FORM 5 QUARTERLY LISTING STATEMENT

Transcription

1 FORM 5 QUARTERLY LISTING STATEMENT Name of CSE Issuer: BioMark Diagnostics Inc. (the Issuer ). Trading Symbol: BUX This Quarterly Listing Statement must be posted on or before the day on which the Issuer s unaudited interim financial statements are to be filed under the Securities Act, or, if no interim statements are required to be filed for the quarter, within 60 days of the end of the Issuer s first, second and third fiscal quarters. This statement is not intended to replace the Issuer s obligation to separately report material information forthwith upon the information becoming known to management or to post the forms required by the CSE Policies. If material information became known and was reported during the preceding quarter to which this statement relates, management is encouraged to also make reference in this statement to the material information, the news release date and the posting date on the CSE website at General Instructions (a) (b) Prepare this Quarterly Listing Statement using the format set out below. The sequence of questions must not be altered nor should questions be omitted or left unanswered. The answers to the following items must be in narrative form. When the answer to any item is negative or not applicable to the Issuer, state it in a sentence. The title to each item must precede the answer. The term Issuer includes the CSE Issuer and any of its subsidiaries. (c) Terms used and not defined in this form are defined or interpreted in Policy 1 Interpretation and General Provisions. There are three schedules which must be attached to this report as follows: SCHEDULE A: FINANCIAL STATEMENTS Financial statements are required as follows: For the first, second and third financial quarters interim financial statements prepared in accordance with the requirements under Ontario securities law must be attached. If the Issuer is exempt from filing certain interim financial statements, give the date of the exempting order.

2 SCHEDULE B: SUPPLEMENTARY INFORMATION The supplementary information set out below must be provided when not included in Schedule A. 1. Related party transactions All related party transactions have been disclosed in the Issuer s financial statements for the interim period ended September 30, Provide disclosure of all transactions with a Related Person, including those previously disclosed on Form 10. Include in the disclosure the following information about the transactions with Related Persons: (a) (b) (c) (d) (e) (f) A description of the relationship between the transacting parties. Be as precise as possible in this description of the relationship. Terms such as affiliate, associate or related company without further clarifying details are not sufficient. A description of the transaction(s), including those for which no amount has been recorded. The recorded amount of the transactions classified by financial statement category. The amounts due to or from Related Persons and the terms and conditions relating thereto. Contractual obligations with Related Persons, separate from other contractual obligations. Contingencies involving Related Persons, separate from other contingencies. 2. Summary of securities issued and options granted during the period. All securities issued and options granted by the Issuer have been disclosed in the Issuer s financial statement notes for the interim period ended September 30, THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

3 Provide the following information for the period beginning on the date of the last Listing Statement (Form 2A): (a) summary of securities issued during the period, Date of Issue Type of Security (common shares, convertible debentures, etc.) Type of Issue (private placement, public offering, exercise of warrants, etc.) Number Price Total Proceeds Type of Consideration (cash, property, etc.) Describe relationship of Person with Issuer (indicate if Related Person) Commission Paid (b) summary of options granted during the period, Date Number Name of Optionee if Related Person and relationship Generic description of other Optionees Exercise Price Expiry Date Market Price on date of Grant 3. Summary of securities as at the end of the reporting period. A summary of securities has been provided in the financial statements for the interim period ended June 30, Provide the following information in tabular format as at the end of the reporting period: (a) (b) description of authorized share capital including number of shares for each class, dividend rates on preferred shares and whether or not cumulative, redemption and conversion provisions, number and recorded value for shares issued and outstanding, THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

4 (c) (d) description of options, warrants and convertible securities outstanding, including number or amount, exercise or conversion price and expiry date, and any recorded value, and number of shares in each class of shares subject to escrow or pooling agreements or any other restriction on transfer. 4. List the names of the directors and officers, with an indication of the position(s) held, as at the date this report is signed and filed. Name of Director Rashid Ahmed Bux Abbey Abdiye Brian Kai-Ming Cheng Bramhanand Ramjiawan Position(s) Held President, CEO and a Director CFO Director Director SCHEDULE C: MANAGEMENT DISCUSSION AND ANALYSIS Provide Interim MD&A if required by applicable securities legislation. See Management s Discussion & Analysis attached as Schedule C. THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

5 Certificate Of Compliance The undersigned hereby certifies that: 1. The undersigned is a director and/or senior officer of the Issuer and has been duly authorized by a resolution of the board of directors of the Issuer to sign this Quarterly Listing Statement. 2. As of the date hereof there is no material information concerning the Issuer which has not been publicly disclosed. 3. The undersigned hereby certifies to CSE that the Issuer is in compliance with the requirements of applicable securities legislation (as such term is defined in National Instrument ) and all CSE Requirements (as defined in CSE Policy 1). 4. All of the information in this Form 5 Quarterly Listing Statement is true. Dated: November 25, 2015 Abbey Abdiye Name of Director or Senior Officer Abbey Abdiye Signature CFO Official Capacity Issuer Details Name of Issuer: BioMark Diagnostics Inc. Issuer Address: Shellbridge Way City/Province/Postal Code: Richmond, BC V6X 2W8 Contact Name: Abbey Abdiye For Quarter Ended September 30, 2015 Issuer Fax No.: N/A Contact Position: CFO Date of Report: YY/MM/DD 15/11/25 Issuer Telephone No Contact Telephone No Contact Address: info@biomarkdiagnostics.com Web Site Address: THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

