial recognition. Financial liabilities at FVTPL are measured at fair value and net gains and losses, including any interest expense, are recognized in profit or loss. Other financial liabilities are subsequently measured at amortized cost using the effective interest method. Interest expense and foreign exchange gains and losses are recognized in profit or loss. Any gain or loss on derecognition is also recognized in net income (loss).

When a financial liability is non-substantially modified, a gain or loss is recognized into net income (loss). The gain or loss is calculated at the date of modification as the difference between the remaining original contractual cash flows and the modified cash flows both discounted at the original effective interest rate. Any costs associated with the modified loan is added to the loan carrying amount and amortized over the remaining modified loan term. The carrying amount of the loan is revised to reflect the new cash outflows at the date of modification.

iii. Derecognition of financial assets and liabilities

Financial assets are derecognized when the contractual rights to the cash flows from the financial asset expire or the Company transfers the rights to receive the contractual cash flow in a transaction in which substantially all the risks and rewards of ownership have been transferred.

A financial liability is derecognized when its contractual obligations are discharged, cancelled or expire. The Company also derecognizes a financial liability when its terms are modified and the cash flows of the modified liability are substantially different, in which case a new financial liability based on the modified terms is recognized at fair value. On derecognition of a financial liability, the difference between the carrying amount extinguished and the consideration paid (including any non- cash assets transferred or liabilities assumed) is recognized in net income (loss).

iv. Impairment of non-derivative financial assets

The Company applies an expected credit loss (“ECL”) impairment model, which applies to financial assets measured at amortized cost, contract assets, lease receivables, and financial guarantee contracts. The ECL model results in an allowance for credit losses being recorded on financial assets regardless of whether there has been an actual loss event. Except for trade receivables, the ECL model requires the recognition of credit losses based on 12 months of expected losses for financial assets and the recognition of lifetime expected losses on financial assets that have experienced a significant increase in credit risk since origination or which are considered credit impaired. A financial asset is credit-impaired when one or more events that have a detrimental impact on the estimated future cash flows of the financial asset have occurred. ECL’s are probability-weighted estimates of credit losses. Credit losses are measured as the present value of all cash shortfalls representing the difference between the cash flows due to the entity in accordance with the contract and the cash flow an entity expects to receive. The Company has elected to measure loss allowances for trade receivables at an amount equal to lifetime ECL’s.

When determining whether the credit risk of a financial asset has increased significantly since initial recognition and when estimating ECL, the Company considers reasonable and supportable information that is relevant and available without undue cost or effort. This includes both quantitative and qualitative information analysis, based on the Company’s historical experience and including forward looking information. Loss allowances for financial assets measured at amortized cost are deducted from the gross carrying amount of the assets. The gross carrying amount of a financial asset is written off when the Company has no reasonable expectations of recovering a portion or the full amount. The Company assesses the timing of write-offs based on whether there is a reasonable expectation of recovery. Impairment losses related to trade and other receivables are presented within general and administrative expenses.

E. Property and equipment

Property and equipment are recorded at cost, less accumulated depreciation and accumulated impairment losses, if any. Cost includes expenditures that are directly attributable to the acquisition of the asset. Depreciation is calculated on a straight-line basis over the estimated useful lives of the assets, as follows:

	Life
Computer equipment	2 -5 years
Office furniture and equipment	7 years
Leasehold improvements	lesser of useful lives or lease term

The estimated useful lives and depreciation methods are reviewed at the end of each reporting period, with the effect of any changes in estimate accounted for on a prospective basis.

An item of property and equipment is derecognized upon disposal or when no future economic benefits are expected to arise from the continued use of the asset. Any gain or loss arising on the disposal or retirement of an item of property and equipment is determined as the difference between the sales proceeds and the carrying amount of the asset and is recognized in profit or loss. Repairs and maintenance costs that do not improve or extend productive life are recognized in profit or loss in the period in which the costs are incurred.

F. Intangible assets and goodwill

Intangible assets

Intangible assets acquired separately

Intangible assets patents and trademarks, customer relationships and technology, all of which have a finite life. Intangible assets acquired separately are measured on initial recognition at cost and intangible assets acquired in a business combination are recognized at fair value at the date of acquisition. Following initial recognition, intangible assets are carried at cost less any accumulated amortization and accumulated impairment losses.

Subsequent expenditure is capitalized only when it increases the future economic benefits embodied in the specific asset to which it relates. All other expenditure, including expenditure on internally generated goodwill and intangible assets are recognized in profit or loss as incurred.

Intangible assets are amortized over their estimated useful lives, on a straight-line basis, as follows:

	Life
Patents and trademarks	5 - 15 years
Customer relationships	5 - 20 years
Technology	5 years

Amortization methods, useful lives and residual values are reviewed at the end of each reporting period and adjusted if required on a prospective basis.

An intangible asset is derecognized on disposal, or when no future economic benefits are expected from use or disposal. Gains or losses arising from derecognition of an intangible asset, measured as the difference between the net disposal proceeds and the carrying amount of the asset, are recognized in profit or loss when the asset is derecognized.

Internally generated intangible assets

Expenditures on research activities are recognized as an expense in the period in which they were incurred.

Internally-generated intangible assets arising from development or from the development phase of an internal project are recognized if all of the following factors have been demonstrated:

• Technical feasibility of completing the intangible asset results in the intangible asset being available for use or sale;

• There is an intention to complete the intangible asset and use or sell it;

• There is an ability to use or sell the intangible asset;

• Evidence to suggest how the intangible asset will generate probable future economic benefits;

• There is availability of adequate technical, financial and other resources to complete the development and to use or sell the intangible asset; and,

• An ability to reliably measure the expenditure(s) attributable to the intangible asset during its development exists.

The estimated useful life and amortization method are reviewed at the end of each reporting period, with the effect of any changes in estimate being accounted for on a prospective basis. Where no internally-generated intangible asset can be recognized, development expenditures are recognized in profit or loss in the period in which it is incurred.

Goodwill

Goodwill, representing the excess of the consideration paid for entities acquired over the fair values of the assets acquired and liabilities assumed, is initially measured at cost and is not amortized. After initial recognition, goodwill is measured at cost less any accumulated impairment losses and is tested annually for impairment.

For the purpose of impairment testing, goodwill is allocated to each of the Company’s cash-generating units that are expected to benefit from the synergies of the business combination. A cash-generating unit to which goodwill has been allocated is tested for impairment annually, or more frequently when there is indication that the unit may be impaired. If the recoverable amount of the cash-generating unit is less than the carrying amount, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro-rata based on the carrying amount of each asset in the cash generating unit. The recoverable amount is the greater of an asset’s fair value less costs of disposal or its value in use. In determining fair value less costs of disposal, recent market transactions are considered or an appropriate valuation model is used. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset or CGU. Any impairment loss for goodwill is recognized directly in profit or loss in the consolidated statements of loss on comprehensive loss. Goodwill impairments are not reversed. Management evaluates goodwill for impairment annually as of December 31 unless impairment indicators exist at another reporting date. On disposal of a cash-generating unit, the attributable amount of goodwill is included in the determination of the profit or loss on disposal.

G. Impairment of non-financial assets

The carrying amount of property and equipment and intangible assets with a finite life are reviewed each reporting period to determine whether events or changes in circumstances indicate that their carrying amounts may not be recoverable. Intangible assets with an indefinite life are reviewed and tested on an annual basis or whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable.

An impairment loss is recognized for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs of disposal or its value in use. To assess value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. In determining fair value less costs of disposal recent market transactions are considered or an appropriate valuation model is used.

To assess impairment, assets are grouped at the lowest levels for which there are separately identifiable cash inflows (cash-generating units). For an asset that does not generate largely independent cash flows, the recoverable amount is determined for the cash-generating unit to which the asset belongs. Impairment losses recognized in prior periods are assessed at each reporting date for any indications that the loss has decreased or no longer exists. An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortization, if no impairment loss had been recognized.

H. Leases

i. Recognition and initial measurement as a lessee

At the commencement date of a lease, the Company recognizes a right-of-use asset and a lease liability for all leases except leases of low-value assets and leases with a duration of 12 months or less.

At inception of a contract, the Company assesses whether a contract is, or contains, a lease. A lease is defined as a contract, or part of a contract, that conveys the right to control the use of an identified asset for a period of time in exchange for consideration. To assess whether a contract conveys the right to control the use of an identified asset, the Company determines whether, throughout the period of use, it has the right to obtain substantially all of the economic benefits from use of the identified asset and the right to direct the use of the identified asset. The Company reassesses whether a contract is, or contains, a lease only if the terms and conditions of the contract are changed.

Lease liabilities are initially measured at the present value of unpaid lease payments at the commencement date of the lease, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the Company’s incremental borrowing rate.

Lease payments included in the measurement of the lease liability comprise the following:

• fixed payments (including in-substance fixed payments), less any lease incentives receivable;

• variable lease payments that depend on an index or a rate (such as CPI), initially measured using the index or rate as at the commencement date;

• amounts expected to be payable by the Company under residual value guarantees;

• exercise price of a purchase option if the Company is reasonably certain to exercise that option; and

• payments of penalties for terminating the lease, if the lease term reflects the Company exercising an option to terminate the lease.

Variable rent payments that are not based on an index or rate, including additional rent for operating costs and taxes and non-recoverable goods and services tax, are recognized as rent expense, within general and administrative expense or direct costs, as incurred. Lease payments for short-term leases and leases of low-value assets are recognized as rent expense on a straight-line basis over the lease term.

Right-of-use assets are initially measured at cost comprised of the initial lease liability adjusted for any lease payments made at or before commencement of the lease, plus initial direct costs incurred less lease incentives received.

ii. Classification and subsequent measurement as a lessee

Subsequent to the commencement date of the lease, the lease liability is measured at amortized cost using the effective interest method. The lease liability is remeasured by discounting the revised lease payments using a revised discount rate when there is a change in the lease term or there is a change in the assessment of an option to purchase the underlying asset. The lease liability is remeasured by discounting the revised lease payments using an unchanged discount rate when there is a change in the amounts expected to be payable under a residual value guarantee or there is a change in future lease payments resulting from a change in an index or a rate used to determine variable payments. Upon remeasurement of a lease liability, a corresponding adjustment to the right-of-use asset is recognized.

Subsequent to the commencement date of the lease, the Company measures the right-of-use asset at cost, less accumulated depreciation, and any accumulated impairment losses, and adjusted for any remeasurement of the lease liability.

The right-of-use asset is depreciated using the straight-line method from the commencement date of the lease to the earlier of the end of the useful life of the underlying asset and the end of the lease term. The Company assesses its right-of-use assets for impairment and accounts for identified impairment losses similar to its assessment of impairment on other property and equipment.

Refundable security deposits are classified as financial assets measured at amortized cost and included in current other receivables or other non-current assets. Tenant improvement allowances are recognized as a reduction in the costs of the associated leasehold improvement assets.

The Company has taken the practical expedient not to assess whether rent concessions arising as a result of COVID-19 are lease modifications. These rent concessions are in the form of rent deferrals and there is no change to the amount recognized in profit or loss as a result of these changes.

I. Government grants

Government grants are assistance by government agencies in the form of transfers of resources to an entity in return for past or future compliance with certain conditions related to the operating activities of the entity. Government grants are recognized where there is reasonable assurance that the grant will be received, and the Company will comply with all attached conditions. Government grants related to costs are deferred, if applicable, and recognized gross in profit or loss on a systematic basis in the periods in which the expenses are recognized. When the grant relates to an asset, it is recognized as income in equal amounts over the expected useful life of the related asset. Government loans are analyzed to determine whether they qualify as grants or are required to be treated as financial liabilities.

J. Provisions

Provisions are recognized when the Company has a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation. Where appropriate, the future cash flow estimates are adjusted to reflect risks specific to the liability. Provisions are measured using managements best estimate as to the outcomes, based on known facts, risks and uncertainties at the reporting date.

Contingent liabilities are possible obligations whose existence will only be confirmed by future events not wholly within the control of the Company. Contingent liabilities are not recognized in the consolidated financial statements but are disclosed unless the possibility of an outflow of economic resources is considered remote.

K. Share related items

Stock options

The Company grants stock options to employees, directors, officers, and consultants. The fair value of options granted is recognized as a share-based payment expense with a corresponding increase in equity. The fair value is measured for each tranche at grant date and is recognized on a graded-vesting basis over the period during which the options vest. Stock options granted to non-employees are measured at the fair value of the goods or services received except where the fair value cannot be estimated, in which case it is measured at the fair value of the equity instrument granted. The fair value of the share-based compensation to non-employees is periodically re-measured until counterparty performance is complete, and any change therein is recognized over the period and in the same manner as if the Company had paid cash instead of paying with stock options.

The fair value of options is determined using the Black-Scholes option pricing model which incorporates all the market vesting conditions. The number of options expected to vest is reviewed and adjusted at the end of each reporting period such that the amount recognized for services received as consideration for the equity instruments granted shall be based on the number of equity instruments that eventually vest.

Expected forfeitures are estimated at the date of grant and subsequently adjusted if further information indicates actual forfeitures may vary from the original estimate. The impact of the revision of the original estimate is recognized in net loss such that the cumulative expense reflects the revised estimate. Upon exercise of stock options, consideration received on exercise of these equity instruments is recorded as share capital and the related share-based payment reserve is transferred to share capital.

Restricted share units

The Company grants RSU’s to directors, employees and consultants which are measured at fair value based on the closing price of the Company’s common shares for the day preceding the date of the grant. The fair value of the grant is recognized as a share-based payment expense over the vesting period with a corresponding charge to contributed surplus. Common shares of the Company are issued on exercise by the holder of vested RSU’s.

Warrants issued as consideration for services

In certain circumstances, the Company issues warrants as consideration for services provided generally in conjunction with debt or equity financings. Where identifiable services are not reliability measured the services are measured with reference to the fair value of the equity instruments issued using the Black-Scholes model. The measurement date is when the entity obtains the goods or is provided the services and the warrants are not remeasured thereafter.

Loss per share

Basic loss per share is calculated by dividing the loss attributable to the common shareholders of the Company by the weighted average number of common shares outstanding during the respective reporting periods. Where a loss is reported, diluted loss per share is the same as basic loss per shares as all potential equity instruments are anti-dilutive and not included in the calculation.

L. Fair value measurement

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date or, in its absence, the most advantageous market to which the group has access at that date. Several of the company’s accounting policies and disclosures require the measurement of fair values for both financial and non-financial assets and liabilities. The Company uses the fair value hierarchy to classify the significance of inputs to valuation techniques used in making fair value measurements of financial assets and liabilities. The categories are:

• Level 1 inputs are quoted prices in active markets for identical assets or liabilities that the Company can access at the measurement date;

• Level 2 inputs are inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (i.e., as prices) or indirectly (i.e., derived from prices); and

• Level 3 inputs are unobservable inputs for the asset or liability.

When one level one input is available the Company measures the fair value of the instrument using the quoted price in an active market for that instrument (Level 1). A market is regarded as active if transactions for the asset or a liability take place with sufficient frequency and volume to provide pricing information on an ongoing basis.

If there is no quoted price in an active market, then the group uses valuation techniques that maximize the use of relevant observable inputs and minimizes the use of unobservable inputs (Level 2 or Level 3). The chosen valuation technique incorporates all the factors that market participants would consider in pricing a transaction.

M. Convertible debentures

Convertible debentures are accounted for depending on the terms of the contract. The fair value of the debentures are allocated into components parts, which may include separate host debt, embedded derivative(s) and/or equity components based on the terms of the contract. Where the fair value of the financial instrument is different than the transaction price then the measurement is dependent on whether the fair value was determined based on a valuation technique that only uses data from observable markets (Level 1 input) or otherwise. For compound financial instruments such as the 2019 Debentures where there is a liability and equity component, on issuance of the convertible debentures, the fair value of the liability component is determined using a market rate for an equivalent non-convertible instrument.

The proceeds are allocated to the liability component first with the remainder of the proceeds allocated to the conversion option that is recognized and included in equity. The liability component (net of transaction costs) is subsequently measured at amortized cost using the effective interest rate method until it is extinguished on conversion or redemption. The carrying amount of the conversion option is not remeasured in subsequent periods.

For the majority of the 2021 Debentures, the fair value of the financial instruments was greater than the transaction price. The residual is treated as a deferred amount and recognized similar to fair value adjustments on derivatives. For hybrid financial instruments such as the 2021 Debentures where there is a liability and embedded derivative component, the fair value of the embedded derivative is determined first with the residual of the total fair value for the instrument allocated to the host debt. The host debt (liability), net of transaction costs, is subsequently measured at amortized cost using the effective interest rate method until it is extinguished on conversion or redemption.

Transaction costs are apportioned between each component of the convertible debentures based on a percentage of proceeds when the instruments are initially recognized. Transaction costs attributable to the liability and equity components are offset against the respective balances with transaction costs attributable to embedded derivatives directly expensed.

N. Warrant liabilities

Warrants issued where the number of common shares to be issued or the value of the common shares varies as they are denominated in a foreign currency are classified as derivative financial liabilities. The derivative warrant liability is measured at fair value with changes in fair value recognized in the consolidated statements of loss at the end of each reporting period.

O. Income taxes and deferred taxation

Income tax expense of the Company represents current tax and deferred tax.

The Company records current tax based on the taxable profits for the period which is calculated using tax rates that have been enacted or substantively enacted by the reporting date. Taxable profit differs from profit as reported in the consolidated statements of loss and comprehensive loss because of items of income or expense that are taxable or deductible in other years and items that are never taxable or deductible.

Deferred income taxes are accounted for using the liability method. Under this method, deferred tax assets and liabilities are determined based on temporary differences between the financial reporting and tax basis of assets and liabilities and measured using the substantively enacted tax rates and laws in effect when the differences are expected to reverse. The effect of a change in tax rates or tax legislation is recognized in the period of substantive enactment. Deferred tax assets, such as unused tax losses, income tax reductions, and certain items that have a tax basis but cannot be identified with an asset or liability on the statement of financial position, are recognized to the extent it is probable that taxable profit will be available against which the difference can be utilized. Deferred tax assets and liabilities are offset when the Company has a legally enforceable right to offset current assets and liabilities. The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilized. Unrecognized deferred tax assets are reassessed at each reporting date and are recognized to the extent that it has become probable that future taxable profits will allow the deferred tax asset to be recovered.

When there is uncertainty concerning the Company’s filing position regarding the tax bases of assets or liabilities, the taxability of certain transactions or other tax-related assumptions, then the Company: (a) considers whether uncertain tax treatments should be considered separately, or as a group, based on which approach provides better predictions of the resolution; (b) determines if it is probable that the tax authorities will accept the uncertain tax treatment; and (c) if it is not probable that the uncertain tax treatment will be accepted, measure the tax uncertainly based on the most likely amount or expected value, depending on whichever method better predicts the resolution of the uncertainty. Companies are to assume in making this measurement that a taxation authority with the right to examine any amounts reported to it will examine those amounts and will have full knowledge of all relevant information when making those examinations.

P. Accounting standards development

(a) Application of new and revised IFRSs

The Company did not apply any new standards or amendments for the year ended December 31, 2021.

(b) New accounting standards, interpretations and amendments not yet effective

There are a number of new accounting standards, amendments to standards, and interpretations which have been issued by the IASB that are effective in future accounting periods that are not expected to have a material impact on the Company in the year of adoption and as such are not included here.

In February 2021, the IASB issued amendments to two existing accounting standards regarding accounting estimates and accounting policies. The amendments issued were Disclosure of Accounting Policies (Amendments to IAS 1 and IFRS Practice Statement 2), which helps preparers determine which accounting policies to disclose in their financial statements, and Definition of Accounting Estimates (Amendment to IAS 8) which helps entities to distinguish between accounting policies and accounting estimates. These amendments are applicable starting January 1, 2023 with early adoption permitted and are not expected to have a material impact on the Company.

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Significant Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2021

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Basis of Consolidation

A. Basis of Consolidation

The consolidated financial statements include the financial statements of the Company and all its subsidiaries as at December 31, 2021. Control exists over an investee when the Company is exposed, or has rights, to variable returns from its investee and has the ability to affect those returns through its power over the investee. Subsidiaries are included in the consolidated financial results of the Company from the effective date of acquisition up to the effective date of disposition or loss of control. Unless otherwise stated, the subsidiaries have share capital consisting solely of ordinary shares and the proportion of ownership interests held equals the voting rights held by the entity.

Subsidiaries

The Company’s principal subsidiaries include the following entities many of which have 100% ownership in other entities. The Company directly and indirectly owns 100% of all subsidiaries except for the Agnity group of companies. While the Company does not have an ownership interest in the Agnity entities, the Company controls them and as such the financial results are consolidated into the Company’s consolidated financial statements.

	Principle activity	Place of business and operations	Functional currency
mCloud Technologies Corp.	Parent company	Canada		CDN $
mCloud Technologies (USA) Inc.	Operations	United States		USD $
mCloud Technologies (Canada) Inc.	Operations	Canada		CDN $
Field Diagnostic Services, Inc. (“FDSI”)	Operations	United States		USD $
Construction Systems Associates, Inc. (“CSA”)	Operations	United States		USD $
mCloud Technologies Services Inc. (“MTS”)	Operations	Canada		CDN $
NGRAIN (Canada) Corporation (“NGRAIN”)	Operations	Canada		CDN $
kanepi Group Pty. Ltd.	Operations	Australia		AUD $
kanepi Services Pty. Ltd.	Operations	Australia		AUD $
mCloud Technologies Singapore Pte. Ltd.	Operations	Singapore		SGD $
mCloud Corp (HK) Ltd.	Operations	China		RMB ¥
mCloud Technologies (Saudi Arabia)	Operations	Saudi Arabia		SAR $
Agnity Global, Inc. (“Agnity”)	Operations	United States		USD $
Agnity Communications, Inc. (“ACI”)	Operations	United Stated		USD $
Agnity Healthcare, Inc. (“AHI”)	Operations	United States		USD $

When the Company loses control over a subsidiary, it derecognizes the assets and liabilities of the subsidiary and any related non-controlling interests and other components of equity. Any resulting gain or loss is recognized in net income (loss). Any interest retained by the former subsidiary is measured at fair value when control is lost.

All intercompany transactions, balances, revenues and expenses have been eliminated on consolidation. Amounts reported in the financial statements of subsidiaries have been adjusted where necessary to ensure consistency with the accounting policies adopted by the Company. Profit or loss and other comprehensive income of subsidiaries acquired or disposed of during the year are recognized from the effective date of acquisition, or up to the effective date of disposal, as applicable.

Non-controlling interests

Non-controlling interests arise from business combinations in which the Company acquires less than 100% ownership interest. Non-controlling interests, presented as part of equity, represent the portion of a subsidiary’s profit or loss and net assets that is not attributable to the common shareholders of the Company. The entire portion of the Agnity operations is a non-controlling interest. The interests of the non-controlling shareholders are initially measured at either fair value or at the non-controlling interests’ proportionate share of the recognized amounts of the acquiree’s identifiable net assets. Any subsequent income/loss, dividends and foreign translation adjustments attributable to the non-controlling interests is recognized as part of the non-controlling interests’ income or equity. When changes in ownership interests are disproportionate to cumulative contributions, distributions and income (loss) allocations, non-controlling interest are adjusted through direct charges to equity. The Company attributes total comprehensive income or loss of subsidiaries between the owners of the parent and the non-controlling interests based on their respective ownership interests. Changes in the Company’s interest in a subsidiary that do not result in a loss of control are accounted for as equity transactions.

Business combinations

Acquisitions of subsidiaries and assets that meet the definition of a business under IFRS are accounted for using the acquisition method. The consideration transferred in the acquisition is measured at acquisition date fair value. The identifiable assets acquired and liabilities assumed that meet the conditions for recognition under IFRS 3 Business Combinations are recognized at their fair values at the acquisition date. Any excess consideration over the fair value of the identifiable net assets is recognized as goodwill. Acquisition-related costs, other than those associated with the issuance of debt or equity, are recognized in profit or loss as incurred.

If the initial accounting for a business combination is incomplete by the end of the reporting period in which the combination occurs, the Company reports provisional amounts for the items for which the accounting is incomplete. Those provisional amounts are adjusted retrospectively during the measurement period, or additional assets or liabilities are recognized, to reflect new information obtained about facts and circumstances that existed as of the acquisition date that, if known, would have affected the amounts recognized as of that date. The measurement period is the period from the date of acquisition to the date the Company obtains complete information about facts and circumstances that existed as of the acquisition date up to a maximum of one year.

Any contingent consideration is measured at fair value at the acquisition date. If contingent consideration that meets the definition of a financial instrument is classified as equity, it is not remeasured and its subsequent settlement is accounted for within equity. Other contingent consideration is remeasured at fair value at each reporting date with changes in fair value recognized in profit or loss.

Foreign currency

B. Foreign currency

Functional currency is the currency of the primary economic environment in which an entity operates. The functional currency of the parent company and its material subsidiaries are presented in the table in Note 32(A). These consolidated financial statements are presented in Canadian dollars.

Foreign currency transactions. In preparing the financial statements of each individual subsidiary, transactions in currencies other than the entity’s functional currency (foreign currencies) are recognized at the rates of exchange prevailing at the dates of the transactions. At the end of each reporting period, monetary items denominated in foreign currencies are retranslated at the rates prevailing at that date. Non-monetary items carried at fair value that are denominated in foreign currencies are retranslated at the rates prevailing at the dates those fair values are determined. Non-monetary items that are measured in terms of historical cost in a foreign currency are not retranslated. Exchange differences on monetary items are recognized in profit or loss in the period in which they arise.

Presentation currency translations. For the purposes of presenting consolidated financial statements, the assets and liabilities of the Company’s foreign operations are translated into Canadian dollars using exchange rates prevailing at the end of each reporting period. Income and expense items are translated at the average exchange rates for the period, unless exchange rates fluctuate significantly during that period, in which case the exchange rates at the dates of the transactions are used. Exchange differences arising, if any, are recognized in other comprehensive income (loss) and accumulated in equity (attributed to non-controlling interests as appropriate).

Revenue recognition

C. Revenue recognition

The Company’s revenues are derived from the sales of perpetual software licenses, subscriptions to AssetCare, installation and engineering services, hardware and post contract support and maintenance (“PCS”).

Revenue from the sale of hardware and perpetual software licenses is recognized at the point in time when control is transferred to the customer, generally upon delivery at the customer’s location.

Installation services involve the installation and implementation of energy efficient hardware, perpetual software licenses and IoT connections which feed information to the AssetCare platform. Engineering services include consulting, implementation and integration services entered into either on a time and materials basis or fixed fee basis. Revenue from installation and engineering services is recognized overtime, using an input method based on direct labour hours to measure progress towards complete satisfaction of the service.

Revenues from PCS and subscriptions to the AssetCare platform are recognized ratably overtime over the term of the PCS or subscription. Any amounts received for which performance obligations have not been completed are recognized as deferred revenue.

The Company’s contracts often include a number of promised goods or services, which are typically distinct from other performance obligations, and are therefore accounted for separately. A good or service is distinct if the customer can benefit from it on its own or together with other readily available resources, and the Company’s promise to transfer the good or service is separately identifiable from other promises in the contractual arrangement with the customer.

In determining the transaction price of a contract with a customer, the Company considers the effects of variable consideration, existence of a significant financing component, non-cash consideration, and any consideration payable to the customer. The total transaction price is allocated to each performance obligation on a relative stand-alone selling price (“SSP”) basis, representing the selling price as if it was sold separately. This is a formal process involving judgement which could impact the timing of recognized revenue.

In most cases, the SSP is based on observable data. Where possible, a narrow SSP range for each product and service is established and this range is assessed on a periodic basis or when material changes in facts and circumstances warrant a review. If the SSP is not directly observable, the amount is estimated using either the expected cost plus a margin or residual approach. The SSP for perpetual software licenses is highly variable and therefore the Company applies the residual approach, which determines the SSP by subtracting the SSP of hardware, installation and other services in the contract from the total transaction price.

Long-term contracts

The Company enters into multi-year contracts with some customers for goods and services. Under the terms of these contracts, the customer is billed an equal monthly amount over the term of the contract. Revenue is recognized as performance obligations are completed, generally with a significant portion of the transaction price being recognized at the beginning of the contract based on the calculated SSP for performance obligations that are satisfied at the point in time at which goods are delivered to customers. The remainder of the revenue is recognized over the life of the contract over time or as services are completed.

Financial Instruments

D. Financial Instruments

i. Recognition and initial measurement

On initial recognition, all financial assets and liabilities are classified and recorded at fair value, net of attributable transaction costs, except for financial assets and liabilities classified as at fair value through profit or loss (“FVTPL”).

Cash and bank indebtedness

Cash is held in bank accounts. The Company considers only those investments that are highly liquid, readily convertible to cash with original maturities of three months or less at date of purchase as cash equivalents.

Bank indebtedness consists of bank overdrafts and draws from the credit facility account repayable on demand for cash management purposes.

ii. Classification and subsequent measurement

Financial Assets

On initial recognition, a financial asset is classified as measured at: amortized cost; fair value through other comprehensive income; or fair value through profit or loss, depending on the business model in which a financial asset is managed and its contractual cash flow characteristics. Financial assets that do not meet the below classifications are classified as fair value through profit or loss.

A financial asset is measured at amortized cost if it meets both of the following conditions and is not designated as FVTPL:

• it is held within a business model whose objective is to hold assets to collect contractual cash flows; and

• its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

A financial asset is measured at fair value through other comprehensive income if it meets both of the following conditions and is not designated as at FVTPL:

• it is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets; and

• its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

Financial Liabilities

Financial liabilities are classified as measured at amortized cost or FVTPL. A financial liability is classified as at FVTPL if it is classified as held-for-trading, it is a derivative, or it is designated as such on initial recognition. Financial liabilities at FVTPL are measured at fair value and net gains and losses, including any interest expense, are recognized in profit or loss. Other financial liabilities are subsequently measured at amortized cost using the effective interest method. Interest expense and foreign exchange gains and losses are recognized in profit or loss. Any gain or loss on derecognition is also recognized in net income (loss).

When a financial liability is non-substantially modified, a gain or loss is recognized into net income (loss). The gain or loss is calculated at the date of modification as the difference between the remaining original contractual cash flows and the modified cash flows both discounted at the original effective interest rate. Any costs associated with the modified loan is added to the loan carrying amount and amortized over the remaining modified loan term. The carrying amount of the loan is revised to reflect the new cash outflows at the date of modification.

iii. Derecognition of financial assets and liabilities

Financial assets are derecognized when the contractual rights to the cash flows from the financial asset expire or the Company transfers the rights to receive the contractual cash flow in a transaction in which substantially all the risks and rewards of ownership have been transferred.

A financial liability is derecognized when its contractual obligations are discharged, cancelled or expire. The Company also derecognizes a financial liability when its terms are modified and the cash flows of the modified liability are substantially different, in which case a new financial liability based on the modified terms is recognized at fair value. On derecognition of a financial liability, the difference between the carrying amount extinguished and the consideration paid (including any non- cash assets transferred or liabilities assumed) is recognized in net income (loss).

iv. Impairment of non-derivative financial assets

The Company applies an expected credit loss (“ECL”) impairment model, which applies to financial assets measured at amortized cost, contract assets, lease receivables, and financial guarantee contracts. The ECL model results in an allowance for credit losses being recorded on financial assets regardless of whether there has been an actual loss event. Except for trade receivables, the ECL model requires the recognition of credit losses based on 12 months of expected losses for financial assets and the recognition of lifetime expected losses on financial assets that have experienced a significant increase in credit risk since origination or which are considered credit impaired. A financial asset is credit-impaired when one or more events that have a detrimental impact on the estimated future cash flows of the financial asset have occurred. ECL’s are probability-weighted estimates of credit losses. Credit losses are measured as the present value of all cash shortfalls representing the difference between the cash flows due to the entity in accordance with the contract and the cash flow an entity expects to receive. The Company has elected to measure loss allowances for trade receivables at an amount equal to lifetime ECL’s.

When determining whether the credit risk of a financial asset has increased significantly since initial recognition and when estimating ECL, the Company considers reasonable and supportable information that is relevant and available without undue cost or effort. This includes both quantitative and qualitative information analysis, based on the Company’s historical experience and including forward looking information. Loss allowances for financial assets measured at amortized cost are deducted from the gross carrying amount of the assets. The gross carrying amount of a financial asset is written off when the Company has no reasonable expectations of recovering a portion or the full amount. The Company assesses the timing of write-offs based on whether there is a reasonable expectation of recovery. Impairment losses related to trade and other receivables are presented within general and administrative expenses.

Property and equipment

E. Property and equipment

Property and equipment are recorded at cost, less accumulated depreciation and accumulated impairment losses, if any. Cost includes expenditures that are directly attributable to the acquisition of the asset. Depreciation is calculated on a straight-line basis over the estimated useful lives of the assets, as follows:

	Life
Computer equipment	2 -5 years
Office furniture and equipment	7 years
Leasehold improvements	lesser of useful lives or lease term

The estimated useful lives and depreciation methods are reviewed at the end of each reporting period, with the effect of any changes in estimate accounted for on a prospective basis.

An item of property and equipment is derecognized upon disposal or when no future economic benefits are expected to arise from the continued use of the asset. Any gain or loss arising on the disposal or retirement of an item of property and equipment is determined as the difference between the sales proceeds and the carrying amount of the asset and is recognized in profit or loss. Repairs and maintenance costs that do not improve or extend productive life are recognized in profit or loss in the period in which the costs are incurred.

Intangible assets and goodwill

F. Intangible assets and goodwill

Intangible assets

Intangible assets acquired separately

Intangible assets patents and trademarks, customer relationships and technology, all of which have a finite life. Intangible assets acquired separately are measured on initial recognition at cost and intangible assets acquired in a business combination are recognized at fair value at the date of acquisition. Following initial recognition, intangible assets are carried at cost less any accumulated amortization and accumulated impairment losses.

Subsequent expenditure is capitalized only when it increases the future economic benefits embodied in the specific asset to which it relates. All other expenditure, including expenditure on internally generated goodwill and intangible assets are recognized in profit or loss as incurred.

Intangible assets are amortized over their estimated useful lives, on a straight-line basis, as follows:

	Life
Patents and trademarks	5 - 15 years
Customer relationships	5 - 20 years
Technology	5 years

Amortization methods, useful lives and residual values are reviewed at the end of each reporting period and adjusted if required on a prospective basis.

An intangible asset is derecognized on disposal, or when no future economic benefits are expected from use or disposal. Gains or losses arising from derecognition of an intangible asset, measured as the difference between the net disposal proceeds and the carrying amount of the asset, are recognized in profit or loss when the asset is derecognized.

Internally generated intangible assets

Expenditures on research activities are recognized as an expense in the period in which they were incurred.

Internally-generated intangible assets arising from development or from the development phase of an internal project are recognized if all of the following factors have been demonstrated:

• Technical feasibility of completing the intangible asset results in the intangible asset being available for use or sale;

• There is an intention to complete the intangible asset and use or sell it;

• There is an ability to use or sell the intangible asset;

• Evidence to suggest how the intangible asset will generate probable future economic benefits;

• There is availability of adequate technical, financial and other resources to complete the development and to use or sell the intangible asset; and,

• An ability to reliably measure the expenditure(s) attributable to the intangible asset during its development exists.

