SLINGER BAG : Management’s Discussion and Analysis of Financial Condition and Results of Operations (form 10-Q)

The following dialogue of our monetary situation and outcomes of operations
must be learn together with the monetary statements and associated notes
included elsewhere on this report and our Annual Report on Form 10-Ok for the
yr ended April 30, 2021. Certain statements on this dialogue and elsewhere
on this report represent forward-looking statements. See “Cautionary Statement
Regarding Forward Looking Information” elsewhere on this report. Because this
dialogue entails dangers and uncertainties, our precise outcomes could differ
materially from these anticipated in these forward-looking statements.

Overview and Description of Business

Lazex Inc. (“Lazex”) was included beneath the legal guidelines of the State of Nevada on
July 12, 2015. On August 23, 2019, the bulk proprietor of Lazex entered right into a
Stock Purchase Agreement with Slinger Bag Americas Inc., a Delaware company
(“Slinger Bag Americas”), which was 100% owned by Slinger Bag Ltd. (“SBL”), an
Israeli firm. In reference to the Stock Purchase Agreement, Slinger Bag
Americas acquired 20,000,000 shares of frequent inventory of Lazex for $332,239. On
September 16, 2019, SBL transferred its possession of Slinger Bag Americas to
Lazex in trade for the 20,000,000 shares of Lazex acquired on August 23,
2019. As a consequence of these transactions, Lazex owned 100% of Slinger Bag
Americas and the only real shareholder of SBL owned 20,000,000 shares of frequent inventory
(roughly 82%) of Lazex. Effective September 13, 2019, Lazex modified its
title to Slinger Bag Inc.

On October 31, 2019, Slinger Bag Americas acquired management of Slinger Bag
Canada, Inc., (“Slinger Bag Canada”) a Canadian firm included on November
3, 2017. There have been no property, liabilities or historic operational exercise of
Slinger Bag Canada at the moment.

On February 10, 2020, Slinger Bag Americas turned the 100% proprietor of SBL, alongside
with SBL’s wholly owned subsidiary Slinger Bag International (UK) Limited
(“Slinger Bag UK”), which was shaped on April 3, 2019. The proprietor of SBL
contributed it to Slinger Bag Americas for no consideration.

On June 21, 2021, Slinger Bag Americas entered right into a membership curiosity
buy settlement with Charles Ruddy to amass a 100% possession stake in
Foundation Sports Systems, LLC (“Foundation Sports”).

The operations of Slinger Bag Inc., Slinger Bag Americas, Slinger Bag Canada,
Slinger Bag UK, SBL and Foundation Sports are collectively known as the
“Company” or “Slinger.”

The Company operates within the sporting and athletic items enterprise. The Company is
the proprietor of the Slinger Launcher, a extremely moveable and inexpensive ball
launcher constructed into a straightforward to move wheeled trolley bag. The Slinger
Launcher permits anybody to easily and simply management the pace, frequency and
elevation of balls which might be launched for follow, coaching or health functions.

The Company has initially centered all its energies on the tennis market
worldwide, however is within the early levels of creating ball launchers for different
ball sports activities.

For the common tennis participant, the Slinger Launcher is way more than a tennis
ball launcher. It additionally features as a whole tennis bag with ample room for
racquets, footwear, towels, water bottles and different equipment and can cost
cell phones and different units.

Tennis ball machines have been round because the 1950’s once they have been launched
by Renne Lacoste. Improvements to efficiency have been made within the 1970’s when
Prince began its tennis enterprise on the again of its first product – Little
Prince – which was a vacuum operated ball machine. In the 1990’s the primary
battery operated machines got here to the market and since that point little or no, if
something, has modified within the construction of ball machine merchandise exterior of added
computerization. Typically, the machines being marketed by conventional ball
machine manufacturers are giant, cumbersome and awkward to function. They are additionally very
costly – usually properly above U.S. $1,000. Up till at the moment the overwhelming majority of
all tennis ball machines have bought to tennis services, with just a few being
bought on to tennis enjoying customers.

According to the Tennis Industry Association ( the one largest
problem dealing with tennis participation is the truth that 34% of lapsed gamers
cited a “lack of enjoying companion” as the explanation for them stopping to play
tennis. The Slinger Launcher goes a protracted strategy to fixing this problem.