6 Schedule A Financial Statements BIOMARK DIAGNOSTICS INC. CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS September 30, 2015 (Stated in Canadian Dollars) (Unaudited Prepared by Management) THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

7 NOTICE OF NO AUDITOR REVIEW OF CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS Under National Instrument , if an auditor has not performed a review of the condensed consolidated interim financial statements, they must be accompanied by a notice indicating that the condensed consolidated interim financial statements have not been reviewed by an auditor. The accompanying unaudited condensed consolidated interim financial statements have been prepared by and are the responsibility of the Company s management. The Company s independent auditor has not performed a review of these condensed consolidated interim financial statements in accordance with standards established by the Canadian Institute of Chartered Accountants for review of condensed consolidated interim financial statements by an entity s auditor.

8 BIOMARK DIAGNOSTICS INC. CONDENSED CONSOLDIATED INTERIM STATEMENTS OF FINANCIAL POSITION (Stated in Canadian Dollars) (Unaudited Prepared by Management) September 30, March 31, Note 2015 (Unaudited) 2015 (Audited) ASSETS $ $ Current Cash 21, ,235 Accounts receivable 4,589 4,589 GST receivable 25,010 26,286 Prepaid 1,641 3,225 LIABILITIES 52, ,335 Current Accounts payable and accrued liabilities 88,223 47,293 Due to a related party 4 221,699 35,081 SHAREHOLDERS DEFICIENCY 309,921 82,374 Share capital 5 2,520,762 2,420,072 Share subscriptions 5-100,000 Contributed surplus 5 553, ,127 Deficit (3,331,717) (2,890,238) Nature and Operations and Going Concern (Note 1) Subsequent Event (Note 9) Commitment (Note 10) Approved by the Board on November 25, 2015 (257,515) 147,961 52, ,335 Rashid Ahmed THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

9 BIOMARK DIAGNOSTICS INC. CONDENSED CONSOLIDATED INTERIM STATEMENTS OF COMPREHENSIVE LOSS (Stated in Canadian Dollars) (Unaudited Prepared by Management) Three Months Ended Six Months Ended Note September 30, 2015 September 30, 2014 September 30, 2015 September 30, 2014 $ $ $ $ Revenue: 4,410-4,410 - Expenses: Corporate and professional services 88,851 1, ,266 14,562 Listing fees ,670 Legal fees 63,282 44,800 71,332 89,662 Office and miscellaneous 3,614 5,261 26,700 10,511 Research and other 29, ,278 - Share-based compensation 5 51,353-35, ,597 51, , ,405 Net loss and comprehensive loss for the period (232,187) (51,406) (441,479) (117,405) Basic and diluted loss per share (0.005) (0.010) (0.009) (0.021) Weighted average number of common shares outstanding 49,363,526 5,339,560 49,224,528 5,538,462 THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

10 BIOMARK DIAGNOSTICS INC. CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CASH FLOWS For the second quarter ended September 30, 2015 (Stated in Canadian Dollars) (Unaudited Prepared by Management) Six Months Ended September 30, 2015 September 30, 2014 $ $ Operating Activities Net loss for the period (441,479) (117,405) Stock-based compensation 35,313 - (406,166) (117,405) Changes in non-cash working capital item related to operations: GST receivable 1,276 - Prepaid 1,584 - Accounts payable and accrued liabilities 40,930 46,734 Cash used in operating activities (362,377) (70,671) Financing Activities Due to a related party 186,618 - Commitment to issue shares - 279,500 Deferred finder s fees - (14,100) Share issued for cash - 10,000 Issue of common shares, net of issuance costs Cash provided by financing activities 187, ,400 Investing Activities Deposit - (2,000) Loan receivable - (198,693) Cash provided by investing activities - (200,693) Decrease in cash during the period (175,069) 4,036 Cash, beginning of the period 196,235 92,000 Cash, end of the period 21,167 96,036 Supplemental Disclosure of Cash Flow Information: Cash paid during the period: Interest - - Income taxes - - Non-cash Transactions see Note 8 THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

11 BIOMARK DIAGNOSTICS INC. CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CHANGES IN SHAREHOLDERS DEFICIENCY For the period ended September 30, 2015 (Stated in Canadian Dollars) (Unaudited Prepared by Management) Number of Shares Share Capital Commitment to Issue Shares Contributed Surplus Deficit Total $ $ $ $ $ Balance, March 31, ,600, , (15,083) 89,917 Shares issued for assets 40,000, , ,000 - Shares returned for cancellation (2,200,000) (34,704) - 34, Shares issued for cash 500,000 10, ,000 Share received for private placement , ,500 Comprehensive loss (117,405) - (117,405) Balance, September 30, ,900, , ,500 34,704 (132,488) 1,059,012 Number of Shares Share Capital Share Subscriptions Contributed Surplus Deficit Total $ $ $ $ $ Balance, March 31, ,635,040 2,420, , ,127 (2,890,238) 147,961 Shares issued under private placement 200, , ,000 - Shares cancelled (21,624) (10,812) (10,812) Shares issued for cash 590,000 11, ,502 Share subscription received - - (100,000) - - (100,000) Stock-based compensation ,313-35,313 Comprehensive loss (441,479) - (441,479) Balance, September 30, ,403,416 2,520, ,440 (3,331,717) (257,515) THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