The estimated useful life and amortization method are reviewed at the end of each reporting period, with the effect of any changes in estimate being accounted for on a prospective basis. Where no internally-generated intangible asset can be recognized, development expenditures are recognized in profit or loss in the period in which it is incurred.

Goodwill

Goodwill, representing the excess of the consideration paid for entities acquired over the fair values of the assets acquired and liabilities assumed, is initially measured at cost and is not amortized. After initial recognition, goodwill is measured at cost less any accumulated impairment losses and is tested annually for impairment.

For the purpose of impairment testing, goodwill is allocated to each of the Company’s cash-generating units that are expected to benefit from the synergies of the business combination. A cash-generating unit to which goodwill has been allocated is tested for impairment annually, or more frequently when there is indication that the unit may be impaired. If the recoverable amount of the cash-generating unit is less than the carrying amount, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro-rata based on the carrying amount of each asset in the cash generating unit. The recoverable amount is the greater of an asset’s fair value less costs of disposal or its value in use. In determining fair value less costs of disposal, recent market transactions are considered or an appropriate valuation model is used. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset or CGU. Any impairment loss for goodwill is recognized directly in profit or loss in the consolidated statements of loss on comprehensive loss. Goodwill impairments are not reversed. Management evaluates goodwill for impairment annually as of December 31 unless impairment indicators exist at another reporting date. On disposal of a cash-generating unit, the attributable amount of goodwill is included in the determination of the profit or loss on disposal.

Impairment of non-financial assets

G. Impairment of non-financial assets

The carrying amount of property and equipment and intangible assets with a finite life are reviewed each reporting period to determine whether events or changes in circumstances indicate that their carrying amounts may not be recoverable. Intangible assets with an indefinite life are reviewed and tested on an annual basis or whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable.

An impairment loss is recognized for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs of disposal or its value in use. To assess value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. In determining fair value less costs of disposal recent market transactions are considered or an appropriate valuation model is used.

To assess impairment, assets are grouped at the lowest levels for which there are separately identifiable cash inflows (cash-generating units). For an asset that does not generate largely independent cash flows, the recoverable amount is determined for the cash-generating unit to which the asset belongs. Impairment losses recognized in prior periods are assessed at each reporting date for any indications that the loss has decreased or no longer exists. An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortization, if no impairment loss had been recognized.

Leases

H. Leases

i. Recognition and initial measurement as a lessee

At the commencement date of a lease, the Company recognizes a right-of-use asset and a lease liability for all leases except leases of low-value assets and leases with a duration of 12 months or less.

At inception of a contract, the Company assesses whether a contract is, or contains, a lease. A lease is defined as a contract, or part of a contract, that conveys the right to control the use of an identified asset for a period of time in exchange for consideration. To assess whether a contract conveys the right to control the use of an identified asset, the Company determines whether, throughout the period of use, it has the right to obtain substantially all of the economic benefits from use of the identified asset and the right to direct the use of the identified asset. The Company reassesses whether a contract is, or contains, a lease only if the terms and conditions of the contract are changed.

Lease liabilities are initially measured at the present value of unpaid lease payments at the commencement date of the lease, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the Company’s incremental borrowing rate.

Lease payments included in the measurement of the lease liability comprise the following:

• fixed payments (including in-substance fixed payments), less any lease incentives receivable;

• variable lease payments that depend on an index or a rate (such as CPI), initially measured using the index or rate as at the commencement date;

• amounts expected to be payable by the Company under residual value guarantees;

• exercise price of a purchase option if the Company is reasonably certain to exercise that option; and

• payments of penalties for terminating the lease, if the lease term reflects the Company exercising an option to terminate the lease.

Variable rent payments that are not based on an index or rate, including additional rent for operating costs and taxes and non-recoverable goods and services tax, are recognized as rent expense, within general and administrative expense or direct costs, as incurred. Lease payments for short-term leases and leases of low-value assets are recognized as rent expense on a straight-line basis over the lease term.

Right-of-use assets are initially measured at cost comprised of the initial lease liability adjusted for any lease payments made at or before commencement of the lease, plus initial direct costs incurred less lease incentives received.

ii. Classification and subsequent measurement as a lessee

Subsequent to the commencement date of the lease, the lease liability is measured at amortized cost using the effective interest method. The lease liability is remeasured by discounting the revised lease payments using a revised discount rate when there is a change in the lease term or there is a change in the assessment of an option to purchase the underlying asset. The lease liability is remeasured by discounting the revised lease payments using an unchanged discount rate when there is a change in the amounts expected to be payable under a residual value guarantee or there is a change in future lease payments resulting from a change in an index or a rate used to determine variable payments. Upon remeasurement of a lease liability, a corresponding adjustment to the right-of-use asset is recognized.

Subsequent to the commencement date of the lease, the Company measures the right-of-use asset at cost, less accumulated depreciation, and any accumulated impairment losses, and adjusted for any remeasurement of the lease liability.

The right-of-use asset is depreciated using the straight-line method from the commencement date of the lease to the earlier of the end of the useful life of the underlying asset and the end of the lease term. The Company assesses its right-of-use assets for impairment and accounts for identified impairment losses similar to its assessment of impairment on other property and equipment.

Refundable security deposits are classified as financial assets measured at amortized cost and included in current other receivables or other non-current assets. Tenant improvement allowances are recognized as a reduction in the costs of the associated leasehold improvement assets.

The Company has taken the practical expedient not to assess whether rent concessions arising as a result of COVID-19 are lease modifications. These rent concessions are in the form of rent deferrals and there is no change to the amount recognized in profit or loss as a result of these changes.

Government grants

I. Government grants

Government grants are assistance by government agencies in the form of transfers of resources to an entity in return for past or future compliance with certain conditions related to the operating activities of the entity. Government grants are recognized where there is reasonable assurance that the grant will be received, and the Company will comply with all attached conditions. Government grants related to costs are deferred, if applicable, and recognized gross in profit or loss on a systematic basis in the periods in which the expenses are recognized. When the grant relates to an asset, it is recognized as income in equal amounts over the expected useful life of the related asset. Government loans are analyzed to determine whether they qualify as grants or are required to be treated as financial liabilities.

Provisions

J. Provisions

Provisions are recognized when the Company has a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation. Where appropriate, the future cash flow estimates are adjusted to reflect risks specific to the liability. Provisions are measured using managements best estimate as to the outcomes, based on known facts, risks and uncertainties at the reporting date.

Contingent liabilities are possible obligations whose existence will only be confirmed by future events not wholly within the control of the Company. Contingent liabilities are not recognized in the consolidated financial statements but are disclosed unless the possibility of an outflow of economic resources is considered remote.

Share related items

K. Share related items

Stock options

The Company grants stock options to employees, directors, officers, and consultants. The fair value of options granted is recognized as a share-based payment expense with a corresponding increase in equity. The fair value is measured for each tranche at grant date and is recognized on a graded-vesting basis over the period during which the options vest. Stock options granted to non-employees are measured at the fair value of the goods or services received except where the fair value cannot be estimated, in which case it is measured at the fair value of the equity instrument granted. The fair value of the share-based compensation to non-employees is periodically re-measured until counterparty performance is complete, and any change therein is recognized over the period and in the same manner as if the Company had paid cash instead of paying with stock options.

The fair value of options is determined using the Black-Scholes option pricing model which incorporates all the market vesting conditions. The number of options expected to vest is reviewed and adjusted at the end of each reporting period such that the amount recognized for services received as consideration for the equity instruments granted shall be based on the number of equity instruments that eventually vest.

Expected forfeitures are estimated at the date of grant and subsequently adjusted if further information indicates actual forfeitures may vary from the original estimate. The impact of the revision of the original estimate is recognized in net loss such that the cumulative expense reflects the revised estimate. Upon exercise of stock options, consideration received on exercise of these equity instruments is recorded as share capital and the related share-based payment reserve is transferred to share capital.

Restricted share units

The Company grants RSU’s to directors, employees and consultants which are measured at fair value based on the closing price of the Company’s common shares for the day preceding the date of the grant. The fair value of the grant is recognized as a share-based payment expense over the vesting period with a corresponding charge to contributed surplus. Common shares of the Company are issued on exercise by the holder of vested RSU’s.

Warrants issued as consideration for services

In certain circumstances, the Company issues warrants as consideration for services provided generally in conjunction with debt or equity financings. Where identifiable services are not reliability measured the services are measured with reference to the fair value of the equity instruments issued using the Black-Scholes model. The measurement date is when the entity obtains the goods or is provided the services and the warrants are not remeasured thereafter.

Loss per share

Basic loss per share is calculated by dividing the loss attributable to the common shareholders of the Company by the weighted average number of common shares outstanding during the respective reporting periods. Where a loss is reported, diluted loss per share is the same as basic loss per shares as all potential equity instruments are anti-dilutive and not included in the calculation.

Fair value measurement

L. Fair value measurement

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date or, in its absence, the most advantageous market to which the group has access at that date. Several of the company’s accounting policies and disclosures require the measurement of fair values for both financial and non-financial assets and liabilities. The Company uses the fair value hierarchy to classify the significance of inputs to valuation techniques used in making fair value measurements of financial assets and liabilities. The categories are:

• Level 1 inputs are quoted prices in active markets for identical assets or liabilities that the Company can access at the measurement date;

• Level 2 inputs are inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (i.e., as prices) or indirectly (i.e., derived from prices); and

• Level 3 inputs are unobservable inputs for the asset or liability.

When one level one input is available the Company measures the fair value of the instrument using the quoted price in an active market for that instrument (Level 1). A market is regarded as active if transactions for the asset or a liability take place with sufficient frequency and volume to provide pricing information on an ongoing basis.

If there is no quoted price in an active market, then the group uses valuation techniques that maximize the use of relevant observable inputs and minimizes the use of unobservable inputs (Level 2 or Level 3). The chosen valuation technique incorporates all the factors that market participants would consider in pricing a transaction.

Convertible Debentures

M. Convertible debentures

Convertible debentures are accounted for depending on the terms of the contract. The fair value of the debentures are allocated into components parts, which may include separate host debt, embedded derivative(s) and/or equity components based on the terms of the contract. Where the fair value of the financial instrument is different than the transaction price then the measurement is dependent on whether the fair value was determined based on a valuation technique that only uses data from observable markets (Level 1 input) or otherwise. For compound financial instruments such as the 2019 Debentures where there is a liability and equity component, on issuance of the convertible debentures, the fair value of the liability component is determined using a market rate for an equivalent non-convertible instrument.

The proceeds are allocated to the liability component first with the remainder of the proceeds allocated to the conversion option that is recognized and included in equity. The liability component (net of transaction costs) is subsequently measured at amortized cost using the effective interest rate method until it is extinguished on conversion or redemption. The carrying amount of the conversion option is not remeasured in subsequent periods.

For the majority of the 2021 Debentures, the fair value of the financial instruments was greater than the transaction price. The residual is treated as a deferred amount and recognized similar to fair value adjustments on derivatives. For hybrid financial instruments such as the 2021 Debentures where there is a liability and embedded derivative component, the fair value of the embedded derivative is determined first with the residual of the total fair value for the instrument allocated to the host debt. The host debt (liability), net of transaction costs, is subsequently measured at amortized cost using the effective interest rate method until it is extinguished on conversion or redemption.

Transaction costs are apportioned between each component of the convertible debentures based on a percentage of proceeds when the instruments are initially recognized. Transaction costs attributable to the liability and equity components are offset against the respective balances with transaction costs attributable to embedded derivatives directly expensed.

Warrant liabilities

N. Warrant liabilities

Warrants issued where the number of common shares to be issued or the value of the common shares varies as they are denominated in a foreign currency are classified as derivative financial liabilities. The derivative warrant liability is measured at fair value with changes in fair value recognized in the consolidated statements of loss at the end of each reporting period.

Income taxes and deferred taxation

O. Income taxes and deferred taxation

Income tax expense of the Company represents current tax and deferred tax.

The Company records current tax based on the taxable profits for the period which is calculated using tax rates that have been enacted or substantively enacted by the reporting date. Taxable profit differs from profit as reported in the consolidated statements of loss and comprehensive loss because of items of income or expense that are taxable or deductible in other years and items that are never taxable or deductible.

Deferred income taxes are accounted for using the liability method. Under this method, deferred tax assets and liabilities are determined based on temporary differences between the financial reporting and tax basis of assets and liabilities and measured using the substantively enacted tax rates and laws in effect when the differences are expected to reverse. The effect of a change in tax rates or tax legislation is recognized in the period of substantive enactment. Deferred tax assets, such as unused tax losses, income tax reductions, and certain items that have a tax basis but cannot be identified with an asset or liability on the statement of financial position, are recognized to the extent it is probable that taxable profit will be available against which the difference can be utilized. Deferred tax assets and liabilities are offset when the Company has a legally enforceable right to offset current assets and liabilities. The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilized. Unrecognized deferred tax assets are reassessed at each reporting date and are recognized to the extent that it has become probable that future taxable profits will allow the deferred tax asset to be recovered.

When there is uncertainty concerning the Company’s filing position regarding the tax bases of assets or liabilities, the taxability of certain transactions or other tax-related assumptions, then the Company: (a) considers whether uncertain tax treatments should be considered separately, or as a group, based on which approach provides better predictions of the resolution; (b) determines if it is probable that the tax authorities will accept the uncertain tax treatment; and (c) if it is not probable that the uncertain tax treatment will be accepted, measure the tax uncertainly based on the most likely amount or expected value, depending on whichever method better predicts the resolution of the uncertainty. Companies are to assume in making this measurement that a taxation authority with the right to examine any amounts reported to it will examine those amounts and will have full knowledge of all relevant information when making those examinations.

Accounting standards development

P. Accounting standards development

(a) Application of new and revised IFRSs

The Company did not apply any new standards or amendments for the year ended December 31, 2021.

(b) New accounting standards, interpretations and amendments not yet effective

There are a number of new accounting standards, amendments to standards, and interpretations which have been issued by the IASB that are effective in future accounting periods that are not expected to have a material impact on the Company in the year of adoption and as such are not included here.

In February 2021, the IASB issued amendments to two existing accounting standards regarding accounting estimates and accounting policies. The amendments issued were Disclosure of Accounting Policies (Amendments to IAS 1 and IFRS Practice Statement 2), which helps preparers determine which accounting policies to disclose in their financial statements, and Definition of Accounting Estimates (Amendment to IAS 8) which helps entities to distinguish between accounting policies and accounting estimates. These amendments are applicable starting January 1, 2023 with early adoption permitted and are not expected to have a material impact on the Company.

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Segment Reporting (Tables)

6 Months Ended

12 Months Ended

Jun. 30, 2022

Dec. 31, 2021

Text Block [Abstract]

Summary of Company's Revenue and Non-current Assets

The Company’s revenue by location of the ultimate customer or consumer of product solution are as follows:

	Three months ended June 30,					Six months ended June 30,
	2022			2021		2022		2021
Canada 1	$	(767,709	)	$	3,440,590	$	1,271,267	$	7,852,189
Americas		1,647,854			1,422,069		3,167,929		2,671,673
Asia Pacific		1,027,989			1,579,435		1,705,857		3,298,173
Other		360,892			114,369		553,576		169,994
Total revenue	$	2,269,026		$	6,556,463	$	6,698,629	$	13,992,029

1  Impact of previously recognized revenue for contract modification as explained in tables above.

The Company’s revenue by location of the ultimate customer or consumer of product solution are as follows:

	Year ended December 31,
	2021		2020		2019
Canada	$	10,733,922	$	13,832,691	$	10,889,542
United States		6,564,271		5,691,202		7,450,707
Japan		5,849,967		6,446,939		–
Australia		993,933		152,301		–
Other		1,454,879		805,306		–
Total revenue	$	25,596,972	$	26,928,439	$	18,340,249

Disclosure of major customers [text block]

The table below presents significant customers who accounted for greater than 10% of total revenues.

For the years ended December 31,	2021	2020	2019
Customer A	Less than 10%	14  %	n/a
Customer B	Less than 10%	13  %	11  %
Customer C	11  %	Less than 10%	20  %
Customer D	11  %	Less than 10%	n/a

The Company’s non-current assets by country are as follows:

	December 31, 2021		December 31, 2020
Canada	$	30,812,581	$	37,966,772
Australia		10,372,410		11,731,960
United States		9,014,016		12,424,844
Total non-current assets	$	50,199,007	$	62,123,576

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Revenue (Tables)

6 Months Ended

12 Months Ended

Jun. 30, 2022

Dec. 31, 2021

Text Block [Abstract]

Summary of Revenue Disaggregated By Major Service Line and Timing of Revenue Recognition

All of the Company’s revenue is derived from contracts with customers. In the following tables, revenue is disaggregated by major service line and timing of revenue recognition.

	Three months ended June 30,					Six months ended June 30,
	2022			2021		2022			2021
AssetCare Initialization 1	$	28,979		$	303,321	$	443,470		$	818,564
AssetCare Solutions 2		4,695,074			6,079,949		8,684,202			12,514,458
Engineering Services 3		116,649			173,193		142,633			659,007
Contract modification revenue reversal 4		(2,571,676	)		—		(2,571,676	)		—
	$	2,269,026		$	6,556,463	$	6,698,629		$	13,992,029

1  Revenues from initial implementation and activation of AssetCare projects, including the sale of hardware.

2 Revenues include sales of subscriptions to AssetCare, other subscriptions, post contract support and maintenance, perpetual software licenses, and installation and engineering services.

3 Revenues includes consulting, implementation and integration services entered into on a time and materials basis or fixed fee basis without the use of AssetCare.

4 During the three months ended June 30, 2022, the Company cancelled a multi-year customer contract for which services had been performed in prior periods, resulting in a contract modification. As a result, revenue from AssetCare Initialization of $2,037,014 and AssetCare Solutions of $534,662 which were recorded in prior periods was reversed during the three and six months ended June 30, 2022.

	Three months ended June 30,					Six months ended June 30,
Revenue recognized	2022			2021		2022			2021
Over time 1	$	3,783,459		$	6,253,142	$	7,645,663		$	11,701,851
At a point in time upon completion 1		(1,514,433	)		303,321		(947,034	)		2,290,178
	$	2,269,026		$	6,556,463	$	6,698,629		$	13,992,029

1  See table above and related footnote 4. The three and six months ended June 30, 2022 reflects the reversal of $534,662 of revenue recognized over time and $2,037,014 of revenue recognized at point in time upon completion.

NOTE 5 - REVENUE

The Company’s operations and main revenue streams are those described in Note 32(C). All of the Company’s revenue is derived from contracts with customers. In the following tables, revenue is disaggregated by major service line and timing of revenue recognition.

	Year ended December 31,
	2021		2020		2019
AssetCare Initialization 1	$	1,250,181	$	7,689,232	$	5,964,663
AssetCare Solutions 2		23,461,748		12,809,054		2,939,582
Engineering Services 3		885,043		6,430,153		9,436,004
	$	25,596,972	$	26,928,439	$	18,340,249

1  Revenues from initial implementation and activation of AssetCare projects, including the sale of hardware.

2  Revenues include sales of subscriptions to AssetCare, other subscriptions, post contract support and maintenance, perpetual software licenses, and installation and engineering services.

3  Revenues includes consulting, implementation and integration services entered into on a time and materials basis or fixed fee basis without the use of AssetCare.

	Year ended December 31,
Timing of revenue recognition	2021		2020		2019
Over time	$	24,422,749	$	18,551,736	$	12,375,586
At a point in time upon completion		1,174,223		8,376,703		5,964,663
	$	25,596,972	$	26,928,439	$	18,340,249

Summary of Significant Changes in Unbilled Revenue and Deferred Revenue Balances

Significant changes in unbilled revenue and deferred revenue balances are as follows:

	Unbilled revenue			Deferred revenue
Balance at December 31, 2021	$	756,042		$	2,811,408
Additions		3,057,402			5,805,365
Less: transferred to trade and other receivables		(2,952,031	)		—
Less: recognized in revenue		—			(3,853,163	)
Effect of movements in exchange rates		—			49,589
Balance at June 30, 2022	$	861,413		$	4,813,199

Significant changes in unbilled revenue and deferred revenue balances are as follows:

	Unbilled revenue			Deferred revenue
Balance at January 1, 2019	$	—		$	133,678
Acquired in business combination (Note 17(c))		2,347,207			133,556
Acquired in business combination (Note 17(b))		—			457,259
Additions		9,595,535			5,309,436
Less: transferred to trade and other receivables		(11,278,312	)		—
Less: recognized in revenue		—			(4,878,419	)
Less: Loss allowance		(5,499	)		—
Effect of movement in exchange rates		—			(17,229	)
Balance at December 31, 2019	$	658,931		$	1,138,281
Acquired in business combination		117,686			–
Additions		11,478,436			6,316,586
Less: transferred to trade and other receivables		(11,557,665	)		–
Less: write-offs		(146,489	)		–
Less: recognized in revenue		–			(5,612,896	)
Less: applied to outstanding trade receivables		–			(30,586	)
Effect of movement in exchange rates		3,841			(40,265	)
Balance at December 31, 2020	$	554,740		$	1,771,120
Additions		7,470,881			10,616,893
Less: transferred to trade and other receivables		(7,269,579	)		–
Less: recognized in revenue		–			(9,585,211	)
Effect of movement in exchange rates		–			8,606
Balance at December 31, 2021 1	$	756,042		$	2,811,408

1  Unbilled revenue is included in trade and other receivables (Note 6) and relates to the Company’s right to consideration for work completed but not billed at the reporting date. Unbilled revenue is transferred to trade and other receivables when services are billed to customers.

Summary of Company's Revenue and Non-current Assets

The Company’s revenue by location of the ultimate customer or consumer of product solution are as follows:

	Three months ended June 30,					Six months ended June 30,
	2022			2021		2022		2021
Canada 1	$	(767,709	)	$	3,440,590	$	1,271,267	$	7,852,189
Americas		1,647,854			1,422,069		3,167,929		2,671,673
Asia Pacific		1,027,989			1,579,435		1,705,857		3,298,173
Other		360,892			114,369		553,576		169,994
Total revenue	$	2,269,026		$	6,556,463	$	6,698,629	$	13,992,029

1  Impact of previously recognized revenue for contract modification as explained in tables above.

The Company’s revenue by location of the ultimate customer or consumer of product solution are as follows:

	Year ended December 31,
	2021		2020		2019
Canada	$	10,733,922	$	13,832,691	$	10,889,542
United States		6,564,271		5,691,202		7,450,707
Japan		5,849,967		6,446,939		–
Australia		993,933		152,301		–
Other		1,454,879		805,306		–
Total revenue	$	25,596,972	$	26,928,439	$	18,340,249

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Trade and Other Receivables and Long-Term Receivables (Tables)

6 Months Ended

12 Months Ended

Jun. 30, 2022

Dec. 31, 2021

Text Block [Abstract]

Summary of Trade and Other Receivables

	June 30, 2022			December 31, 2021
Trade receivables from contracts with customers	$	11,532,760		$	14,204,320
Unbilled revenue (Note 4)		861,413			756,042
Indirect taxes receivable		293,320			148,200
Income taxes receivable		11,404			2,217
Other receivables		920,419			919,954
Contract asset		46,812			86,777
Loss allowance		(1,531,136	)		(1,550,535	)
Total trade and other receivables - current	$	12,134,992		$	14,566,975

	December 31, 2021			December 31, 2020
Trade receivables from contracts with customers	$	14,204,320		$	10,182,229
Unbilled revenue (Note 5)		756,042			554,740
Indirect taxes receivable		148,200			341,583
Income taxes receivable		2,217			594,036
Other receivables		919,954			961,714
Contract asset 1		86,777			153,178
Loss allowance (Note 26(b))		(1,550,535	)		(474,666	)
Total trade and other receivables - current	$	14,566,975		$	12,312,814

Summary of Long-Term Receivables

	June 30, 2022		December 31, 2021
Current portion of long-term receivables 1	$	390,398	$	397,060
Non-current portion of long-term receivables 2		318,360		343,371
Total long-term receivables	$	708,758	$	740,431

1 Net of expected credit loss allowance of $95,518 at June 30, 2022 (December 31, 2021 - $95,064).

2 Net of expected credit loss allowance of $61,619 at June 30, 2022 (December 31, 2021 - $61,619).

	December 31, 2021		December 31, 2020
Current portion of long-term receivables 1	$	397,060	$	445,213
Non-current portion of long-term receivables 2		343,371		2,091,059
Total long-term receivables	$	740,431	$	2,536,272

1  Net of expected credit loss allowance of $95,064 at December 31, 2021 and $131,364 at December 31, 2020 (Note 26(b)).

2  Net of expected credit loss allowance of $61,619 at December 31, 2021 and nil at December 31, 2020 (Note 26(b)).

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Prepaid Expenses And Other Assets (Tables)

12 Months Ended

Dec. 31, 2021

Text Block [Abstract]

Summary of Prepayments and Other Assets

	December 31, 2021		December 31, 2020
Prepaid insurance	$	348,063	$	122,893
Advances		121,806		38,593
Deposits		862,338		189,734
Prepaid licenses		938,887		1,075,797
Prepaid services		505,448		292,552
Other prepaid costs		197,962		325,481
Other assets		3,423		293,116
Prepaid expenses and other assets	$	2,977,927	$	2,338,166
Current portion	$	2,355,350	$	1,326,319
Non-current portion		622,577		1,011,847
	$	2,977,927	$	2,338,166

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Leases (Tables)

12 Months Ended

Dec. 31, 2021

Text Block [Abstract]

Summary of Change in Carrying Amount of Company's Right of Use Assets

a) Right-of-use assets

The following table presents the change in carrying amount of the Company’s right-of-use assets:

	Office			Equipment and Vehicles			Total
Balance at January 1, 2019	$	285,086		$	–		$	285,086
Acquired right-of-use assets (Note 17)		4,207,837			95,378			4,303,215
Additions to right-of-use assets		–			183,617			183,617
Depreciation charge for the year		(433,617	)		(48,360	)		(481,977	)
Impairment charge for the year		(78,764	)		–			(78,764	)
Effect of movement in exchange rates		(4,369	)		–			(4,369	)
Balance at January 1, 2020	$	3,976,173		$	230,635		$	4,206,808
Acquired right-of-use assets (Note 17)		509,290			–			509,290
Additions to right-of-use assets		84,413			6,158			90,571
Depreciation charge for the year		(780,767	)		(145,661	)		(926,429	)
Impact of lease modification		(221,590	)		–			(221,590	)
Effect of movement in exchange rates		2,648			(582	)		2,067
Balance at December 31, 2020	$	3,570,167		$	90,550		$	3,660,717
Depreciation charge for the year		(748,058	)		(80,198	)		(828,256	)
Impact of lease modification		(1,924,504	)		–			(1,924,504	)
Effect of movement in exchange rates		8,122			(51	)		8,071
Balance at December 31, 2021	$	905,727		$	10,301		$	916,028

Summary of Amounts Recognized in Consolidated Statements of Loss and Comprehensive Loss

b) Amounts recognized in consolidated statements of loss and comprehensive loss

	Year ended December 31,
	2021		2020		2019
Accretion of lease liabilities included in finance costs	$	137,272	$	350,792	$	168,571
Depreciation of right-of-use assets 1		828,256		926,429		481,977
Expense related to variable lease payments 2		825,212		824,062		–
Expense related to short-term leases 2		4,550		–		–
	$	1,795,290	$	2,101,283	$	650,548

1  Included in depreciation and amortization expense.

 2 Included in rent expense within general and administrative expense.

Summary of Amounts Recognized in Consolidated Statements of Cash Flows

c) Amounts recognized in consolidated statements of cash flows

	Year ended December 31,
	2021		2020		2019
Total cash outflows included in operating activities	$	137,272	$	350,792	$	168,571
Total cash outflows included in financing activities	$	1,095,327	$	814,072	$	422,783

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Property and Equipment (Tables)

12 Months Ended

Dec. 31, 2021

Text Block [Abstract]

Summary of Property and Equipment

	Office Furniture and Equipment			Leasehold Improvements			Computer Equipment			Total
Cost:
At January 1, 2019	$	10,117		$	239,555		$	52,966		$	302,638
Additions		30,529			74,641			32,952			138,122
Acquisitions		253,057			64,366			232,175			549,598
Impairment		–			–			(14,460	)		(14,460	)
Effect of movement in exchange rates		(1,339	)		(1,973	)		(6,990	)		(10,302	)
At December 31, 2019	$	292,364		$	376,589		$	296,643		$	965,596
Additions		30,543			–			97,145			127,688
Effect of movement in exchange rates		(917	)		(1,351	)		(6,964	)		(9,232	)
Balance at December 31, 2020	$	321,990		$	375,238		$	386,824		$	1,084,052
Additions		–			–			626,841			626,841
Disposals		(29,459	)		(43,409	)		(124,544	)		(197,412	)
Effect of movement in exchange rates		(504	)		(744	)		(4,588	)		(5,836	)
Balance at December 31, 2021	$	292,027		$	331,085		$	884,533		$	1,507,645
Accumulated depreciation:
At January 1, 2019	$	410		$	13,433		$	13,318		$	27,161
Depreciation		44,729			71,143			123,272			239,144
Effect of movement in exchange rates		(1,321	)		(1,577	)		(8,363	)		(11,261	)
At December 31, 2019	$	43,818		$	82,999		$	128,227		$	255,044
Depreciation		78,289			77,906			175,027			331,222
Effect of movement in exchange rates		(923	)		(1,436	)		(6,242	)		(8,601	)
Balance at December 31, 2020	$	121,184		$	159,469		$	297,012		$	577,665
Depreciation		75,117			73,864			336,765			485,746
Disposals		(29,458	)		(43,409	)		(123,240	)		(196,107	)
Other movements		6,746			–			(6,746	)		–
Effect of movement in exchange rates		(505	)		(744	)		(7,813	)		(9,062	)
Balance at December 31, 2021	$	173,084		$	189,180		$	495,978		$	858,242
Carrying amounts:
Balance at December 31, 2020	$	200,806		$	215,769		$	89,812		$	506,387
Balance at December 31, 2021	$	118,943		$	141,905		$	388,555		$	649,403

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Intangible Assets and Goodwill (Tables)

12 Months Ended

Dec. 31, 2021

Text Block [Abstract]

Summary of detailed information about intangible assets

	Patents and trademarks			Customer relationships			Technology			Total
Cost:
At January 1, 2019	$	192,032		$	2,118,739		$	1,590,958		$	3,901,729
Additions		–			–			–			–
Acquisitions		–			14,168,830			10,212,390			24,381,220
Effect of movements in exchange rates		(9,374	)		(46,579	)		(47,366	)		(103,319	)
Balance at December 31, 2019	$	182,658		$	16,240,990		$	11,755,982		$	28,179,630
Additions		–			–			2,333,666			2,333,666
Acquisitions		–			3,434,334			3,846,189			7,280,523
Effect of movements in exchange rates		(2,957	)		(38,494	)		(32,016	)		(73,467	)
Balance at December 31, 2020	$	179,701		$	19,636,830		$	17,903,821		$	37,720,352
Additions		–			–			440,965			440,965
Effect of movement in exchange rates		(343	)		(3,217	)		1,556			(2,004	)
Balance at December 31, 2021	$	179,358		$	19,633,613		$	18,346,342		$	38,159,313
Accumulated amortization and impairments:
At January 1, 2019	$	51,238		$	333,430		$	349,188		$	733,856
Amortization 1		36,564			1,668,090			1,618,368			3,323,022
Impairment		–			–			507,433			507,433
Effect of movements in exchange rates		(3,219	)		(23,895	)		(28,656	)		(55,770	)
Balance at December 31, 2019	$	84,583		$	1,977,625		$	2,446,333		$	4,508,541
Amortization 1		35,243			2,696,767			2,753,602			5,485,612
Effect of movements in exchange rates		(3,078	)		(19,774	)		(17,788	)		(40,640	)
Balance at December 31, 2020	$	116,748		$	4,654,618		$	5,182,147		$	9,953,513
Amortization 1		32,073			3,099,234			4,479,503			7,610,810
Effect of movement in exchange rates		85			3,820			5,252			9,157
Balance at December 31, 2021	$	148,906		$	7,757,672		$	9,666,902		$	17,573,480
Carrying amounts:
Balance at December 31, 2020	$	62,953		$	14,982,212		$	12,721,674		$	27,766,839
Balance at December 31, 2021	$	30,452		$	11,875,941		$	8,679,440		$	20,585,833

1  Amortization charges are included in depreciation and amortization in the consolidated statements of loss and comprehensive loss.

Summary of reconciliation changes in goodwill

The carrying amount of goodwill is as follows:

	December 31, 2021		December 31, 2020
Opening balance	$	27,086,727	$	18,758,975
Acquisitions, business combinations (Note 18)		–		8,405,341
Effect of movements in exchange rates		(4,932)		(77,589)
Total goodwill	$	27,081,795	$	27,086,727

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Trade Payables And Accrued Liabilities (Tables)

6 Months Ended

12 Months Ended

Jun. 30, 2022

Dec. 31, 2021

Text Block [Abstract]

Disclosure of Trade and Other Payables Explanatory

	June 30, 2022		December 31, 2021
Trade payables		$              8,697,912		$                    5,591,316
Accrued liabilities		5,453,285		5,398,389
Interest payable		228,222		233,854
Mastercard facility		372,374		296,669
Due to related parties		217,795		265,074
Income taxes payable		278,813		266,753
Indirect taxes payable		279,993		150,577
Other 1		814,953		218,677
Total trade payables and accrued liabilities		$            16,343,347		$                  12,421,309

1 At June 30, 2022, includes $718,092 associated with previous warrant liability (Note 11(c)).

	December 31, 2021		December 31, 2020
Trade payables	$	5,591,316	$	5,903,789
Accrued liabilities		5,398,389		4,795,742
Interest payable		233,854		425,054
Mastercard facility (Note 13)		296,669		600,590
Due to related parties (Note 28)		265,074		846,228
Income taxes payable		266,753		21,752
Indirect taxes payable		150,577		242,703
Other		218,677		88,398
Total trade payables and accrued liabilities	$	12,421,309	$	12,924,256

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Loans And Borrowings (Tables)

6 Months Ended

12 Months Ended

Jun. 30, 2022

Dec. 31, 2021

Disclosure of detailed information about borrowings [abstract]

Disclosure of Detailed Information About Borrowings Explanatory

The carrying value of loans and borrowings by entities controlled by the Company are as follows. Note 17(b) includes the reconciliation of cash flows associated with borrowing activities.