The international tennis market is regarded by business specialists, governing
organizations, tennis manufacturers and tennis-specific market analysis firms as
having 100 million energetic gamers globally, with as many customers once more being
avid followers of the game. Of this 100 million tennis participant market, 20 million
gamers are considered frequent or avid gamers – gamers who play frequently –
no less than 1 time per 30 days. These avid gamers drive the full tennis business
and account for 80% of all tennis revenues worldwide.


It is that this avid participant market that the Company is targeted on penetrating with
its Slinger Launcher and related tennis equipment.

The Company intends to disrupt this conventional tennis market by creating a brand new
ball machine class – referred to as Slinger Launcher – and advertising and marketing moveable and
inexpensive Slinger Launchers on to avid, common tennis gamers.
Constructed inside a wheeled trolley tennis bag, a Slinger Launcher weighs
round 15kgs / 34lbs when empty. If saved with 72 balls inside the burden
will increase to 19kgs / 42lbs. It can simply be saved in a automotive trunk, wheeled to
the courtroom and arrange inside minutes to make use of. The Slinger Launcher is powered by a
6.6Ah Lithium battery that may last as long as 3.5 hours of play relying on the
settings getting used and frequency of use. The Slinger Launcher’s comfort as
a tennis bag mixed with its ease of operation and general efficiency as a
tennis ball launcher is the idea that the Company will goal direct gross sales

these avid gamers.

While the preliminary model focus is clearly on tennis, the Company is creating
related launchers to handle different varieties of tennis across the globe which might be
both quickly gaining new contributors or are already well-established sports activities
in their very own proper. These embody, however are usually not restricted to, Pickleball (U.S.),
Soft Tennis (Japan), and Paddle Tennis (International markets), all of that are
at the moment in both improvement or testing and are deliberate for introduction

calendar 2022 .

On December 3, 2020, Slinger signed an unique settlement with Flixsense Pty
Limited d/b/a Gameface for the event of a tennis particular synthetic
intelligence (AI) utility. The Company intends to introduce a market
disrupting tennis app for gamers of all ages and talents. This app will
present a variety of analytics and different providers and embody follow and
tennis health drills and actions, teaching ideas and recommendation and a full suite
of AI analytics. The Company will provide some providers free of cost and will
construct a tiered subscription mannequin for others. The app is predicted to be able to
launch to the market later in calendar 2021.

In future years, the Company plans to enter new ball sport markets akin to
baseball, softball, and cricket, that are at the moment deliberate for introduction in
calendar 2023.

The Company delivers Slinger Launchers straight from the ultimate meeting facility
in Xiamen, China to clients both by direct cargo from the port in China,
or to 3rd social gathering logistics services in Columbia, SC (U.S.) to assist our
U.S. enterprise, Belleville, Ontario, Canada, Rotterdam, The Netherlands to
assist smaller distributors in Canada, Europe, the Middle East, Africa, and
lastly to Israel.

Additionally, we ship full containers of our Slinger Triniti tennis balls from
Wilson (our provider) in Thailand to the United States and Belgium for onward

The Company has contracted with unique distributors globally. These embody
Japan, UK, Ireland, Switzerland, Scandinavian markets (overlaying Denmark, Sweden,
Norway, Finland) Australia, New Zealand, Bulgaria, Czech Republic, Singapore,
Morocco, Slovenia, Slovkian Republic, Hungary, Croatia, Germany, Austria,
France, Italy, Spain, Portugal, Netherlands, Belgium and Luxembourg, Russia,
Middle East GCC markets, Egypt, Bangladesh, Pakistan, Malaysia Czech and Slovak
Republics, Greece, Panama, South Africa, Hong Kong, Macau and China and we’re
in varied levels of negotiation with different potential market distribution
firms throughout the globe.

Strategic Brand Partnerships

The Company is actively engaged on securing a quantity of extremely seen
ground-breaking strategic partnerships throughout tennis. These partnerships will
each present the Company with co-branded merchandise to complement the core product
providing and, on the identical time, are anticipated to drive mutually helpful
advertising and marketing campaigns aimed toward reaching avid tennis gamers globally. Details of
such companions introduced and energetic at the moment embody:

? Wilson Sporting Goods: North America: The Company has entered a strategic
partnership with the worldwide chief in tennis, Wilson, for the provision of
co-branded Triniti tennis balls within the U.S. and Canada markets.

? Professional Tennis Registry (PTR): PTR is the world’s most prestigious
instructing professional group with greater than 40,000 members. The Company has
partnered with PTR for the provision of Slinger Launchers to their membership.