12 BIOMARK DIAGNOSTICS INC. Notes to the Condensed Consolidated Interim Financial Statements September 30, 2015 (Stated in Canadian Dollars) (Unaudited Prepared by Management) 1. Nature and Operations and Going Concern BioMark Diagnostics Inc. ( BioMark Diagnostics or the Company ) was incorporated on June 19, 2014 under the Business Corporation Act of British Columbia. The head office of the Company is Shellbridge Way, Richmond, British Columbia, V6X 2W8. The ultimate parent of BioMark Diagnostics is BioMark Technologies Inc. ( BioMark Technologies ), which is located at the same address as the Company. Asset Purchase Agreement On September 5, 2014 and amended on September 8 and 18, 2014, Luger Minerals Corp. ( Luger ) entered into an agreement (the Asset Purchase Agreement ) with Biomark Technologies, Rashid Ahmed Bux ( Rashid ) and Bux Investments Ltd. ( Bux ) to acquire and transfer certain assets, properties and rights (collectively IP ) to Luger for the following consideration: i) Issuance of 40,000,000 common shares of Luger to Biomark Technologies (issued on September 29, 2014); ii) Loan forgiveness of the balance due from Biomark Technologies; and iii) Assumption of all expenses incurred by Biomark Technologies for this transaction Plan of Arrangement During the prior year, the Company entered into an Arrangement Agreement ( Arrangement ) with Luger, Noor Energy Corporation ( Noor ) and Kyle Stevenson, the controlling shareholder of Noor (the Controlling Shareholder ). Under the Arrangement, the following transactions took place on October 30, 2014: i) Luger acquired from Noor, which is a company listed on the Canadian Stock Exchange ( CSE ), all of the issued and outstanding shares of Noor s wholly owned subsidiary, BioMark Diagnostics (the Purchase Shares ), for consideration of $5,000. ii) Each outstanding Luger common share was then exchanged for one BioMark Diagnostics common share, such that Luger became a wholly-owned subsidiary of BioMark Diagnostics. iii) Noor issued 1,000 of its common shares to BioMark Diagnostics in exchange for 370,000 common shares of BioMark Diagnostics. Out of the 370,000 shares, the Controlling Shareholder of Noor agreed to forgo 60,000 common shares, which were cancelled in October Following the completion of the Arrangement, BioMark Diagnostics applied for a listing on the CSE. On November 3, 2014, the Company commenced trading on the CSE under the trade symbol BUX. Page 1

13 1. Nature and Operations and Going Concern (continued) As a result of the above noted transactions, the parties who controlled the IP before the Asset Purchase Agreement and the Arrangement continued to control Biomark Diagnostics Inc., including the IP. The historical costs of the IP were not identifiable or recognized prior to these transactions. As a result, no value has been allocated to the 40,000,000 shares issued to Biomark Technologies under the Asset Purchase Agreement. The resulting financial statements are presented as a continuance of Luger and comparative figures presented in the financial statements after the Arrangement are those of Luger. On October 15, 2014, Luger, now the wholly-owned subsidiary of BioMark Diagnostics Inc. changed its name to BioMark Cancer Systems Inc. ( BioMark Cancer ). Concurrent with the closing of the Arrangement, the Company and Biomark Technologies entered into an agreement (the Stock Restriction Agreement ) restricting the transfer of 40,000,000 common shares of the Company, being those issued in connection with the Asset Purchase Agreement. These shares are subject to a 36-month release period commencing November 3, 2014 (the Listing Date ), with 10% released upon the Listing Date and 15% of such shares released in 6- month intervals thereafter. As at September 30, 2015, there were 30,600,000 common shares held in escrow. 2. Basis of Preparation Statement of Compliance These condensed consolidated interim financial statements, including comparatives, have been prepared in accordance with International Financial Reporting Standards ( IFRS ) as issued by the International Accounting Standards Board ( IASB ), Interpretations issued by the International Financial Reporting Interpretations Committee ( IFRIC ) and in accordance with International Accounting Standard ( IAS ) 34 Interim Financial Reporting and which were in effect as of September 30, Basis of Measurement and Consolidation The condensed consolidated financial statements have been prepared on an accrual basis and are based on historical costs. The consolidated financial statements are presented in Canadian dollars which is also the Company s functional currency. These condensed consolidated financial statements have been prepared on a going concern basis, which assumes that the Company will be able to realize its assets and discharge its liabilities in the normal course of business. As at September 30, 2015, the Company has an accumulated deficit of $3,331,717. The continued operations of the Company are dependent on its ability to generate future cash flows or obtain additional financing. Management is of the opinion that sufficient working capital will be obtained from external financing to meet the Company s liabilities and commitments as they become due, although there is a risk that additional financing will not be available on a timely basis or on terms acceptable to the Company. These condensed consolidated financial statements do not reflect any adjustments that may be necessary if the Company is unable to continue as a going concern. These conditions indicate the existence of a material uncertainty that may cast significant doubt on the Company s ability to continue as a going concern. Page 2