	June 30, 2022		December 31, 2021
Term loan (a)		$              6,623,292		$                    9,275,683
Promissory notes (b)		19,342,593		—
Nations Interbanc facility 1		2,975,021		2,639,143
Debenture payable to Industry Canada		—		26,412
Loan payable to related party 2		349,980		335,860
Oracle financing		632,034		826,418
Other loans and financing		62,887		112,085
Total		$            29,985,807		$                  13,215,601
Current		$            10,399,574		$                  12,447,939
Non-current		$            19,586,233		$767,662
Total		$            29,985,807		$                  13,215,601

1 Nations advanced $5,433,688 under the factor and security agreement and was repaid $5,454,108 in the six months ended June 30, 2022 (six months ended June 30, 2021 - $4,842,450 advances and $6,020,883 repayments).

2 Loan which originally matured in January 2023 was repaid in full in August 2022.

The carrying value of loans and borrowings by entities controlled by the Company are as follows:

	December 31, 2021		December 31, 2020
Term loan	$	9,275,683	$	10,928,055
Nations Interbanc facility		2,639,143		1,137,360
Debenture payable to Industry Canada		26,412		76,227
Loan payable to related party 1		335,860		318,428
Oracle financing 2		826,418		427,250
Other loans and financing		112,085		264,980
Total 3	$	13,215,601	$	13,152,300
Current		12,447,939		3,431,251
Non-current		767,662		9,721,049
	$	13,215,601	$	13,152,300

1  Loan assumed as part of CSA Acquisition (Note 17(d)) which bears interest at 6% and matures in January 2023. Interest is payable annually and accrued interest is included in trade payables and accrued liabilities.

2  Financing arrangements provided by Oracle Credit Corporation (“Oracle”) bearing interest between 6.2% and 6.6%. Interest is due in quarterly installments with loans maturing in May 2023 and February 2024. During the year ended December 31, 2021, proceeds from additional funding received was $577,378 (December 31, 2020 - $495,944)

3  Note 30(b) includes the reconciliation of movements of liabilities to cash flows arising from financing activities.

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Bank Indebtedness (Tables)

6 Months Ended

12 Months Ended

Jun. 30, 2022

Dec. 31, 2021

Disclosure Of Detailed Information About Bank Indebtedness Abstract [Abstract]

Disclosure of Detailed Information About Bank Indebtedness Explanatory

	June 30, 2022		December 31, 2021
ATB Financial revolving operating facility	$	3,679,631	$	3,460,109

	December 31, 2021		December 31, 2020
ATB Financial revolving operating facility	$	3,460,109	$	–
Operating loan facility 1		–		923,461
Bank overdraft 1		–		53,318
Total	$	3,460,109	$	976,779

1  At December 31, 2020, the Company had access to an operating loan facility and Mastercard facility. On April 15, 2021, the operating loan facility was repaid and closed. The Mastercard facility remains in place and at December 31, 2021, $296,669 was drawn (December 31, 2020 - $600,590) and this amount is included in trade payables and accrued liabilities on the consolidated statements of financial position. The bank overdraft at December 31, 2020 was repaid in October 2021.

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Convertible Debentures (Tables)

6 Months Ended

12 Months Ended

Jun. 30, 2022

Dec. 31, 2021

Text Block [Abstract]

Summary of Convertible Debentures

	December 31, 2021		December 31, 2020
2019 Convertible debentures liability (a)	$	22,185,170	$	19,534,988
2021 Convertible debentures liability (b)		69,034		–
2021 Convertible debentures embedded derivative (b)		41,506		–
Total	$	22,295,710	$	19,534,988

Current debentures	$	22,185,170	$	–
Non-current debentures		110,540		19,534,988
	$	22,295,710	$	19,534,988

Summary of Components of Convertible Debentures

2019 Convertible debentures

	June 30, 2022		December 31, 2021
Opening balance	$	22,380,649	$	19,767,472
Interest paid		(1,172,875)		(2,345,750)
Accreted interest at effective interest rate		2,445,205		4,958,927
Carrying amount of liability component	$	23,652,979	$	22,380,649
Less: interest payable		(195,479)		(195,479)
Total - current	$	23,457,500	$	22,185,170

	December 31, 2021		December 31, 2020
Opening balance	$	19,767,472	$	17,753,016
Conversion of debentures into common shares		–		(50,000)
Interest paid		(2,345,750)		(2,345,750)
Accreted interest at effective interest rate		4,958,927		4,410,206
Carrying amount of liability component	$	22,380,649	$	19,767,472
Less: interest payable		(195,479)		(232,484)
Total	$	22,185,170	$	19,534,988

	December 31, 2021
Proceeds from issue of convertible debentures	$	11,328,870
Fair value adjustments (Note 23)		1,615,102
Total fair value of convertible debentures		12,943,972
Less: fair value of embedded derivative		(5,060,776	)
Less: transaction costs 1		(660,604	)
Carrying value of liability at inception		7,222,592
Interest expense associated with liability		813,615
Debt extinguishment, including interest payable		(7,735,230	)
Foreign exchange adjustments		(224,286	)
		76,691
Less: accrued interest included in accrued liabilities		(7,657	)
Carrying value of liability at end of period 2	$	69,034

1  Total transaction costs were $1,061,854 which include cash compensation paid to brokers and the value of 115,760 broker warrants issued. Transaction costs of $401,250 allocated to the embedded derivative portion of the convertible debentures were expensed in finance costs in the consolidated statements of loss and comprehensive loss for the year ended December 31, 2021.

2  Convertible debt in the principal amount of US$75,000 which matures January 2024, bears interest at 8% per annum and is convertible to the Company’s shares at a conversion price of $5.84 (US$4.59).

Summary of Reconciliation of Embedded Derivatives

	December 31, 2021
Fair value of embedded derivative at inception	$	5,060,776
Fair value decrease 1		(784,261	)
Derecognition of embedded derivative on conversion		(4,214,198	)
Foreign exchange adjustments		(20,811	)
Balance, embedded derivative	$	41,506

1 The fair value of the embedded derivative is remeasured at the end of each reporting period and on conversion and recognized in fair value (gain) loss on derivatives in the consolidated statements of loss and comprehensive loss (Note 23).

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Warrant Liabilities (Tables)

6 Months Ended

12 Months Ended

Jun. 30, 2022

Dec. 31, 2021

Text Block [Abstract]

Summary of Warrant Liabilities

	June 30, 2022		December 31, 2021
Derivative warrant liabilities - 2021 Debentures (a)	$	367,019	$	1,868,541
Derivative warrant liabilities - USD equity financing (b)		2,650,624		6,106,596
Warrant liability related to business acquisition (c)		—		709,835
Other warrant liability (c)		—		195,066
Total, all current	$	3,017,643	$	8,880,038

	December 31, 2021		December 31, 2020
Derivative warrant liabilities - 2021 Debentures (a)	$	1,868,541	$	–
Derivative warrant liabilities - USD equity financing (b)		6,106,596		–
Warrant liability related to business acquisition (c)		709,835		710,924
Other warrant liability (c)		195,066		–
Total, all current	$	8,880,038	$	710,924

Summary of Black-Scholes Option-Pricing Model Inputs and Assumption

The Black-Scholes model inputs and assumptions include:

	December 31, 2021		August 13, 2021
Share price at date of valuation	$	6.18	$	6.90
Exercise price	$	8.74	$	8.74
Risk free rate		0.88 %		0.43 %
Expected life (years)		2.62		3.00
Expected volatility 1		45.0 %		71.5 %
Fair value per warrant 2	$	0.89	$	2.82

1  Expected volatility at December 31, 2021 measured at implied volatility of traded warrants.

2  Considers a liquidity discount of 20% in determining the fair value per warrant as these warrants are not publicly traded.

	December 31, 2021		November 29, 2021
Share price at date of valuation	$	6.18	$	5.70
Exercise price	$	6.04	$	6.05
Risk free rate		1.25 %		1.18 %
Expected life (years)		4.92		5.00
Expected volatility 1		45.0 %		45.0 %
Fair value per warrant	$	2.53	$	2.19

1  Expected volatility at represents implied volatility of the Company’s traded warrants.

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Other Liabilities (Tables)

12 Months Ended

Dec. 31, 2021

Text Block [Abstract]

Schedule of Other Liabilities Explanatory

	December 31, 2021		December 31, 2020
US Government loans	$	–	$	950,418
2021 Debentures subscriptions payable (Note 14(b))		–		5,285,997
Total	$	–	$	6,236,415
Current portion 1	$	–		6,003,838
Non-current portion		–		232,577
	$	–	$	6,236,415

1  Includes US Government loans of $717,841 at December 31, 2020. These forgivable loans are considered to be government grants when there is reasonable assurance that they will be forgiven.

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Business Acquisitions (Tables)

12 Months Ended

Dec. 31, 2021

Disclosure of detailed information about business combination [line items]

Summary of Fair Value of Options Using Inputs

	2021	2020	2019
Grant date share price	$                                    7.00	$                                    8.93	$                                10.88
Exercise price	$                                    7.10	$                                    9.74	$                                11.13
Risk-free rate	1.32  %	0.36  %	1.57  %
Expected life, years	6.2 years	5.0 years	3.9 years
Expected volatility	75  %	66  %	54  %
Expected dividends	–  %	–  %	–  %
Forfeiture rate	7  %	–  %	10  %

Agnity Global Inc [Member]

Disclosure of detailed information about business combination [line items]

Summary of Acquisition Date Fair Value of Each Major Class of Consideration Transferred And Identifiable Assets Acquired And Liabilities Assumed

The following table summarizes the acquisition-date fair value of each major class of consideration transferred, the recognized amounts of the identifiable assets acquired, and liabilities assumed, and the resulting measurement of 100% NCI recorded by the Company at the date of acquisition:

Consideration transferred:		Final
Change in fair-value of interest in Royalty Agreement (i)	$	167,488
Assumption of Agnity’s liabilities		43,050
Total consideration transferred	$	210,538

(i) The fair value of interest in the Royalty Agreement at April 22, 2019 was estimated using the discounted cash flow model. The major inputs employed in the model include forecasted royalty payments and the discount rate of 16%.

Fair value of assets and liabilities recognized:		Final
Cash and cash equivalents	$	33,524
Trade and other receivables		1,387,723
Prepaid expenses and deposits		46,483
Long term receivable		–
Property and equipment		1,281
Intangible Asset – Technology		8,412,390
Intangible Asset – Customer Relationship		1,468,830
Accounts payable and accrued liabilities		(3,232,910	)
Deferred revenue		(457,259	)
Loans and borrowings		(5,556,587	)
Warrant liability (i)		(737,419	)
Due to related party		(930,608	)
Deferred income tax liability		(444,768	)
Net identifiable assets acquired (liabilities assumed)		(9,320	)
Allocation to non-controlling interest	$	219,858

(i) A warrant was issued by Agnity in 2015 which entitles the warrant holder to acquire 6,324,660 common shares of Agnity at the exercise price of $0.000036 per share at any time until April 15, 2022. The exercise price of the warrant is subject to certain anti-dilution adjustment provisions in the event of certain capital or business transactions. The warrant holder has the option to demand a cash settlement of the warrant for US$552,250 at any time prior to its expiry date if the warrant is not exercised. It is classified as other financial liabilities and measured at its redemption amount of US$552,250 or $737,419 in Canadian dollars on acquisition date, which is equivalent to its assessed acquisition date fair value. The fair value in Canadian dollar equivalent as at December 31, 2021 was $709,835 (December 31, 2020 - $710,924; December 31, 2019 - $725,086).

mCloud Technologies Services Inc [Member]

Disclosure of detailed information about business combination [line items]

Summary of Acquisition Date Fair Value of Each Major Class of Consideration Transferred And Identifiable Assets Acquired And Liabilities Assumed

The following table summarizes the acquisition-date fair value of each major class of consideration transferred, the recognized amounts of the identifiable assets acquired, and liabilities assumed, and the resulting value of goodwill:

Consideration transferred:		Final
Cash consideration	$	4,650,689
Fair value of demand promissory notes issued(1)		18,000,000
Fair value of common shares transferred(2)		13,320,000
Total consideration transferred	$	35,970,689

(1) Comprised of two promissory notes with fair-value of $6,000,000 and $12,000,000 which were fully repaid and settled on July 10 and August 8, 2019 respectively; there was no gain or loss on settlement.

Fair value of assets and liabilities recognized:		Final
Cash and cash equivalents	$	2,227,739
Trade and other receivables (includes Unbilled revenue of $2,347,207)		5,120,830
Prepaid expenses and deposits		611,104
Right-of-use assets		4,303,215
Property and equipment		548,317
Intangible asset – Customer relationships		12,700,000
Intangible asset – Technology		1,800,000
Accounts payable and accrued liabilities		(2,030,470)
Deferred revenue		(133,556	)
Lease liabilities		(4,303,215	)
Deferred income tax liability		(3,632,250	)
Fair value of net assets acquired		17,211,714
Goodwill	$	18,758,975
	$	35,970,689

Construction Systems Associates Inc USA [Member]

Disclosure of detailed information about business combination [line items]

Summary of Acquisition Date Fair Value of Each Major Class of Consideration Transferred And Identifiable Assets Acquired And Liabilities Assumed

The following table summarizes the final balances of each major class of consideration transferred, the recognized amounts of the identifiable assets acquired and liabilities assumed, and the resulting value of goodwill.

	Final
Consideration transferred:
Cash consideration	$	703,212
Fair value of common share consideration		2,304,073
Fair value of contingent consideration payable		879,066
Total consideration	$	3,886,351

Fair value of assets and liabilities recognized:
Cash	$	181,408
Trade and other receivables		262,846
Prepaid expenses and other deposits		13,863
Property and equipment		2,098
Right of use assets		242,894
Intangible - technology		551,880
Intangible - customer relationships		801,540
Accounts payable and accrued liabilities		(168,542	)
Short-term loan		(371,610	)
Lease liabilities		(242,894	)
Deferred tax liabilities		—
Fair value of net assets acquired	$	1,273,483
Goodwill	$	2,612,868

Kanepi [Member]

Disclosure of detailed information about business combination [line items]

Summary of Acquisition Date Fair Value of Each Major Class of Consideration Transferred And Identifiable Assets Acquired And Liabilities Assumed

On October 8, 2021, the measurement period for the acquisition ended and the following table summarizes the acquisition-date fair value and the final balances of each major class of consideration transferred, the recognized amounts of the identifiable assets acquired and liabilities assumed, and the resulting value of goodwill. The preliminary balances were reported in the consolidated financial statements for the year ended December 31, 2020 and there were no measurement period adjustments.

	Final
Consideration transferred:
Cash consideration	$	4,657,512
Fair value of common share consideration		5,882,547
Fair value of contingent consideration payable		568,638
Total consideration	$	11,108,697

Fair value of assets and liabilities recognized:
Cash	$	556,880
Trade and other receivables		598,059
Other current assets		13,149
Property and equipment		1,224
Right of use assets		266,396
Intangible - technology		3,294,309
Intangible - customer relationships		2,632,794
Accounts payable and accrued liabilities		(643,385	)
Lease liabilities		(266,396	)
Deferred tax liabilities		(1,136,806	)
Fair value of net assets acquired	$	5,316,224
Goodwill	$	5,792,473

Flow Capital Corp [Member]

Disclosure of detailed information about business combination [line items]

Summary of Fair Value of Options Using Inputs

The Company used Black-Scholes option model to determine the fair value of these shares using the following inputs at January 22, 2019:

Barrier share price	$30 - $90
Risk free rate	1.90%
Expected life	6 years
Expected volatility	80.00%
Expected dividends	Nil

Flow Capital Corp [Member] | Secured Loan Agreement [Member]

Disclosure of detailed information about business combination [line items]

Summary of Fair Value of Options Using Inputs

The Company used the Black-Scholes option model to determine the fair value of the option using the following inputs at January 22, 2019:

Share price	$10.50
Risk free rate	1.90%
Expected life	0.5 years
Expected volatility	60.00%
Expected dividends	Nil

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Business Acquisition Payable (Tables)

12 Months Ended

Dec. 31, 2021

Text Block [Abstract]

Disclosure of Detailed Information about Business Acquisition Payable Explanatory

	December 31, 2021			December 31, 2020
Opening balance	$	2,439,529		$	1,043,314
Contingent consideration changes related to CSA (Note 17)		(853,308	)		879,066
Contingent consideration changes related to kanepi (Note 17)		(171,092	)		568,638
Effect of foreign exchange differences		(16,157	)		(51,489	)
		1,398,972			2,439,529
Current portion		1,398,972			1,594,297
Non-current portion		—			845,232
	$	1,398,972		$	2,439,529

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Share Capital (Tables)

6 Months Ended

12 Months Ended

Jun. 30, 2022

Dec. 31, 2021

Text Block [Abstract]

Summary Of Detailed Information About Reconciliation Of Warrants Classified As Equity Settled And Financial Liabilities

The Company’s warrants outstanding as at June 30, 2022 are as follows and include both warrants classified as equity-settled and warrants classified as financial liabilities (Note 11):

	Number of Warrants			Weighted Average  Exercise Price
Balance, December 31, 2021		8,481,929		$	8.83
Issued		183,486			5.45
Expired		(19,318	)		15.00
Balance, June 30, 2022		8,646,097		$	8.74

The Company’s warrants outstanding at December 31, 2021, 2020 and 2019 are as follows and includes warrants classified as equity-settled and warrants classified as financial liabilities (Note 15):

	Number of Warrants	Weighted Average   Exercise Price   $
December 31, 2018	1,104,378	$                                        13.50
Issued	19,957	$                                        14.46
Exercised	(133,176)	$                                        12.96
Expired	(209,899)	13.50
December 31, 2019	781,260	$                                        13.80
Issued	2,433,081	13.72
Exercised	(1,228,935)	12.06
Expired	(53,880)	13.31
December 31, 2020	1,931,526	$                                        14.82
Issued	7,140,223	7.64
Expired	(589,820)	13.97
December 31, 2021	8,481,929	$                                          8.83

Summary Of Detailed Information About Warrants Oustanding Including Expiration Date

Warrants outstanding at December 31, 2021 were as follows:

Expiry Date	Exercise Price $	Outstanding Warrants
June 2022	15.00	19,584
July 2022	14.25	525,114
December 2022	5.63	1,000
January 2023	5.72	37,400
January 2023	6.97	25,400
February 2023	7.80	8,000
March 2023	8.28	9,000
May 2023	4.12	34,960
April 2024	8.55	2,375,676
June 2024	22.50	3,333
August 2024	8.60	2,107,787
January 2025	16.20	611,027
May 2025	6.31	126,000
July 2025	14.25	182,648
November 2026	6.05	2,415,000
	$                                            8.83	8,481,929

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Share-Based Payment Arrangements (Tables)

6 Months Ended

12 Months Ended

Jun. 30, 2022

Dec. 31, 2021

Text Block [Abstract]

Summary Of Share-Based Compensation

The Company recorded share-based compensation as follows:

	Three months ended June 30,				Six months ended June 30,
	2022		2021		2022		2021
Stock options (a)	$	128,441	$	116,892	$	320,588	$	247,790
Restricted share units (b)		63,087		243,753		123,873		488,129
Total	$	191,528	$	360,645	$	444,461	$	735,919

The Company recorded share-based compensation as follows.

	Year Ended December 31,
	2021		2020		2019
Stock options (a)	$	908,293	$	677,452	$	820,613
Restricted share units (b)		959,622		776,783		647,748
Total	$	1,867,915	$	1,454,235	$	1,468,361

Summary Of Weighted-Average Exercise Prices Of Stock Options

a)   Stock Options

	Number of Options			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (years)
Outstanding, December 31, 2021		866,789		$	8.81		7.5
Granted		167,699		$	4.70		9.6
Forfeited		(137,526	)	$	7.11		9.3
Expired		(40,648	)	$	10.46		1.1
Outstanding, June 30, 2022		856,314		$	8.20		7.7

Movement in the number of stock options outstanding and their related weighted-average exercise prices were as follows:

	Number of Options			Weighted Average Exercise Price		Number of Options			Weighted Average Exercise Price		Number of Options			Weighted Average Exercise Price
	2021			2021		2020			2020		2019			2019
Opening balance		423,303		$	11.01		349,657		$	11.48		95,000		$	11.70
Granted		487,775			7.10		153,828			9.99		323,278			11.20
Exercised		–			–		(7,639	)		10.50		(50,838	)		10.62
Forfeited		(40,088	)		9.87		(32,777	)		11.52		(17,783	)		10.35
Expired		(4,201	)		11.03		(6,433	)		10.67		–			–
Cancelled		–			–		(33,333	)		10.50		–			–
Outstanding at December 31		866,789		$	8.81		423,303		$	11.01		349,657		$	11.48
Exercisable at December 31		275,473		$	11.10		161,244		$	11.70		17,014		$	12.87

Summary Of Company's Stock Options Outstanding

The following summarizes information about the Company’s stock options outstanding at December 31, 2021:

	Options Outstanding						Options exercisable
Range of prices	Number		Weighted average exercise price		Weighted average life (years)		Number		Weighted average exercise price
$5.67 - $8.70		506,502	$	6.88		9.0		25,389	$	6.56
$8.71 - $10.95		200,706	$	10.67		4.9		138,622	$	10.57
$10.96 - $12.59		104,303	$	11.78		6.1		71,461	$	11.78
$12.60 - $18.02		55,278	$	14.11		6.4		40,001	$	14.59
		866,789	$	8.81		7.5		275,473	$	11.10

Summary Of Indirect Measurement Of Fair Value Of Goods Or Services Received, Share Options Granted During Period

	2021	2020	2019
Grant date share price	$                                    7.00	$                                    8.93	$                                10.88
Exercise price	$                                    7.10	$                                    9.74	$                                11.13
Risk-free rate	1.32  %	0.36  %	1.57  %
Expected life, years	6.2 years	5.0 years	3.9 years
Expected volatility	75  %	66  %	54  %
Expected dividends	–  %	–  %	–  %
Forfeiture rate	7  %	–  %	10  %

Summary Of Company's Obligation To Issue Shares On The Vesting Of Rsus

b)   Restricted Share Units (“RSUs”)

The Company’s obligation to issue shares on the vesting of RSUs is an unfunded and unsecured obligation of the Company. A continuity of RSUs is as follows:

	Number of RSUs
Outstanding, December 31, 2021		208,674
Granted		98,417
Exercised		(17,585	)
Forfeited		(35,893	)
Outstanding, June 30, 2022		253,613
Exercisable at June 30, 2022		108,992

During the six months ended June 30, 2022, 17,585 common shares were issued on the exercise of 17,585 RSUs at a weighted average share price at exercise of $7.53. The fair value of each RSU is based on the market price of the Company’s common shares on the date of grant and the total fair value of RSUs granted in six months ended June 30, 2022 was $491,999. As at June 30, 2022, unrecognized share-based compensation expense related to non-vested RSUs granted was $310,434 (December 31, 2021 - $277,686).

The Company’s obligation to issue shares on the vesting of RSUs is an unfunded and unsecured obligation of the Company. A continuity of RSUs is as follows:

Number of RSUs	2021	2020	2019
Outstanding at January 1	222,222	151,790	101,778
Granted	73,164	123,797	71,640
Exercised 1	(71,190)	(35,877)	(11,905)
Forfeited	(7,074)	(3,332)	(9,723)
Withheld 1	(8,448)	(14,156)	–
Outstanding at December 31	208,674	222,222	151,790
Exercisable at December 31	115,468	33,516	32,036

1  71,190 common shares issued on exercise of 79,638 RSUs at a weighted average grant date exercise price of $8.87. Certain RSU holders elected for RSUs exercised to be settled net of any tax withholding obligations.

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Non-Controlling Interest (Tables)

6 Months Ended

12 Months Ended

Jun. 30, 2022

Dec. 31, 2021

Text Block [Abstract]

Summary of subsidiaries with material non controlling interests explanatory

	June 30, 2022			December 31, 2021
					Recast (Note 2)
NCI percentage		100%			100%
Current assets	$	8,923,871		$	11,906,502
Non-current assets		4,512,625			5,111,714
Current liabilities		(11,141,684	)		(8,752,552	)
Non-current liabilities		(4,510,938	)		(5,598,783	)
Net assets (liabilities) attributable to NCI	$	(2,216,126	)	$	2,666,881
For the six months ended	June 30, 2022			June 30, 2021
					Recast (Note 2)
Revenue	$	1,761,613		$	6,010,328
(Loss) income allocated to NCI		(4,805,598	)		449,017
Other comprehensive income allocated to NCI		53,389			221,545
Total comprehensive (loss) income attributable to NCI	$	(4,752,209	)	$	670,562
Cash flows (used in) provided by operating activities	$	(209,162	)		1,396,859
Cash flows (used in) investing activities		(8,790	)		(309,586	)
Cash flows provided by (used in) financing activities		90,633			(387,222	)
Foreign exchange impact on cash held in USD		125			15,283
Net (decrease) increase in cash and cash equivalents	$	(127,194	)	$	715,334

The following table summarizes the information relating to Agnity before any intercompany eliminations.

						December 31, 2021			December 31, 2020
NCI percentage						100%			100%
				Recast (Note 2)			Recast (Note 2)
Current assets					$	11,906,502		$	7,778,252
Non-current assets						5,111,714			8,081,135
Current liabilities						(8,752,552)			(7,107,244)
Non-current liabilities						(5,598,783)			(6,185,049)
Net assets attributable to NCI					$	2,666,881		$	2,567,094
For the years ended			December 31, 2021			December 31, 2020			December 31, 2019
	Recast (Note 2)			Recast (Note 2)			Recast (Note 2)
Revenue		$	11,966,226		$	11,548,811		$	6,010,753
Income (loss) allocated to NCI			63,387			1,586,588			590,056
Other comprehensive income allocated to NCI			138,655			159,749			176,711
Total comprehensive income attributable to NCI		$	202,042		$	1,746,337		$	766,767
Cash flows (used in) provided by operating activities		$	(1,859,900)			(405,548)			483,245
Cash flows used in investing activities			(578,483)			–			(3,731)
Cash flows (used in) provided by financing activities			2,081,137			655,347			(417,068)
Foreign exchange impact on cash held in USD			(6,383)			155,274			5,976
Net (decrease) increase in cash and cash equivalents		$	(363,629)		$	405,073		$	68,422

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Finance Costs (Tables)

6 Months Ended

12 Months Ended

Jun. 30, 2022

Dec. 31, 2021

Text Block [Abstract]

Summary of finance cost

a)  Finance Costs

	Three months ended June 30,					Six months ended June 30,
	2022		2021			2022		2021
Interest on loans and borrowings	$	734,854	$	286,144		$	1,131,557	$	533,508
Interest on convertible debentures		1,126,304		1,592,597			2,454,350		3,105,233
Interest on lease liabilities		118,368		75,179			201,417		154,854
Transaction costs expensed		229,716		87,070			248,645		454,574
Other finance costs		20,751		(94,404	)		52,661		(65,656	)
Total finance costs	$	2,229,993	$	1,946,586		$	4,088,630	$	4,182,513

	Year Ended December 31,
	2021		2020		2019
Interest on loans and borrowings (Note 12)	$	1,179,234	$	1,272,512	$	918,682
Interest on convertible debentures (Note 14)		5,740,346		4,410,206		2,130,247
Interest on lease liabilities (Note 8)		137,245		350,792		168,571
Transaction costs expensed 1		1,471,219		–		–
Other finance costs		90,750		–		–
Total finance costs	$	8,618,794	$	6,033,510	$	3,217,500

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Fair Value Loss (Gain) On Derivatives (Tables)

6 Months Ended

12 Months Ended

Jun. 30, 2022

Dec. 31, 2021

Text Block [Abstract]

Summary Of Gains Losses On Change In Fair Value Of Derivatives Explanatory

b)  Fair value gain (loss) on derivatives

	Three months ended June 30,						Six months ended June 30,
	2022			2021			2022			2021
Gain on warrant liability remeasurement 1	$	(2,505,810	)	$	—		$	(4,999,080	)	$	—
Gain on embedded derivatives 2		(32,519	)		(1,107,784	)		(32,519	)		(1,164,059	)
Deferred charge loss 2		—			(5,322	)		—			1,615,102
Total fair value (gain) loss on derivatives	$	(2,538,329	)	$	(1,113,106	)	$	(5,031,599	)	$	451,043

1 Unrealized change in fair value (Note 11).

2 Associated with the 2021 Debentures. Transactions detailed in the 2021 Annual Financial Statements.

Year Ended December 31,

	2021
Gain on embedded derivatives 1	$	(784,261	)
Deferred charge loss 1		1,615,102
Loss on substantial modification and conversion 1		8,571,881
Gain on warrant liability remeasurement (Note 15) 2		(3,362,601	)
Total	$	6,040,121

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Other Income (Tables)

6 Months Ended

12 Months Ended

Jun. 30, 2022

Dec. 31, 2021

Text Block [Abstract]

Summary Of Other Income Explanatory

c) Other income

	Three months ended June 30,						Six months ended June 30,
	2022			2021			2022			2021
Government assistance 1	$	(258,296	)	$	(941,369	)	$	(637,942	)	$	(2,117,743	)
Government loan forgiveness		—			(181,770	)		—			(299,082	)
Derecognition of contingent consideration		—			8,855			—			(572,262	)
Other		(5,728	)		(40,718	)		(24,350	)		(76,221	)
Total other income	$	(264,024	)	$	(1,155,002	)	$	(662,292	)	$	(3,065,308	)

1 Majority of government assistance are grants from the Canadian Government for wage and rental subsidies.

	Year Ended December 31,
	2021		2020		2019
Government assistance 1	$	(4,201,822)	$	(2,775,677)	$	–
US Government loan forgiveness 2 (Note 16)		(1,825,237)		(124,507)		–
Derecognition of contingent consideration (Note 18)		(1,010,024)		–		–
Other		(89,014)		(32,158)		(167,913)
Total other income	$	(7,126,097)	$	(2,932,342)	$	(167,913)

1  Majority represents amounts received from the Canadian Government for wage and rental subsidies associated with COVID-19. The amount of government assistance available is dependent on the programs in place and the Company’s eligibility for these programs.

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Income Taxes (Tables)

12 Months Ended

Dec. 31, 2021

Text Block [Abstract]

Summary of amounts recognized in net loss

	Year Ended December 31,
	2021			2020			2019
Current tax expense
Current year		157,303			(295,709	)		181,895
Changes in estimates related to prior years		–			–			–
		157,303			(295,709)			181,895
Deferred tax expense (recovery)
Origination and reversal of temporary differences		(13,161,689	)		(10,744,803	)		(6,261,674	)
Change in unrecognized deferred income tax assets		11,339,580			10,076,594			3,569,361
		(1,822,109)			(668,209)			(2,692,313)
Tax expense (recovery)	$	(1,664,806)		$	(963,918)		$	(2,510,418)

Summary of reconciliation of effective tax rate

	Year Ended December 31,
	2021			2020			2019
Loss before taxes	$	(46,364,119)		$	(35,824,882)		$	(30,405,252)
Statutory income tax rate 1		27	%		27	%		27	%
Income tax recovery at statutory rate		(12,518,312)			(9,672,718)			(8,209,418)
Increase (decrease) in taxes resulting from:
Change in deferred tax assets not recognized		11,339,580			10,076,594			3,569,361
Foreign tax rate and other foreign tax differences		(2,089,761)			(2,293,503)			(1,015,536)
Change in enacted rates		608,064			(58,050)			–
Share issuance costs and other		(828,082)			126,247			49,210
Non-deductible transaction costs		38,776			424,828			2,664,789
Other non-deductible items		1,784,929			432,684			431,176
Tax expense (recovery)	$	(1,664,806)		$	(963,918)		$	(2,510,418)

Summary of significant components of the company's deferred income tax asset (liabilities)

The significant components of the Company’s deferred income tax asset (liabilities) are as follows:

	At December 31, 2020		Recovery/ (expense) through earnings		Recovery/ (expense) through equity		Recovery/ (expense) through OCI		At December 31, 2021
Property and equipment	$	261,661	$	(195,977)	$	–	$	2,575	$	68,259
Intangible assets		(5,012,355)		1,415,370		–		73,801		(3,523,184)
Loans and accrued liabilities		(1,714,850)		1,471,654		–		(1,816)		(245,012)
Share issuance costs		27,453		25,467		–		–		52,920
Foreign exchange		–		(6,765)		–		24		(6,741)
Non-capital losses/net operating losses		2,269,186		(887,640)		–		(18,845)		1,362,701
Total	$	(4,168,905)	$	1,822,109	$	–	$	55,739	$	(2,291,057)

	At December 31, 2019		Acquired in business combinations		Recovery/ (expense) through earnings		Recovery/ (expense) through equity		Recovery/ (expense) through OCI		At December 31, 2020
Property and equipment	$	–	$	(376)	$	263,436	$	–	$	(1,399)	$	261,661
Intangible assets		(5,321,008)		(1,136,429)		1,280,692		–		164,390		(5,012,355)
Loans and accrued liabilities		(1,696,435)		–		(41,233)		24,000		(1,182)		(1,714,850)
Share issuance costs		–		–		27,453		–		–		27,453
Foreign exchange		(39,533)		–		39,533		–		–		0
Non-capital losses/net operating losses		3,202,361		–		(901,672)		–		(31,503)		2,269,186
Total	$	(3,854,615)	$	(1,136,805)	$	668,209	$	24,000	$	130,306	$	(4,168,905)

Summary of deferred tax assets not recognized and tax losses carried forward

	Year Ended December 31,
	2021		2020
Net operating losses - United States	$	77,415,498	$	55,395,751
Non-capital losses - Canada		68,018,286		45,619,846
Foreign tax losses		157,602		865,599
Investment tax credits and research and development expenditures		6,603,163		6,603,287
Property and equipment		948,765		753,467
Share issuance costs		6,510,677		1,282,965
Other		2,046,890		1,922,194
	$	161,700,881	$	112,443,109

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Financial Instruments and Financial Risk Management (Tables)

6 Months Ended

12 Months Ended

Jun. 30, 2022

Dec. 31, 2021

Text Block [Abstract]

Summary of detailed information about carrying values of financial assets and liabilities measured

The following represents the carrying values of the financial assets and liabilities of the Company and the associated measurement basis for each balance.

Financial assets	Measurement basis	June 30, 2022		December 31, 2021
Cash and cash equivalents	Amortized cost	$	4,405,948	$	4,588,057
Trade and other receivables 1	Amortized cost		11,783,456		14,329,781
Long-term receivables	Amortized cost		708,758		740,431
		$	16,898,162	$	19,658,269
Financial liabilities
Bank indebtedness	Amortized cost	$	3,679,631	$	3,460,109
Trade payables and accrued liabilities 1	Amortized cost		15,784,541		12,003,979
Loans and borrowings	Amortized cost		29,985,807		13,215,601
Lease liabilities	Amortized cost		7,678,618		1,045,472
2019 Debentures - host liability	Amortized cost		23,457,500		22,185,170
2021 Debentures - host liability	Amortized cost		75,491		69,034
2021 Debentures embedded derivative	FVTPL		9,600		41,506
Warrant liability - business acquisition	FVTPL		–		709,835
Warrant liabilities - derivatives (Note 11)	FVTPL		3,017,643		7,975,137
Business acquisition payable	FVTPL		1,399,580		1,398,972
		$	85,088,411	$	62,104,815

1   Excludes amounts for indirect taxes, income taxes and contract assets, where applicable.

The following represents the carrying values of the financial assets and liabilities of the Company and the associated measurement basis for each balance.

