Quarterly Report (10-q)
November 15 2021 - 05:20PM
Edgar (US Regulatory)
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM
10-Q
(Mark One)
☒
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended
September 30,
2021
OR
☐
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from
to
Commission File Number:
001-36247
Meta Materials Inc.
(Exact Name of Registrant as Specified in its Charter)
|
|
|
Nevada
|
74-3237581
|
|
(State or other jurisdiction of
incorporation or organization)
|
(I.R.S. Employer
Identification No.)
|
|
|
|
|
1 Research Drive
Dartmouth,
Nova Scotia
|
B2Y 4M9
|
|
(Address of principal executive offices)
|
(Zip Code)
|
Registrant’s telephone number, including area code:
(902)
482-5729
Securities registered pursuant to Section 12(b) of the
Act:
|
|
|
|
Title of each class
|
Trading
Symbol(s)
|
Name of each exchange
on which registered
|
|
Common Stock, par value $0.001 per share
|
MMAT
|
Nasdaq Capital
Market
|
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months (or
for such shorter period that the registrant was required to file
such reports), and (2) has been subject to such filing requirements
for the past 90 days.
Yes
☒ No ☐
Indicate by check mark whether the registrant has submitted
electronically every Interactive Data File required to be submitted
pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter)
during the preceding 12 months (or for such shorter period that the
registrant was required to submit such files).
Yes
☒ No ☐
Indicate by check mark whether the registrant is a large
accelerated filer, an accelerated filer, a non-accelerated filer,
smaller reporting company, or an emerging growth company. See the
definitions of “large accelerated filer,” “accelerated filer,”
“smaller reporting company,” and “emerging growth company” in Rule
12b-2 of the Exchange Act.
|
|
|
|
|
Large accelerated filer
|
☐
|
Accelerated filer
|
☐
|
|
Non-accelerated filer
|
☒
|
Smaller reporting company
|
☒
|
|
|
|
Emerging growth company
|
☐
|
If an emerging growth company, indicate by check mark if the
registrant has elected not to use the extended transition period
for complying with any new or revised financial accounting
standards provided pursuant to Section 13(a) of the Exchange Act.
☐
Indicate by check mark whether the registrant is a shell company
(as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No
☒
Indicate by check mark whether the registrant has filed all
documents and reports required to be filed by Sections 12, 13 or
15(d) of the Securities Exchange Act of 1934 subsequent to the
distribution of securities under a plan confirmed by a court. Yes ☒
No ☐
As of September 30, 2021, the registrant had
281,200,905
shares of common stock, $0.001 par value per share,
outstanding.
Table of Contents
2
PART I—FINANCIAL
INFORMATION
Item 1. Financial
Statements
META MATERIALS INC.
CONDENSED CONSOLIDATED INTERIM BALANCE SHEETS
(UNAUDITED)
|
|
|
|
|
|
|
|
|
|
|
|
As of
|
|
|
As of
|
|
|
|
|
September 30, 2021
|
|
|
December 31, 2020
|
|
|
Assets
|
|
|
|
|
|
|
|
Current assets:
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