14 These condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiary, BioMark Cancer. BioMark Cancer was incorporated on February 27, 2. Basis of Preparation (continued) 2014 under the Business Corporation Act of British Columbia. All material inter-company balances and transactions have been eliminated upon consolidation. Significant Estimates and Assumptions The preparation of condensed consolidated financial statements in accordance with IFRS requires the Company to make estimates and assumptions concerning the future. The Company s management reviews these estimates and underlying assumptions on an ongoing basis, based on experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. Revisions to estimates are adjusted for prospectively in the period in which the estimates are revised. Estimates and assumptions where there is significant risk of material adjustments to assets and liabilities in future accounting periods include the fair value measurements for financial instruments and the recoverability and measurement of deferred tax assets. Significant Judgements The preparation of condensed consolidated financial statements in accordance with IFRS requires the Company to make judgments, apart from those involving estimates, in applying accounting policies. The most significant judgments in applying the Company s financial statements are the valuation of shares in the listing expense, the classification of financial instruments and the going concern assumption. In addition, management has made certain estimates and assumptions when calculating the fair value of share options. The significant assumptions include estimates of expected volatility, expected life and expected risk-free rate of return. Management also makes certain assumptions with respect to the number of options expected to vest. Changes in these assumptions may result in a material change to share-based compensation expense. 3. Significant Accounting Policies The preparation of financial data is based on accounting principles and practices consistent with those used in the preparation of the audited financial statements of BioMark Cancer as at March 31, The accompanying unaudited condensed consolidated interim financial statements should be read in conjunction with the BioMark Cancer s audited financial statements for the period ended March 31, Intellectual properties Intellectual properties consist of patents and trademarks acquired from BioMark Technologies. Research costs are expensed as incurred. Development costs are expensed as incurred unless they meet certain criteria for deferral and amortization. The Company assesses whether it has met the relevant criteria for deferral and amortization at each reporting date. Page 3

15 3. Significant Accounting Policies (cont d) Stock-based compensation: Stock options granted to employees, consultants or directors are measured at fair value at the grant date and expensed over the vesting period with a corresponding increase to contributed surplus. Upon the exercise of the stock options, consideration paid together with the amount previously recognized in contributed surplus is recorded as an increase to share capital. Impairment of tangible and intangible assets At the end of each reporting period, the Company s assets are reviewed to determine whether there is any indication that those assets may be impaired. If such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment, if any. The recoverable amount is the higher of fair value less costs to sell and value in use. Fair value is determined as the amount that would be obtained from the sale of the asset in an arm s length transaction between knowledgeable and willing parties. 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. If the recoverable amount of an asset is estimated to be less than its carrying amount, the carrying amount of the asset is reduced to its recoverable amount and the impairment loss is recognized in profit or loss for the period. 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. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cashgenerating unit) is increased to the revised estimate of its recoverable amount, but to an amount that does not exceed the carrying amount that would have been determined had no impairment loss been recognized for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognized immediately in profit or loss. Accounting standards issued but not yet applied The following new standards and interpretations are not yet effective and have not been applied in preparing these financial statements. The Company is currently evaluating the potential impacts of these new standards and does not anticipate any material changes to the financial statements upon adoption of this new and revised accounting pronouncement. IFRS 9 Financial Instruments (effective January 1, 2018) introduces new requirements for the classification and measurement of financial assets, and will replace IAS 39. IFRS 9 uses a single approach to determine whether a financial asset is measured at amortized cost or fair value, replacing the multiple classification options available in IAS 39. Page 4

16 4. Due to a related party During the period ended September 30, 2015, the Company has the following transactions with BioMark Technologies: $ Balance, March 31, 2015 $35,081 Company expenses paid by BioMark Technologies to date 139,118 Money transfer from BioMark Technologies September 30, ,500 Cash payments to BioMark Technologies September 30, Balance payable, September 30, ,699 The expenses paid by BioMark Technologies represent the expenses incurred per General Service Agreement as indicated in Note 4, in the amount of $136,230 plus the applicable taxes of $2,888. On May 14, 2014, the Company entered into an Independent Contractor Agreement (the CEO Agreement ) with the CEO of the Company. According to the Agreement, the CEO will provide consulting services to the Company for one year with a compensation of $240,000 per year plus benefits. In addition, the CEO will be paid a cash bonus equivalent to 30% of the annual salary at the end of each year if the trading price of the Company shares increased by more than 30% from the trading price at the beginning of the year. For the purpose of this calculation, the starting trading price is $0.25 per share. The CEO will also be granted stock options for 1,000,000 common shares of the Company at a price of $0.25 per share (granted). Finally, if the Company s market capitalization exceeds $200 million USD, the CEO will be paid an additional cash bonus of $500,000. In addition, on May 14, 2014, the Company also entered a General Service Agreement (the Service Agreement ) with BioMark Technologies Inc., a company that holds approximately 82% of the common shares of the Company as at September 30, Both BioMark Diagnostics and BioMark Technologies are controlled by the CEO of the Company. According to the Service Agreement, the Company engaged BioMark Technologies to provide services of research and development, quality management, IP refinement, training, territorial business development, supplier review and related functions (the Services ). The Company will pay management fees equivalent to cost plus a 25% administration fee to BioMark Technologies and payable upon completion of the Services. For any loan facility funded by BioMark Technologies, the Company will pay an 8% per annual interest. For the period ended September 30, 2015, the Company paid $6,309 to BioMark Technologies as administration fees. Page 5