Financial assets	Measurement basis	December 31, 2021		December 31, 2020
Cash and cash equivalents	Amortized cost	$	4,588,057	$	1,110,889
Trade and other receivables 1	Amortized cost		14,329,781		11,224,017
Long-term receivables	Amortized cost		740,431		2,536,272
Derivative asset	FVTPL		—		131,400
		$	19,658,269	$	15,002,578
Financial liabilities
Bank indebtedness	Amortized cost	$	3,460,109	$	976,779
Trade payables and accrued liabilities 1	Amortized cost		12,003,979		12,693,256
Loans and borrowings	Amortized cost		13,215,601		13,152,300
Lease liabilities 2	Amortized cost		1,045,472		3,945,076
2019 Debentures - host liability 3	Amortized cost		22,185,170		19,534,988
2021 Debentures - host liability 3	Amortized cost		69,034		—
2021 Debentures embedded derivative	FVTPL		41,506		—
Warrant liability - business acquisition	FVTPL		709,835		710,924
Warrant liabilities - derivatives (Note 15)	FVTPL		7,975,137		—
Business acquisition payable	Amortized cost		1,398,972		2,439,529
Other liabilities	Amortized cost		—		6,236,415
		$	62,104,815	$	59,689,267

1  Excludes amounts for indirect taxes, income taxes and contract asset, where applicable. Note 27 describes credit risk associated with trade receivables including reconciliation of expected credit loss allowance.

2  Lease liabilities are not subject to classification in the fair value hierarchy.

3  2019 Debentures (Note 14(a)) and 2021 Debentures host liability (Note 14(b)).

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Capital and Risk Management (Tables)

12 Months Ended

Dec. 31, 2021

Text Block [Abstract]

Summary of Carrying Values of Financial Liabilities and Contractual Undiscounted Cash Flows

The Company’s carrying values of financial liabilities and the contractual undiscounted cash flows associated with these liabilities broken into relevant maturity grouping based on their contractual maturities are as follows:

At December 31, 2021			Undiscounted Contractual Cash Flows
	Carrying Amount		< 1 year		1 – 2 years		> 2 years		Total
Bank indebtedness 1	$	3,460,109	$	3,460,109	$	–	$	–	$	3,460,109
Trade payables and accrued liabilities		12,421,309		12,421,309		–		–		12,421,309
Loans and borrowings 2		13,215,601		11,763,697		786,123		–		12,549,820
Lease liabilities 3		1,045,472		521,506		534,241		179,281		1,235,028
2019 Debentures		22,185,170		24,630,375		–		–		24,630,375
2021 Debentures		110,540		7,635		103,073		–		110,708
Warrant liabilities 4		8,880,038		709,835		–		–		709,835
Business acquisition payable		1,398,972		1,398,972		–		–		1,398,972
	$	62,717,211	$	54,913,438	$	1,423,437	$	179,281	$	56,516,156

1  No contractual maturity. Excludes interest charged on facility as detailed in Note 13.

2  Includes term loan with a carrying value of $9,275,683 classified as current due to covenant breach. Assuming term loan is repaid in accordance with agreement to maturity, the undiscounted contractual cash flows for loans and borrowings would be $2,933,739, $5,472,193, and $4,143,888 , respectively for the periods presented above.

3  Variable costs due under leases not included in this amount. Minimum payment related to leases which have not yet commenced are not included in this amount. See Note 29.

4  Majority of liability will be settled by issuing common shares of the Company when warrants are exercised during the year. The remaining amount may be settled in cash or common shares of Agnity (Note 15).

As at December 31, 2020			Undiscounted Contractual Cash Flows
	Carrying Amount		< 1 year		1 – 2 years		> 2 years		Total
Bank indebtedness	$	976,779	$	976,779	$	–	$	–	$	976,779
Trade payables and accrued liabilities		12,924,256		12,924,256		–		–		12,924,256
Loans and borrowings		13,152,300		4,248,351		2,617,443		8,796,757		15,662,551
Lease liabilities		3,945,076		1,131,528		939,108		2,815,695		4,886,331
2019 Debentures		19,534,988		2,350,750		24,629,655		–		26,980,405
Warrant liabilities		710,924		710,924		–		–		710,924
Business acquisition payable		2,439,529		1,594,297		845,232		–		2,439,529
Other liabilities		6,236,415		6,003,838		232,577		–		6,236,415
	$	59,920,267	$	29,940,723	$	29,264,015	$	11,612,452	$	70,817,190

Summary of Information about Allowance Account for Credit Losses of Trade Receivables and Long Term Receivables Explanatory

The movement in the ECL allowance related to trade receivables and long-term receivables was as follows (Note 6):

	December 31, 2021			December 31, 2020
Beginning balance	$	606,030		$	382,901
Increase in loss allowance		1,162,537			443,961
Amounts written off during the year as uncollectible		(65,930	)		(220,832	)
Effects of movement in exchange rates		4,581			–
Total	$	1,707,218		$	606,030

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Related Party Transactions (Tables)

12 Months Ended

Dec. 31, 2021

Text Block [Abstract]

Summary of Transactions Between Related Parties

Key management personnel compensation

Key management personnel include those persons having authority and responsibility for planning, directing, and controlling the activities of the Company as a whole. The Company defines key management personnel as key officers and directors.

For the years ended December 31,	2021		2020		2019
Salaries, management and directors’ fees	$	1,613,502	$	1,683,015	$	1,460,296
Share-based payments		432,098		628,019		388,398
Total	$	2,045,600	$	2,311,034	$	1,848,694

Other related party balances and transactions 1

	December 31, 2021		December 31, 2020
Due to principal owner of Agnity 2	$	234,278	$	813,023
Due to officer of Company for working capital loan 2		30,796		33,205
Due to key management personnel 2		121,852		116,091
Due to Agnity Communications Private Ltd. 3		1,111,521		1,138,630
Loan due to former shareholder of CSA 4		335,860		318,428
Amount due to related parties	$	1,834,307	$	2,419,377

1  Unless otherwise noted, all amounts due are unsecured, non-interest bearing and due on demand.

2  Included in trade accounts payable and accrued liabilities on the consolidated statements of financial position.

3  Associated with consulting services paid to a company partially owned by the principal owner of Agnity. Consulting services were $3,765,201 for the year ended December 31, 2021 (December 31, 2020 - $2,532,550; December 31, 2019 - $1,630,119). Balance due included in trade accounts payable and accrued liabilities on the consolidated statements of financial position.

4  Included in loans and borrowings (Note 12) on the consolidated statements of financial position.

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Commitments And Contingencies (Tables)

12 Months Ended

Dec. 31, 2021

Disclosure of detailed explanation of Undiscounted Contractual Cash Flows [Abstract]

Minimum Payments for Contractual Commitments that are not Recognized as Liabilities

The Company has the following minimum payments for contractual commitments that are not recognized as liabilities at December 31, 2021, which are disclosed in Note 27(a) - Risk Management, Liquidity Risk.

	Undiscounted Contractual Cash Flows
	< 1 year		2 - 3 years		4 - 5 years		More than 5 years		Total
Variable lease payments 1	$	396,719	$	477,562	$	125,275	$	12,999	$	1,012,555
Lease payments related to leases which have not yet commenced 2		104,702		2,589,330		2,762,597		12,636,454		18,093,083
	$	501,421	$	3,066,892	$	2,887,872	$	12,649,453	$	19,105,638

1  Variable lease payments associated lease liabilities (Note 8).

2  In October 2021, the Company executed a 12-year lease for office space in Calgary, Alberta. Basic rent and estimated common expense payments commence in December 2022, preceded by a fixturing period which the Company will use to build out the space. The Company will receive a tenant improvement allowance which is expected to cover the majority of the costs.

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Other Income / Expense (Tables)

6 Months Ended

12 Months Ended

Jun. 30, 2022

Dec. 31, 2021

Text Block [Abstract]

Summary of finance cost

a)  Finance Costs

	Three months ended June 30,					Six months ended June 30,
	2022		2021			2022		2021
Interest on loans and borrowings	$	734,854	$	286,144		$	1,131,557	$	533,508
Interest on convertible debentures		1,126,304		1,592,597			2,454,350		3,105,233
Interest on lease liabilities		118,368		75,179			201,417		154,854
Transaction costs expensed		229,716		87,070			248,645		454,574
Other finance costs		20,751		(94,404	)		52,661		(65,656	)
Total finance costs	$	2,229,993	$	1,946,586		$	4,088,630	$	4,182,513

	Year Ended December 31,
	2021		2020		2019
Interest on loans and borrowings (Note 12)	$	1,179,234	$	1,272,512	$	918,682
Interest on convertible debentures (Note 14)		5,740,346		4,410,206		2,130,247
Interest on lease liabilities (Note 8)		137,245		350,792		168,571
Transaction costs expensed 1		1,471,219		–		–
Other finance costs		90,750		–		–
Total finance costs	$	8,618,794	$	6,033,510	$	3,217,500

Summary of gains losses on change in fair value of derivatives

b)  Fair value gain (loss) on derivatives

	Three months ended June 30,						Six months ended June 30,
	2022			2021			2022			2021
Gain on warrant liability remeasurement 1	$	(2,505,810	)	$	—		$	(4,999,080	)	$	—
Gain on embedded derivatives 2		(32,519	)		(1,107,784	)		(32,519	)		(1,164,059	)
Deferred charge loss 2		—			(5,322	)		—			1,615,102
Total fair value (gain) loss on derivatives	$	(2,538,329	)	$	(1,113,106	)	$	(5,031,599	)	$	451,043

1 Unrealized change in fair value (Note 11).

2 Associated with the 2021 Debentures. Transactions detailed in the 2021 Annual Financial Statements.

Year Ended December 31,

	2021
Gain on embedded derivatives 1	$	(784,261	)
Deferred charge loss 1		1,615,102
Loss on substantial modification and conversion 1		8,571,881
Gain on warrant liability remeasurement (Note 15) 2		(3,362,601	)
Total	$	6,040,121

Summary of other income

c) Other income

	Three months ended June 30,						Six months ended June 30,
	2022			2021			2022			2021
Government assistance 1	$	(258,296	)	$	(941,369	)	$	(637,942	)	$	(2,117,743	)
Government loan forgiveness		—			(181,770	)		—			(299,082	)
Derecognition of contingent consideration		—			8,855			—			(572,262	)
Other		(5,728	)		(40,718	)		(24,350	)		(76,221	)
Total other income	$	(264,024	)	$	(1,155,002	)	$	(662,292	)	$	(3,065,308	)

1 Majority of government assistance are grants from the Canadian Government for wage and rental subsidies.

	Year Ended December 31,
	2021		2020		2019
Government assistance 1	$	(4,201,822)	$	(2,775,677)	$	–
US Government loan forgiveness 2 (Note 16)		(1,825,237)		(124,507)		–
Derecognition of contingent consideration (Note 18)		(1,010,024)		–		–
Other		(89,014)		(32,158)		(167,913)
Total other income	$	(7,126,097)	$	(2,932,342)	$	(167,913)

1  Majority represents amounts received from the Canadian Government for wage and rental subsidies associated with COVID-19. The amount of government assistance available is dependent on the programs in place and the Company’s eligibility for these programs.

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Supplemental Cash Flow Information (Tables)

6 Months Ended

12 Months Ended

Jun. 30, 2022

Dec. 31, 2021

Text Block [Abstract]

Summary of Changes in Non Cash Working Capital

a)  Changes in non-cash working capital

	Six months ended June 30,
	2022			2021
Trade and other receivables decrease (increase)	$	2,567,218		$	(721,406	)
Long-term receivables decrease		37,442			806,434
Prepaid expenses and other assets (increase)		(106,582	)		(926,225	)
Trade payables and accrued liabilities increase (decrease)		2,419,693			(2,231,429	)
Deferred revenue increase		1,962,559			1,425,521
Increase (decrease) in working capital	$	6,880,330		$	(1,647,105	)

a) Changes in non-cash working capital

	2021		2020		2019
Trade and other receivables (increase)		$        (3,342,737)		$        (2,006,780)		$            (169,896)
Long-term receivables decrease (increase)		1,682,646		(924,625)		(3,662,207)
Prepaid expenses and other assets decrease (increase)		(591,737)		(1,119,123)		150,991
Trade payables and accrued liabilities (decrease) increase		(782,561)		2,513,477		1,102,361
Deferred revenue increase		1,045,868		632,839		447,511
Decrease in working capital		$        (1,988,521)		$           (904,212)		$         (2,131,240)

Summary of Non Cash Investing and Financing Activities

c) Non-cash investing and financing activities

	Six months ended June 30,
	2022		2021
Non-cash accretion of interest included in finance costs 1	$	1,274,689	$	1,572,967
Addition of right-of-use assets 2		6,874,258		—
Addition to lease liabilities 2		6,758,036		—
Non-cash broker warrants compensation		—		372,947

1 Associated mainly with convertible debentures.

2 Associated mainly with Calgary lease described in Note 6 and one other new lease in the six months ended June 30, 2022.

c) Non-cash investing and financing activities

For the years ended December 31,		2021		2020		2019
Value of shares issued in business combination		$	–	$	8,186,620	$	13,320,000
Value of shares issued on conversion of 2021 Debentures	14(b)	$	14,436,728	$	–	$	–
Value of share issued on conversion of 2019 Debentures		$	–	$	50,000	$	–
Value of shares issued on AirFusion asset acquisition		$	–	$	820,000	$	–
Settlement of liabilities through issuance of common shares or RSUs		$	–	$	143,002	$	84,252
Non-cash accretion of interest included in finance cost		$	3,015,294	$	2,145,706	$	909,158
Non-cash broker warrants compensation	19(b)	$	294,894	$	–	$	–
Non-cash underwriter warrants compensation	19(b)	$	162,947	$	–	$	–
Non-cash warrants consideration associated with credit facility		$	195,066	$	–	$	–
Shares issued to extinguish the loan from Flow Capital		$	–	$	–	$	606,495
Addition to right-of-use assets		$	–	$	599,861	$	468,703
Addition to lease liabilities		$	–	$	599,861	$	586,000

Summary of Changes in liabilities arising from financing activities

b)  Changes in liabilities arising from financing activities

	Six months ended June 30,
	2022			2021
Balance of loans, borrowings and PPP loans, beginning of period	$	13,215,601		$	14,102,718
New advances		24,600,213			6,260,673
Repayments of principal		(8,224,068	)		(7,009,073	)
Repayments of interest		(1,055,673	)		(377,648	)
Liability related items
Forgiveness of PPP Loans 1		—			(175,790	)
Finance fees paid		(300,707	)		—
Non-cash related items
Accretion of interest and debt issuance costs		836,182			460,411
Loss on debt modification		161,698			—
Benefit from below market interest rate		—			(117,482	)
Foreign exchange and other		752,561			(9,354	)
Balance of loans, borrowings and PPP loans, end of period	$	29,985,807		$	13,134,455

1 Paycheck Protection Plan (“PPP”) loans as described in the 2021 Annual Financial Statements.

	2021		2020		2019
Balance of loans, borrowings and PPP loans, beginning of year		$        14,102,718		$        13,973,055		$                78,285
New advances		10,664,916		8,726,766		16,539,700
Repayments of principal		(9,781,554)		(9,011,638)		(6,787,528)
Repayments of interest		(757,950)		(642,809)		(500,413)
Liability assumed		–		–		2,904,355
Liability related items
Assumption of loans in business combination		–		371,609		1,339,546
Forgiveness of PPP Loans		(1,835,237)		(124,507)		–
Finance fees paid		(191,310)		–
Non-cash related items
Accretion of interest and debt issuance costs		869,567		959,058		445,762
Loss on debt modification		138,908		–		–
Foreign exchange and other		5,543		(148,816)		(46,652)
Balance of loans, borrowings and PPP loans, end of year		$        13,215,601		$        14,102,718		$        13,973,055

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Significant Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2021

Text Block [Abstract]

Summary of Subsidiaries

	Principle activity	Place of business and operations	Functional currency
mCloud Technologies Corp.	Parent company	Canada		CDN $
mCloud Technologies (USA) Inc.	Operations	United States		USD $
mCloud Technologies (Canada) Inc.	Operations	Canada		CDN $
Field Diagnostic Services, Inc. (“FDSI”)	Operations	United States		USD $
Construction Systems Associates, Inc. (“CSA”)	Operations	United States		USD $
mCloud Technologies Services Inc. (“MTS”)	Operations	Canada		CDN $
NGRAIN (Canada) Corporation (“NGRAIN”)	Operations	Canada		CDN $
kanepi Group Pty. Ltd.	Operations	Australia		AUD $
kanepi Services Pty. Ltd.	Operations	Australia		AUD $
mCloud Technologies Singapore Pte. Ltd.	Operations	Singapore		SGD $
mCloud Corp (HK) Ltd.	Operations	China		RMB ¥
mCloud Technologies (Saudi Arabia)	Operations	Saudi Arabia		SAR $
Agnity Global, Inc. (“Agnity”)	Operations	United States		USD $
Agnity Communications, Inc. (“ACI”)	Operations	United Stated		USD $
Agnity Healthcare, Inc. (“AHI”)	Operations	United States		USD $

Summary of Estimated Useful Lives of Property Plant and Equipment

Depreciation is calculated on a straight-line basis over the estimated useful lives of the assets, as follows:

	Life
Computer equipment	2 -5 years
Office furniture and equipment	7 years
Leasehold improvements	lesser of useful lives or lease term

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Nature of Operations - Additional Information (Detail)	6 Months Ended	12 Months Ended
	Jun. 30, 2022	Dec. 31, 2021
Text Block [Abstract]
Domicile of entity	Vancouver, Canada	Vancouver, Canada
Address of entity registered office	550-510	550-510

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Basis of Accounting - Additional Information (Detail) - CAD ($)	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Disclosure of objectives, policies and processes for managing capital [line items]
Name of ultimate parent of group					mCloud
Net loss for the year	$ 11,611,709	$ 9,000,411	$ 22,634,830	$ 18,752,020	$ 44,699,313	$ 34,860,963	$ 27,894,834
Net cash used in operating activities			(16,149,906)	(12,954,894)	(28,329,771)	(24,855,800)	$ (15,988,223)
Working capital deficit	44,054,559		44,054,559		42,108,177
Current borrowings	3,679,631		3,679,631		3,460,109	976,779
Trade and other current payables	16,343,347		16,343,347		12,421,309	12,924,256
Current lease liabilities	$ 554,895		$ 554,895		$ 410,674	$ 835,472
Adjusted amount		$ 945,470		$ 1,597,134
Earnings per share basic and diluted attributable to parent	$ 0.5	$ 0.88	$ 1.1	$ 1.89	$ 3.76	$ 5.01	$ 6.97
Accumulative other comprehensive income	$ 291,811		$ 291,811		$ 1,227,269	$ 1,435,384
Deficit	(146,501,130)		(146,501,130)		(128,671,898)	(83,909,198)
Non-controlling interest	(2,256,921)		(2,256,921)		2,495,288	2,293,246
Net income loss attributable to parent	(8,051,662)	$ (8,930,312)	(17,829,232)	$ (19,201,037)	(44,762,700)	(36,447,551)	$ (28,484,890)
Net income loss attributable to non controlling interest	(3,560,047)	$ (70,099)	$ (4,805,598)	449,017	63,387	1,586,588	590,056
Reclassification Of Cost of Sales [Member]
Disclosure of objectives, policies and processes for managing capital [line items]
Amount of reclassifications or changes in presentation				(539,776)
Reclassification Of Sales, Wages and Benefits [Member]
Disclosure of objectives, policies and processes for managing capital [line items]
Amount of reclassifications or changes in presentation				749,688
Reclassification Of Professional and Consulting Fees [Member]
Disclosure of objectives, policies and processes for managing capital [line items]
Amount of reclassifications or changes in presentation				$ (209,912)
Going Concern Assessment [Member] | Term Loan [Member]
Disclosure of objectives, policies and processes for managing capital [line items]
Borrowings, Maturity			the repayment of the term loan in full on or before October 31, 2022 (Note 8);
Top of range [member]
Disclosure of objectives, policies and processes for managing capital [line items]
Earnings per share basic and diluted attributable to parent		$ 0.88		$ 1.89
Bottom of range [member]
Disclosure of objectives, policies and processes for managing capital [line items]
Earnings per share basic and diluted attributable to parent		$ 0.75		$ 1.73
Not later than one year [member]
Disclosure of objectives, policies and processes for managing capital [line items]
Trade and other current payables	16,343,347		$ 16,343,347		12,421,309
Current lease liabilities	1,408,243		1,408,243		1,000,000
Not later than one year [member] | Two Thousand And Nineteen Convertible Debentures [Member]
Disclosure of objectives, policies and processes for managing capital [line items]
Current borrowings	23,652,979		23,652,979		23,457,500
Not later than one year [member] | Short-term borrowings [member]
Disclosure of objectives, policies and processes for managing capital [line items]
Current borrowings	$ 12,721,061		$ 12,721,061		11,763,697
Increase (decrease) due to corrections of prior period errors [member]
Disclosure of objectives, policies and processes for managing capital [line items]
Accumulative other comprehensive income		$ (102,247)		$ (102,247)	(344,729)	(234,212)
Deficit					(1,344,175)	(1,777,168)
Non-controlling interest		$ 102,247		$ 102,247	$ (999,446)	$ (1,542,956)
Reclassification Between Accumulated Other Comprehensive Income Non Controlling Interest And Accumulated Deficit [Member]
Disclosure of objectives, policies and processes for managing capital [line items]
Accumulative other comprehensive income							22,877
Deficit							(1,354,452)
Non-controlling interest							$ (1,377,329)
Reclassification Between Income Loss Attributable To Parent And Non Controlling Interest [Member]
Disclosure of objectives, policies and processes for managing capital [line items]
Earnings per share basic and diluted attributable to parent					$ 0.03	$ (0.06)	$ (0.33)
Net income loss attributable to parent					$ 432,993	$ (422,716)	$ (1,354,452)
Net income loss attributable to non controlling interest					$ (432,993)	$ 422,716	$ (1,354,452)

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Critical Accounting Estimates And Judgements - Additional Information (Detail)	12 Months Ended
	Dec. 31, 2021 CAD ($)
Text Block [Abstract]
Goodwill impairment loss	$ 0

XML

Segment Reporting - Summary of Company's Revenue and Non-current Assets (Detail) - CAD ($)	3 Months Ended				6 Months Ended				12 Months Ended
	Jun. 30, 2022		Jun. 30, 2021		Jun. 30, 2022		Jun. 30, 2021		Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Disclosure of geographical areas [line items]
Total revenue	$ 2,269,026		$ 6,556,463		$ 6,698,629		$ 13,992,029		$ 25,596,972	$ 26,928,439	$ 18,340,249
Total non-current assets	53,086,679				53,086,679				50,199,007	62,123,576
Operating segments [member]
Disclosure of geographical areas [line items]
Total revenue									25,596,972	26,928,439	18,340,249
Total non-current assets									50,199,007	62,123,576
Canada [Member] | Operating segments [member]
Disclosure of geographical areas [line items]
Total revenue	(767,709)	[1]	3,440,590	[1]	1,271,267	[1]	7,852,189	[1]	10,733,922	13,832,691	10,889,542
Total non-current assets									30,812,581	37,966,772
United States [Member] | Operating segments [member]
Disclosure of geographical areas [line items]
Total revenue									6,564,271	5,691,202	$ 7,450,707
Total non-current assets									9,014,016	12,424,844
JAPAN | Operating segments [member]
Disclosure of geographical areas [line items]
Total revenue									5,849,967	6,446,939
AUSTRALIA | Operating segments [member]
Disclosure of geographical areas [line items]
Total revenue									993,933	152,301
Total non-current assets									10,372,410	11,731,960
Other [Member] | Operating segments [member]
Disclosure of geographical areas [line items]
Total revenue	$ 360,892		$ 114,369		$ 553,576		$ 169,994		$ 1,454,879	$ 805,306

[1] Impact of previously recognized revenue for contract modification as explained in tables above.

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Segment Reporting - Additional Information (Detail)	12 Months Ended
	Dec. 31, 2021 CAD ($)
Disclosure of geographical areas [line items]
Number of operating segments	1
Bottom of range [member]
Disclosure of geographical areas [line items]
Percentage of entity revenue	10.00%

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Segment Reporting-significant customers who accounted for greater than 10% of total revenues (Details)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Bottom of range [member]
Disclosure of major customers [line items]
Percentage of entity's revenue	10.00%
Customer A [Member]
Disclosure of major customers [line items]
Percentage of entity's revenue		14.00%
Customer A [Member] | Bottom of range [member]
Disclosure of major customers [line items]
Percentage of entity's revenue	10.00%
Customer B [Member]
Disclosure of major customers [line items]
Percentage of entity's revenue		13.00%	11.00%
Customer B [Member] | Bottom of range [member]
Disclosure of major customers [line items]
Percentage of entity's revenue	10.00%
Customer C [Member]
Disclosure of major customers [line items]
Percentage of entity's revenue	11.00%		20.00%
Customer C [Member] | Bottom of range [member]
Disclosure of major customers [line items]
Percentage of entity's revenue		10.00%
Customer D [Member]
Disclosure of major customers [line items]
Percentage of entity's revenue	11.00%
Customer D [Member] | Bottom of range [member]
Disclosure of major customers [line items]
Percentage of entity's revenue		10.00%

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Revenue - Summary of Revenue Disaggregated By Major Service Line and Timing of Revenue Recognition (Detail) - CAD ($)		3 Months Ended				6 Months Ended				12 Months Ended
		Jun. 30, 2022		Jun. 30, 2021		Jun. 30, 2022		Jun. 30, 2021		Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Disclosure of disaggregation of revenue from contracts with customers [line items]
Revenue from contracts with customers		$ 2,269,026		$ 6,556,463		$ 6,698,629		$ 13,992,029		$ 25,596,972	$ 26,928,439	$ 18,340,249
Over time [Member]
Disclosure of disaggregation of revenue from contracts with customers [line items]
Revenue from contracts with customers		3,783,459	[1]	6,253,142	[1]	7,645,663	[1]	11,701,851	[1]	24,422,749	18,551,736	12,375,586
At a point in time upon completion [Member]
Disclosure of disaggregation of revenue from contracts with customers [line items]
Revenue from contracts with customers		(1,514,433)	[1]	303,321	[1]	(947,034)	[1]	2,290,178	[1]	1,174,223	8,376,703	5,964,663
AssetCare initialization [Member]
Disclosure of disaggregation of revenue from contracts with customers [line items]
Revenue from contracts with customers	[2]	28,979		303,321		443,470		818,564		1,250,181	7,689,232	5,964,663
AssetCare solutions [Member]
Disclosure of disaggregation of revenue from contracts with customers [line items]
Revenue from contracts with customers	[3]	4,695,074		6,079,949		8,684,202		12,514,458		23,461,748	12,809,054	2,939,582
Engineering services [Member]
Disclosure of disaggregation of revenue from contracts with customers [line items]
Revenue from contracts with customers	[4]	116,649		$ 173,193		142,633		$ 659,007		$ 885,043	$ 6,430,153	$ 9,436,004
Contract modification revenue reversal [Member]
Disclosure of disaggregation of revenue from contracts with customers [line items]
Revenue from contracts with customers	[5]	$ (2,571,676)				$ (2,571,676)

[1] See table above and related footnote 4. The three and six months ended June 30, 2022 reflects the reversal of $534,662 of revenue recognized over time and $2,037,014 of revenue recognized at point in time upon completion.

[2] Revenues from initial implementation and activation of AssetCare projects, including the sale of hardware.

[3] Revenues include sales of subscriptions to AssetCare, other subscriptions, post contract support and maintenance, perpetual software licenses, and installation and engineering services.

[4] Revenues includes consulting, implementation and integration services entered into on a time and materials basis or fixed fee basis without the use of AssetCare.

[5] During the three months ended June 30, 2022, the Company cancelled a multi-year customer contract for which services had been performed in prior periods, resulting in a contract modification. As a result, revenue from AssetCare Initialization of $2,037,014 and AssetCare Solutions of $534,662 which were recorded in prior periods was reversed during the three and six months ended June 30, 2022.

XML

Revenue - Summary of Revenue Disaggregated By Major Service Line and Timing of Revenue Recognition (Parenthetical) (Detail) - CAD ($)	3 Months Ended	6 Months Ended
	Jun. 30, 2022	Jun. 30, 2022
Goods or services transferred at point in time [member]
Disclosure of disaggregation of revenue from contracts with customers [line items]
Reversal of revenue previously reported	$ 534,662	$ 2,037,014
AssetCare initialization [Member]
Disclosure of disaggregation of revenue from contracts with customers [line items]
Reversal of revenue previously reported	2,037,014	2,037,014
AssetCare solutions [Member]
Disclosure of disaggregation of revenue from contracts with customers [line items]
Reversal of revenue previously reported	$ 534,662	$ 534,662

XML

Revenue - Summary of Company's Revenue and Non-current Assets (Detail) - CAD ($)	3 Months Ended				6 Months Ended				12 Months Ended
	Jun. 30, 2022		Jun. 30, 2021		Jun. 30, 2022		Jun. 30, 2021		Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Disclosure of geographical areas [line items]
Total revenue	$ 2,269,026		$ 6,556,463		$ 6,698,629		$ 13,992,029		$ 25,596,972	$ 26,928,439	$ 18,340,249
Operating segments [member]
Disclosure of geographical areas [line items]
Total revenue									25,596,972	26,928,439	18,340,249
Canada [Member] | Operating segments [member]
Disclosure of geographical areas [line items]
Total revenue	(767,709)	[1]	3,440,590	[1]	1,271,267	[1]	7,852,189	[1]	10,733,922	13,832,691	$ 10,889,542
Americas [Member] | Operating segments [member]
Disclosure of geographical areas [line items]
Total revenue	1,647,854		1,422,069		3,167,929		2,671,673
Asia-Pacific [Member] | Operating segments [member]
Disclosure of geographical areas [line items]
Total revenue	1,027,989		1,579,435		1,705,857		3,298,173
Other [Member] | Operating segments [member]
Disclosure of geographical areas [line items]
Total revenue	$ 360,892		$ 114,369		$ 553,576		$ 169,994		$ 1,454,879	$ 805,306

[1] Impact of previously recognized revenue for contract modification as explained in tables above.

XML

Revenue - Summary of Significant Changes in Unbilled Revenue and Deferred Revenue Balances (Detail) - CAD ($)	6 Months Ended		12 Months Ended
	Jun. 30, 2022		Dec. 31, 2021		Dec. 31, 2020	Dec. 31, 2019
Unbilled revenue
Beginning Balance	$ 756,042	[1]	$ 554,740			$ 658,931
Acquired in business combination					$ 117,686	2,347,207
Additions	3,057,402		7,470,881		11,478,436	9,595,535
Less: transferred to trade and other receivables	(2,952,031)		(7,269,579)		(11,557,665)	(11,278,312)
Less: write-offs					(146,489)
Effect of movement in exchange rates					3,841
Less: loss allowance						(5,499)
Ending Balance	861,413		756,042	[1]	554,740
Deferred revenue
Beginning Balance	2,811,408	[1]	1,771,120		1,138,281	133,678
Additions	5,805,365		10,616,893		6,316,586	5,309,436
Less: recognized in revenue	(3,853,163)		(9,585,211)		(5,612,896)	(4,878,419)
Less: applied to outstanding trade receivables					(30,586)
Effect of movement in exchange rates	49,589		8,606		(40,265)	(17,229)
Ending Balance	$ 4,813,199		$ 2,811,408	[1]	$ 1,771,120	1,138,281
Agnity Global Inc [Member]
Deferred revenue
Acquired in business combination						457,259
mCloud Technologies Services Inc [Member]
Deferred revenue
Acquired in business combination						$ 133,556

[1] Unbilled revenue is included in trade and other receivables (Note 6) and relates to the Company’s right to consideration for work completed but not billed at the reporting date. Unbilled revenue is transferred to trade and other receivables when services are billed to customers.

XML

Trade and Other Receivables and Long-Term Receivables - Summary of Trade and Other Receivables (Detail) - CAD ($)	Jun. 30, 2022	Dec. 31, 2021		Dec. 31, 2020
Trade and other current receivables [abstract]
Trade receivables from contracts with customers	$ 11,532,760	$ 14,204,320		$ 10,182,229
Unbilled revenue (Note 4)	861,413	756,042		554,740
Indirect taxes receivable	293,320	148,200		341,583
Income taxes receivable	11,404	2,217		594,036
Other receivables	920,419	919,954		961,714
Contract asset	46,812	86,777	[1]	153,178	[1]
Loss allowance	(1,531,136)	(1,550,535)		(474,666)
Trade and other current receivables	$ 12,134,992	$ 14,566,975		$ 12,312,814

[1] At December 31, 2021, the total contract assets were $90,200 with the non-current portion of $3,423 included in other assets (December 31, 2020 - $314,894 total and $161,716 non-current). No new contract assets were recognized and amortization to cost of sales over the life of the contract assets continues to occur until June 30, 2023.