140,796,052
|
|
|
$
|
1,395,683
|
|
|
Restricted cash
|
|
|
421,817
|
|
|
|
-
|
|
|
Grants receivable
|
|
|
285,063
|
|
|
|
327,868
|
|
|
Accounts receivable
|
|
|
96,848
|
|
|
|
22,833
|
|
|
Inventory
|
|
|
358,964
|
|
|
|
463,382
|
|
|
Prepaid expenses and other current assets
|
|
|
3,262,595
|
|
|
|
514,204
|
|
|
Assets held for sale
|
|
|
73,650,140
|
|
|
|
-
|
|
|
Due from related parties
|
|
|
64,708
|
|
|
|
-
|
|
|
Total current assets
|
|
|
218,936,187
|
|
|
|
2,723,970
|
|
|
Intangible assets, net
|
|
|
4,642,904
|
|
|
|
4,476,614
|
|
|
Property, plant and equipment, net
|
|
|
7,525,989
|
|
|
|
2,761,171
|
|
|
Operating lease right-of-use assets
|
|
|
4,775,130
|
|
|
|
270,581
|
|
|
Goodwill
|
|
|
218,828,518
|
|
|
|
-
|
|
|
Total assets
|
|
$
|
454,708,728
|
|
|
$
|
10,232,336
|
|
|
Liabilities and stockholders’ equity (deficit)
|
|
|
|
|
|
|
|
Current liabilities
|
|
|
|
|
|
|
|
Trade and other payables
|
|
$
|
6,556,665
|
|
|
$
|
2,940,452
|
|
|
Due to related party
|
|
|
-
|
|
|
|
245,467
|
|
|
Current portion of long-term debt
|
|
|
532,346
|
|
|
|
290,544
|
|
|
Current portion of deferred revenues
|
|
|
1,186,885
|
|
|
|
1,239,927
|
|
|
Current portion of deferred government assistance
|
|
|
842,425
|
|
|
|
779,578
|
|
|
Preferred stock liability
|
|
|
77,906,354
|
|
|
|
-
|
|
|
Current portion of operating lease liabilities
|
|
|
330,867
|
|
|
|
150,802
|
|
|
Asset retirement obligations
|
|
|
21,937
|
|
|
|
-
|
|
|
Unsecured convertible promissory notes
|
|
|
-
|
|
|
|
1,203,235
|
|
|
Secured convertible debentures
|
|
|
-
|
|
|
|
5,545,470
|
|
|
Total current liabilities
|
|
|
87,377,479
|
|
|
|
12,395,475
|
|
|
Deferred revenues
|
|
|
637,559
|
|
|
|
804,143
|
|
|
Deferred government assistance
|
|
|
38,869
|
|
|
|
146,510
|
|
|
Deferred tax liability
|
|
|
131,907
|
|
|
|
318,054
|
|
|
Unsecured convertible debentures
|
|
|
-
|
|
|
|
1,825,389
|
|
|
Long-term operating lease liabilities
|
|
|
2,423,123
|
|
|
|
119,779
|
|
|
Funding obligation
|
|
|
868,169
|
|
|
|
776,884
|
|
|
Long-term debt
|
|
|
2,698,515
|
|
|
|
2,743,504
|
|
|
Total liabilities
|
|
|
94,175,621
|
|
|
|
19,129,738
|
|
|
Stockholders’ equity (deficit)
|
|
|
|
|
|
|
|
Common stock - $0.001 par
value;
1,000,000,000 shares
authorized,
281,200,905 shares
issued and outstanding at September 30, 2021, and
$Nil par
value; unlimited shares authorized,
154,163,975 shares
issued and outstanding at December 31, 2020
|
|
|
259,384
|
|
|
|
132,347
|
|
|
Additional paid-in capital
|
|
|
459,129,666
|
|
|
|
29,021,974
|
|
|
Accumulated other comprehensive income (loss)
|
|
|
7,970
|
|
|
|
(654,880
|
)
|
|
Accumulated deficit
|
|
|
(98,863,913
|
)
|
|
|
(37,396,843
|
)
|
|
Total stockholders’ equity (deficit)
|
|
|
360,533,107
|
|
|
|
(8,897,402
|
)
|
|
Total liabilities and stockholders’ equity (deficit)
|
|
$
|
454,708,728
|
|
|
$
|
10,232,336
|
|
Commitments and contingencies (note 21)
Subsequent events (note 22)
The accompanying notes are an integral part of these condensed
consolidated interim financial statements
3
META MATERIALS INC.