? Peter Burwash International (PBI): A excessive profile group offering
teaching and tennis providers to excessive degree, prime quality accommodations, resorts and
tennis services throughout the globe. The Company is the official provider of
Slinger Launchers to PBI, which will likely be used at every location and PBI will provide
an affiliate internet marketing program selling gross sales to its record of international shoppers.

? DSV Logistics USA and OSL Logistics: DSV is one of the world’s main
suppliers of warehousing, freight forwarding and logistics. The Company will use
DSV warehousing providers within the U.S. to optimize logistical actions. OSL are
at the moment offering all freight forwarding for the U.S. markets and Europe as
properly as third social gathering warehousing logistics in Rotterdam for Europe.



There are at the moment no rivals with merchandise which might be much like the Slinger
Launcher, primarily based on its portability, affordability and tennis bag performance.
There are, nevertheless, different firms that make tennis ball machines, together with
the next:

? Spinshot
? Lobster Sports
? Spinfire Pro 2
? Match Mate Rookie
? Sports Tutor
? Silent Partner

Raw Materials

All supplies used within the Slinger Launder can be found off-the-shelf. The
trolley bag is manufactured with 600D Polyester and has the CA65 certification
for the U.S. market. The launcher housing, Oscillator and Ball Collector tube
components are produced utilizing an injection mould utilizing poly propylene blended with 30%
glass fibers. The digital motors, PCB boards and remote-control components are all
normal off-the-shelf objects.

Intellectual Property

As on the date hereof, the Company has utilized for worldwide design and
utility patent safety for its important 3 merchandise: Slinger Launcher, Slinger
Oscillator and Slinger Telescopic Ball Tube. Patents have been utilized for in
all key markets together with the U.S., China, Taiwan, India, Israel and EU markets
and granted in China and Israel. Trademarks have been utilized for in all main
markets across the globe. Trademark safety has been utilized for and/or
obtained within the following nations:

? U.S.
? Chile
? Taiwan
? Mexico
? EU
? Russia
? Poland
? Czech Republic
? Australia
? New Zealand
? China
? South Korea


? Vietnam
? Singapore
? India
? Canada
? Argentina
? Brazil
? United Arab Emirates*
? South Africa*
? Columbia*
? Israel*
? Japan*
? Switzerland*
? Indonesia*
? Malaysia*
? Thailand*
? Turkey*

*Protection is pending.

The Company is engaged in ongoing efforts to register extra logos throughout an
increasing record of merchandise, providers and functions, that are in varied
levels of the registration course of.

Slinger Bag Inc. owns the rights to its area.


The Company has a chance to disrupt the standard tennis market
globally. The Company expects drive 80% of its international revenues via its
direct-to-consumer go-to-market technique, whether or not that be via its on-line
e-commerce platform at or via related e-commerce
platforms established and managed by its distribution community. The stability of
revenues will likely be pushed via partnerships with main wholesalers,
federations and instructing professional organizations and different transactions throughout varied
markets. The Company will function a third-party distributor construction in all
markets with the exception of the United States, the biggest tennis market
globally, Canada and its founder’s residence market of Israel. Distributor companions
could have unique territories and could have a acknowledged background inside the
tennis business for his or her market in addition to having the monetary capability and
service infrastructure to aggressively develop the Slinger model. Uniquely within the
sports activities business, all shopper orders obtained into from markets
exterior the United States will likely be routed again to our native distribution companions
to meet and to service their native clients. All distributor companions will
buy with superior orders, both primarily based on a vendor-direct FOB Asia direct
ship or via 1 of our 3 international third social gathering distribution services on an obligation
paid foundation and at premium price value. Currently, the Company has signed a quantity
of unique distribution agreements in key markets and has on-going discussions
with different key potential distributor companions in different markets across the globe
and is seeking to shut these distribution preparations within the coming months.

The United States market will stay a direct to shopper marketplace for Slinger. As
the biggest tennis market on this planet with 17.4 million gamers of which 10.5
million are common / avid gamers, the United States is a key market each to
set up the Slinger model and to drive demonstrable development. Recently the
business reported a major enhance in U.S. tennis participation and
general quantity of tennis play events, one thing that has been replicated in
different key tennis markets across the globe. Direct to shopper gross sales will likely be
supplemented by a number of main tennis wholesalers who handle giant
databases of coach, participant, faculty, highschool and membership shoppers. This market
will likely be serviced out of a third-party logistics facility in West Columbia, SC
and operated by one of Slinger’s most well-liked international logistics companions, DSV, one
of the world’s main suppliers of freight-forwarding, logistics and