17 5. Share Capital a) Authorized Unlimited common shares, without par value. b) Issued Common shares issued and outstanding: Shares Amount $ Balance, March 31, ,635,040 2,420,072 Share issued under private placement 200, ,000 Shares cancelled (21,624) (10,812) Shares issued to Caro and Regal 500, Shares issued to LHA 50,000 1,266 Shares issued for cash 40,000 10,000 Balance, September 30, ,403,416 2,520,762 c) Stock Options: The Corporation has reserved 4,490,000 common shares under its 2014 Stock Option Plan. The plan provides for the granting of options to directors, employees and consultants. The Board of Directors determines the features of the awards, including the exercise price, the term and vesting provisions, provided no stock options will have a term exceeding five years. On October 31, 2014, the Company granted 4,490,000 stock options to directors, officers, consultants, and employees. Stock options outstanding at September 30, 2015 will expire on October 31, Stock options granted to directors and officers of the Company (3,320,000 options) vest at 25% at the date of grant and 25% every six months thereafter. Stock options granted to consultants (1,170,000 options) vest at 33.33% every 6 month from the date of grant. As of September 30, 2015, there were 4,490,000 stock options outstanding and 2,648,000 stock options are vested and exercisable at $0.25 per option. The weighted average life remaining for these options was 4.08 years and weighted average exercise price was $0.25 per option. The fair value of the share-based compensation from vested options recognized during the period ended September 30, 2015 was $51,353. The Company used the Black-Scholes option pricing model with weighted average assumptions and resulting values for grants as follows: Page 6

18 5. Share Capital (cont d) 2015 Assumptions: Weighted average risk free interest rate (%) 1.46% Expected life (years) 5.0 years Weighted average expected volatility (%) 79% Expected dividend Nil The weighted average fair value of each option granted was $0.25 in d) Warrants: Information regarding the Company s outstanding warrants is summarized below: Expiry date Number of warrants outstanding Number of warrants exercisable Exercise price Balance, March 31, Granted January 2, , ,000 $0.80 Granted February 18, , ,188 $0.80 Balance September 30, , ,188 $0.80 The outstanding shareholder warrants at September 30, 2015 will expire in February 18, e) Contributed Surplus: $ Balance, March 31, ,127 Cancelled - Stock-based recovery June 30, 2015 (16,040) Stock-based compensation September 30, ,353 Balance September 30, , Financial Instruments The Company is exposed to varying degrees to a variety of financial instrument related risks: Fair value The carrying value of cash, accounts receivable, accounts payable and due to a related party approximated their fair value because of the relatively short-term nature of these instruments. Page 7

19 Credit risk The Company is exposed to credit risk with respect to its accounts receivable. To reduce the credit risk of the loan receivable, the Company regularly reviews the collectability. Interest rate risk Interest rate risk is the risk the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. Financial assets and liabilities with variable interest rates expose the Company to cash flow interest rate risk. The Company does not hold any financial liabilities with variable interest rates. The Company does maintain bank accounts which earn interest at variable rates but it does not believe it is currently subject to any significant interest rate risk. Liquidity risk The Company s ability to continue as a going concern is dependent on management s ability to raise required funding through future equity issuances and through short-term borrowing. The Company manages its liquidity risk by forecasting cash flows from operations and anticipating any investing and financing activities. Management and the Board of Directors are actively involved in the review, planning and approval of significant expenditures and commitments. The Company intends to meet its current obligations in the following year with funds to be raised through private placements, shares for debt, loans and related party loans. Fair value Financial instruments measured at fair value are classified into one of three levels in the fair value hierarchy according to the relative reliability of the inputs used to estimate the fair values. The three levels of the fair value hierarchy are: Level 1 Unadjusted quoted prices in active markets for identical assets or liabilities; Level 2 Inputs other than quoted prices that are observable for the asset or liability either directly or indirectly; and Level 3 Inputs that are not based on observable market data. 7. Capital Risk Management The Company defines its capital as shareholders equity. The Company s objectives when managing capital are to safeguard the Company s ability to continue as a going concern in order to pursue the development of its technologies and to maintain a flexible capital structure for its projects for the benefit of its shareholders. As the Company is in the development stage, its principal source of funds is from the issuance of common shares. The Company manages the capital structure and makes adjustments to it in light of changes in economic conditions and the risk characteristics of the underlying assets. To maintain or adjust the capital structure, the Company may attempt to issue new shares, acquire or dispose of assets or adjust the amount of cash. Page 8