XML

Trade and Other Receivables and Long-Term Receivables - Summary of Trade and Other Receivables (Parenthetical) (Detail) - CAD ($)	Dec. 31, 2021	Dec. 31, 2020
Statements [Line Items]
Contract assets	$ 90,200	$ 314,894
Non-current contract assets	$ 3,423	$ 161,716

XML

Trade and Other Receivables and Long-Term Receivables - Summary of Long-Term Receivables (Detail) - CAD ($)	Jun. 30, 2022	Dec. 31, 2021	Dec. 31, 2020
Text Block [Abstract]
Current portion of long-term receivables	$ 390,398	$ 397,060	$ 445,213
Non-current portion of long-term receivables	318,360	343,371	2,091,059
Total long-term receivables	$ 708,758	$ 740,431	$ 2,536,272

XML

Trade and Other Receivables and Long-Term Receivables - Summary of Long-Term Receivables (Parenthetical) (Detail) - CAD ($)	Jun. 30, 2022	Dec. 31, 2021	Dec. 31, 2020
Statements [Line Items]
Allowance account for expected credit losses of financial assets, Current	$ 95,518	$ 95,064	$ 131,364
Allowance account for expected credit losses of financial assets, Noncurrent	$ 61,619	$ 61,619	$ 0

XML

Prepaid Expenses And Other Assets - Summary of Prepayments and Other Assets (Detail) - CAD ($)	Jun. 30, 2022	Dec. 31, 2021	Dec. 31, 2020
Prepayments and accrued income including contract assets [abstract]
Prepaid insurance		$ 348,063	$ 122,893
Advances		121,806	38,593
Deposits		862,338	189,734
Prepaid licenses		938,887	1,075,797
Prepaid services		505,448	292,552
Other prepaid costs		197,962	325,481
Other assets		3,423	293,116
Prepaid expenses and other assets		2,977,927	2,338,166
Current portion	$ 2,679,472	2,355,350	1,326,319
Non-current portion		$ 622,577	$ 1,011,847

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Leases - Summary of Change in Carrying Amount of Company's Right of Use Assets (Detail) - CAD ($)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Disclosure of quantitative information about right-of-use assets [line items]
Beginning Balance	$ 3,660,717	$ 4,206,808	$ 285,086
Acquired right-of-use assets (Note 17)		509,290	4,303,215
Additions to right-of-use assets		90,571	183,617
Depreciation charge for the year	(828,256)	(926,429)	(481,977)
Impairment charge for the year			(78,764)
Impact of lease modification	(1,924,504)	(221,590)
Effect of movement in exchange rates	8,071	2,067	(4,369)
Ending Balance	916,028	3,660,717	4,206,808
Office [Member]
Disclosure of quantitative information about right-of-use assets [line items]
Beginning Balance	3,570,167	3,976,173	285,086
Acquired right-of-use assets (Note 17)		509,290	4,207,837
Additions to right-of-use assets		84,413
Depreciation charge for the year	(748,058)	(780,767)	(433,617)
Impairment charge for the year			(78,764)
Impact of lease modification	(1,924,504)	(221,590)
Effect of movement in exchange rates	8,122	2,648	(4,369)
Ending Balance	905,727	3,570,167	3,976,173
Equipment and Vehicles [Member]
Disclosure of quantitative information about right-of-use assets [line items]
Beginning Balance	90,550	230,635
Acquired right-of-use assets (Note 17)			95,378
Additions to right-of-use assets		6,158	183,617
Depreciation charge for the year	(80,198)	(145,661)	(48,360)
Effect of movement in exchange rates	(51)	(582)
Ending Balance	$ 10,301	$ 90,550	$ 230,635

XML

Leases - Summary of Amounts Recognized in Consolidated Statements of Loss and Comprehensive Loss (Detail) - CAD ($)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Disclosure Of Amounts Recognized In Consolidated Statements Of Income Loss And Comprehensive Income loss [Line Items]
Accretion of lease liabilities included in finance costs	$ 137,272	$ 350,792	$ 168,571
Depreciation of right-of-use assets	828,256	926,429	481,977
Expense related to variable lease payments	825,212	824,062
Expense related to short-term leases	4,550
Total	$ 1,795,290	$ 2,101,283	$ 650,548

XML

Leases - Summary of Amounts Recognized in Consolidated Statements of Cash Flows (Detail) - CAD ($)	6 Months Ended		12 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Text Block [Abstract]
Total cash outflows included in operating activities			$ 137,272	$ 350,792	$ 168,571
Total cash outflows included in financing activities	$ 268,359	$ 592,372	$ 1,095,327	$ 814,072	$ 422,783

XML

Leases - Additional Information (Detail) - CAD ($)	6 Months Ended
	Jun. 30, 2022	Jan. 01, 2022	Dec. 31, 2021		Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Disclosure of quantitative information about right-of-use assets [line items]
Lease term	12 years
Right-of-use assets	$ 7,298,424		$ 916,028		$ 3,660,717	$ 4,206,808	$ 285,086
Lease Liabilities	$ 7,678,618		$ 1,045,472	[1]
Office Space [Member]
Disclosure of quantitative information about right-of-use assets [line items]
Right-of-use assets		$ 6,322,509
Lease Liabilities		$ 6,221,749

[1] Variable costs due under leases not included in this amount. Minimum payment related to leases which have not yet commenced are not included in this amount. See Note 29.

XML

Property and Equipment - Summary of Write-off of Fully Amortized Assets (Detail) - CAD ($)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Disclosure of detailed information about property, plant and equipment [line items]
Beginning Balance	$ 506,387
Ending Balance	649,403	$ 506,387
Gross carrying amount [member]
Disclosure of detailed information about property, plant and equipment [line items]
Beginning Balance	1,084,052	965,596	$ 302,638
Additions	626,841	127,688	138,122
Acquisitions			549,598
Effect of movement in exchange rates	(5,836)	(9,232)	(10,302)
Disposals	(197,412)
Impairment			(14,460)
Ending Balance	1,507,645	1,084,052	965,596
Accumulated Depreciation [Member]
Disclosure of detailed information about property, plant and equipment [line items]
Beginning Balance	577,665	255,044	27,161
Effect of movement in exchange rates	(9,062)	(8,601)	(11,261)
Disposals	(196,107)
Depreciation	485,746	331,222	239,144
Ending Balance	858,242	577,665	255,044
Carrying Amounts [Member]
Disclosure of detailed information about property, plant and equipment [line items]
Beginning Balance	506,387
Ending Balance	649,403	506,387
Office Furniture and Equipment [member] | Gross carrying amount [member]
Disclosure of detailed information about property, plant and equipment [line items]
Beginning Balance	321,990	292,364	10,117
Additions		30,543	30,529
Acquisitions			253,057
Effect of movement in exchange rates	(504)	(917)	(1,339)
Disposals	(29,459)
Ending Balance	292,027	321,990	292,364
Office Furniture and Equipment [member] | Accumulated Depreciation [Member]
Disclosure of detailed information about property, plant and equipment [line items]
Beginning Balance	121,184	43,818	410
Effect of movement in exchange rates	(505)	(923)	(1,321)
Disposals	(29,458)
Depreciation	75,117	78,289	44,729
Other movements	6,746
Ending Balance	173,084	121,184	43,818
Office Furniture and Equipment [member] | Carrying Amounts [Member]
Disclosure of detailed information about property, plant and equipment [line items]
Beginning Balance	200,806
Ending Balance	118,943	200,806
Leasehold Improvements [member] | Gross carrying amount [member]
Disclosure of detailed information about property, plant and equipment [line items]
Beginning Balance	375,238	376,589	239,555
Additions			74,641
Acquisitions			64,366
Effect of movement in exchange rates	(744)	(1,351)	(1,973)
Disposals	(43,409)
Ending Balance	331,085	375,238	376,589
Leasehold Improvements [member] | Accumulated Depreciation [Member]
Disclosure of detailed information about property, plant and equipment [line items]
Beginning Balance	159,469	82,999	13,433
Effect of movement in exchange rates	(744)	(1,436)	(1,577)
Disposals	(43,409)
Depreciation	73,864	77,906	71,143
Ending Balance	189,180	159,469	82,999
Leasehold Improvements [member] | Carrying Amounts [Member]
Disclosure of detailed information about property, plant and equipment [line items]
Beginning Balance	215,769
Ending Balance	141,905	215,769
Computer Equipment [member] | Gross carrying amount [member]
Disclosure of detailed information about property, plant and equipment [line items]
Beginning Balance	386,824	296,643	52,966
Additions	626,841	97,145	32,952
Acquisitions			232,175
Effect of movement in exchange rates	(4,588)	(6,964)	(6,990)
Disposals	(124,544)
Impairment			(14,460)
Ending Balance	884,533	386,824	296,643
Computer Equipment [member] | Accumulated Depreciation [Member]
Disclosure of detailed information about property, plant and equipment [line items]
Beginning Balance	297,012	128,227	13,318
Effect of movement in exchange rates	(7,813)	(6,242)	(8,363)
Disposals	(123,240)
Depreciation	336,765	175,027	123,272
Other movements	(6,746)
Ending Balance	495,978	297,012	$ 128,227
Computer Equipment [member] | Carrying Amounts [Member]
Disclosure of detailed information about property, plant and equipment [line items]
Beginning Balance	89,812
Ending Balance	$ 388,555	$ 89,812

XML

Intangible Assets and Goodwill - Summary of Detailed Information About Intangible Assets (Detail) - CAD ($)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Disclosure of detailed information about intangible assets [line items]
Beginning Balance	$ 27,766,839
Impairment			$ (600,657)
Ending Balance	20,585,833	$ 27,766,839
Cost [member]
Disclosure of detailed information about intangible assets [line items]
Beginning Balance	37,720,352	28,179,630	3,901,729
Additions	440,965	2,333,666
Acquisitions		7,280,523	24,381,220
Effect of movements in exchange rates	(2,004)	(73,467)	(103,319)
Ending Balance	38,159,313	37,720,352	28,179,630
Accumulated amortization and impairments [member]
Disclosure of detailed information about intangible assets [line items]
Beginning Balance	9,953,513	4,508,541	733,856
Effect of movements in exchange rates	9,157	(40,640)	(55,770)
Impairment			507,433
Amortization	7,610,810	5,485,612	3,323,022
Ending Balance	17,573,480	9,953,513	4,508,541
Carrying amounts [member]
Disclosure of detailed information about intangible assets [line items]
Beginning Balance	27,766,839
Ending Balance	20,585,833	27,766,839
Patents and trademarks [member] | Cost [member]
Disclosure of detailed information about intangible assets [line items]
Beginning Balance	179,701	182,658	192,032
Effect of movements in exchange rates	(343)	(2,957)	(9,374)
Ending Balance	179,358	179,701	182,658
Patents and trademarks [member] | Accumulated amortization and impairments [member]
Disclosure of detailed information about intangible assets [line items]
Beginning Balance	116,748	84,583	51,238
Effect of movements in exchange rates	85	(3,078)	(3,219)
Amortization	32,073	35,243	36,564
Ending Balance	148,906	116,748	84,583
Patents and trademarks [member] | Carrying amounts [member]
Disclosure of detailed information about intangible assets [line items]
Beginning Balance	62,953
Ending Balance	30,452	62,953
Customer relationships [member] | Cost [member]
Disclosure of detailed information about intangible assets [line items]
Beginning Balance	19,636,830	16,240,990	2,118,739
Acquisitions		3,434,334	14,168,830
Effect of movements in exchange rates	(3,217)	(38,494)	(46,579)
Ending Balance	19,633,613	19,636,830	16,240,990
Customer relationships [member] | Accumulated amortization and impairments [member]
Disclosure of detailed information about intangible assets [line items]
Beginning Balance	4,654,618	1,977,625	333,430
Effect of movements in exchange rates	3,820	(19,774)	(23,895)
Amortization	3,099,234	2,696,767	1,668,090
Ending Balance	7,757,672	4,654,618	1,977,625
Customer relationships [member] | Carrying amounts [member]
Disclosure of detailed information about intangible assets [line items]
Beginning Balance	14,982,212
Ending Balance	11,875,941	14,982,212
Technology [member] | Cost [member]
Disclosure of detailed information about intangible assets [line items]
Beginning Balance	17,903,821	11,755,982	1,590,958
Additions	440,965	2,333,666
Acquisitions		3,846,189	10,212,390
Effect of movements in exchange rates	1,556	(32,016)	(47,366)
Ending Balance	18,346,342	17,903,821	11,755,982
Technology [member] | Accumulated amortization and impairments [member]
Disclosure of detailed information about intangible assets [line items]
Beginning Balance	5,182,147	2,446,333	349,188
Effect of movements in exchange rates	5,252	(17,788)	(28,656)
Impairment			507,433
Amortization	4,479,503	2,753,602	1,618,368
Ending Balance	9,666,902	5,182,147	$ 2,446,333
Technology [member] | Carrying amounts [member]
Disclosure of detailed information about intangible assets [line items]
Beginning Balance	12,721,674
Ending Balance	$ 8,679,440	$ 12,721,674

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Intangible Assets and Goodwill - Summary of Reconciliation Changes in Goodwill (Detail) - CAD ($)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Disclosure of reconciliation of changes in goodwill [abstract]
Opening Balance	$ 27,086,727	$ 18,758,975
Acquisitions, business combinations (Note 18)		8,405,341
Effect of movements in exchange rates	(4,932)	(77,589)
Ending Balance	$ 27,081,795	$ 27,086,727

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Intangible Assets and Goodwill - Additional Information (Detail)	12 Months Ended
	Dec. 31, 2021 CAD ($)	Dec. 31, 2020 CAD ($)	Jun. 30, 2022 CAD ($)	Dec. 31, 2019 CAD ($)
Disclosure of detailed information about intangible assets [line items]
Number of cash generating units	2	2
Goodwill	$ 27,081,795	$ 27,086,727	$ 27,119,177	$ 18,758,975
Impairment loss , Goodwill	0
Implied market capitalization of Goodwill	146,500,000
Net assets carrying value	36,160,000
Agnity CGU [Member]
Disclosure of detailed information about intangible assets [line items]
Goodwill	$ 0

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Trade Payables And Accrued Liabilities - Disclosure of Trade and Other Payables Explanatory (Detail) - CAD ($)	Jun. 30, 2022	Dec. 31, 2021	Dec. 31, 2020
Trade and other non-current payables [abstract]
Trade payables	$ 8,697,912	$ 5,591,316	$ 5,903,789
Accrued liabilities	5,453,285	5,398,389	4,795,742
Interest payable	228,222	233,854	425,054
Mastercard facility	372,374	296,669	600,590
Due to related parties	217,795	265,074	846,228
Income taxes payable	278,813	266,753	21,752
Indirect taxes payable	279,993	150,577	242,703
Other	814,953	218,677	88,398
Total trade payables and accrued liabilities	$ 16,343,347	$ 12,421,309	$ 12,924,256

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Trade Payables And Accrued Liabilities - Disclosure of trade and other payables explanatory (Parenthetical) (Detail)	Jun. 30, 2022 CAD ($)
Trade and other non-current payables [abstract]
Warrant liability	$ 718,092

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Loans And Borrowings - Disclosure of Detailed Information About Borrowings Explanatory (Detail) - CAD ($)	Jun. 30, 2022	Dec. 31, 2021		Dec. 31, 2020
Disclosure of detailed information about borrowings [line items]
Debenture payable to Industry Canada		$ 22,295,710		$ 19,534,988
Loan payable to related party		1,834,307		2,419,377
Current	$ 10,399,574	12,447,939		3,431,251
Non-current	19,586,233	767,662		9,721,049
Total	29,985,807	13,215,601	[1],[2]	13,152,300	[2]
Term Loan [Member]
Disclosure of detailed information about borrowings [line items]
Term loan	6,623,292	9,275,683		10,928,055
Promissory Notes [Member]
Disclosure of detailed information about borrowings [line items]
Promissory notes	19,342,593	0
Nations Interbanc Facility [Member]
Disclosure of detailed information about borrowings [line items]
Nations Interbanc facility	2,975,021	2,639,143		1,137,360
Debenture Payable To Industry Canada [Member]
Disclosure of detailed information about borrowings [line items]
Debenture payable to Industry Canada	0	26,412		76,227
Loan Payable To Related Party [Member]
Disclosure of detailed information about borrowings [line items]
Loan payable to related party	349,980	335,860		318,428
Oracle Financing [Member]
Disclosure of detailed information about borrowings [line items]
Oracle financing	632,034	826,418		427,250
Other Loans And Financing [Member]
Disclosure of detailed information about borrowings [line items]
Other loans and financing	$ 62,887	$ 112,085		$ 264,980

[1] Includes term loan with a carrying value of $9,275,683 classified as current due to covenant breach. Assuming term loan is repaid in accordance with agreement to maturity, the undiscounted contractual cash flows for loans and borrowings would be $2,933,739, $5,472,193, and $4,143,888 , respectively for the periods presented above.

[2] Note 30(b) includes the reconciliation of movements of liabilities to cash flows arising from financing activities.

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Loans And Borrowings - Disclosure of Detailed Information About Borrowings Explanatory (Parenthetical) (Detail) - CAD ($)	6 Months Ended		12 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Dec. 31, 2021	Dec. 31, 2020
Disclosure of detailed information about borrowings [line items]
Proceed from the issue of additional debt			$ 577,378	$ 495,944
Nations Interbanc Facility [Member]
Disclosure of detailed information about borrowings [line items]
Proceeds from current borrowings	$ 5,433,688	$ 4,842,450
Repayments of current borrowings	$ 5,454,108	$ 6,020,883
Loan Payable To Related Party [Member] | Amounts Payable Related Party Transactions [Member]
Disclosure of detailed information about borrowings [line items]
Borrowings, Interest rate			6.00%
Borrowings, Maturity			January 2023
Oracle Financing [Member] | Credit Arrangement [Member]
Disclosure of detailed information about borrowings [line items]
Borrowings, Maturity			maturing in May 2023 and February 2024
Oracle Financing [Member] | Credit Arrangement [Member] | Bottom of range [member]
Disclosure of detailed information about borrowings [line items]
Borrowings, Interest rate			6.20%
Oracle Financing [Member] | Credit Arrangement [Member] | Top of range [member]
Disclosure of detailed information about borrowings [line items]
Borrowings, Interest rate			6.60%

XML

Loans And Borrowings - Additional Information (Detail)			3 Months Ended		6 Months Ended		12 Months Ended
	May 31, 2022 CAD ($)	Nov. 09, 2021	Jun. 30, 2022 CAD ($)	Jun. 30, 2021 CAD ($)	Jun. 30, 2022 CAD ($)	Jun. 30, 2021 CAD ($)	Dec. 31, 2021 CAD ($)	Dec. 31, 2020 CAD ($)	Dec. 31, 2019 CAD ($)	May 05, 2022 USD ($)	Apr. 01, 2022 USD ($)	Mar. 28, 2022 USD ($)	Dec. 31, 2021 USD ($)
Disclosure of detailed information about borrowings [line items]
Percentage of factoring fee on gross face value for the first 30 days							1.50%
Percentage of factoring fee on gross face value for 30 days thereafter							0.06%
Interest expense on borrowings			$ 734,854	$ 286,144	$ 1,131,557	$ 533,508	$ 1,179,234	$ 1,272,512	$ 918,682
Repayments of borrowings					$ 8,224,068	7,009,073	$ 9,781,554	$ 9,011,638	6,787,528
Fiera Private Debt Fund VI LP [Member] | Bottom of range [member]
Disclosure of detailed information about borrowings [line items]
Borrowings, Maturity					August 7, 2026
Fiera Private Debt Fund VI LP [Member] | Top of range [member]
Disclosure of detailed information about borrowings [line items]
Borrowings, Maturity					October 31, 2022		October 31, 2022
Term Loan [Member]
Disclosure of detailed information about borrowings [line items]
Borrowing costs incurred							$ 191,310
Debt Instrument, principal and interest amount							2,343,036
Term Loan [Member] | Amended [Member]
Disclosure of detailed information about borrowings [line items]
Borrowings, Maturity		August 7, 2026
Borrowings, Covenants terms		financial covenants which are applicable for the period from July 1, 2021 to December 31, 2022
Modification loss					$ (161,698)		(138,908)
Term Loan [Member] | Amended [Member] | Bottom of range [member]
Disclosure of detailed information about borrowings [line items]
Borrowings interest rate		6.85%
Term Loan [Member] | Amended [Member] | Top of range [member]
Disclosure of detailed information about borrowings [line items]
Borrowings interest rate		7.50%
Term Loan [Member] | Fiera Private Debt Fund VI LP [Member]
Disclosure of detailed information about borrowings [line items]
Notional amount									$ 13,000,000
Borrowings, Maturity									August 2026
Debt Instrument, principal and interest amount					$ 2,987,535	$ 1,171,518
Repayments of borrowings	$ 2,044,086
Term Loan [Member] | Fiera Private Debt Fund VI LP [Member] | Bottom of range [member]
Disclosure of detailed information about borrowings [line items]
Borrowings interest rate			6.85%		6.85%
Term Loan [Member] | Fiera Private Debt Fund VI LP [Member] | Top of range [member]
Disclosure of detailed information about borrowings [line items]
Borrowings interest rate			9.50%		9.50%
Nations Interbanc Facility [Member]
Disclosure of detailed information about borrowings [line items]
Notional amount													$ 2,000,000
Proceeds from current borrowings							9,246,693
Repayments of current borrowings							$ 7,954,698
Nations Interbanc Facility [Member] | Loans Received [Member]
Disclosure of detailed information about borrowings [line items]
Percentage of funds borrowed													85.00%
Financing of Electric Vehicle Development Projects [Member]
Disclosure of detailed information about borrowings [line items]
Borrowings, Maturity					March 31, 2025
Borrowings, Adjustment to interest rate basis			18.00%		18.00%
Borrowings, Interest rate basis					10
Financing of Electric Vehicle Development Projects [Member] | Long-term borrowings [member]
Disclosure of detailed information about borrowings [line items]
Notional amount										$ 10,000,000
Financing of Electric Vehicle Development Projects [Member] | Short-term borrowings [member]
Disclosure of detailed information about borrowings [line items]
Notional amount											$ 5,000,000
Financing of Electric Vehicle Development Projects [Member] | Carbon Royalty Corp [Member] | Promissory Note [Member]
Disclosure of detailed information about borrowings [line items]
Notional amount												$ 15,000,000

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Bank Indebtedness - Disclosure of Detailed Information About Bank Indebtedness Explanatory (Detail) - CAD ($)	Jun. 30, 2022	Dec. 31, 2021		Dec. 31, 2020
Disclosure Of Detailed Information About Bank Indebtedness LineItems [Line Items]
Bank overdraft 1	$ 3,679,631	$ 3,460,109		$ 976,779
Total		3,460,109	[1]	976,779
ATB Financial Revolving Operating Facility [Member] | Bank Borrowings [Member]
Disclosure Of Detailed Information About Bank Indebtedness LineItems [Line Items]
ATB Financial revolving operating facility	$ 3,679,631	$ 3,460,109
Operating Loan Facility [Member] | Bank Borrowings [Member]
Disclosure Of Detailed Information About Bank Indebtedness LineItems [Line Items]
Operating loan facility				923,461
Bank Overdraft [Member] | Bank Borrowings [Member]
Disclosure Of Detailed Information About Bank Indebtedness LineItems [Line Items]
Bank overdraft 1				$ 53,318

[1] No contractual maturity. Excludes interest charged on facility as detailed in Note 13.

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Bank Indebtedness - Disclosure of Detailed Information About Bank Indebtedness Explanatory (Parenthetical) (Detail) - CAD ($)	Jun. 30, 2022	Dec. 31, 2021	Dec. 31, 2020
Disclosure Of Detailed Information About Bank Indebtedness LineItems [Line Items]
Debt instruments drawn	$ 372,374	$ 296,669	$ 600,590
Mastercard Facility [Member]
Disclosure Of Detailed Information About Bank Indebtedness LineItems [Line Items]
Debt instruments drawn		$ 296,669	$ 600,590

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Bank Indebtedness - Additional Information (Detail) - CAD ($)			6 Months Ended		12 Months Ended
	Nov. 12, 2021	Jun. 24, 2021	Jun. 30, 2022	Jun. 30, 2021	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019	Nov. 09, 2021	Nov. 08, 2021	May 17, 2021
Disclosure Of Detailed Information About Bank Indebtedness LineItems [Line Items]
Repayments Of Borrowings			$ 8,224,068	$ 7,009,073	$ 9,781,554	$ 9,011,638	$ 6,787,528
Bank Borrowings [Member] | ATB Financial Revolving Operating Facility [Member]
Disclosure Of Detailed Information About Bank Indebtedness LineItems [Line Items]
Notional amount								$ 5,000,000		$ 5,000,000
Proceeds from current borrowings		$ 2,500,000
Borrowings, Interest rate basis			prime rate plus 2% per annum		prime rate plus 2% per annum
Borrowings, Adjustment to interest rate basis					2.00%
Line of credit, Covenants terms					The Company was in compliance with these covenants
Bank Borrowings [Member] | ATB Financial Revolving Operating Facility [Member] | Bottom of range [member]
Disclosure Of Detailed Information About Bank Indebtedness LineItems [Line Items]
Notional amount									$ 5,000,000
Bank Borrowings [Member] | ATB Financial Revolving Operating Facility [Member] | Top of range [member]
Disclosure Of Detailed Information About Bank Indebtedness LineItems [Line Items]
Notional amount								$ 5,000,000	10,000,000
Bank Borrowings [Member] | ATB Financial Revolving Operating Facility [Member] | Amended [Member]
Disclosure Of Detailed Information About Bank Indebtedness LineItems [Line Items]
Proceeds from current borrowings	$ 950,000		$ 1,077,338
Line of credit, Increments									$ 1,250,000
Repayments Of Borrowings			$ 863,502

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Convertible Debentures - Summary of Convertible Debentures (Detail) - CAD ($)	Jun. 30, 2022	Dec. 31, 2021	Dec. 31, 2020
Disclosure Of Detailed Information About Notes And Debentures Issued [Line Items]
Convertible Debentures		$ 22,295,710	$ 19,534,988
Current debentures	$ 23,457,500	22,185,170	0
Non-current debentures	$ 85,091	110,540	19,534,988
2019 Convertible debentures liability [Member]
Disclosure Of Detailed Information About Notes And Debentures Issued [Line Items]
Convertible Debentures		22,185,170	$ 19,534,988
2021 Convertible debentures liability [Member]
Disclosure Of Detailed Information About Notes And Debentures Issued [Line Items]
Convertible Debentures		69,034
Non-current debentures		110,540
2021 Convertible debentures embedded derivative [Member]
Disclosure Of Detailed Information About Notes And Debentures Issued [Line Items]
Convertible Debentures		$ 41,506

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Convertible Debentures - Summary of 2019 Convertible Debentures (Detail) - 2019 Convertible debentures liability [Member] - CAD ($)	6 Months Ended	12 Months Ended
	Jun. 30, 2022	Dec. 31, 2021	Dec. 31, 2020
Disclosure Of Reconciliation Of Notes And Debentures Issued [Line Items]
Carrying amount of liability component	$ 23,457,500	$ 22,185,170	$ 19,534,988
Less: interest payable (Note 11)	(195,479)	(195,479)	(232,484)
Convertible Debentures [Member]
Disclosure Of Reconciliation Of Notes And Debentures Issued [Line Items]
Opening balance	22,380,649	19,767,472	17,753,016
Conversion of debentures into common shares			(50,000)
Interest paid	(1,172,875)	(2,345,750)	(2,345,750)
Accreted interest at effective interest rate	2,445,205	4,958,927	4,410,206
Carrying amount of liability component	$ 23,652,979	$ 22,380,649	$ 19,767,472

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Convertible Debentures - Summary of Components of Convertible Debentures (Detail) - CAD ($)	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Detailed Information About Components Of Convertible Debentures [Line Items]
Interest expense associated with liability	$ 1,126,304	$ 1,592,597	$ 2,454,350	$ 3,105,233	$ 5,740,346	$ 4,410,206	$ 2,130,247
Convertible Debentures [Member] | 2021 Convertible debentures liability [Member]
Detailed Information About Components Of Convertible Debentures [Line Items]
Proceeds from issue of convertible debentures					11,328,870
Fair value Fair value adjustments (Note 23)adjustments (Note 11(c))					1,615,102
Total fair value of convertible debentures					12,943,972
Less: fair value of embedded derivative					(5,060,776)
Less: transaction costs					(660,604)
Carrying value of liability at inception			$ 69,034	$ 7,222,592	7,222,592
Interest expense associated with liability					813,615
Debt extinguishment, including interest payable					(7,735,230)
Foreign exchange adjustments					(224,286)
Convertible debentures, gross carrying value					76,691
Less: accrued interest included in accrued liabilities					(7,657)
Carrying value of liability at end of period					$ 69,034	$ 7,222,592

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Convertible Debentures - Summary of Reconciliation of Embedded Derivatives (Detail)	12 Months Ended
	Dec. 31, 2021 CAD ($)
Disclosure Of Detailed Information About Reconciliation Of Embedded Derivatives [Line Items]
Fair value of embedded derivative at inception	$ 5,060,776
Fair value decrease	(784,261)
Derecognition of embedded derivative on conversion	(4,214,198)
Foreign exchange adjustments	(20,811)
Balance, embedded derivative	$ 41,506

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Convertible Debentures - Additional Information (Detail)	1 Months Ended	6 Months Ended			12 Months Ended
	Jul. 31, 2019 CAD ($) $ / shares shares	Jun. 30, 2022	May 25, 2021 CAD ($) $ / shares	May 25, 2021 USD ($)	Dec. 31, 2021 CAD ($) shares	Dec. 31, 2020 CAD ($)	Dec. 31, 2020 USD ($)	Dec. 31, 2019 CAD ($)	Dec. 31, 2021 USD ($)	Jul. 12, 2021	May 25, 2021 $ / shares	Dec. 07, 2020 USD ($) $ / shares	Jul. 12, 2020
Disclosure Of Convertible Debentures [Line Items]
Proceeds from issuance of convertible debentures, net of costs					$ 5,424,661	$ 5,285,997		$ 22,865,049
Debentures outstanding					$ 22,295,710	19,534,988
Broker warrants issued | shares					115,760
2019 Convertible debentures liability [Member]
Disclosure Of Convertible Debentures [Line Items]
Debentures outstanding					$ 22,185,170	19,534,988
2021 Convertible debentures liability [Member]
Disclosure Of Convertible Debentures [Line Items]
Debentures outstanding					$ 69,034
Percentage of debt extinguishment										99.20%
2021 Convertible debentures liability [Member] | Two Tranches [Member]
Disclosure Of Convertible Debentures [Line Items]
Proceeds from issuance of convertible debentures, net of costs						5,285,997	$ 4,146,825
Debentures outstanding						$ 5,285,997
Convertible Debentures [Member] | 2019 Convertible debentures liability [Member]
Disclosure Of Convertible Debentures [Line Items]
Proceeds from issuance of convertible debentures, net of costs	$ 23,507,500
Borrowings, Interest rate	10.00%
Borrowings, maturity	mature on May 31, 2022	matured on June 30, 2022,
Notional amount	$ 23,457,500
Convertible debentures, number of units issuable upon conversion | shares	1,563,833
Convertible debentures conversion price | $ / shares	$ 15
Warrants exercise price | $ / shares	$ 22.5
Convertible Debentures [Member] | 2021 Convertible debentures liability [Member]
Disclosure Of Convertible Debentures [Line Items]
Proceeds from issuance of convertible debentures, net of costs			$ 11,328,870	$ 8,884,000
Borrowings, Interest rate					8.00%				8.00%				8.00%
Borrowings, maturity					January 2024
Notional amount												$ 10,000,000
Issue of debentures, Price per debenture | $ / shares												$ 100
Debentures outstanding									$ 75,000
Tranche description			six tranches between December 7, 2020 and May 25, 2021	six tranches between December 7, 2020 and May 25, 2021
Debt conversion price per share					$ 5.84				$ 4.59
Convertible Debentures [Member] | 2021 Convertible debentures liability [Member] | Embeded Derivative Deventures Two Thousand Twenty One [Member]
Disclosure Of Convertible Debentures [Line Items]
Transaction costs related to financial liabilities					401,250
Convertible Debentures [Member] | 2021 Convertible debentures liability [Member] | Broker Warrants [Member]
Disclosure Of Convertible Debentures [Line Items]
Transaction costs related to financial liabilities					$ 1,061,854
Convertible Debentures [Member] | 2021 Convertible debentures liability [Member] | Bottom of range [member]
Disclosure Of Convertible Debentures [Line Items]
Convertible debentures conversion price | (per share)			$ 4.11								$ 3.42
Convertible Debentures [Member] | 2021 Convertible debentures liability [Member] | Top of range [member]
Disclosure Of Convertible Debentures [Line Items]
Convertible debentures conversion price | (per share)			$ 8.28								$ 6.6

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Warrant Liabilities - Additional Information (Detail)				3 Months Ended	6 Months Ended	12 Months Ended
	Jan. 17, 2022 $ / shares shares	Nov. 29, 2021 CAD ($) shares	Aug. 13, 2021 $ / shares shares	Jun. 30, 2022 CAD ($) shares	Jun. 30, 2022 CAD ($) shares	Dec. 31, 2021 CAD ($)		Jun. 30, 2022 $ / shares	Jun. 30, 2022 CAD ($) Dividends $ / shares yr	Dec. 31, 2021 USD ($)		Nov. 29, 2021 USD ($) $ / shares	Aug. 13, 2021 CAD ($)
Disclosure of financial liabilities [line items]
Warrant liability | $									$ 718,092
Warrants exercised during period | shares				0	0
Warrants [Member]
Disclosure of financial liabilities [line items]
Warrant liability									552,250	$ 552,250
Warrants [Member] | Warrant Liability Related To ATB Financial [Member]
Disclosure of financial liabilities [line items]
Warrants issued during period | shares	183,486
Warrants exercise price | $ / shares	$ 5.45
Warrants Maturity	maturing one year from date of issuance
Financial liabilities, at fair value | $						$ 195,066
Warrants [Member] | 2021 Debentures [Member]
Disclosure of financial liabilities [line items]
Warrants issued during period | shares			2,107,787		2,107,787
Warrants exercise price | $ / shares			$ 6.87					$ 6.87
Warrants Maturity			August 2024
Financial liabilities, at fair value | $						1,868,541			$ 367,019				$ 5,947,689
Gains on change in fair value of derivatives | $				$ 853,068	$ 1,509,069	$ 4,177,825
Warrants maturity date			Aug. 13, 2024
Warrants [Member] | 2021 Debentures [Member] | Fair Value Per Warrant Measurement Input [Member]
Disclosure of financial liabilities [line items]
Significant unobservable input, liabilities						0.89	[1]		0.17	0.89	[1]		2.82	[1]
Warrants [Member] | 2021 Debentures [Member] | Share Price Measurement Input [Member]
Disclosure of financial liabilities [line items]
Significant unobservable input, liabilities | $ / shares									4.05
Warrants [Member] | 2021 Debentures [Member] | Canadian Dollar Equivalent Exercise Price of Warrant Measurement Input [Member]
Disclosure of financial liabilities [line items]
Significant unobservable input, liabilities | $ / shares									8.87
Warrants [Member] | 2021 Debentures [Member] | Risk Free Rate Measurement Input [Member]
Disclosure of financial liabilities [line items]
Significant unobservable input, liabilities						0.88			0.0293	0.88			0.43
Warrants [Member] | 2021 Debentures [Member] | Expected Life Measurement Input [Member]
Disclosure of financial liabilities [line items]
Significant unobservable input, liabilities						2.62			2.1	2.62			3
Warrants [Member] | 2021 Debentures [Member] | Historical volatility for shares, measurement input [member]
Disclosure of financial liabilities [line items]
Significant unobservable input, liabilities						45			0.43	45			71.5
Warrants [Member] | 2021 Debentures [Member] | Expected Dividend Measurement Input [Member]
Disclosure of financial liabilities [line items]
Significant unobservable input, liabilities | Dividends									0
Warrants [Member] | US$ equity financing [Member]
Disclosure of financial liabilities [line items]
Warrants issued during period | shares		2,415,000			2,415,000
Warrants exercise price | $ / shares								$ 4.75				$ 4.75
Warrants Maturity		mature five years after issuance
Financial liabilities, at fair value		$ 5,302,004				$ 6,106,596			$ 2,650,624			$ 4,158,396
Gains on change in fair value of derivatives | $				$ 1,652,742	$ 3,490,011
Warrants maturity date		Nov. 29, 2026
Warrants [Member] | US$ equity financing [Member] | Fair Value Per Warrant Measurement Input [Member]
Disclosure of financial liabilities [line items]
Significant unobservable input, liabilities		2.19				2.53		0.85	1.1	2.53		2.19
Warrants [Member] | US$ equity financing [Member] | Risk Free Rate Measurement Input [Member]
Disclosure of financial liabilities [line items]
Significant unobservable input, liabilities						1.25				1.25			1.18
Warrants [Member] | US$ equity financing [Member] | Expected Life Measurement Input [Member]
Disclosure of financial liabilities [line items]
Significant unobservable input, liabilities		5				4.92				4.92		5
Warrants [Member] | US$ equity financing [Member] | Historical volatility for shares, measurement input [member]
Disclosure of financial liabilities [line items]
Significant unobservable input, liabilities						45				45			45

[1] Considers a liquidity discount of 20% in determining the fair value per warrant as these warrants are not publicly traded.