Brand Marketing

As a direct-to-consumer e-commerce model, all advertising and marketing exercise and promoting
media will likely be centered round pushing customers to and
changing them to purchases. Slinger has engaged a quantity of main companies
to assist its international advertising and marketing efforts:

Brand Nation is a world class influencer advertising and marketing company primarily based in London. Brand
Nation will lead all influencer programming globally. Slinger has seeded about
50% of its deliberate 1,000 international influencers to this point. Influencers focused are
extensive ranging and embody main sports activities, tennis, movie, TV, music and blogger
celebrities all identified for the truth that they play tennis frequently and have a
fan base in extra of 10,000 followers. All influencer exercise is rolled again
as much as the Slinger social media platforms as a method of producing important
model consciousness and product curiosity.


Ad Venture Media Group is a New York primarily based main PPC (pay-per-click) company
whose work is grounded in refined scientific evaluation of shopper information and
shopper traits and they’re acknowledged globally as leaders in paid search and
paid social media campaigns. Ad Venture Media will lead all Slinger PPC exercise
on a performance-based price construction and is briefed to drive shopper
engagement, via bespoke promoting campaigns which might be aligned to our
product profitability targets.

In the United States market, now we have partnered with a corporation referred to as Team
HQS who will handle an affiliate internet marketing program throughout U.S. primarily based instructing
professionals, gamers, juniors and occasions. These associates will likely be offered
with distinctive affiliate internet marketing codes to share with their social media followers
and different such communities that they’re related to and every will obtain an
affiliate internet marketing price primarily based on revenues generated by customers buying
Slinger merchandise attributable to their distinctive code.

We proceed to judge every assist company on a month-to-month foundation and on the identical
time are regularly exploring new avenues to develop our attain to our core

Each of our distributor companions around the globe are establishing their Slinger
distribution enterprise as Slinger itself would do if it was establishing a
Slinger subsidiary in every market. As such, every distributor can even undertake all
varieties of Slinger model advertising and marketing applications in addition to initiating new native
ideas of their very own – all aimed toward reaching the avid/common tennis participant
straight and guaranteeing that the Slinger model message is constant across the
globe. Slinger has agreed an area advertising and marketing finances construction with every
distributor as half of its distribution settlement. This advertising and marketing finances will likely be
primarily funded by the distributor companion with an extra contribution
coming from Slinger with the contribution being linked to the distributor’s
buy targets. Each distributor will execute native grassroots applications
together with demonstration days, native instructing professional partnerships, specialist tennis
community communications, seeding of Slinger product domestically as essential to native
key market tennis influencers to additional enhance the depth of the
influencer effort. Marketing {dollars} can even be allotted to Google, Facebook,
YouTube and different social media promoting spend and, the place acceptable,
permitted and overseen by Ad Venture Media Group.

Distribution Agreements

Slinger Bag Americas has entered into unique distribution agreements for
Slinger’s line of merchandise, together with, however not restricted to, tennis ball launcher
units, tennis ball launcher equipment, sports activities luggage, tennis balls, tennis
courtroom equipment and different tennis associated merchandise within the following markets and
with the next distributors:

Minimum Purchase
Requirement of Slinger
Territory Distributor Tennis Ball Launchers
32,500 via the top of
Japan Globeride Inc. January 2025
United Kingdom and Framework Sports & 9,000 via the top of
Ireland Marketing Ltd May 2025
3,000 via the top of
Switzerland Ace Distribution May 2025
Denmark, Finland, Norway 6,500 via the top of
and Sweden Frihavnskompagniet ApS December 2025
1,000 via the top of
Morocco Planet Sport Sarl December 2025
Sportsman Warehouse t/a 2,500 via the top of
Australia Tennis Only 2025
Sporting Goods 100 via the top of
New Zealand Specialists 2025
950 via the top of
Bulgaria Ark Dream EOOD 2025
165 via the top of
Chile Sporting Brands Ltda 2025
Croatia, Hungary and 380 via the top of
Slovenia Go 4 d.o.o. 2025
Austria, Belgium, France,
Germany, Italy,
Luxembourg, Portugal, Dunlop International 120,000 via the top
Spain and The Netherlands Europe Ltd of 2025
950 via the top of
Singapore Tennis Bot Pte Ltd 2025
10,000 via the top of
India Racquets4U 2025
2,050 via the top of
Israel Eran Shine 2025
Bahrain, Bangladesh,
Egypt, Kuwait, Maldives,
Oman, Pakistan, Qatar,
Saudi Arabia, Sri Lanka,
Tunisia and United Arab 3,000 via the top of
Emirates Color Sports Inc 2025
380 via the top of
Greece Elsol 2025
50 via the top of
Panama Orange Pro 2021
1,900 via the top of
Russia Neva Sport 2025
500 via the top of
Malaysia Tennis Bot 2025
Czech and Slovak 3,000 via the top of
Republics RaketSport s.r.o 2025
5,000 via the top of
South Africa Golf Racket Pty Ltd 2025
750 via the top of
Hong Kong and Macau Tennis Bot 2025
650 via the top of
Indonesia and Philippines Tennis Bot 2026
Xiamen Powerway Sports 17,500 via the top of
China Co. Ltd 2026
Total 221,825