20 The Company is not subject to externally imposed capital requirements. 8. Non-cash Transactions Investing and financing activities that do not have a direct impact on cash flows are excluded from the statements of cash flows. The following transactions were excluded from the statement of cash flows: During the period ended September 30, 2015: - The Company issued 50,000 common shares pursuant to the terms of the Agreement with LHA. 9. Subsequent Events There were no reportable subsequent events. 10. Commitment a) The Company is committed to an office lease for its office in Richmond, British Columbia expiring on October Minimum lease payments of $25,962 annually are required until October b) On February 6, 2015, the Company entered into an agreement with Caro Capital LLC ( Caro ) and Regal Venture Capital Partners ( Regal ), Florida corporations, of which Caro and Regal will provide services for management consulting and public relations. The term of the agreement was six months. The Company is committed to issue 500,000 common shares. On April 20, 2015, the Company issued 500,000 common shares. c) The Company is committed to the CEO Agreement with the CEO as described in Note 4. d) The Company is committed to a General Service Agreement with BioMark Technologies Inc. as described in Note 4. Page 9

21 Page 10

22 Schedule B Supplementary Information [included in Schedule A ] Page 11

23 MANAGEMENT S DISCUSSION AND ANALYSIS 1.1 Date of Report: November 25, 2015 Schedule C BIOMARK DIAGNOSTICS INC. Quarterly Report September 30, 2015 The following management s discussion and analysis ( MD&A ) should be read together with the condensed consolidated interim financial statements and accompanying notes for the three months period ended September 30, 2015, which are prepared in accordance with International Financial Reporting Standards ( IFRS ). All amounts are stated in Canadian dollars unless otherwise indicated. This MD&A includes certain statements that may be deemed forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as "anticipate", "plan", "estimate", "expect", "may", "project", "predict", "potential", "could", "might", "should" and other similar expressions. Although the Company believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those in the forward-looking statements. Factors that could cause actual results to differ materially from those in forward-looking statements include market prices, continued availability of capital and financing and general economic, market or business conditions. Investors are cautioned that any such statements are not guarantees of future performance and actual results or developments may differ materially from those projected in the forward-looking statements. 1.2 Overall Performance Nature of Business and Overall Performance BioMark Diagnostics Inc. was incorporated under the Business Corporation Act of British Columbia on June 19, The head office of the Company is Shellbridge Way, Richmond, British Columbia, V6X 2W8. Background We are a Canadian based company that has purchased all the assets related to, and will continue to develop, an advanced stage cancer diagnostic business. Our cancer diagnostics technology was initially licensed from the University of Manitoba in Canada in 2006 by Bux Group and was subsequently assigned to BioMark Technologies Inc ( BTI ), with whom we completed an asset purchase agreement on September 29, 2014, described in detail below under Significant Acquisitions and Dispositions. The diagnostic technology has developed to date into a metabolomics-based diagnostic assay that allows for cancer detection, monitoring and prognosis for treatment. We are currently focused on bringing our cancer diagnostic kits and detection system up to commercialization standards and we hope to commence export once clinical trials and regulatory acceptance are obtained from Health Canada and other applicable regulatory agencies. Phase 3 clinical trial approval was granted by Health Canada in July, 2012, and the trials commenced at Saint Boniface Research Centre in October, 2013, and expanded to one additional site in Bangladesh. The Phase 3 study focus is on breast, prostate, lung and gastrointestinal cancers. We hope that the multi-site study will aid in accelerating trial completion by mid Page 12