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Warrant Liabilities - Summary of Warrant Liabilities (Detail) - CAD ($)	Jun. 30, 2022	Dec. 31, 2021	Dec. 31, 2020
Disclosure Of Detailed Information About Current Warrant Liability [Line Items]
Total, all current	$ 3,017,643	$ 8,880,038	$ 710,924
Warrants [Member]
Disclosure Of Detailed Information About Current Warrant Liability [Line Items]
Warrant liability related to business acquisition		709,835	710,924
Other warrant liability		195,066
Total, all current	3,017,643	8,880,038	$ 710,924
Warrants [Member] | US$ equity financing [Member]
Disclosure Of Detailed Information About Current Warrant Liability [Line Items]
Derivative warrant liabilities	2,650,624	6,106,596
Warrants [Member] | 2021 Debentures [Member]
Disclosure Of Detailed Information About Current Warrant Liability [Line Items]
Derivative warrant liabilities	$ 367,019	$ 1,868,541

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Warrant Liabilities - Summary of Black-Scholes Option-Pricing Model Inputs and Assumption (Detail) - Warrants [Member]	Jun. 30, 2022	Jun. 30, 2022 $ / shares	Jun. 30, 2022 yr	Jun. 30, 2022 $ / shares	Dec. 31, 2021		Nov. 29, 2021	Aug. 13, 2021
Share price at date of valuation [Member] | 2021 Debentures [Member]
Disclosure of significant unobservable inputs used in fair value measurement of liabilities [line items]
Significant unobservable input, liabilities					6.18			6.9
Share price at date of valuation [Member] | US$ equity financing [Member]
Disclosure of significant unobservable inputs used in fair value measurement of liabilities [line items]
Significant unobservable input, liabilities					6.18		5.7
Exercise price of warrant [Member] | 2021 Debentures [Member]
Disclosure of significant unobservable inputs used in fair value measurement of liabilities [line items]
Significant unobservable input, liabilities					8.74			8.74
Exercise price of warrant [Member] | US$ equity financing [Member]
Disclosure of significant unobservable inputs used in fair value measurement of liabilities [line items]
Significant unobservable input, liabilities					6.04		6.05
Risk free rate [Member] | 2021 Debentures [Member]
Disclosure of significant unobservable inputs used in fair value measurement of liabilities [line items]
Significant unobservable input, liabilities	0.0293				0.88			0.43
Risk free rate [Member] | US$ equity financing [Member]
Disclosure of significant unobservable inputs used in fair value measurement of liabilities [line items]
Significant unobservable input, liabilities					1.25			1.18
Expected life (years) [Member] | 2021 Debentures [Member]
Disclosure of significant unobservable inputs used in fair value measurement of liabilities [line items]
Significant unobservable input, liabilities			2.1		2.62			3
Expected life (years) [Member] | US$ equity financing [Member]
Disclosure of significant unobservable inputs used in fair value measurement of liabilities [line items]
Significant unobservable input, liabilities					4.92		5
Expected volatility [Member] | 2021 Debentures [Member]
Disclosure of significant unobservable inputs used in fair value measurement of liabilities [line items]
Significant unobservable input, liabilities	0.43				45			71.5
Expected volatility [Member] | US$ equity financing [Member]
Disclosure of significant unobservable inputs used in fair value measurement of liabilities [line items]
Significant unobservable input, liabilities					45			45
Fair value per warrant [Member] | 2021 Debentures [Member]
Disclosure of significant unobservable inputs used in fair value measurement of liabilities [line items]
Significant unobservable input, liabilities		0.17			0.89	[1]		2.82	[1]
Fair value per warrant [Member] | US$ equity financing [Member]
Disclosure of significant unobservable inputs used in fair value measurement of liabilities [line items]
Significant unobservable input, liabilities		1.1		0.85	2.53		2.19

[1] Considers a liquidity discount of 20% in determining the fair value per warrant as these warrants are not publicly traded.

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Warrant Liabilities - Summary of Black-Scholes Option-Pricing Model Inputs and Assumption (Parenthetical) (Detail)	12 Months Ended
	Dec. 31, 2021
Fair Value Per Warrant Measurement Input [Member] | Warrants [Member] | Warrants Two Thousand Twenty One Debentures [Member]
Disclosure of financial liabilities [line items]
Liquidity Discount	20.00%

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Other Liabilities - Summary of Other Liabilities (Detail) - CAD ($)	Dec. 31, 2021	Dec. 31, 2020
Schedule of Other Liabilities [Line Items]
US Government loans		$ 950,418
2021 Debentures subscriptions payable (Note 14(b))	$ 22,295,710	19,534,988
Total		6,236,415
Current portion	0	6,003,838
Non-current portion	0	232,577
Two Thousand and Twenty One Convertible Debentures [Member]
Schedule of Other Liabilities [Line Items]
2021 Debentures subscriptions payable (Note 14(b))	$ 69,034
Two Tranches [Member] | Two Thousand and Twenty One Convertible Debentures [Member]
Schedule of Other Liabilities [Line Items]
2021 Debentures subscriptions payable (Note 14(b))		$ 5,285,997

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Other Liabilities - Summary of Other Liabilities (Parenthetical) (Detail)	Dec. 31, 2020 CAD ($)
Text Block [Abstract]
Current government grants	$ 717,841

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Other Liabilities - Additional Information (Detail)	3 Months Ended	6 Months Ended		12 Months Ended
	Jun. 30, 2021 CAD ($)	Jun. 30, 2022 CAD ($)	Jun. 30, 2021 CAD ($)	Dec. 31, 2021 CAD ($)		Dec. 31, 2020 CAD ($)		Dec. 31, 2019 CAD ($)	Dec. 31, 2021 USD ($)	Dec. 31, 2020 USD ($)
Schedule of Other Liabilities [Line Items]
Repayments of borrowings		$ 8,224,068	$ 7,009,073	$ 9,781,554		$ 9,011,638		$ 6,787,528
Income from government loan forgiveness	$ (181,770)		$ (299,082)	$ 1,825,237	[1]	124,507	[1]
Paycheck Protection Program [Member]
Schedule of Other Liabilities [Line Items]
Number of borrowings forgiven				5
US Government Loans [Member] | Paycheck Protection Program [Member]
Schedule of Other Liabilities [Line Items]
Repayments of borrowings				$ 0
Income from government loan forgiveness				$ 1,825,237
Each Loan [Member] | US Government Loans [Member] | Paycheck Protection Program [Member]
Schedule of Other Liabilities [Line Items]
Borrowings, Interest rate				1.00%					1.00%
Borrowings, Maturity				maturity dates in February and May 2026
Two Loans [Member] | US Government Loans [Member] | Paycheck Protection Program [Member]
Schedule of Other Liabilities [Line Items]
Notional amount				$ 840,845					$ 668,689
Four loans [Member] | US Government Loans [Member] | Paycheck Protection Program [Member]
Schedule of Other Liabilities [Line Items]
Notional amount						$ 1,120,139				$ 805,246

[1] Includes other income recognized as below market interest rate benefit.

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Business Acquisitions - Summary of Fair Value of Options Using Inputs (Detail)		6 Months Ended	12 Months Ended
	Jan. 22, 2019 yr $ / shares	Jun. 30, 2022 yr $ / shares	Dec. 31, 2021 yr $ / shares	Dec. 31, 2020 yr $ / shares	Dec. 31, 2019 yr $ / shares
Disclosure of terms and conditions of share-based payment arrangement [line items]
Weighted average share price, share options granted		$ 4.7	$ 7	$ 8.93	$ 10.88
Risk free rate		2.23%	1.32%	0.36%	1.57%
Expected life | yr		6.5	6.2	5	3.9
Expected volatility		74.00%	75.00%	66.00%	54.00%
Expected dividends		0.00%
Flow Capital Corp [Member]
Disclosure of terms and conditions of share-based payment arrangement [line items]
Risk free rate	1.90%
Expected life | yr	6
Expected volatility	80.00%
Expected dividends
Flow Capital Corp [Member] | Top of range [member]
Disclosure of terms and conditions of share-based payment arrangement [line items]
Weighted average share price, share options granted	$ 90
Flow Capital Corp [Member] | Bottom of range [member]
Disclosure of terms and conditions of share-based payment arrangement [line items]
Weighted average share price, share options granted	30
Flow Capital Corp [Member] | Secured Loan Agreement [Member]
Disclosure of terms and conditions of share-based payment arrangement [line items]
Weighted average share price, share options granted	$ 10.5
Risk free rate	1.90%
Expected life | yr	0.5
Expected volatility	60.00%
Expected dividends

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Business Acquisitions - Summary of Acquisition Date Fair Value of Each Major Class of Consideration Transferred And Identifiable Assets Acquired And Liabilities Assumed (Detail) - CAD ($)	Oct. 08, 2020	Jan. 24, 2020	Dec. 31, 2019	Jul. 10, 2019	Apr. 22, 2019
Agnity Global Inc [Member]
Consideration transferred:
Change in fair-value of interest in Royalty Agreement					$ 167,488
Assumption of Agnity's liabilities					43,050
Total consideration transferred					210,538
Cash consideration					552,250
Fair value of assets and liabilities recognized:
Cash and cash equivalents					33,524
Trade and other receivables					1,387,723
Prepaid expenses and deposits					46,483
Property and equipment					1,281
Intangible Asset – Technology					8,412,390
Intangible Asset – Customer Relationship					1,468,830
Accounts payable and accrued liabilities					(3,232,910)
Deferred revenue					(457,259)
Loans and borrowings					(5,556,587)
Warrant liability (ii)					(737,419)
Due to related party					(930,608)
Deferred income tax liability					(444,768)
Net identifiable assets acquired (liabilities assumed)					(9,320)
Allocation to non-controlling interest					$ 219,858
mCloud Technologies Services Inc [Member]
Consideration transferred:
Total consideration transferred				$ 35,970,689
Cash consideration				4,650,689
Fair Value of Demand Promissory Notes of Acquirer				18,000,000
Fair value of common shares transferred(2)			$ 8,880,000	13,320,000
Fair value of assets and liabilities recognized:
Cash and cash equivalents				2,227,739
Trade and other receivables				5,120,830
Prepaid expenses and deposits				611,104
Property and equipment				548,317
Intangible Asset – Technology				1,800,000
Intangible Asset – Customer Relationship				12,700,000
Accounts payable and accrued liabilities				(2,030,470)
Deferred revenue				(133,556)
Deferred income tax liability				(3,632,250)
Net identifiable assets acquired (liabilities assumed)				17,211,714
Right-of-use assets				4,303,215
Goodwill				18,758,975
Lease liabilities				$ (4,303,215)
Construction Systems Associates Inc USA [Member]
Consideration transferred:
Total consideration transferred		$ 3,886,351
Cash consideration		703,212
Fair value of common shares transferred(2)		2,304,073
Fair value of contingent consideration payable		879,066
Fair value of assets and liabilities recognized:
Cash and cash equivalents		181,408
Trade and other receivables		262,846
Prepaid expenses and deposits		13,863
Property and equipment		2,098
Intangible Asset – Technology		551,880
Intangible Asset – Customer Relationship		801,540
Accounts payable and accrued liabilities		(168,542)
Loans and borrowings		(371,610)
Deferred income tax liability		0
Net identifiable assets acquired (liabilities assumed)		1,273,483
Right-of-use assets		242,894
Goodwill		2,612,868
Lease liabilities		$ (242,894)
Kanepi [Member]
Consideration transferred:
Total consideration transferred	$ 11,108,697
Cash consideration	4,657,512
Fair value of common shares transferred(2)	5,882,547
Fair value of contingent consideration payable	568,638
Fair value of assets and liabilities recognized:
Cash and cash equivalents	556,880
Trade and other receivables	598,059
Property and equipment	1,224
Intangible Asset – Technology	3,294,309
Intangible Asset – Customer Relationship	2,632,794
Accounts payable and accrued liabilities	(643,385)
Deferred income tax liability	(1,136,806)
Net identifiable assets acquired (liabilities assumed)	5,316,224
Right-of-use assets	266,396
Goodwill	5,792,473
Lease liabilities	(266,396)
Other Current Assets recognized As Of Acquisition Date	$ 13,149

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Business Acquisitions - Summary of Acquisition Date Fair Value of Each Major Class of Consideration Transferred And Identifiable Assets Acquired And Liabilities Assumed (Parenthetical) (Detail)	Jun. 30, 2022 CAD ($)	Dec. 31, 2021 CAD ($)		Dec. 31, 2020 CAD ($)	Dec. 31, 2019 CAD ($)	Aug. 08, 2019 CAD ($)	Jul. 10, 2019 CAD ($)	Apr. 22, 2019 CAD ($) $ / shares	Apr. 22, 2019 USD ($)	Dec. 31, 2018 CAD ($)
Disclosure of detailed information about business combination [line items]
Fair value of warrant liabilities business combination		$ 709,835
Unbilled Revenue	$ 861,413	$ 756,042	[1]	$ 554,740						$ 658,931
Agnity Global Inc [Member]
Disclosure of detailed information about business combination [line items]
Discount rates used in current estimate of value in use								16.00%	16.00%
Number of common shares acquired in business combination								6,324,660
Business acquisition share price | $ / shares								$ 0.000036
Consideration in cash								$ 552,250
Financial liabilities measured at redemption amount								$ 737,419	$ 552,250
Fair value of warrant liabilities business combination				$ 710,924	$ 725,086
mCloud Technologies Services Inc [Member]
Disclosure of detailed information about business combination [line items]
Number of common shares acquired in business combination							1,200,000
Consideration in cash							$ 4,650,689
Fair value of warrant liabilities business combination						$ 12,000,000	6,000,000
Unbilled Revenue							$ 2,347,207

[1] Unbilled revenue is included in trade and other receivables (Note 6) and relates to the Company’s right to consideration for work completed but not billed at the reporting date. Unbilled revenue is transferred to trade and other receivables when services are billed to customers.

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Business Acquisitions - Additional Information (Detail)						3 Months Ended		6 Months Ended		12 Months Ended
	Jul. 26, 2019 CAD ($) shares	Jul. 26, 2019 USD ($) $ / shares shares	Jul. 10, 2019 CAD ($)	Apr. 22, 2019 USD ($)	Jan. 22, 2019 USD ($) shares	Jun. 30, 2022 CAD ($)	Jun. 30, 2021 CAD ($)	Jun. 30, 2022 CAD ($)	Jun. 30, 2021 CAD ($)	Dec. 31, 2021 CAD ($)		Dec. 31, 2020 CAD ($)		Dec. 31, 2019 CAD ($) shares	Oct. 08, 2020 CAD ($)	Jan. 24, 2020 CAD ($)	Jan. 24, 2020 $ / shares	Apr. 22, 2019 CAD ($)	Jan. 22, 2019 CAD ($)	Jan. 22, 2019 USD ($)
Disclosure of business combinations [line item]
Secured loans						$ 29,985,807		$ 29,985,807		$ 13,215,601	[1],[2]	$ 13,152,300	[2]
Shares issued to extinguish the loan from Flow Capital														$ 606,495
Repayments of borrowings								8,224,068	$ 7,009,073	9,781,554		9,011,638		6,787,528
Legal and professional fees						$ 3,560,346	$ 2,490,612	$ 6,736,389	$ 4,230,033	9,085,436		8,886,341		4,351,812
Contingent shares issuable to Flow Capital														712,000
Par value per share | $ / shares																	$ 18.18
Agnity global inc [member]
Disclosure of business combinations [line item]
Royalty expense				$ 10,000
Consideration in cash																		$ 552,250
Initial fair value of loans																		5,556,587
Liabilities payable to third party																		$ 43,050
Proportion of ownership interests held by non-controlling interests				100.00%
Number of common shares acquired in business combination																		6,324,660
Discount rates used in current estimate of value in use																		16.00%
mCloud technologies services inc. (member)
Disclosure of business combinations [line item]
Consideration in cash			$ 4,650,689
Number of common shares acquired in business combination			1,200,000
Business combination transaction costs			$ 9,869,589
Consulting fees			750,000
Legal and professional fees			239,589
Fair value of equity shares acquired			$ 13,320,000											$ 8,880,000
Common shares issued for brokering and due diligence | shares														800,000
Construction systems associates inc usa (member)
Disclosure of business combinations [line item]
Consideration in cash																$ 703,212
Initial fair value of loans																371,610
Fair value of equity shares acquired																$ 2,304,073
Contingent consideration payable										0
Contingent consideration recognised in other income										838,932
Kanepi [member]
Disclosure of business combinations [line item]
Consideration in cash															$ 4,657,512
Fair value of equity shares acquired															$ 5,882,547
Contingent consideration payable										$ 171,092		$ 568,638
Discount rates used in current estimate of value in use										27.00%
Royalty agreement [member] | Flow capital corp [member]
Disclosure of business combinations [line item]
Financial asset receivable																				$ 2,834,750
Consideration in cash																			$ 204,604	153,227
Secured loan agreement [member] | Flow capital corp [member]
Disclosure of business combinations [line item]
Consideration in cash																				525,000
Initial fair value of loans																			$ 2,670,600	2,000,000
Secured loans																				$ 2,000,000
Borrowings interest rate																			25.00%	25.00%
Option to repay the loan percentage																			100.00%	100.00%
Shares issued to extinguish the loan from Flow Capital (Shares) | shares	50,000	50,000			50,000
Shares issued to extinguish the loan from Flow Capital		$ 606,495			$ 606,495
Liability component included in compound instrument options																				$ 525,000
Conversion of equity shares value					81,495
Repayments of borrowings		$ 2,000,000
Borrowings settled in cash	$ 2,703,148
Contingent shares issuable to Flow Capital	$ 712,000
Secured loan agreement [member] | Flow capital corp [member] | Tranche one [member]
Disclosure of business combinations [line item]
Share price | $ / shares		$ 30
Number of shares will be issued | shares		50,000
Secured loan agreement [member] | Flow capital corp [member] | Tranche two [member]
Disclosure of business combinations [line item]
Share price | $ / shares		$ 60
Number of shares will be issued | shares		33,333
Secured loan agreement [member] | Flow capital corp [member] | Tranche three [member]
Disclosure of business combinations [line item]
Share price | $ / shares		$ 90
Number of shares will be issued | shares		33,333
Bottom of range [member]
Disclosure of business combinations [line item]
Percentage of entity revenue										10.00%
Bottom of range [member] | Royalty agreement [member] | Flow capital corp [member]
Disclosure of business combinations [line item]
Royalty expense					$ 41,667
Percentage of entity revenue					4.25%

[1] Includes term loan with a carrying value of $9,275,683 classified as current due to covenant breach. Assuming term loan is repaid in accordance with agreement to maturity, the undiscounted contractual cash flows for loans and borrowings would be $2,933,739, $5,472,193, and $4,143,888 , respectively for the periods presented above.

[2] Note 30(b) includes the reconciliation of movements of liabilities to cash flows arising from financing activities.

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Business Acquisition Payable - Additional Information (Detail) - CAD ($)	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Disclosure of Detailed Information About Business Acquisition Payable [Line Items]
Contingent consideration payable	$ 1,398,972	$ 2,439,529	$ 1,043,314
Kanepi Acquisition [Member]
Disclosure of Detailed Information About Business Acquisition Payable [Line Items]
Contingent consideration payable	383,368
FDSI Acquisition [Member]
Disclosure of Detailed Information About Business Acquisition Payable [Line Items]
Contingent consideration payable	$ 1,015,604

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Business Acquisition Payable - Summary of Business Acquisition Payable (Detail) - CAD ($)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Jun. 30, 2022
Disclosure of Detailed Information About Business Acquisition Payable [Line Items]
Opening balance	$ 2,439,529	$ 1,043,314
Effect of foreign exchange differences	(16,157)	(51,489)
Total	1,398,972	2,439,529
Current portion	1,398,972	1,594,297	$ 1,399,580
Non-current portion	0	845,232
CSA Acquisition [Member]
Disclosure of Detailed Information About Business Acquisition Payable [Line Items]
Contingent consideration changes related	(853,308)	879,066
Kanepi Acquisition [Member]
Disclosure of Detailed Information About Business Acquisition Payable [Line Items]
Contingent consideration changes related	(171,092)	$ 568,638
Total	$ 383,368

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Share Capital - Summary Of Detailed Information About Reconciliation Of Warrants Classified As Equity Settled And Financial Liabilities (Detail)	6 Months Ended	12 Months Ended
	Jun. 30, 2022 CAD ($) $ / shares shares	Dec. 31, 2021 CAD ($) $ / shares shares	Dec. 31, 2020 CAD ($) $ / shares shares	Dec. 31, 2019 CAD ($) $ / shares shares
Detailed Information About Reconciliation Of Warrants Classified As Equity Settled And Financial Liabilities [Line Items]
Balance – Beginning of period | $	866,789	423,303	349,657	95,000
Number Of Warrants Exercised | $			(7,639)	(50,838)
Number Of Warrants Expired | $	(40,648)	(4,201)	(6,433)
Balance – Ending of period | $	856,314	866,789	423,303	349,657
Balance – Beginning of period	$ 8.81	$ 11.01	$ 11.48	$ 11.7
Weighted Average Exercise Exercised			10.5	10.62
Weighted Average Exercise Expired	10.46	11.03	10.67
Balance – Ending of period	$ 8.2	$ 8.81	$ 11.01	$ 11.48
Warrants [Member] | Equity Settled And Finance Liabilities [Member]
Detailed Information About Reconciliation Of Warrants Classified As Equity Settled And Financial Liabilities [Line Items]
Balance – Beginning of period | $	8,481,929	1,931,526	781,260	1,104,378
Number Of Warrants Issued | shares	183,486	7,140,223	2,433,081	19,957
Number Of Warrants Exercised | $			(1,228,935)	(133,176)
Number Of Warrants Expired | $	(19,318)	(589,820)	(53,880)	(209,899)
Balance – Ending of period | $	8,646,097	8,481,929	1,931,526	781,260
Balance – Beginning of period	$ 8.83	$ 14.82	$ 13.8	$ 13.5
Weighted Average Exercise Issued	5.45	7.64	13.72	14.46
Weighted Average Exercise Exercised			12.06	12.96
Weighted Average Exercise Expired	15	13.97	13.31	13.5
Balance – Ending of period	$ 8.74	$ 8.83	$ 14.82	$ 13.8

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Share Capital - Summary Of Detailed Information About Warrants Outstanding Including Expiration Date (Detail)	Jul. 06, 2022 CAD ($)	Jun. 30, 2022 CAD ($) $ / shares	Dec. 31, 2021 CAD ($) $ / shares	Dec. 31, 2020 CAD ($) $ / shares	Dec. 31, 2019 CAD ($) $ / shares	Dec. 31, 2018 CAD ($) $ / shares
Detailed Information About Warrants Oustanding Including Expiration Date [Line Items]
Exercise Price | $ / shares		$ 8.2	$ 8.81	$ 11.01	$ 11.48	$ 11.7
Outstanding Warrants		856,314	866,789	423,303	349,657	95,000
Warrants [Member]
Detailed Information About Warrants Oustanding Including Expiration Date [Line Items]
Outstanding Warrants	525,114
Warrants [Member] | Equity Settled And Finance Liabilities [Member]
Detailed Information About Warrants Oustanding Including Expiration Date [Line Items]
Exercise Price | $ / shares		$ 8.74	$ 8.83	$ 14.82	$ 13.8	$ 13.5
Outstanding Warrants		8,646,097	8,481,929	1,931,526	781,260	1,104,378
Warrants [Member] | Equity Settled And Finance Liabilities [Member] | June 2022
Detailed Information About Warrants Oustanding Including Expiration Date [Line Items]
Exercise Price | $ / shares			$ 15
Outstanding Warrants			19,584
Warrants [Member] | Equity Settled And Finance Liabilities [Member] | July 2022
Detailed Information About Warrants Oustanding Including Expiration Date [Line Items]
Exercise Price | $ / shares			$ 14.25
Outstanding Warrants			525,114
Warrants [Member] | Equity Settled And Finance Liabilities [Member] | December 2022
Detailed Information About Warrants Oustanding Including Expiration Date [Line Items]
Exercise Price | $ / shares			$ 5.63
Outstanding Warrants			1,000
Warrants [Member] | Equity Settled And Finance Liabilities [Member] | January 2023
Detailed Information About Warrants Oustanding Including Expiration Date [Line Items]
Exercise Price | $ / shares			$ 5.72
Outstanding Warrants			37,400
Warrants [Member] | Equity Settled And Finance Liabilities [Member] | January 2023
Detailed Information About Warrants Oustanding Including Expiration Date [Line Items]
Exercise Price | $ / shares			$ 6.97
Outstanding Warrants			25,400
Warrants [Member] | Equity Settled And Finance Liabilities [Member] | February 2023
Detailed Information About Warrants Oustanding Including Expiration Date [Line Items]
Exercise Price | $ / shares			$ 7.8
Outstanding Warrants			8,000
Warrants [Member] | Equity Settled And Finance Liabilities [Member] | March 2023
Detailed Information About Warrants Oustanding Including Expiration Date [Line Items]
Exercise Price | $ / shares			$ 8.28
Outstanding Warrants			9,000
Warrants [Member] | Equity Settled And Finance Liabilities [Member] | May 2023
Detailed Information About Warrants Oustanding Including Expiration Date [Line Items]
Exercise Price | $ / shares			$ 4.12
Outstanding Warrants			34,960
Warrants [Member] | Equity Settled And Finance Liabilities [Member] | April 2024
Detailed Information About Warrants Oustanding Including Expiration Date [Line Items]
Exercise Price | $ / shares			$ 8.55
Outstanding Warrants			2,375,676
Warrants [Member] | Equity Settled And Finance Liabilities [Member] | June 2024
Detailed Information About Warrants Oustanding Including Expiration Date [Line Items]
Exercise Price | $ / shares			$ 22.5
Outstanding Warrants			3,333
Warrants [Member] | Equity Settled And Finance Liabilities [Member] | August 2024
Detailed Information About Warrants Oustanding Including Expiration Date [Line Items]
Exercise Price | $ / shares			$ 8.6
Outstanding Warrants			2,107,787
Warrants [Member] | Equity Settled And Finance Liabilities [Member] | January 2025
Detailed Information About Warrants Oustanding Including Expiration Date [Line Items]
Exercise Price | $ / shares			$ 16.2
Outstanding Warrants			611,027
Warrants [Member] | Equity Settled And Finance Liabilities [Member] | May 2025
Detailed Information About Warrants Oustanding Including Expiration Date [Line Items]
Exercise Price | $ / shares			$ 6.31
Outstanding Warrants			126,000
Warrants [Member] | Equity Settled And Finance Liabilities [Member] | July 2025
Detailed Information About Warrants Oustanding Including Expiration Date [Line Items]
Exercise Price | $ / shares			$ 14.25
Outstanding Warrants			182,648
Warrants [Member] | Equity Settled And Finance Liabilities [Member] | November 2026
Detailed Information About Warrants Oustanding Including Expiration Date [Line Items]
Exercise Price | $ / shares			$ 6.05
Outstanding Warrants			2,415,000

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Share Capital - Additional information (Detail)							6 Months Ended	12 Months Ended
	Dec. 03, 2021 CAD ($) shares	Dec. 03, 2021 USD ($) $ / shares shares	Nov. 29, 2021 CAD ($) shares	Nov. 29, 2021 USD ($) $ / shares shares	Aug. 13, 2021 CAD ($) $ / shares shares	Apr. 15, 2021 CAD ($) $ / shares shares	Jun. 30, 2022 CAD ($) shares	Dec. 31, 2023 shares	Dec. 31, 2021 CAD ($) shares yr $ / shares	Dec. 31, 2020 shares	Dec. 31, 2019 CAD ($) shares	Jul. 06, 2022 $ / shares	Dec. 31, 2021 $ / shares	Sep. 01, 2019 shares	Feb. 01, 2019 shares
Disclosure of classes of share capital [line items]
Class of warrants exercise price per share | $ / shares												$ 14.25
Share issue related cost | $											$ 3,300
Residual value of common shares measured | $			$ 8,558,264
Common shares subject to escrow | shares							441,913		681,024	1,674,284	2,381,826
Additional common shares issued during period subject to escrow | shares									0
Weighted average remaining contractual life of share options outstanding							7 days 16 hours		7 days 12 hours
Proceeds from the issue of warrants | $			5,302,004
Transaction costs associated with the issuance of the units | $			1,738,087
Payments for share issue costs | $			1,073,262
Payments for debt issue costs | $			664,825
Transaction cost related to fair value of warrants | $			$ 162,947
Warrants outstanding | shares				2,107,787	2,415,000
Warrants [Member] | Atb [Member]
Disclosure of classes of share capital [line items]
Financial liabilities reclassified to share capital | $							$ 195,066
USD brokered public offering [member]
Disclosure of classes of share capital [line items]
Proceeds from issue of ordinary shares	$ 1,820,070	$ 1,417,450
Net proceeds allocated to common shares | $	$ 1,674,464
Major ordinary share transactions [member]
Disclosure of classes of share capital [line items]
Additional common shares to be issued during period subject to escrow | shares								222,425	458,599
2021 Debentures [Member]
Disclosure of classes of share capital [line items]
Percentage of debt extinguishment					99.20%
Ordinary shares [member] | US brokered public offering [member]
Disclosure of classes of share capital [line items]
Stock issued during period new shares issued in initial public offering | shares			2,100,000	2,100,000
Sale of stock price per share | $ / shares				$ 4.5
Proceeds from issue of ordinary shares net of issuance costs | $			$ 10,912,251
Ordinary shares [member] | Over allotment option [member]
Disclosure of classes of share capital [line items]
Stock issued during period new shares issued in initial public offering | shares	315,000	315,000
Class of warrants exercise price per share | $ / shares		$ 4.75
Ordinary shares [member] | USD brokered public offering [member]
Disclosure of classes of share capital [line items]
Proceeds from issue of ordinary shares			$ 12,040,198	$ 9,450,000
Ordinary shares [member] | 2021 Debentures [Member]
Disclosure of classes of share capital [line items]
Proceeds from issue of ordinary shares net of issuance costs | $					$ 14,436,728
Stock issued during period shares issued for conversion settlement | shares					2,107,787
Ordinary shares [member] | Restricted share units [member]
Disclosure of classes of share capital [line items]
Stock issued during period common shares issued | shares							17,585		71,190
Warrants [Member]
Disclosure of classes of share capital [line items]
Weighted average remaining contractual life of share options outstanding									3 years 1 month 2 days	2 years 3 months 14 days	1 year 4 months 13 days
Warrants [Member] | Atb [Member]
Disclosure of classes of share capital [line items]
Weighted average remaining contractual life of share options outstanding							2 years 7 months 6 days		3 years 1 month 6 days
Warrants [Member] | Equity Settled Warrants Issued To Broker [Member]
Disclosure of classes of share capital [line items]
Fair value of warrants issued | $									$ 294,894
Warrants [Member] | Equity Settled Warrants Issued To Broker [Member] | Share Price Measurement Input [Member]
Disclosure of classes of share capital [line items]
Warrants measurement input | shares									6.39
Warrants [Member] | Equity Settled Warrants Issued To Broker [Member] | Exercise Price Measurement Input [Member]
Disclosure of classes of share capital [line items]
Warrants measurement input | shares									5.85
Warrants [Member] | Equity Settled Warrants Issued To Broker [Member] | Risk Free Rate Measurement Input [Member]
Disclosure of classes of share capital [line items]
Warrants measurement input									0.26
Warrants [Member] | Equity Settled Warrants Issued To Broker [Member] | Expected Life Measurement Input [Member]
Disclosure of classes of share capital [line items]
Warrants measurement input | yr									1.88
Warrants [Member] | Equity Settled Warrants Issued To Broker [Member] | Expected Volatility Measurement Input [Member]
Disclosure of classes of share capital [line items]
Warrants measurement input									69
Warrants [Member] | Equity Settled Warrants Issued To Broker [Member] | Expected Dividend Measurement Input [Member]
Disclosure of classes of share capital [line items]
Warrants measurement input | shares									0
Warrants [Member] | Equity Settled Warrants Issued To Underwriters [Member]
Disclosure of classes of share capital [line items]
Stock issued during period warrants issued to underwriters | shares									126,000
Fair value of warrants issued | $									$ 162,947
Warrants [Member] | Equity Settled Warrants Issued To Underwriters [Member] | Share Price Measurement Input [Member]
Disclosure of classes of share capital [line items]
Warrants measurement input | shares									5.7
Warrants [Member] | Equity Settled Warrants Issued To Underwriters [Member] | Exercise Price Measurement Input [Member]
Disclosure of classes of share capital [line items]
Warrants measurement input | shares									6.31
Warrants [Member] | Equity Settled Warrants Issued To Underwriters [Member] | Risk Free Rate Measurement Input [Member]
Disclosure of classes of share capital [line items]
Warrants measurement input									1.04
Warrants [Member] | Equity Settled Warrants Issued To Underwriters [Member] | Expected Life Measurement Input [Member]
Disclosure of classes of share capital [line items]
Warrants measurement input | yr									3.48
Warrants [Member] | Equity Settled Warrants Issued To Underwriters [Member] | Expected Volatility Measurement Input [Member]
Disclosure of classes of share capital [line items]
Warrants measurement input									45
Warrants [Member] | Equity Settled Warrants Issued To Underwriters [Member] | Expected Dividend Measurement Input [Member]
Disclosure of classes of share capital [line items]
Warrants measurement input | shares									0
Warrants [Member] | Brokered public offering [member
Disclosure of classes of share capital [line items]
Stock issued during period new shares issued in initial public offering | shares					75,676	2,300,000
Sale of stock price per share | $ / shares						$ 6.3
Proceeds from issue of ordinary shares | $						$ 14,490,000
Class of warrants exercise price per share | $ / shares						$ 8.55
Warrants exercisable term						36 months
Underwriters Cash Commission | $						$ 1,014,300
Percentage of gross proceeds from public offering issue						7.00%
Share issue related cost | $						$ 459,986
Proceeds from issue of ordinary shares net of issuance costs | $						13,015,714
Net proceeds allocated to common shares | $						12,395,918
Residual value of common shares measured | $						$ 619,796
Warrants [Member] | Non brokered private placement [member]
Disclosure of classes of share capital [line items]
Stock issued during period new shares issued in initial public offering | shares					75,676
Sale of stock price per share | $ / shares					$ 5.55
Proceeds from issue of ordinary shares | $					$ 420,000
Class of warrants exercise price per share | $ / shares					$ 8.55
Net proceeds allocated to common shares | $					$ 420,000
Warrants maturity term					April 2024
Warrants [Member] | US brokered public offering [member]
Disclosure of classes of share capital [line items]
Class of warrants exercise price per share | $ / shares				$ 4.95
Stock issued during period warrants issued to underwriters | shares			126,000	126,000
Warrants [Member] | 2021 Debentures [Member]
Disclosure of classes of share capital [line items]
Stock issued during period common shares issued | shares									115,760
Warrants exercisable term									24 months
Stock issued during period shares issued for conversion settlement | shares					2,107,787
Warrants [Member] | 2021 Debentures [Member] | Bottom of range [member]
Disclosure of classes of share capital [line items]
Class of warrants exercise price per share | (per share)									$ 4.12				$ 3.42
Warrants maturity term									December 2022
Warrants [Member] | 2021 Debentures [Member] | Top of range [member]
Disclosure of classes of share capital [line items]
Class of warrants exercise price per share | (per share)									$ 8.28				$ 6.6
Warrants maturity term									May 2023
Common share [member]
Disclosure of classes of share capital [line items]
Number of Shares issued for debt settlement | shares														5,000	1,964