CONDENSED CONSOLIDATED INTERIM STATEMENTS OF OPERATIONS AND
COMPREHENSIVE LOSS (UNAUDITED)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended
September 30,
|
|
|
Nine months ended
September 30,
|
|
|
|
|
2021
|
|
|
2020
|
|
|
(Recast - note 11) 2021
|
|
|
2020
|
|
|
Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Product sales
|
|
|
297,431
|
|
|
|
982
|
|
|
|
321,431
|
|
|
|
2,904
|
|
|
Development revenue
|
|
|
275,181
|
|
|
|
197,193
|
|
|
|
1,471,804
|
|
|
|
845,954
|
|
|
Total Revenue
|
|
|
572,612
|
|
|
|
198,175
|
|
|
|
1,793,235
|
|
|
|
848,858
|
|
|
Cost of goods sold
|
|
|
145,103
|
|
|
|
935
|
|
|
|
146,209
|
|
|
|
3,095
|
|
|
Gross Profit
|
|
|
427,509
|
|
|
|
197,240
|
|
|
|
1,647,026
|
|
|
|
845,763
|
|
|
Operating Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling & Marketing
|
|
|
427,004
|
|
|
|
196,276
|
|
|
|
1,122,469
|
|
|
|
520,804
|
|
|
General & Administrative
|
|
|
9,776,850
|
|
|
|
1,463,255
|
|
|
|
16,217,012
|
|
|
|
4,620,907
|
|
|
Research & Development
|
|
|
1,816,547
|
|
|
|
1,043,915
|
|
|
|
5,229,456
|
|
|
|
2,936,516
|
|
|
Total operating expenses
|
|
|
12,020,401
|
|
|
|
2,703,446
|
|
|
|
22,568,937
|
|
|
|
8,078,227
|
|
|
Other income (expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense, net
|
|
|
(215,116
|
)
|
|
|
(376,776
|
)
|
|
|
(1,093,833
|
)
|
|
|
(893,001
|
)
|
|
(Loss) Gain on foreign exchange, net
|
|
|
(440,157
|
)
|
|
|
(175,514
|
)
|
|
|
(770,542
|
)
|
|
|
81,159
|
|
|
(Loss) Gain on financial instruments, net
|
|
|
—
|
|
|
|
(118,455
|
)
|
|
|
(40,540,091
|
)
|
|
|
1,167,310
|
|
|
Other income, net
|
|
|
739,260
|
|
|
|
562,443
|
|
|
|
1,673,124
|
|
|
|
974,112
|
|
|
Total other income (expense)
|
|
|
83,987
|
|
|
|
(108,302
|
)
|
|
|
(40,731,342
|
)
|
|
|
1,329,580
|
|
|
Loss before income taxes
|
|
|
(11,508,905
|
)
|
|
|
(2,614,508
|
)
|
|
|
(61,653,253
|
)
|
|
|
(5,902,884
|
)
|
|
Income tax recovery
|
|
|
83,657
|
|
|
|
33,304
|
|
|
|
186,183
|
|
|
|
87,651
|
|
|
Net loss
|
|
|
(11,425,248
|
)
|
|
|
(2,581,204
|
)
|
|
|
(61,467,070
|
)
|
|
|
(5,815,233
|
)
|
|
Other Comprehensive Income (Loss) net of tax
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign currency translation gain (loss)
|
|
|
(125,976
|
)
|
|
|
167,941
|
|
|
|
(17,328
|
)
|
|
|
8,693
|
|
|
Fair value gain (loss) on changes of own credit risk
|
|
|
—
|
|
|
|
(223,221
|
)
|
|
|
680,178
|
|
|
|
(588,429
|
)
|
|
Total Other Comprehensive Income (Loss)
|
|
|
(125,976
|
)
|
|
|
(55,280
|
)
|
|
|
662,850
|
|
|
|
(579,736
|
)
|
|
Comprehensive loss
|
|
|
(11,551,224
|
)
|
|
|
(2,636,484
|
)
|
|
|
(60,804,220
|
)
|
|
|
(6,394,969
|
)
|
|
Basic and diluted loss per share
(1)
|
|
|
(0.04
|
)
|
|
|
(0.02
|
)
|
|
|
(0.28
|
)
|
|
|
(0.04
|
)
|
|
Weighted average number of shares outstanding - basic and
diluted
(1)
|
|
|
280,080,786
|
|
|
|
155,913,202
|
|
|
|
216,135,190
|
|
|
|
131,557,607
|
|
(1)
Retroactively restated for the three and nine months ended
September 30, 2021 and 2020 for the Torchlight RTO (“Reverse
Acquisition”) and CPM RTO (“Reverse Recapitalization”) as described
in Note 3
The accompanying notes are an integral part of these condensed
consolidated interim financial statements
4
META MATERIALS INC.
CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CHANGES IN
STOCKHOLDERS’ EQUITY (UNAUDITED)
(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Additional
|
|
|
Other
|
|
|
|
|
|
Total
|
|
|
|
|
Preferred Stock
|
|
|
Common Stock
|
|
|
Paid-in
|
|
|
Comprehensive
|
|
|
Accumulated
|
|
|
Stockholders’
|
|
|
|
|
Shares
|
|
|
Amount
|
|
|
Shares
|
|
|
Amount
|
|
|
Capital
|
|
|
Income (loss)
|
|
|
Deficit
|
|
|
Equity
|
|
|
Balance, July 1, 2021 (Recast - note 11)
|
|
|
—
|
|
|
|
—
|
|
|
|
279,782,854
|
|
|
|
257,966
|
|
|
|
454,961,102
|
|
|
|
133,946
|
|
|
|
(87,438,665
|
)
|
|
|
367,914,349
|
|
|
Net loss
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(11,425,248
|
)
|
|
|
(11,425,248
|
)
|
|
Other comprehensive loss
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(125,976
|
)
|
|
|
—
|
|
|
|
(125,976
|
)
|
|
Exercise of stock options
|
|
|
—
|
|
|
|
—
|
|
|
|
1,226,375
|
|
|
|
1,226
|
|
|
|
335,271
|
|
|
|
—
|
|
|
|
—
|
|
|
|
336,497
|
|
|
Exercise of warrants
|
|
|
—
|
|
|
|
—
|
|
|
|
43,308
|
|
|
|
43
|
|
|
|
(43
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
Stock-based compensation
|
|
|
—
|
|
|
|
—
|
|
|
|
148,368
|
|
|
|
149
|
|
|
|
3,833,336
|
|
|
|
—
|
|
|
|
—
|
|
|
|
3,833,485
|
|
|
Balance, September 30, 2021
|
|
|
—
|
|
|
|
—
|
|
|
|
281,200,905
|
|
|
|
259,384
|
|
|
|
459,129,666
|
|
|
|
7,970
|
|
|
|
(98,863,913
|
)
|
|
|
360,533,107
|
|
|
Balance, July 1, 2020
|
|
|
—
|
|
|
|
—
|
|
|
|
154,236,692
|
|
|
|
132,420
|
|
|
|
28,262,051
|
|
|
|
(588,335
|
)
|
|
|
(29,019,613
|
)
|
|
|
(1,213,477
|
)
|
|
Net loss
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(2,581,204
|
)
|
|
|
(2,581,204
|
)
|
|
Other comprehensive loss
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(55,280
|
)
|
|
|
—
|
|
|
|
(55,280
|
)
|
|
Stock-based compensation
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
406,345
|
|
|
|
—
|
|
|
|
—
|
|
|
|
406,345
|
|
|
Balance September 30, 2020
|
|
|
—
|
|
|
|
—
|
|
|
|
154,236,692
|
|
|
|
132,420
|
|
|
|
28,668,396
|
|
|
|
(643,615
|
)
|
|
|
(31,600,817
|
)
|
|
|
(3,443,616
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Additional
|
|
|
Other
|
|
|
|
|
|
Total
|
|
|
|
|
Preferred Stock
|
|
|
Common Stock
|
|
|
Paid-in
|
|
|
Comprehensive
|
|
|
Accumulated
|
|
|
Stockholders’
|
|
|
|
|
Shares
|
|
|
Amount
|
|
|
Shares
|
|
|
Amount
|
|
|
Capital
|
|
|
Income (loss)
|
|
|
Deficit
|
|
|
Equity
|
|
|
Balance, January 1, 2021
|
|
|
—
|
|
|
|
—
|
|
|
|
154,163,975
|
|
|
|
132,347
|
|
|
|
29,021,974
|
|
|
|
(654,880
|
)
|
|
|
(37,396,843
|
)
|
|
|
(8,897,402
|
)
|
|
Net loss
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(61,467,070
|
)
|
|
|
(61,467,070
|
)
|
|
Other comprehensive income
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
662,850
|
|
|
|
—
|
|
|
|
662,850
|
|
|
Conversion of promissory notes
|
|
|
—
|
|
|
|
—
|
|
|
|
20,391,239
|
|
|
|
20,391
|
|
|
|
23,635,974
|
|
|
|
—
|
|
|
|
—
|
|
|
|
23,656,365
|
|
|
Conversion of secured debentures