24 On September 29, 2014, BioMark Cancer Systems Inc. ( BCS ), completed an Asset Purchase Agreement with BTI to purchase the rights, title and interest in and to BTI s advanced stage cancer diagnostic business (the Diagnostic Business ) including all related research, technologies and products, and the corresponding intellectual property rights and moral rights thereto. Pursuant to the Asset Purchase Agreement, we obtained numerous assets relating to the Diagnostic Business. These include: five patents relating to the cancer diagnostic technology, registered or applied for in jurisdictions around the world; all of the diagnostic products, such as assays, kits, technology and detection systems, and any prototypes thereof; a real property lease for office premises; all of the tangible property; all of the know-how; all of the books and records, including all research, clinical studies and trial data, patient lists, plans, manuals and applications; a number of material contracts relating to the Diagnostic Business; all inventory allocated or assigned to the Diagnostic Business as of the closing of the Asset Purchase Agreement; the internationally registered BioMark trademarks to which BTI held transfer rights prior to the closing of the Asset Purchase Agreement; the intellectual property rights relating to several governmental and university partnerships; and all governmental approvals required for the lawful operation of the Diagnostic Business, to the extent transferable to BCS under the applicable laws. BCS assumed some limited liabilities pursuant to the Asset Purchase Agreement relating to the transferred contracts and property lease, as well as to the operation and conduct of the Diagnostic Business after the closing of the Asset Purchase Agreement. BCS also assumed liability for BTI s accounts payable arising out of, relating to or incurred in connection with the Diagnostic Business as they stood at signing, and up to the closing of the Asset Purchase Agreement. As a result of the Asset Purchase Agreement, to ensure continued involvement of persons possessed of scientific knowledge relating to the Diagnostic Business, BCS intends to enter into several independent contractor s agreements with key individuals involved with the research, technology and development of the Diagnostic Business. Plan of Arrangement On October 30, 2014, the Company executed an Arrangement Agreement ( Arrangement ) which was entered into among Luger Minerals Corp ( Luger ), Noor Energy Corporation. ( Noor ), BioMark, and Kyle Stevenson, the controlling shareholder of Noor (the Controlling Shareholder ). According to the Arrangement, Luger acquired from Noor all of the issued and outstanding shares of BioMark (the Purchase Shares ) for consideration of $5,000. BioMark and the shareholders of Luger then completed a one-for-one share exchange pursuant to which Luger became a wholly-owned subsidiary of BioMark. In addition, Noor issued 1,000 of its common shares to BioMark in exchange for 370,000 shares of BioMark, of which the Controlling Shareholder of Noor agreed to forgo 60,000 BioMark shares to which he would otherwise be entitled to, which were cancelled in October As a result of the Arrangement, the shareholders of Luger own a majority of the issued and outstanding shares of BioMark. Accordingly, this transaction will be accounted for as a reverse acquisition. On October 15, 2014, Luger changed its name to BioMark Cancer Systems Inc. Page 13

25 On October 30, 2014, the Company issued 90,000 common shares to settle debt of $22,500. On October 30, 2014, the Company issued 310,000 common shares pursuant to the terms of the Arrangement agreement. On October 30, 2014, the Company completed the share exchange with the shareholders of Luger and 47,335,040 common shares were issued and outstanding pursuant to the terms of the Arrangement agreement. On October 31, 2014, the Company granted 4,490,000 stock options to directors and officers and consultants exercisable at $0.25 per share expiring five years from the date of grant. Stock options granted to directors and officers of the Company (3,320,000) vest at 25% at the date of grant and 25% every six months thereafter. Stock options granted to consultants (1,170,000) vest at 33.33% every 6 month from the date of grant. On November 3, 2014, the Company commenced trading on the CSE under the trade symbol BUX. The Company is focused on the research, development and commercialization of its novel Acetylated BioMarker Assay ( ABA ) Red Alert technology (the Technology ). The Technology is a patented screening technology that is used to determine the amount of cancer in the body ( Tumour Burden ), has broad applications and is suited for determining the presence of solid tumours as well as predicting tumour response to treatment and monitoring. The Technology works by screening for the acetylated form of a Health Canada and Food and Drug Administration ( FDA ) approved drug (amantadine) which is given to patients prior to measurement in body fluids using liquid chromatography - tandem mass spectrometry ( LC MS/MS ). The amantadine acetylation is performed by an enzyme, spermidine/spermine N-acetyltransferase ( SSAT ). This is the basis of determining Tumour Burden. The Technology is designed to provide information that is highly sensitive, reliable and specific for early stage red alerts for solid tumours. Our current diagnostic assay involves hospital or commercial laboratory-based testing using our internally-developed standard for LC- MS/MS, for which an Investigational Testing Authorization was approved by Health Canada. Pursuant to the Asset Purchase Agreement we acquired the first generation acetyl amantadine enzyme- linked immunosorbent assay ( ELISA ) kits, and the necessary validation and selected tests are now being conducted to meet technical and regulatory standards. We are also in the process of developing point-ofcare ( POC ) immunochromatography test ( ICT ) kits and an infrared ( IR ) Raman-based detection system, which provides metabolite detection using a proprietary spectrometry technology. Diagnostic testing costs associated with our products are expected to decrease significantly upon the launch of our ELISA kits, POC ICT kits and the Raman system, in comparison to the LC MS assay tests. 1.3 Results of Operations As a result the parties who controlled the Diagnostic Business before the Asset Purchase Agreement and the Arrangement continued to control BioMark Diagnostics Inc., including the Diagnostic Business, after the Asset Purchase Agreement and the Arrangement. The business consisting of the Diagnostic Business is deemed to have issued shares in exchange of the listing status of BioMark Diagnostics Inc. As a result, no value has been allocated to the 39,937,500 shares issued to BTI. The resulting consolidated statements of financial position are presented as a continuance of the BioMark Cancer Systems Inc. (formerly Luger Minerals Corp. and comparative figures presented in the financial statements after the Arrangement are those of the BioMark Cancer Systems Inc. Page 14