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Share-Based Payment Arrangements - Summary Of Share-Based Compensation (Detail) - CAD ($)	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Explanation Of Effect Of Share Based Payments On Profit Or Loss [Line Items]
Expense from share-based payment transactions	$ 191,528	$ 360,645	$ 444,461	$ 735,919	$ 1,867,915	$ 1,454,235	$ 1,468,361
Stock Options [Member]
Explanation Of Effect Of Share Based Payments On Profit Or Loss [Line Items]
Expense from share-based payment transactions	128,441	116,892	320,588	247,790	908,293	677,452	820,613
Restricted Share Units [Member]
Explanation Of Effect Of Share Based Payments On Profit Or Loss [Line Items]
Expense from share-based payment transactions	$ 63,087	$ 243,753	$ 123,873	$ 488,129	$ 959,622	$ 776,783	$ 647,748

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Share-Based Payment Arrangements - Summary Of Weighted-Average Exercise Prices Of Stock Options (Detail)	6 Months Ended	12 Months Ended
	Jun. 30, 2022 CAD ($) $ / shares	Dec. 31, 2021 CAD ($) $ / shares	Dec. 31, 2020 CAD ($) $ / shares	Dec. 31, 2019 CAD ($) $ / shares
Text Block [Abstract]
Balance – Beginning of period	866,789	423,303	349,657	95,000
Number Of Options Granted	167,699	487,775	153,828	323,278
Number Of Options Exercised			(7,639)	(50,838)
Number Of Options Forfeited	(137,526)	(40,088)	(32,777)	(17,783)
Number Of Options Expired	(40,648)	(4,201)	(6,433)
Number Of Options Cancelled			(33,333)
Balance – Ending of period	856,314	866,789	423,303	349,657
Exercisable	263,202	275,473	161,244	17,014
Balance – Beginning of period | $ / shares	$ 8.81	$ 11.01	$ 11.48	$ 11.7
Weighted Average Exercise Granted | $ / shares	4.7	7.1	9.99	11.2
Weighted Average Exercise Exercised | $ / shares			10.5	10.62
Weighted Average Exercise Forfeited | $ / shares	7.11	9.87	11.52	10.35
Weighted Average Exercise Expired | $ / shares	10.46	11.03	$ 10.67
Weighted Average Exercise Price Cancelled			10.50%
Balance – Ending of period | $ / shares	8.2	8.81	$ 11.01	11.48
Exercisable | $ / shares	$ 10.94	$ 11.1	$ 11.7	$ 12.87
Balance – Beginning of period	7 days 16 hours	7 days 12 hours
Weighted Average Contractual Granted	9 days 14 hours
Weighted Average Contractual Forfeited	9 days 7 hours
Weighted Average Contractual Expired	1 day 2 hours
Balance – Ending of period	7 days 16 hours	7 days 12 hours

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Share-Based Payment Arrangements - Summary Of Company's Stock Options Outstanding (Detail)	6 Months Ended	12 Months Ended
	Jun. 30, 2022 CAD ($) $ / shares	Dec. 31, 2021 CAD ($) $ / shares	Dec. 31, 2020 CAD ($) $ / shares	Dec. 31, 2019 CAD ($) $ / shares	Dec. 31, 2018 CAD ($) $ / shares
Disclosure of range of exercise prices of outstanding share options [line items]
Number Outstanding | $	856,314	866,789	423,303	349,657	95,000
Weighted Average Exercise Price	$ 8.2	$ 8.81	$ 11.01	$ 11.48	$ 11.7
Number Exercisable | $	263,202	275,473	161,244	17,014
Weighted Average Exercise Price	$ 10.94	$ 11.1	$ 11.7	$ 12.87
Weighted average remaining contractual life of share options outstanding	7 days 16 hours	7 days 12 hours
Five Point Six Seven To Eight Point Seven Zero [Member]
Disclosure of range of exercise prices of outstanding share options [line items]
Number Outstanding | $		506,502
Weighted Average Exercise Price		$ 6.88
Number Exercisable | $		25,389
Weighted Average Exercise Price		$ 6.56
Weighted average remaining contractual life of share options outstanding		9 years
Five Point Six Seven To Eight Point Seven Zero [Member] | Bottom of range [member]
Disclosure of range of exercise prices of outstanding share options [line items]
Range of prices		$ 5.67
Five Point Six Seven To Eight Point Seven Zero [Member] | Top of range [member]
Disclosure of range of exercise prices of outstanding share options [line items]
Range of prices		$ 8.7
Eight Point Seven One To Ten Point Nine Five [Member]
Disclosure of range of exercise prices of outstanding share options [line items]
Number Outstanding | $		200,706
Weighted Average Exercise Price		$ 10.67
Number Exercisable | $		138,622
Weighted Average Exercise Price		$ 10.57
Weighted average remaining contractual life of share options outstanding		4 years 10 months 24 days
Eight Point Seven One To Ten Point Nine Five [Member] | Bottom of range [member]
Disclosure of range of exercise prices of outstanding share options [line items]
Range of prices		$ 8.71
Eight Point Seven One To Ten Point Nine Five [Member] | Top of range [member]
Disclosure of range of exercise prices of outstanding share options [line items]
Range of prices		$ 10.95
Ten Point Nine Six To Twelve Point Five Nine [Member]
Disclosure of range of exercise prices of outstanding share options [line items]
Number Outstanding | $		104,303
Weighted Average Exercise Price		$ 11.78
Number Exercisable | $		71,461
Weighted Average Exercise Price		$ 11.78
Weighted average remaining contractual life of share options outstanding		6 years 1 month 6 days
Ten Point Nine Six To Twelve Point Five Nine [Member] | Bottom of range [member]
Disclosure of range of exercise prices of outstanding share options [line items]
Range of prices		$ 10.96
Ten Point Nine Six To Twelve Point Five Nine [Member] | Top of range [member]
Disclosure of range of exercise prices of outstanding share options [line items]
Range of prices		$ 12.59
Twelve Point Six Zero To Eighteen Point Zero Two [Member]
Disclosure of range of exercise prices of outstanding share options [line items]
Number Outstanding | $		55,278
Weighted Average Exercise Price		$ 14.11
Number Exercisable | $		40,001
Weighted Average Exercise Price		$ 14.59
Weighted average remaining contractual life of share options outstanding		6 years 4 months 24 days
Twelve Point Six Zero To Eighteen Point Zero Two [Member] | Bottom of range [member]
Disclosure of range of exercise prices of outstanding share options [line items]
Range of prices		$ 12.6
Twelve Point Six Zero To Eighteen Point Zero Two [Member] | Top of range [member]
Disclosure of range of exercise prices of outstanding share options [line items]
Range of prices		$ 18.02
Total [Member]
Disclosure of range of exercise prices of outstanding share options [line items]
Number Outstanding | $		866,789
Weighted Average Exercise Price		$ 8.81
Number Exercisable | $		275,473
Weighted Average Exercise Price		$ 11.1
Weighted average remaining contractual life of share options outstanding		7 years 6 months

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Share-Based Payment Arrangements - Summary Of Indirect Measurement Of Fair Value Of Goods Or Services Received, Share Options Granted During Period (Detail)	6 Months Ended	12 Months Ended
	Jun. 30, 2022 yr $ / shares	Dec. 31, 2021 yr $ / shares	Dec. 31, 2020 yr $ / shares	Dec. 31, 2019 yr $ / shares
Text Block [Abstract]
Grant date share price	$ 4.7	$ 7	$ 8.93	$ 10.88
Exercise price	$ 4.7	$ 7.1	$ 9.74	$ 11.13
Risk-free rate	2.23%	1.32%	0.36%	1.57%
Expected life, years | yr	6.5	6.2	5	3.9
Expected volatility	74.00%	75.00%	66.00%	54.00%
Forfeiture rate	10.00%	7.00%		10.00%

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Share-Based Payment Arrangements - Summary Of Company's Obligation To Issue Shares On The Vesting Of RSUs (Detail)	6 Months Ended	12 Months Ended
	Jun. 30, 2022 CAD ($)	Dec. 31, 2021 CAD ($) shares	Dec. 31, 2020 CAD ($) shares	Dec. 31, 2019 CAD ($) shares
Disclosure Of Number And Weighted Average Exercise Prices Of Other Equity Instruments [Line Items]
Balance – Beginning of period	208,674	222,222	151,790
Granted		73,164	123,797
Exercised | shares		(71,190)	(35,877)
Forfeited		(7,074)	(3,332)
Withheld		(8,448)	(14,156)
Balance – Ending of period		208,674	222,222	151,790
Exercisable		115,468	33,516
Restricted Share Units [Member]
Disclosure Of Number And Weighted Average Exercise Prices Of Other Equity Instruments [Line Items]
Balance – Beginning of period	208,674		151,790	101,778
Granted	98,417			71,640
Exercised	(17,585)			(11,905)
Forfeited	(35,893)			(9,723)
Balance – Ending of period	253,613	208,674		151,790
Exercisable	108,992			32,036

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Share-Based Payment Arrangements - Summary Of Company's Obligation To Issue Shares On The Vesting Of RSUs (Parenthetical) (Detail)	6 Months Ended	12 Months Ended
	Jun. 30, 2022 CAD ($) $ / shares	Dec. 31, 2021 shares $ / shares	Dec. 31, 2020 shares	Dec. 31, 2019 shares
Disclosure Of Number And Weighted Average Exercise Prices Of Other Equity Instruments [Line Items]
Number of other equity instruments exercised or vested in share-based payment arrangement | shares		71,190	35,877
Restricted Share Units [Member]
Disclosure Of Number And Weighted Average Exercise Prices Of Other Equity Instruments [Line Items]
Number of other equity instruments exercised or vested in share-based payment arrangement	17,585			11,905
Number of other equity instruments exercised	17,585	79,638
Weighted average exercise price of other equity instruments exercised in share based payment arrangement | $ / shares	$ 7.53	$ 8.87
Issued capital [member]
Disclosure Of Number And Weighted Average Exercise Prices Of Other Equity Instruments [Line Items]
Number of other equity instruments exercised or vested in share-based payment arrangement	17,585	71,190

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Share-Based Payment Arrangements - Additional Information (Detail)	6 Months Ended	12 Months Ended
	Jun. 30, 2022 CAD ($) yr $ / shares	Dec. 31, 2021 CAD ($) yr $ / shares	Dec. 31, 2021 CAD ($) $ / shares	Dec. 31, 2020 CAD ($) yr $ / shares	Dec. 31, 2020 CAD ($) $ / shares	Dec. 31, 2019 CAD ($) yr	Dec. 31, 2019 CAD ($) $ / shares	Jun. 30, 2022 $ / shares	Dec. 31, 2021 $ / shares	Dec. 31, 2020 $ / shares	Dec. 31, 2019 $ / shares
Statements [Line Items]
Percentage of issued and outstanding shares reserved for issuance under the Plan		10.00%	10.00%
Proceeds from exercise of options				$ 70,000		$ 543,249
Unrecognized share based compensation expense related to unvested stock options granted		$ 1,824,812	$ 1,824,812	$ 710,934	$ 710,934	$ 1,061,013	$ 1,061,013
Information about how expected volatility was determined, share options granted		Expected volatility is based on an evaluation of the historical volatility of the Company’s share prices since the Company commenced trading which is a reasonable approximation of the volatility over the expected term
Unrecognized share based compensation expense related to unvested other equity instruments granted	$ 1,202,934	$ 1,824,812	$ 1,824,812
Share based compensation by share based award options exercisable	263,202	275,473	275,473	161,244	161,244	17,014	17,014
Share based compensation by share based award options excercisable weighted average exercise price | $ / shares								$ 10.94	$ 11.1	$ 11.7	$ 12.87
Grant date share price | $ / shares	$ 4.7		$ 7		$ 8.93		$ 10.88
Exercise price | $ / shares	$ 4.7		$ 7.1		$ 9.74		11.13
Risk-free rate	2.23%	1.32%		0.36%		1.57%
Expected life, years | yr	6.5	6.2		5		3.9
Expected volatility	74.00%	75.00%		66.00%		54.00%
Forfeiture rate	10.00%	7.00%				10.00%
Expected dividends	0.00%
Bottom of range [member] | Exercise Price Range Three Point Four Six To Eighteen Point Zero Two [Member]
Statements [Line Items]
Exercise price of outstanding share options | $ / shares								3.46
Top of range [member] | Exercise Price Range Three Point Four Six To Eighteen Point Zero Two [Member]
Statements [Line Items]
Exercise price of outstanding share options | $ / shares								$ 18.02
Each Anniversary Date Over Three Years [Member]
Statements [Line Items]
Share based payment arrangement, Vesting right percentage		33.00%	33.00%
Stock Options [Member]
Statements [Line Items]
Description of maximum term of options granted for share based payment arrangement		10
Description of vesting requirements for share based payment arrangement		vest as to 33% on each anniversary date of the date of grant
Number of months determining vested options exercisable		3 months
Weighted average share price | (per share)	$ 2.88	$ 4.25		$ 4.54			$ 4.91
Weighted average fair value of share options granted	$ 482,514	$ 2,061,007	$ 2,061,007	$ 698,949	$ 698,949	$ 1,597,043	$ 1,597,043
Description of option pricing model, share options granted	Black-Scholes model	Black-Scholes model
Stock Options [Member] | Each Of The Three One Year Anniversaries Of The Date Of Grant [Member]
Statements [Line Items]
Share based payment arrangement, Vesting right percentage		33.00%	33.00%
Stock Options [Member] | If All Exercisable Options Were Exercised [Member]
Statements [Line Items]
Proceeds from exercise of options		$ 3,057,750		1,886,555		1,206,687
Restricted Share Units [Member]
Statements [Line Items]
Description of vesting requirements for share based payment arrangement		RSUs have various terms ranging from immediate vesting to vesting on either the first, second or third anniversary of the grant date, or as to 33% on each anniversary date of the grant over three years.
Information about how expected volatility was determined, share options granted	The fair value of each RSU is based on the market price of the Company’s common shares on the date of grant	The fair value of each RSU is based on the market price of the Company’s common shares on the date of grant
Conversion basis		one
Weighted average fair value at measurement date, Other equity instruments granted	$ 491,999	$ 528,028	$ 528,028	1,069,042	1,069,042	829,976	829,976
Unrecognized share based compensation expense related to unvested other equity instruments granted	$ 310,434	$ 277,686	$ 277,686	$ 807,830	$ 807,830	$ 702,373	$ 702,373

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Non-Controlling Interest - Additional Information (Detail) - Subsidiaries with material non-controlling interests [member] - Agnity Global Inc [Member]		6 Months Ended	12 Months Ended
	Apr. 30, 2019	Jun. 30, 2022	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Disclosure of Subsidiaries with Material Non controlling Interests [Line Items]
Proportion of ownership interests held by non-controlling interests	100.00%	100.00%	100.00%	100.00%
Percentage change in non controlling interest percentage			0.00%	0.00%	0.00%

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Non-Controlling Interest - Summary of Information Relating to Agnity, Before Any Intercompany Eliminations (Detail) - CAD ($)		3 Months Ended		6 Months Ended		12 Months Ended
	Apr. 30, 2019	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Disclosure of Subsidiaries with Material Non controlling Interests [Line Items]
Current assets		$ 19,610,810		$ 19,610,810		$ 21,907,442	$ 15,195,235
Non-current assets		53,086,679		53,086,679		50,199,007	62,123,576
Current liabilities		(63,665,369)		(63,665,369)		(64,015,619)	(28,247,937)
Revenue		2,269,026	$ 6,556,463	6,698,629	$ 13,992,029	25,596,972	26,928,439	$ 18,340,249
(Loss) income allocated to NCI		(3,560,047)	(70,099)	(4,805,598)	449,017	63,387	1,586,588	590,056
Total comprehensive (loss) income attributable to NCI		(3,525,745)	$ 11,406	(4,752,209)	670,562	202,042	1,746,337	766,767
Cash flows (used in) provided by operating activities				(16,149,906)	(12,954,894)	(28,329,771)	(24,855,800)	(15,988,223)
Cash flows used in investing activities				(35,935)	(774,339)	(1,063,927)	(6,395,154)	(20,732,153)
Cash flows (used in) provided by financing activities				16,026,601	19,168,656	32,926,878	31,856,797	35,936,694
Foreign exchange impact on cash held in USD				$ (22,869)	(20,604)	(56,012)	(24,144)	(12,922)
Subsidiaries with material non-controlling interests [member]
Disclosure of Subsidiaries with Material Non controlling Interests [Line Items]
Current assets						11,906,502	7,778,252
Non-current assets						5,111,714	8,081,135
Current liabilities						(8,752,552)	(7,107,244)
Non-current liabilities						(5,598,783)	(6,185,049)
Net assets (liabilities) attributable to NCI						$ 2,666,881	$ 2,567,094
Subsidiaries with material non-controlling interests [member] | Agnity Global Inc [Member]
Disclosure of Subsidiaries with Material Non controlling Interests [Line Items]
NCI percentage	100.00%			100.00%		100.00%	100.00%
Current assets		8,923,871		$ 8,923,871		$ 11,906,502
Non-current assets		4,512,625		4,512,625		5,111,714
Current liabilities		(11,141,684)		(11,141,684)		(8,752,552)
Non-current liabilities		(4,510,938)		(4,510,938)		(5,598,783)
Net assets (liabilities) attributable to NCI		$ (2,216,126)		(2,216,126)		2,666,881
Revenue				1,761,613	6,010,328	11,966,226	$ 11,548,811	6,010,753
(Loss) income allocated to NCI				(4,805,598)	449,017	63,387	1,586,588	590,056
Other comprehensive income allocated to NCI				53,389	221,545	138,655	159,749	176,711
Total comprehensive (loss) income attributable to NCI				(4,752,209)	670,562	202,042	1,746,337	766,767
Cash flows (used in) provided by operating activities				(209,162)	1,396,859	(1,859,900)	(405,548)	483,245
Cash flows used in investing activities				(8,790)	(309,586)	(578,483)		(3,731)
Cash flows (used in) provided by financing activities				90,633	(387,222)	2,081,137	655,347	(417,068)
Foreign exchange impact on cash held in USD				125	15,283	(6,383)	155,274	5,976
Net (decrease) increase in cash and cash equivalents				$ (127,194)	$ 715,334	$ (363,629)	$ 405,073	$ 68,422

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Finance Costs - Summary Of Finance Cost (Detail) - CAD ($)	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021	Dec. 31, 2021		Dec. 31, 2020	Dec. 31, 2019
Gains (losses) on litigation settlements [abstract]
Interest on loans and borrowings (Note 12)	$ 734,854	$ 286,144	$ 1,131,557	$ 533,508	$ 1,179,234		$ 1,272,512	$ 918,682
Interest on convertible debentures (Note 14)	1,126,304	1,592,597	2,454,350	3,105,233	5,740,346		4,410,206	2,130,247
Interest on lease liabilities (Note 8)					137,245		350,792	168,571
Transaction costs expensed	229,716	87,070	248,645	454,574	1,471,219	[1]
Other finance costs	20,751	(94,404)	52,661	(65,656)	90,750
Total finance costs	$ 2,229,993	$ 1,946,586	$ 4,088,630	$ 4,182,513	$ 8,618,794		$ 6,033,510	$ 3,217,500

[1] Transaction costs include costs incurred associated with financing or equity transactions that are not otherwise netted against the debt or equity instrument. The majority of costs are associated with the USD brokered public offering (Note 19(a)), the 2021 Debentures (Note 14(b)), the Fiera term loan amendment (Note 12) and the ATB facility amendment (Note 13). See Note 31 (a) and (b) for subsequent changes to Fiera loan.

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Fair Value Loss (Gain) On Derivatives - Summary Of Gains Losses On Change In Fair Value Of Derivatives (Detail) - CAD ($)		3 Months Ended				6 Months Ended				12 Months Ended
		Jun. 30, 2022		Jun. 30, 2021		Jun. 30, 2022		Jun. 30, 2021		Dec. 31, 2021
Gains (losses) on financial instruments [abstract]
Gain on embedded derivatives		$ 32,519	[1]	$ 1,107,784	[1]	$ 32,519	[1]	$ 1,164,059	[1]	$ (784,261)	[2]
Deferred charge loss				5,322	[1]			(1,615,102)	[1]	1,615,102	[2]
Loss on substantial modification and conversion	[2]									8,571,881
Gain on warrant liability remeasurement (Note 15)		2,505,810	[3]			4,999,080	[3]			(3,362,601)	[4]
Total		$ (2,538,329)		$ (1,113,106)		$ (5,031,599)		$ 451,043		$ 6,040,121

[1] Associated with the 2021 Debentures. Transactions detailed in the 2021 Annual Financial Statements.

[2] Associated with the 2021 Debentures (Note 14(b)) of which the majority is realized at December 31, 2021.

[3] Unrealized change in fair value (Note 11).

[4] Change in fair value unrealized (Note 26).

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Other Income - Summary Of Other Income Explanatory (Detail) - CAD ($)	3 Months Ended				6 Months Ended				12 Months Ended
	Jun. 30, 2022		Jun. 30, 2021		Jun. 30, 2022		Jun. 30, 2021		Dec. 31, 2021		Dec. 31, 2020		Dec. 31, 2019
Gains (losses) on disposals of investments [abstract]
Government assistance	$ (258,296)	[1]	$ (941,369)	[1]	$ (637,942)	[1]	$ (2,117,743)	[1]	$ (4,201,822)	[2]	$ (2,775,677)	[2]
Government loan forgiveness			181,770				299,082		(1,825,237)	[3]	(124,507)	[3]
Derecognition of contingent consideration			8,855				(572,262)		(1,010,024)
Other	5,728		40,718		24,350		76,221		(89,014)		(32,158)		$ (167,913)
Total other income	$ (264,024)		$ (1,155,002)		$ (662,292)		$ (3,065,308)		$ (7,126,097)		$ (2,932,342)		$ (167,913)

[1] Majority of government assistance are grants from the Canadian Government for wage and rental subsidies.

[2] Majority represents amounts received from the Canadian Government for wage and rental subsidies associated with COVID-19. The amount of government assistance available is dependent on the programs in place and the Company’s eligibility for these programs.

[3] Includes other income recognized as below market interest rate benefit.

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Income Taxes - Additional Information (Detail) $ in Millions	12 Months Ended
	Dec. 31, 2021 USD ($)	Dec. 31, 2021 CAD ($)	Dec. 31, 2020 USD ($)	Dec. 31, 2020 CAD ($)
Income Tax [Line Items]
Net operating losses, Carryforwards	$ 60,837,326.0		$ 44.1
Non capital losses, Carryforwards		$ 70,204,681,000,000		$ 49,600,000
Temporary differences associated with investments in subsidiaries, branches and associates and interests in joint arrangements for which deferred tax liabilities have not been recognised		0
Net Operating Losses [member]
Income Tax [Line Items]
Description of expiry date of deductible temporary differences, unused tax losses and unused tax credits	2029
Non Capital Losses [member]
Income Tax [Line Items]
Description of expiry date of deductible temporary differences, unused tax losses and unused tax credits	2027
Foreign Tax Losses [member]
Income Tax [Line Items]
Description of expiry date of deductible temporary differences, unused tax losses and unused tax credits	expiry dates ranging from five years to indefinite life
Foreign tax losses, Carryforwards		2,307,882,000,000		1,200,000
Investment tax credits and research and development expenditures [member]
Income Tax [Line Items]
Description of expiry date of deductible temporary differences, unused tax losses and unused tax credits	2022
Investment tax credit, Carryforwards		$ 500,000,000,000		$ 500,000,000,000

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Income Taxes - Summary of Amounts Recognized in Net Loss (Detail) - CAD ($)	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Current tax expense
Current year	$ (184,181)	$ 240,562	$ 104,682	$ 479,359	$ 157,303	$ (295,709)	$ 181,895
Current tax expense (income) and adjustments for current tax of prior periods					157,303	(295,709)	181,895
Deferred tax expense (recovery)
Deferred tax expense (income)					(1,822,109)	(668,209)	(2,692,313)
Tax expense (recovery)					(1,664,806)	(963,918)	(2,510,418)
Adjustment in prior years [member]
Deferred tax expense (recovery)
Change in unrecognized deferred income tax assets					11,339,580	10,076,594	3,569,361
Currently reported [member]
Current tax expense
Current year					157,303	(295,709)	181,895
Deferred tax expense (recovery)
Origination and reversal of temporary differences					$ (13,161,689)	$ (10,744,803)	$ (6,261,674)

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Income Taxes - Summary of Reconciliation of Effective Tax Rate (Detail) - CAD ($)		3 Months Ended		6 Months Ended		12 Months Ended
		Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Statements [Line Items]
Loss before taxes		$ 12,387,308	$ 9,132,449	$ 24,012,382	$ 18,764,485	$ 46,364,119	$ 35,824,881	$ 30,405,252
Tax expense (recovery)						(1,664,806)	(963,918)	(2,510,418)
Canadian [member]
Statements [Line Items]
Loss before taxes						$ (46,364,119)	$ (35,824,882)	$ (30,405,252)
Statutory income tax rate	[1]					27.00%	27.00%	27.00%
Income tax recovery at statutory rate						$ (12,518,312)	$ (9,672,718)	$ (8,209,418)
Change in deferred tax assets not recognized						11,339,580	10,076,594	3,569,361
Foreign tax rate and other foreign tax differences						(2,089,761)	(2,293,503)	(1,015,536)
Change in enacted rates						608,064	(58,050)
Share issuance costs and other						(828,082)	126,247	49,210
Non-deductible transaction costs						38,776	424,828	2,664,789
Other non-deductible items						1,784,929	432,684	431,176
Tax expense (recovery)						$ (1,664,806)	$ (963,918)	$ (2,510,418)

[1] Comprised of the Canadian Federal effective corporate tax rate of 15.0% and blended provincial tax rates.

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Income Taxes - Summary of Reconciliation of Effective Tax Rate Parenthetical (Detail)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Canadian Federal Effective Corporate Tax Rate [member]
Income Tax [Line Items]
Applicable tax rate	15.00%	15.00%	15.00%

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Income Taxes - Summary of significant components of the Company's deferred income tax asset (liabilities) (Detail) - CAD ($)	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Reconciliation Of Changes In Deferred Tax Liability Asset [Line Items]
Balance in beginning			$ (2,291,057)	$ (4,168,905)	$ (4,168,905)	$ (3,854,615)
Acquired in business combinations						(1,136,805)
Recovery/ (expense) through earnings	$ 591,418	$ 372,600	1,482,234	491,824	1,822,109	668,209	$ 2,692,313
Recovery/ (expense) through equity						24,000
Recovery/ (expense) through OCI					55,739	130,306
Balance in ending					(2,291,057)	(4,168,905)	(3,854,615)
Property, plant and equipment [member]
Reconciliation Of Changes In Deferred Tax Liability Asset [Line Items]
Balance in beginning			68,259	261,661	261,661
Acquired in business combinations						(376)
Recovery/ (expense) through earnings					(195,977)	263,436
Recovery/ (expense) through OCI					2,575	(1,399)
Balance in ending					68,259	261,661
Intangible assets other than goodwill [member]
Reconciliation Of Changes In Deferred Tax Liability Asset [Line Items]
Balance in beginning			(3,523,184)	(5,012,355)	(5,012,355)	(5,321,008)
Acquired in business combinations						(1,136,429)
Recovery/ (expense) through earnings					1,415,370	1,280,692
Recovery/ (expense) through OCI					73,801	164,390
Balance in ending					(3,523,184)	(5,012,355)	(5,321,008)
Loans And Accrued Liabilities [Member]
Reconciliation Of Changes In Deferred Tax Liability Asset [Line Items]
Balance in beginning			(245,012)	(1,714,850)	(1,714,850)	(1,696,435)
Recovery/ (expense) through earnings					1,471,654	(41,233)
Recovery/ (expense) through equity						24,000
Recovery/ (expense) through OCI					(1,816)	(1,182)
Balance in ending					(245,012)	(1,714,850)	(1,696,435)
Share Issuance Costs [Member]
Reconciliation Of Changes In Deferred Tax Liability Asset [Line Items]
Balance in beginning			52,920	27,453	27,453
Recovery/ (expense) through earnings					25,467	27,453
Balance in ending					52,920	27,453
Foreign Exchange [Member]
Reconciliation Of Changes In Deferred Tax Liability Asset [Line Items]
Balance in beginning			(6,741)	0	0	(39,533)
Recovery/ (expense) through earnings					(6,765)	39,533
Recovery/ (expense) through OCI					24
Balance in ending					(6,741)	0	(39,533)
Non-capital losses/net operating losses [Member]
Reconciliation Of Changes In Deferred Tax Liability Asset [Line Items]
Balance in beginning			$ 1,362,701	$ 2,269,186	2,269,186	3,202,361
Recovery/ (expense) through earnings					(887,640)	(901,672)
Recovery/ (expense) through OCI					(18,845)	(31,503)
Balance in ending					$ 1,362,701	$ 2,269,186	$ 3,202,361

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Income Taxes - Summary of Deferred Tax Assets Not Recognized and Tax Losses Carried Forward (Detail) - CAD ($)	Dec. 31, 2021	Dec. 31, 2020
Income Tax [Line Items]
Deductible Temporary Differences and Unused Tax Losses for Which No Deferred Tax Assets Recognised	$ 161,700,881	$ 112,443,109
Net operating losses - United States [Member]
Income Tax [Line Items]
Unused tax losses for which no deferred tax asset recognised	77,415,498	55,395,751
Non-capital losses - Canada [Member]
Income Tax [Line Items]
Unused tax losses for which no deferred tax asset recognised	68,018,286	45,619,846
Foreign tax losses [Member]
Income Tax [Line Items]
Unused tax losses for which no deferred tax asset recognised	157,602	865,599
Investment tax credits and research and development expenditures [Member]
Income Tax [Line Items]
Unused tax losses for which no deferred tax asset recognised	6,603,163	6,603,287
Property and equipment [Member]
Income Tax [Line Items]
Deductible temporary differences for which no deferred tax asset is recognised	948,765	753,467
Share issuance costs [Member]
Income Tax [Line Items]
Deductible temporary differences for which no deferred tax asset is recognised	6,510,677	1,282,965
Other [Member]
Income Tax [Line Items]
Deductible Temporary Differences and Unused Tax Losses for Which No Deferred Tax Assets Recognised	$ 2,046,890	$ 1,922,194

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Financial Instruments and Financial Risk Management - Summary of Detailed Information about Carrying Values of Financial Assets and Liabilities Measured (Detail) - CAD ($)	Jun. 30, 2022		Dec. 31, 2021		Dec. 31, 2020
Disclosure of detailed information about financial instruments [line items]
Financial assets	$ 16,898,162		$ 19,658,269		$ 15,002,578
Financial liabilities	85,088,411		62,104,815		59,689,267
Amortized cost at financial liabilities [member] | Bank indebtedness [member]
Disclosure of detailed information about financial instruments [line items]
Financial liabilities	3,679,631		3,460,109		976,779
Amortized cost at financial liabilities [member] | Trade payables and accrued liabilities [member]
Disclosure of detailed information about financial instruments [line items]
Financial liabilities	15,784,541	[1]	12,003,979	[1],[2]	12,693,256	[2]
Amortized cost at financial liabilities [member] | Loans and borrowings [member]
Disclosure of detailed information about financial instruments [line items]
Financial liabilities	29,985,807		13,215,601		13,152,300
Amortized cost at financial liabilities [member] | Lease liabilities [member]
Disclosure of detailed information about financial instruments [line items]
Financial liabilities	7,678,618		1,045,472	[3]	3,945,076	[3]
Amortized cost at financial liabilities [member] | 2019 Debentures - host liability [member]
Disclosure of detailed information about financial instruments [line items]
Financial liabilities	23,457,500		22,185,170	[4]	19,534,988	[4]
Amortized cost at financial liabilities [member] | 2021 Debentures - host liability [member]
Disclosure of detailed information about financial instruments [line items]
Financial liabilities	75,491		69,034	[5]	0	[5]
Amortized cost at financial liabilities [member] | Business acquisition payable [member]
Disclosure of detailed information about financial instruments [line items]
Financial liabilities			1,398,972		2,439,529
Amortized cost at financial liabilities [member] | Other liabilities [member]
Disclosure of detailed information about financial instruments [line items]
Financial liabilities			0		6,236,415
FVTPL at financial liabilities [member] | 2021 Debentures embedded derivative [member]
Disclosure of detailed information about financial instruments [line items]
Financial liabilities	9,600		41,506		0
FVTPL at financial liabilities [member] | Warrant liability - business acquisition [member]
Disclosure of detailed information about financial instruments [line items]
Financial liabilities			709,835		710,924
FVTPL at financial liabilities [member] | Warrant Liabilities Derivatives [Member]
Disclosure of detailed information about financial instruments [line items]
Financial liabilities	3,017,643		7,975,137		0
FVTPL at financial liabilities [member] | Business acquisition payable [member]
Disclosure of detailed information about financial instruments [line items]
Financial liabilities	1,399,580		1,398,972
Amortized cost at financial assets [member] | Cash and cash equivalents [member]
Disclosure of detailed information about financial instruments [line items]
Financial assets	4,405,948		4,588,057		1,110,889
Amortized cost at financial assets [member] | Trade and other receivables [member]
Disclosure of detailed information about financial instruments [line items]
Financial assets	11,783,456	[1]	14,329,781	[1],[2]	11,224,017	[2]
Amortized cost at financial assets [member] | Long-term receivables [member]
Disclosure of detailed information about financial instruments [line items]
Financial assets	$ 708,758		740,431		2,536,272
FVTPL at financial assets [member] | Derivative asset [member]
Disclosure of detailed information about financial instruments [line items]
Financial assets			$ 0		$ 131,400

[1] Excludes amounts for indirect taxes, income taxes and contract assets, where applicable.

[2] 1 Excludes amounts for indirect taxes, income taxes and contract asset, where applicable. Note 27 describes credit risk associated with trade receivables including reconciliation of expected credit loss allowance.

[3] 2 Lease liabilities are not subject to classification in the fair value hierarchy.