Brand Endorsements

We have reached settlement with a number of globally acknowledged tennis gamers and
coaches to turn out to be model ambassadors.

Tommy Haas (former ATP #2 Player) has been appointed the Slinger Bag Chief
Ambassador. In this function Tommy will assist Slinger in constructing out its international
ambassador crew centered on figuring out ambassadors in our key international enterprise
markets of the U.S., Japan, Europe, Australia, China, Brazil and India. Tommy
can even be very energetic supporting and selling Slinger throughout the globe with
private appearances at Slinger occasions and through on-line coaching and drill movies.

Mike and Bob Bryan (aka the Bryan Brothers – the foremost doubles crew within the
tennis world) have prolonged their ambassador agreements and will proceed to
characteristic prominently in our advertising and marketing actions and messaging.

Additionally, now we have model endorsements with the next athletes and

? Eugenie Bouchard
? Luke and Murphy Jensen (aka the Jensen Brothers)
? Darren Cahill
? Nick Bollettieri
? Patrick Mouratoglou
? Dustin Brown

Each of the foregoing athletes and coaches is or was both a world-ranked
singles or doubles tennis participant or, within the case of Nick Bollettieri and Patrick
Mouratoglou, the coach of a quantity of world-ranked tennis gamers, has a big
following of followers and supporters and is energetic throughout many points of tennis
at the moment.

The Professional Tennis Registry (PTR) – a United States-based instructing instructor
affiliation with roughly 40,000 members will turn out to be a non-exclusive
strategic companion for Slinger with all their members capable of entry an affiliate
member half of our web site.

Peter Burwash International (PBI) – a United States-based, extremely revered,
international tennis providers firm arrange by Peter Burwash some 35 years in the past. PBI
gives tennis applications and different tennis providers to as many as 56 of the
globes main accommodations and resorts. Slinger Launchers will likely be out there to make use of at
every resort and the PBI crew will likely be actively selling Slinger as half of

affiliate internet marketing exercise.

PTCA Central Europe – a European coach group of main touring professional
coaches and they, like others, will undertake an affiliate internet marketing strategy.

Tie Break 10s – a world group that owns and operates Tie Break 10 occasions
each independently and in partnership with main international tour occasions, e.g.,
Indian Wells. These occasions contain prime gamers enjoying ‘tie-break’ matches with
the occasion totally accomplished in a single night and with a major money prize for
the winner. Slinger will likely be promoted at every of these occasions and will likely be
out there for followers to check out in addition to the Slinger model title being
prominently used on Tie Break 10s social media.

Tennis One App – a United States-based firm that has developed and
efficiently marketed an all-inclusive tennis app for gamers throughout the globe.
Slinger has engaged with Tennis One to assist its coaches nook section – a
weekly podcast sequence and in doing so advantages from the model publicity out there
via the attain of the customers utilizing the app regularly.

Functional Tennis – an Ireland primarily based social media tennis weblog website with an
extra of 250,000 followers. Slinger is engaged with Functional Tennis in a
selection of methods and is the presenting sponsor of its weekly Tennis Podcast.

We are at the moment in discussions with different organizations, occasions, distinguished
coaches and gamers and must date seeded Slinger merchandise to 12 of the Top 20
ATP male gamers, 5 of the highest 20 WTA girls gamers, plus quite a few different
top-class touring and instructing professionals.

Throughout 2020 we sponsored a number of distinguished tennis occasions, e.g. Battle of the
Brits, Tie Break 10s (all proven dwell throughout the globe).