|
|
|
—
|
|
|
|
—
|
|
|
|
14,155,831
|
|
|
|
14,156
|
|
|
|
22,104,626
|
|
|
|
—
|
|
|
|
—
|
|
|
|
22,118,782
|
|
|
Conversion of unsecured debentures
|
|
|
—
|
|
|
|
—
|
|
|
|
5,105,338
|
|
|
|
5,105
|
|
|
|
5,764,370
|
|
|
|
—
|
|
|
|
—
|
|
|
|
5,769,475
|
|
|
Conversion of long-term debt
|
|
|
—
|
|
|
|
—
|
|
|
|
124,716
|
|
|
|
125
|
|
|
|
221,718
|
|
|
|
—
|
|
|
|
—
|
|
|
|
221,843
|
|
|
Conversion of payable to related party
|
|
|
—
|
|
|
|
—
|
|
|
|
150,522
|
|
|
|
151
|
|
|
|
225,835
|
|
|
|
—
|
|
|
|
—
|
|
|
|
225,986
|
|
|
Exercise of stock options
|
|
|
—
|
|
|
|
—
|
|
|
|
1,640,294
|
|
|
|
1,640
|
|
|
|
448,012
|
|
|
|
—
|
|
|
|
—
|
|
|
|
449,652
|
|
|
Exercise of warrants
|
|
|
—
|
|
|
|
—
|
|
|
|
282,114
|
|
|
|
282
|
|
|
|
93,712
|
|
|
|
—
|
|
|
|
—
|
|
|
|
93,994
|
|
|
Exercise of broker warrants
|
|
|
—
|
|
|
|
—
|
|
|
|
61,331
|
|
|
|
61
|
|
|
|
16,194
|
|
|
|
—
|
|
|
|
—
|
|
|
|
16,255
|
|
|
Effect of reverse acquisition
|
|
|
—
|
|
|
|
—
|
|
|
|
82,813,994
|
|
|
|
82,814
|
|
|
|
369,548,188
|
|
|
|
—
|
|
|
|
—
|
|
|
|
369,631,002
|
|
|
Shares issued in lieu of operating lease liability
|
|
|
—
|
|
|
|
—
|
|
|
|
1,832,989
|
|
|
|
1,833
|
|
|
|
2,780,135
|
|
|
|
—
|
|
|
|
—
|
|
|
|
2,781,968
|
|
|
Stock-based compensation
|
|
|
—
|
|
|
|
—
|
|
|
|
478,562
|
|
|
|
479
|
|
|
|
5,268,928
|
|
|
|
—
|
|
|
|
—
|
|
|
|
5,269,407
|
|
|
Balance, September 30, 2021
|
|
|
—
|
|
|
|
—
|
|
|
|
281,200,905
|
|
|
|
259,384
|
|
|
|
459,129,666
|
|
|
|
7,970
|
|
|
|
(98,863,913
|
)
|
|
|
360,533,107
|
|
|
Balance, January 1, 2020
|
|
|
58,153,368
|
|
|
|
58,153
|
|
|
|
53,297,568
|
|
|
|
31,480
|
|
|
|
19,896,611
|
|
|
|
(63,879
|
)
|
|
|
(25,785,584
|
)
|
|
|
(5,863,219
|
)
|
|
Net loss
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(5,815,233
|
)
|
|
|
(5,815,233
|
)
|
|
Other comprehensive loss
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(579,736
|
)
|
|
|
—
|
|
|
|
(579,736
|
)
|
|
Issuance of common stock, net
|
|
|
—
|
|
|
|
—
|
|
|
|
2,613,321
|
|
|
|
2,613
|
|
|
|
429,795
|
|
|
|
—
|
|
|
|
—
|
|
|
|
432,408
|
|
|
Issuance of warrants
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
149,994
|
|
|
|
—
|
|
|
|
—
|
|
|
|
149,994
|
|
|
Issuance of broker warrants
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
16,144
|
|
|
|
—
|
|
|
|
—
|
|
|
|
16,144
|
|
|
Conversion of deferred share units
|
|
|
—
|
|
|
|
—
|
|
|
|
522,596
|
|
|
|
523
|
|
|
|
(523
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
Conversion of promissory notes
|
|
|
—
|
|
|
|
—
|
|
|
|
17,752,163
|
|
|
|
17,752
|
|
|
|
3,921,695
|
|
|
|
—
|
|
|
|
—
|
|
|
|
3,939,447
|
|
|
Conversion of preferred stock
|
|
|
(58,153,368
|
)
|
|
|
(58,153
|
)
|
|
|
58,153,368
|
|
|
|
58,153
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
Effect of reverse recapitalization
|
|
|
—
|
|
|
|
—
|
|
|
|
21,599,223
|
|
|
|
21,599
|
|
|
|
3,089,235
|
|
|
|
—
|
|
|
|
—
|
|
|
|
3,110,834
|
|
|
Stock-based compensation
|
|
|
—
|
|
|
|
—
|
|
|