[4] 3 2019 Debentures (Note 14(a)) and 2021 Debentures host liability (Note 14(b)).

[5] 3 2019 Debentures (Note 14(a)) and 2021 Debentures host liability (Note 14(b)).

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Financial Instruments and Financial Risk Management - Additional Information (Detail)	3 Months Ended		6 Months Ended			12 Months Ended
	Jun. 30, 2022 CAD ($)	Jun. 30, 2021 CAD ($)	Jun. 30, 2022 CAD ($)	Jun. 30, 2022 USD ($)	Jun. 30, 2021 CAD ($)	Dec. 31, 2021 CAD ($) yr	Dec. 31, 2020 CAD ($)	Dec. 31, 2019 CAD ($)	Dec. 31, 2021 USD ($)
Disclosure of detailed information about financial instruments [line items]
Transfers out of level 3 related to liabilities			$ 0
Debentures outstanding						$ 22,295,710	$ 19,534,988
Convertible debentures	$ 85,091		85,091			110,540	19,534,988
Variable lease payments 1						1,012,555
Assets	72,697,489		72,697,489			72,106,449	77,318,811
Liabilities	91,288,088		91,288,088			67,819,676	65,860,292
Net loss for the year	(11,611,709)	$ (9,000,411)	(22,634,830)		$ (18,752,020)	(44,699,313)	(34,860,963)	$ (27,894,834)
Note [member]
Disclosure of detailed information about financial instruments [line items]
Proceeds from non-current borrowings				$ 15,000,000
New Premise Leases [member]
Disclosure of detailed information about financial instruments [line items]
Lease obligation			10,200,000
Variable lease payments 1			8,600,000
Two Thousand and Twenty One Convertible Debentures [Member]
Disclosure of detailed information about financial instruments [line items]
Debentures outstanding						69,034
Convertible debentures						110,540
Liquidity risk [member]
Disclosure of detailed information about financial instruments [line items]
Convertible debentures							710,924
Currency risk [member]
Disclosure of detailed information about financial instruments [line items]
Assets	12,015,544		12,015,544			14,554,193	8,291,005
Liabilities	$ 32,282,233		$ 32,282,233			$ 11,685,160	16,398,521
Average foreign exchange rate			5	5		5
Net loss for the year			$ 1,013,334			$ 143,452	405,376
2021 Debentures - host liability [member]
Disclosure of detailed information about financial instruments [line items]
Transefrs into level 3 related to debentures						5,285,997
Transfers out of level 3 related to liabilities						$ 0
2021 Debentures - host liability [member] | Liquidity risk [member]
Disclosure of detailed information about financial instruments [line items]
Debentures outstanding									$ 75,000
2019 Debentures - host liability [member] | Discount rate, measurement input [member]
Disclosure of detailed information about financial instruments [line items]
Significant unobservable input liabilities						25			25
Non-recurring fair value measurement [member]
Disclosure of detailed information about financial instruments [line items]
Financial assets at fair value						$ 0	0
Financial liabilities at fair value						$ 0	$ 0

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Capital and Risk Management - Additional Information (Detail)	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2022 CAD ($)	Jun. 30, 2021 CAD ($)	Jun. 30, 2022 CAD ($)	Jun. 30, 2021 CAD ($)	Dec. 31, 2021 CAD ($) yr	Dec. 31, 2020 CAD ($)	Dec. 31, 2019 CAD ($)	Dec. 31, 2018 CAD ($)
Disclosure of risk management strategy related to hedge accounting [line items]
Assets	$ 72,697,489		$ 72,697,489		$ 72,106,449	$ 77,318,811
Liabilities	91,288,088		91,288,088		67,819,676	65,860,292
Net loss	(11,611,709)	$ (9,000,411)	(22,634,830)	$ (18,752,020)	(44,699,313)	(34,860,963)	$ (27,894,834)
Cash and cash equivalents	4,405,948	$ 6,529,708	4,405,948	$ 6,529,708	4,588,057	1,110,889	$ 529,190	$ 1,325,794
Working Capital Deficit	44,054,559		44,054,559		42,108,177
Current assets	19,610,810		19,610,810		21,907,442	15,195,235
Current liabilities	63,665,369		63,665,369		64,015,619	28,247,937
Liquidity risk [member]
Disclosure of risk management strategy related to hedge accounting [line items]
Cash and cash equivalents					4,588,057	1,110,889
Working Capital Deficit					42,108,177	13,052,702
Current assets					6,712,207
Current liabilities					35,767,682
Currency risk [member]
Disclosure of risk management strategy related to hedge accounting [line items]
Assets	12,015,544		12,015,544		14,554,193	8,291,005
Liabilities	$ 32,282,233		32,282,233		11,685,160	16,398,521
Net loss			$ 1,013,334		$ 143,452	$ 405,376
Average foreign exchange rate			5		5
Credit risk [member]
Disclosure of risk management strategy related to hedge accounting [line items]
Loss rate					1.00%

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Capital and Risk Management - Sumamry of Carrying Values of Financial Liabilities And Contratual Undiscounted Cash Flows (Detail) - CAD ($)		Jun. 30, 2022	Dec. 31, 2021		Dec. 31, 2020
Disclosure of maturity analysis for non-derivative financial liabilities [line items]
Bank indebtedness, Carrying Amount			$ 3,460,109	[1]	$ 976,779
Trade payables and accrued liabilities, Carrying Amount		$ 16,343,347	12,421,309		12,924,256
Loans and borrowings, Carrying Amount		29,985,807	13,215,601	[2],[3]	13,152,300	[3]
Lease liabilities, Carrying Amount		7,678,618	1,045,472	[4]
2019 Debentures, Carrying Amount		23,457,500	22,185,170		0
2021 Debentures, Carrying Amount		85,091	110,540		19,534,988
Warrant liabilities, Carrying Amount		3,017,643	8,880,038		710,924
Business acquisition payable, Carrying Amount		1,399,580	1,398,972		1,594,297
Other liabilities, Carrying Amount					6,236,415
Financial Liabilities		85,088,411	62,104,815		59,689,267
Bank indebtedness, Undiscounted Contractual Cash Flows	[1]		3,460,109
Warrant Liability,Undiscounted Contractual Cash Flows	[5]		709,835
Liquidity risk [member]
Disclosure of maturity analysis for non-derivative financial liabilities [line items]
Bank indebtedness, Carrying Amount					976,779
Trade payables and accrued liabilities, Carrying Amount			12,421,309		12,924,256
Loans and borrowings, Carrying Amount					13,152,300
Lease liabilities, Carrying Amount					3,945,076
2021 Debentures, Carrying Amount					710,924
Warrant liabilities, Carrying Amount					2,439,529
Business acquisition payable, Carrying Amount			1,398,972
Other liabilities, Carrying Amount					6,236,415
Financial Liabilities			62,717,211		59,920,267
Bank indebtedness, Undiscounted Contractual Cash Flows					976,779
Trade payables and accrued liabilities, Undiscounted Contractual Cash Flows			12,421,309		12,924,256
Loans and Borrowings,undiscounted contractual cash flows			12,549,820	[2]	15,662,551
Lease liabilities, Undiscounted Contractual Cash Flows			1,235,028	[4]	4,886,331
Warrant Liability,Undiscounted Contractual Cash Flows					710,924
Business Acquisition Payable,Undiscounted Contractual Cash Flows			1,398,972		2,439,529
Other Liabilities,Undiscounted Contractual Cash Flows					6,236,415
Non-derivative financial liabilities, undiscounted cash flows			56,516,156		70,817,190
Liquidity risk [member] | 2019 Debentures
Disclosure of maturity analysis for non-derivative financial liabilities [line items]
2019 Debentures, Carrying Amount			22,185,170		19,534,988
Loans And Debentures Issued,Undiscounted Contractual Cash Flows			24,630,375		26,980,405
Liquidity risk [member] | 2021 Debentures
Disclosure of maturity analysis for non-derivative financial liabilities [line items]
2021 Debentures, Carrying Amount			110,540
Loans And Debentures Issued,Undiscounted Contractual Cash Flows			110,708
Less than 1 year
Disclosure of maturity analysis for non-derivative financial liabilities [line items]
Trade payables and accrued liabilities, Carrying Amount		$ 16,343,347	12,421,309
Less than 1 year | Liquidity risk [member]
Disclosure of maturity analysis for non-derivative financial liabilities [line items]
Bank indebtedness, Undiscounted Contractual Cash Flows					976,779
Trade payables and accrued liabilities, Undiscounted Contractual Cash Flows			12,421,309		12,924,256
Loans and Borrowings,undiscounted contractual cash flows			11,763,697	[2]	4,248,351
Lease liabilities, Undiscounted Contractual Cash Flows			521,506	[4]	1,131,528
Warrant Liability,Undiscounted Contractual Cash Flows					710,924
Business Acquisition Payable,Undiscounted Contractual Cash Flows			1,398,972		1,594,297
Other Liabilities,Undiscounted Contractual Cash Flows					6,003,838
Non-derivative financial liabilities, undiscounted cash flows			54,913,438		29,940,723
Less than 1 year | Liquidity risk [member] | 2019 Debentures
Disclosure of maturity analysis for non-derivative financial liabilities [line items]
Loans And Debentures Issued,Undiscounted Contractual Cash Flows			24,630,375		2,350,750
Less than 1 year | Liquidity risk [member] | 2021 Debentures
Disclosure of maturity analysis for non-derivative financial liabilities [line items]
Loans And Debentures Issued,Undiscounted Contractual Cash Flows			7,635
1 - 2 years | Liquidity risk [member]
Disclosure of maturity analysis for non-derivative financial liabilities [line items]
Loans and Borrowings,undiscounted contractual cash flows			786,123	[2]	2,617,443
Lease liabilities, Undiscounted Contractual Cash Flows			534,241	[4]	939,108
Business Acquisition Payable,Undiscounted Contractual Cash Flows					845,232
Other Liabilities,Undiscounted Contractual Cash Flows					232,577
Non-derivative financial liabilities, undiscounted cash flows			1,423,437		29,264,015
1 - 2 years | Liquidity risk [member] | 2019 Debentures
Disclosure of maturity analysis for non-derivative financial liabilities [line items]
Loans And Debentures Issued,Undiscounted Contractual Cash Flows					24,629,655
1 - 2 years | Liquidity risk [member] | 2021 Debentures
Disclosure of maturity analysis for non-derivative financial liabilities [line items]
Loans And Debentures Issued,Undiscounted Contractual Cash Flows			103,073
> 2 years | Liquidity risk [member]
Disclosure of maturity analysis for non-derivative financial liabilities [line items]
Loans and Borrowings,undiscounted contractual cash flows					8,796,757
Lease liabilities, Undiscounted Contractual Cash Flows			179,281	[4]	2,815,695
Non-derivative financial liabilities, undiscounted cash flows			$ 179,281		$ 11,612,452

[1] No contractual maturity. Excludes interest charged on facility as detailed in Note 13.

[2] Includes term loan with a carrying value of $9,275,683 classified as current due to covenant breach. Assuming term loan is repaid in accordance with agreement to maturity, the undiscounted contractual cash flows for loans and borrowings would be $2,933,739, $5,472,193, and $4,143,888 , respectively for the periods presented above.

[3] Note 30(b) includes the reconciliation of movements of liabilities to cash flows arising from financing activities.

[4] Variable costs due under leases not included in this amount. Minimum payment related to leases which have not yet commenced are not included in this amount. See Note 29.

[5] Majority of liability will be settled by issuing common shares of the Company when warrants are exercised during the year. The remaining amount may be settled in cash or common shares of Agnity (Note 15).

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Capital and Risk Management - Sumamry of Carrying Values of Financial Liabilities And Contratual Undiscounted Cash Flows (Parenthetical) (Detail) - CAD ($)	Jun. 30, 2022	Dec. 31, 2021	Dec. 31, 2020
Disclosure of risk management strategy related to hedge accounting [line items]
Current portion of loans and borrowings	$ 10,399,574	$ 12,447,939	$ 3,431,251
Liquidity risk [member] | Term Loan [Member]
Disclosure of risk management strategy related to hedge accounting [line items]
Current portion of loans and borrowings		9,275,683
Liquidity risk [member] | Term Loan [Member] | Not later than one year [member]
Disclosure of risk management strategy related to hedge accounting [line items]
Loans and Borrowings,undiscounted contractual cash flows		2,933,739
Liquidity risk [member] | Term Loan [Member] | Later than one year and not later than two years [member]
Disclosure of risk management strategy related to hedge accounting [line items]
Loans and Borrowings,undiscounted contractual cash flows		5,472,193
Liquidity risk [member] | Term Loan [Member] | Later Than Two Years [Member]
Disclosure of risk management strategy related to hedge accounting [line items]
Loans and Borrowings,undiscounted contractual cash flows		$ 4,143,888

XML

Capital and Risk Management - Disclosure Of Movement In The Expected Credit Loss Allowance Related To Trade Receivables and Long Term Receivables (Detail) - Trade receivables and long term receivables [Member] - CAD ($)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Reconciliation of changes in allowance account for credit losses of financial assets [abstract]
Beginning balance	$ 606,030	$ 382,901
Increase in loss allowance	1,162,537	443,961
Amounts written off during the year as uncollectible	(65,930)	(220,832)
Effects of movement in exchange rates	4,581
Total	$ 1,707,218	$ 606,030

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Related Party Transactions - Summary of Transactions Between Related Parties (Detail) - CAD ($)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Disclosure of transactions between related parties [line items]
Amount due to related parties	$ 1,834,307	$ 2,419,377
Key management personnel of entity or parent [member]
Disclosure of transactions between related parties [line items]
Salaries, management and directors' fees	1,613,502	1,683,015	$ 1,460,296
Share-based payments	432,098	628,019	388,398
Total	2,045,600	2,311,034	$ 1,848,694
Amount due to related parties	121,852	116,091
Principal Owner Of Agnity [Member]
Disclosure of transactions between related parties [line items]
Amount due to related parties	234,278	813,023
Officer Of Company For Working Capital Loan [Member]
Disclosure of transactions between related parties [line items]
Amount due to related parties	30,796	33,205
Agnity Communications Private Ltd [Member]
Disclosure of transactions between related parties [line items]
Amount due to related parties	1,111,521	1,138,630
Former Shareholder Of CSA [Member]
Disclosure of transactions between related parties [line items]
Amount due to related parties	$ 335,860	$ 318,428

XML

Related Party Transactions - Summary of Transactions Between Related Parties (Parenthetical) (Detail) - CAD ($)	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Disclosure of transactions between related parties [line items]
Consulting services paid to related party	$ 3,560,346	$ 2,490,612	$ 6,736,389	$ 4,230,033	$ 9,085,436	$ 8,886,341	$ 4,351,812
Agnity Communications Private Ltd [Member]
Disclosure of transactions between related parties [line items]
Consulting services paid to related party					$ 3,765,201	$ 2,532,550	$ 1,630,119

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Commitments And Contingencies - Minimum Payments for Contractual Commitments that are not Recognized as Liabilities (Detail)	12 Months Ended
	Dec. 31, 2021 CAD ($)
Commitment and Contigencies [Line Items]
Variable lease payments 1	$ 1,012,555
Lease payments related to leases which have not yet commenced 2	18,093,083
Minimum Lease Payments Payable Under Non Cancellable Lease	19,105,638
Less than 1 year
Commitment and Contigencies [Line Items]
Variable lease payments 1	396,719
Lease payments related to leases which have not yet commenced 2	104,702
Minimum Lease Payments Payable Under Non Cancellable Lease	501,421
2 - 3 years
Commitment and Contigencies [Line Items]
Variable lease payments 1	477,562
Lease payments related to leases which have not yet commenced 2	2,589,330
Minimum Lease Payments Payable Under Non Cancellable Lease	3,066,892
4 - 5 years
Commitment and Contigencies [Line Items]
Variable lease payments 1	125,275
Lease payments related to leases which have not yet commenced 2	2,762,597
Minimum Lease Payments Payable Under Non Cancellable Lease	2,887,872
More than 5 years
Commitment and Contigencies [Line Items]
Variable lease payments 1	12,999
Lease payments related to leases which have not yet commenced 2	12,636,454
Minimum Lease Payments Payable Under Non Cancellable Lease	$ 12,649,453

XML

Commitments And Contingencies (Parenthetical) (Detail)	Oct. 31, 2021
Disclosure of detailed explanation of Undiscounted Contractual Cash Flows [Abstract]
Leases term	12 years

XML

Other Income / Expense - Summary Of Finance Cost (Detail) - CAD ($)	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021	Dec. 31, 2021		Dec. 31, 2020	Dec. 31, 2019
Gains (losses) on litigation settlements [abstract]
Interest on loans and borrowings	$ 734,854	$ 286,144	$ 1,131,557	$ 533,508	$ 1,179,234		$ 1,272,512	$ 918,682
Interest on convertible debentures	1,126,304	1,592,597	2,454,350	3,105,233	5,740,346		4,410,206	2,130,247
Interest on lease liabilities	118,368	75,179	201,417	154,854
Transaction costs expensed	229,716	87,070	248,645	454,574	1,471,219	[1]
Other finance costs	20,751	(94,404)	52,661	(65,656)	90,750
Total finance costs	$ 2,229,993	$ 1,946,586	$ 4,088,630	$ 4,182,513	$ 8,618,794		$ 6,033,510	$ 3,217,500

[1] Transaction costs include costs incurred associated with financing or equity transactions that are not otherwise netted against the debt or equity instrument. The majority of costs are associated with the USD brokered public offering (Note 19(a)), the 2021 Debentures (Note 14(b)), the Fiera term loan amendment (Note 12) and the ATB facility amendment (Note 13). See Note 31 (a) and (b) for subsequent changes to Fiera loan.

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Other Income / Expense - Summary Of Gains Losses On Change In Fair Value Of Derivatives (Detail) - CAD ($)	3 Months Ended				6 Months Ended				12 Months Ended
	Jun. 30, 2022		Jun. 30, 2021		Jun. 30, 2022		Jun. 30, 2021		Dec. 31, 2021
Gains (losses) on financial instruments [abstract]
Gain on warrant liability remeasurement (Note 11)	$ (2,505,810)	[1]			$ (4,999,080)	[1]			$ 3,362,601	[2]
Gain on embedded derivatives	(32,519)	[3]	$ (1,107,784)	[3]	(32,519)	[3]	$ (1,164,059)	[3]	784,261	[4]
Deferred charge loss			(5,322)	[3]			1,615,102	[3]	(1,615,102)	[4]
Total	$ (2,538,329)		$ (1,113,106)		$ (5,031,599)		$ 451,043		$ 6,040,121

[1] Unrealized change in fair value (Note 11).

[2] Change in fair value unrealized (Note 26).

[3] Associated with the 2021 Debentures. Transactions detailed in the 2021 Annual Financial Statements.

[4] Associated with the 2021 Debentures (Note 14(b)) of which the majority is realized at December 31, 2021.

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Other Income / Expense - Summary of other income (Detail) - CAD ($)	3 Months Ended				6 Months Ended				12 Months Ended
	Jun. 30, 2022		Jun. 30, 2021		Jun. 30, 2022		Jun. 30, 2021		Dec. 31, 2021		Dec. 31, 2020		Dec. 31, 2019
Gains (losses) on disposals of investments [abstract]
Government assistance	$ (258,296)	[1]	$ (941,369)	[1]	$ (637,942)	[1]	$ (2,117,743)	[1]	$ (4,201,822)	[2]	$ (2,775,677)	[2]
Government loan forgiveness			(181,770)				(299,082)		1,825,237	[3]	124,507	[3]
Derecognition of contingent consideration			8,855				(572,262)		(1,010,024)
Other	(5,728)		(40,718)		(24,350)		(76,221)		89,014		32,158		$ 167,913
Total other income	$ (264,024)		$ (1,155,002)		$ (662,292)		$ (3,065,308)		$ (7,126,097)		$ (2,932,342)		$ (167,913)

[1] Majority of government assistance are grants from the Canadian Government for wage and rental subsidies.

[2] Majority represents amounts received from the Canadian Government for wage and rental subsidies associated with COVID-19. The amount of government assistance available is dependent on the programs in place and the Company’s eligibility for these programs.

[3] Includes other income recognized as below market interest rate benefit.

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Supplemental Cash Flow Information - Summary of Changes in Non Cash Working Capital (Detail) - CAD ($)	6 Months Ended		12 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Details Of Supplemental Cash Flow Information [Abstract]
Trade and other receivables decrease (increase)	$ 2,567,218	$ (721,406)	$ (3,342,737)	$ (2,006,780)	$ (169,896)
Long-term receivables decrease (increase)	37,442	806,434	1,682,646	(924,625)	(3,662,207)
Prepaid expenses and other assets decrease (increase)	(106,582)	(926,225)	(591,737)	(1,119,123)	150,991
Trade payables and accrued liabilities (decrease) increase	2,419,693	(2,231,429)	(782,561)	2,513,477	1,102,361
Deferred revenue increase	1,962,559	1,425,521	1,045,868	632,839	447,511
Increase (decrease) in working capital	$ 6,880,330	$ (1,647,105)	$ (1,988,521)	$ (904,212)	$ (2,131,240)

XML

Supplemental Cash Flow Information - Summary of Changes in liabilities arising from financing activities (Detail) - CAD ($)	6 Months Ended		12 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Disclosure of Changes in Liabilities Arising From Financing Activities [Abstract]
Beginning Balance	$ 13,215,601	$ 14,102,718	$ 14,102,718	$ 13,973,055	$ 78,285
New advances	24,600,213	6,260,673	10,664,916	8,726,766	16,539,700
Repayments of principal	(8,224,068)	(7,009,073)	(9,781,554)	(9,011,638)	(6,787,528)
Repayments of interest	(1,055,673)	(377,648)	(757,950)	(642,809)	(500,413)
Liability assumed					2,904,355
Liability related items
Assumption of loans in business combination				371,609	1,339,546
Forgiveness of PPP Loans		(175,790)	(1,835,237)	(124,507)
Finance Fees Paid	(300,707)		(191,310)
Non-cash related items
Accretion of interest and debt issuance costs	836,182	460,411	869,567	959,058	445,762
Loss On Debt Modification	161,698		138,908
Benefit from below market interest rate		(117,482)
Foreign exchange and other	752,561	(9,354)	5,543	(148,816)	(46,652)
Ending Balance	$ 29,985,807	$ 13,134,455	$ 13,215,601	$ 14,102,718	$ 13,973,055

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Supplemental Cash Flow Information - Summary of Non Cash Investing and Financing Activities (Detail) - CAD ($)	6 Months Ended		12 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Statements [Line Items]
Value of shares issued in business combination				$ 8,186,620	$ 13,320,000
Value of shares issued on AirFusion asset acquisition				820,000
Settlement of liabilities through issuance of common shares or RSUs				143,002	84,252
Non-cash accretion of interest included in finance cost	$ 1,274,689	$ 1,572,967	$ 3,015,294	2,145,706	909,158
Non-cash broker warrants compensation		$ 372,947	294,894
Non-cash underwriter warrants compensation			162,947
Non-cash warrants consideration associated with credit facility			195,066
Shares issued to extinguish the loan from Flow Capital					606,495
Addition to right-of-use assets	6,874,258			599,861	468,703
Addition to lease liabilities	$ 6,758,036			599,861	$ 586,000
Two Thousand Twenty One Debentures [Member]
Statements [Line Items]
Value of shares issued on conversion			$ 14,436,728
Two Thousand Nineteen Debentures [Member]
Statements [Line Items]
Value of shares issued on conversion				$ 50,000

XML

Events After The Reporting Period - Additional Information (Detail)								3 Months Ended		6 Months Ended		12 Months Ended
	Jul. 29, 2022 CAD ($)	Jul. 06, 2022 CAD ($) $ / shares shares	Jun. 30, 2022 CAD ($) shares	May 31, 2022 CAD ($)	May 06, 2022 CAD ($)	Apr. 01, 2022 USD ($)	Mar. 28, 2022 USD ($)	Jun. 30, 2022 CAD ($)	Jun. 30, 2021 CAD ($)	Jun. 30, 2022 CAD ($)	Jun. 30, 2021 CAD ($)	Dec. 31, 2021 CAD ($)	Dec. 31, 2020 CAD ($)	Dec. 31, 2019 CAD ($)	Jul. 29, 2022 USD ($)	Jun. 30, 2022 $ / shares	May 05, 2022 USD ($)	Jan. 17, 2022 CAD ($)	Dec. 31, 2018 CAD ($)
Events After The Reporting Period [Line Items]
Promissory notes issued												$ 22,295,710	$ 19,534,988
Warrant liability			$ 718,092					$ 718,092		$ 718,092
Class Of Warrants			856,314					856,314		856,314		866,789	423,303	349,657					95,000
Expense from share-based payment transactions								$ 191,528	$ 360,645	$ 444,461	$ 735,919	$ 1,867,915	$ 1,454,235	$ 1,468,361
Class of warrants exercise price per share | $ / shares		$ 14.25
Repayments of borrowings										$ 8,224,068	7,009,073	$ 9,781,554	$ 9,011,638	$ 6,787,528
Share based compensation by share based award optons granted during the period										167,699		487,775	153,828	323,278
Share based compensation by share based award equity instruments other than options granted during the period												73,164	123,797
Asset Care Initialization [Member]
Events After The Reporting Period [Line Items]
Reversal of revenue previously reported								2,037,014		$ 2,037,014
AssetCare Solutions [Member]
Events After The Reporting Period [Line Items]
Reversal of revenue previously reported								534,662		534,662
Warrants [Member]
Events After The Reporting Period [Line Items]
Class Of Warrants		525,114
Stock Options [Member]
Events After The Reporting Period [Line Items]
Expense from share-based payment transactions								$ 128,441	$ 116,892	$ 320,588	$ 247,790	$ 908,293	$ 677,452	$ 820,613
Equity Incentive Plan [Member] | Stock Options [Member]
Events After The Reporting Period [Line Items]
Expense from share-based payment transactions	$ 161,300
Equity Incentive Plan [Member] | RSU's [member]
Events After The Reporting Period [Line Items]
Expense from share-based payment transactions	151,550
Top of range [member] | Fiera Private Debt Fund VI LP [Member]
Events After The Reporting Period [Line Items]
Borrowings, maturity										October 31, 2022		October 31, 2022
Technology Continuation Agreement [Member]
Events After The Reporting Period [Line Items]
Company received payment															$ 6,000,000
Electric Vehicle [Member]
Events After The Reporting Period [Line Items]
Commitments Income Based Payment sharing ratio							50/50
Commitments project term							20 years
Warrant liability																		$ 195,066
New Agreement Being Replaced With An Old Agreement [Member] | Technology Continuation Agreement [Member] | Agnity Global Inc [Member]
Events After The Reporting Period [Line Items]
Receipt of money from the counterpary including advances returned net of services received	$ 6,000,000
Contract Modification Revenue Reversal [Member]
Events After The Reporting Period [Line Items]
Reversal of revenue previously reported						$ 2,571,676
Contract Modification Revenue Reversal [Member] | Asset Care Initialization [Member]
Events After The Reporting Period [Line Items]
Reversal of revenue previously reported						2,037,014
Contract Modification Revenue Reversal [Member] | AssetCare Solutions [Member]
Events After The Reporting Period [Line Items]
Reversal of revenue previously reported						$ 534,662
Expiry Of Unexcercised Warrants [Member]
Events After The Reporting Period [Line Items]
Class of warrants or rights expired during the period | shares		525,114	19,318
Class of warrants or rights expired during the period exercise price per unit | $ / shares		$ 14.25														$ 15
Grant Of Options And Instruments Other Than Options [Member] | Equity Incentive Plan [Member]
Events After The Reporting Period [Line Items]
Share based compensation by share based award optons granted during the period	161,300
Grant Of Options And Instruments Other Than Options [Member] | Equity Incentive Plan [Member] | RSU's [member]
Events After The Reporting Period [Line Items]
Share based compensation by share based award equity instruments other than options granted during the period	151,550
Promissory note.
Events After The Reporting Period [Line Items]
Promissory notes issued							$ 5,000,000
Promissory note. | Electric Vehicle [Member]
Events After The Reporting Period [Line Items]
Promissory notes issued							$ 15,000,000
Borrowings, maturity							March 31, 2025
Borrowings, interest rate							10.00%
Term Loan [Member] | Fiera Private Debt Fund VI LP [Member]
Events After The Reporting Period [Line Items]
Notional amount														$ 13,000,000
Borrowings, maturity														August 2026
Repayments of borrowings				$ 2,044,086
Term Loan [Member] | Top of range [member] | Fiera Private Debt Fund VI LP [Member]
Events After The Reporting Period [Line Items]
Borrowings, interest rate			9.50%					9.50%		9.50%
Term Loan [Member] | Amendment To Term Loan [Member] | Fiera Private Debt Fund VI LP [Member]
Events After The Reporting Period [Line Items]
Repayments of borrowings					$ 2,044,086
Term Loan [Member] | Amendment To Term Loan [Member] | Fiera Private Debt Fund VI LP [Member] | Previous Interest Rate [Member]
Events After The Reporting Period [Line Items]
Borrowings, interest rate					6.85%
Term Loan [Member] | Amendment To Term Loan [Member] | Fiera Private Debt Fund VI LP [Member] | Current Interest Rate [Member]
Events After The Reporting Period [Line Items]
Borrowings, interest rate					9.50%
Financing of Electric Vehicle Development Projects [Member]
Events After The Reporting Period [Line Items]
Borrowings, maturity										March 31, 2025
Financing of Electric Vehicle Development Projects [Member] | Long-term borrowings [member]
Events After The Reporting Period [Line Items]
Notional amount																	$ 10,000,000

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Significant Accounting Policies - Summary of Subsidiaries (Detail)	12 Months Ended
	Dec. 31, 2021
mCloud Technologies Corp.
Disclosure of subsidiaries [line items]
Name of subsidiary	mCloud Technologies Corp.
Principal Activity	Parent company
Principal place of business of subsidiary	Canada
Description of functional currency	CDN $
mCloud Technologies (USA) Inc.
Disclosure of subsidiaries [line items]
Name of subsidiary	mCloud Technologies (USA) Inc.
Principal Activity	Operations
Principal place of business of subsidiary	United States
Description of functional currency	USD $
mCloud Technologies (Canada) Inc.
Disclosure of subsidiaries [line items]
Name of subsidiary	mCloud Technologies (Canada) Inc.
Principal Activity	Operations
Principal place of business of subsidiary	Canada
Description of functional currency	CDN $
Field Diagnostic Services, Inc. ("FDSI")
Disclosure of subsidiaries [line items]
Name of subsidiary	Field Diagnostic Services, Inc.
Principal Activity	Operations
Principal place of business of subsidiary	United States
Description of functional currency	USD $
Construction Systems Associates, Inc. ("CSA")
Disclosure of subsidiaries [line items]
Name of subsidiary	Construction Systems Associates, Inc.
Principal Activity	Operations
Principal place of business of subsidiary	United States
Description of functional currency	USD $
mCloud technologies services inc. (member)
Disclosure of subsidiaries [line items]
Name of subsidiary	mCloud Technologies Services Inc.
Principal Activity	Operations
Principal place of business of subsidiary	Canada
Description of functional currency	CDN $
NGRAIN (Canada) Corporation ("NGRAIN")
Disclosure of subsidiaries [line items]
Name of subsidiary	NGRAIN (Canada) Corporation
Principal Activity	Operations
Principal place of business of subsidiary	Canada
Description of functional currency	CDN $
kanepi Group Pty. Ltd.
Disclosure of subsidiaries [line items]
Name of subsidiary	kanepi Group Pty. Ltd
Principal Activity	Operations
Principal place of business of subsidiary	Australia
Description of functional currency	AUD $
kanepi Services Pty. Ltd.
Disclosure of subsidiaries [line items]
Name of subsidiary	kanepi Services Pty. Ltd.
Principal Activity	Operations
Principal place of business of subsidiary	Australia
Description of functional currency	AUD $
mCloud Technologies Singapore Pte. Ltd.
Disclosure of subsidiaries [line items]
Name of subsidiary	mCloud Technologies Singapore Pte. Ltd.
Principal Activity	Operations
Principal place of business of subsidiary	Singapore
Description of functional currency	SGD $
mCloud Corp (HK) Ltd.
Disclosure of subsidiaries [line items]
Name of subsidiary	mCloud Corp (HK) Ltd.
Principal Activity	Operations
Principal place of business of subsidiary	China
Description of functional currency	RMB ¥
mCloud Technologies (Saudi Arabia)
Disclosure of subsidiaries [line items]
Name of subsidiary	mCloud Technologies
Principal Activity	Operations
Principal place of business of subsidiary	Saudi Arabia
Description of functional currency	SAR $
Agnity global inc [member]
Disclosure of subsidiaries [line items]
Name of subsidiary	Agnity Global, Inc
Principal Activity	Operations
Principal place of business of subsidiary	United States
Description of functional currency	USD $
Agnity Communications, Inc. ("ACI")
Disclosure of subsidiaries [line items]
Name of subsidiary	Agnity Communications, Inc
Principal Activity	Operations
Principal place of business of subsidiary	United Stated
Description of functional currency	USD $
Agnity Healthcare, Inc. ("AHI")
Disclosure of subsidiaries [line items]
Name of subsidiary	Agnity Healthcare, Inc.
Principal Activity	Operations
Principal place of business of subsidiary	United States
Description of functional currency	USD $

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Significant Accounting Policies - Summary of Estimated Useful Lives of Property Plant and Equipment (Detail)	12 Months Ended
	Dec. 31, 2021
Office furniture and equipment [Member]
Detailed Information About Estimated Useful Lives Of Property Plant And Equipment [Line Items]
Estimated useful life	7 years
Leasehold improvements [member]
Detailed Information About Estimated Useful Lives Of Property Plant And Equipment [Line Items]
Estimated useful life, description	lesser of useful lives or lease term
Bottom of range [member] | Computer equipment [member]
Detailed Information About Estimated Useful Lives Of Property Plant And Equipment [Line Items]
Estimated useful life	2 years
Top of range [member] | Computer equipment [member]
Detailed Information About Estimated Useful Lives Of Property Plant And Equipment [Line Items]
Estimated useful life	5 years

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Significant Accounting Policies - Additional Information (Detail)	12 Months Ended
	Dec. 31, 2021
Text Block [Line Items]
Percentage Of Voting Equity Interests Acquired	100.00%
Technology-based intangible assets [member]
Text Block [Line Items]
Estimated useful life, intangible assets other than goodwill	5 years
Bottom of range [member] | Patents and trade marks [Member]
Text Block [Line Items]
Estimated useful life, intangible assets other than goodwill	5 years
Bottom of range [member] | Customer-related intangible assets [member]
Text Block [Line Items]
Estimated useful life, intangible assets other than goodwill	5 years
Top of range [member] | Patents and trade marks [Member]
Text Block [Line Items]
Estimated useful life, intangible assets other than goodwill	15 years
Top of range [member] | Customer-related intangible assets [member]
Text Block [Line Items]
Estimated useful life, intangible assets other than goodwill	20 years