26 The Company has generated revenues in the amount of $4,410 for the three months ended September 30, 2015 and has a negative operating cash outflows in the amount of $362,377 for the three month period ended September 30, The Company has recorded a loss of $232,187 for the three months ended September 30, Liquidity The Company has total assets of $52,407 as at September 30, 2015 consisting of cash, amounts receivable and prepaid expenses and has a negative working capital of $257,515 in which the majority amount is supported by BioMark Technologies per agreement. (See Note 4 of the financial statements) Since the Company will not be able to generate cash from its operations in the foreseeable future, the Company will have to rely on funding through future equity issuances and through short term debt instrument in order to finance ongoing operations. The ability of the Company to raise capital will depend on market conditions and it may not be possible for the Company to issue shares on acceptable terms or at all. See subsequent event for additional information. 1.5 Share Capital As at September 30, 2015, the Company had 49,403,416 common shares issued and outstanding. 1.6 Share Purchase Warrants As at September 30, 2015, the Company had 759,188 shareholder warrants issued and outstanding. On February 18, 2015, the Company completed a Non-Brokered Private Placement at a price of $0.50 per unit for proceeds of $750,000, resulting in the issuance of 1,500,000 common shares and 750,000 warrants. Each warrant will entitle the holder to purchase an additional common share at an exercise price of $0.80 per share for a period of 12 months following the issuance of the warrants. 1.7 Stock Options The Company has reserved 4,490,000 common shares under its 2014 Amended Stock Option Plan. The plan provides for the granting of options to directors, employees and consultants. Stock options granted generally have varying expiry terms of up to five years and vesting periods determined at the discretion of the directors. During the period, there were 4,490,000 stock options granted to directors, consultants and employees. As at September 30, 2015, the Company had outstanding 4,490,000 stock options with a weighted average remaining contractual life of 4.08 years and with a weighted average exercise price of $0.25 per share. 1.8 Capital Resources The Company does not have any other commitments for material capital expenditures Off Balance Sheet Arrangements Page 15

27 There is no off-balance sheet arrangements to which the Company is committed Transactions with Related Parties During the period ended September 30, 2015, the Company entered into the following transactions with related parties: a) For the three-month period September 30, 2015, directors, officers and consultants of the company provided consulting services to the company value at $47,000. These charges are included in corporate and professional services and wages. b) For the three-month period September 30, 2015, the Company recognized $49,721 of the stock-based compensation for stock option held by directors and officers. This amount is included in stock-based compensation expense Fourth Quarter N/A 1.13 Proposed Transaction/Subsequent events Subsequent to September 30, 2015: - There were no reportable subsequent events Critical Accounting Estimates Critical Estimates and Assumptions The preparation of the condensed consolidated interim financial statements in accordance with IFRS requires the Company to make estimates and assumptions concerning the future. The Company s management reviews these estimates and underlying assumptions on an ongoing basis, based on experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. Revisions to estimates are adjusted for prospectively in the period in which the estimates are revised. Estimates and assumptions where there is significant risk of material adjustments to assets and liabilities in future accounting periods include the fair value measurements for financial instruments and the recoverability and measurement of deferred tax assets. The most significant judgments in applying the Company s financial statements is the classification of financial instruments and the going concern assumption Changes in Accounting Policies Accounting standards issued but not yet applied The following new standards and interpretations are not yet effective and have not been applied in preparing these financial statements. The Company is currently evaluating the potential impacts of these new standards and does not anticipate any material changes to the financial statements upon adoption of this new and revised accounting pronouncement. Page 16

28 IFRS 9 Financial Instruments (effective January 1, 2018) introduces new requirements for the classification and measurement of financial assets, and will replace IAS 39. IFRS 9 uses a single approach to determine whether a financial asset is measured at amortized cost or fair value, replacing the multiple classification options available in IAS Financial Instruments and Other Instruments The Company s financial instruments consist of cash, accounts receivable, accounts payable and due to a related party. The Company s financial instruments are exposed to the following risks: Credit risk The Company is exposed to credit risk with respect to its loan receivable. To reduce the credit risk of the loan receivable, the Company regularly reviews the collectability. Currently there is no indication that the loan will not be fully recoverable. Interest rate risk Interest rate risk is the risk the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. Financial assets and liabilities with variable interest rates expose the Company to cash flow interest rate risk. The Company does not hold any financial liabilities with variable interest rates. The Company does maintain bank accounts which earn interest at variable rates but it does not believe it is currently subject to any significant interest rate risk. Liquidity risk The Company s ability to continue as a going concern is dependent on management s ability to raise required funding through future equity issuances and through short-term borrowing. The Company manages its liquidity risk by forecasting cash flows from operations and anticipating any investing and financing activities. Management and the Board of Directors are actively involved in the review, planning and approval of significant expenditures and commitments. The Company intends to meet its current obligations in the following year with funds to be raised through private placements, shares for debt, loans and related party loans. Fair value Financial instruments measured at fair value are classified into one of three levels in the fair value hierarchy according to the relative reliability of the inputs used to estimate the fair values. The three levels of the fair value hierarchy are: Level 1 Unadjusted quoted prices in active markets for identical assets or liabilities; Level 2 Inputs other than quoted prices that are observable for the asset or liability either directly or indirectly; and Level 3 Inputs that are not based on observable market data Other MD&A Requirements A. For more information about the Company, see The Company has not filed an AIF Page 17