Research and Development

The Company is concerned in further analysis and improvement of transportable,
inexpensive and player-enhancing ball launching machines and related recreation
enchancment merchandise for all ball sports activities. Following a profitable launch of its
tennis ball launcher, Slinger is at the moment area testing its new pickleball,
paddle and tender tennis launchers, that are anticipated to be launched to the
market in calendar 2022. Slinger plans to introduce related transportable,
versatile and inexpensive ball launchers for baseball, softball, cricket,
badminton and different excessive participation ball sports activities over the course of the following 3
years. In this connection, on September 10, 2020, Slinger entered into an
settlement with Igloo Design, which is identical firm that designed the Slinger
Launcher for tennis, for a Slinger ball launcher for baseball and softball. This
improvement commenced in the course of the three months ended October 31, 2020 and preliminary
design concepts and additional course have been offered.

We retain exterior consultants to supply analysis and product design providers
and every marketing consultant has a particular experience (e.g., molding expertise,
electronics, product design, bag design, as examples). We are also working with
a choose group of extremely certified and resourceful third-party suppliers in
Asia. We are regularly striving to determine product enhancements, new ideas
and enchancment to the manufacturing course of on an on-going day by day foundation. In respect
of any new mission, administration gives detailed briefs, market information, product
price targets, aggressive evaluation, timelines and mission price objectives to both
the product consultants or distributors and manages them to agreed upon key
efficiency indicators (“KPIs”). These KPI’s embody however are usually not restricted to: (i)
manufacturing to focus on prices; (ii) agreed improvement timelines; (iii)
established high quality standards; and (iv) outlined efficiency standards.

We additionally retain specialist trademark and patent attorneys and work with these
attorneys on the tasks, as wanted.

Government Regulation

Both Slinger Launcher and Slinger Oscillator meet all of the U.S. authorities
necessities for electrical, radio wave and battery requirements in addition to having
all essential and required certification to facilitate international advertising and marketing and
gross sales of these merchandise.


Results of Operations for the Three Months Ended July 31, 2021 and 2020

The following are the outcomes of our operations for the three months ended July
31, 2021 as in comparison with 2020:

For the Three Months Ended
July 31, July 31,
2021 2020 Change
(Unaudited) (Unaudited)

Net gross sales $ 2,537,573 $ 564,985 $ 1,972,588
Cost of gross sales 1,752,351 936,900 815,451
Gross earnings (loss) 785,222 (371,915 ) 1,157,137

Operating bills:

Selling and advertising and marketing bills 707,097 302,018


General and administrative bills 2,394,799 759,268


Research and improvement prices 174,048 28,110

Total working bills 3,275,944 1,089,396 2,186,548
Loss from operations (2,490,722 ) (1,461,311 ) (1,029,411 )

Other expense (earnings):

Amortization of debt reductions 21,216 233,708 (212,492 )
Loss (acquire) on extinguishment of
debt 5,118,435 (566,667 )


Gain on change in truthful worth of
derivatives (4,327,344 ) – (4,327,344 )
Interest expense – associated social gathering 56,233 172,464

(116,231 )
Interest expense, internet 76,050 73,210 2,840
Total different expense (earnings) 944,590 (87,285 ) 1,031,875
Loss earlier than earnings taxes (3,435,312 ) (1,374,026 ) (2,061,286 )
Provision for earnings taxes – – –
Net loss $ (3,435,312 ) $ (1,374,026 ) $ (2,061,286 )

Net gross sales

Net gross sales elevated $1,972,588, or 349%, in the course of the three months ended July 31,
2021 as in comparison with the three months ended July 31, 2020. The enhance is because of
a rise within the quantity of new orders positioned on the Company’s web site and from
its worldwide distributors and fulfilled in the course of the three months ended July
31, 2021 as in comparison with the three months ended July 30, 2020 when a big
portion of the orders have been associated to the Kickstarter and Indiegogo crowdfunding
campaigns initiated in fiscal yr 2019. As of July 31, 2021, we had deferred
income of $1,239,083 representing quantities obtained for items that haven’t been
shipped to clients. We count on these orders to be fulfilled and the gross sales to be
acknowledged within the yr ended April 30, 2022.

Cost of gross sales and Gross earnings (loss)

Cost of gross sales elevated $815,451, or 87%, in the course of the three months ended July 31,
2021 as in comparison with the three months ended July 31, 2020, which was primarily
because of the enhance in internet gross sales. Gross earnings elevated $1,157,137, or 311%,
in the course of the three months ended July 31, 2021 as in comparison with the three months
ended July 31, 2020. The enhance in gross earnings is essentially because of the prior
yr gross loss on internet gross sales being as a result of (1) discounted pricing on the preliminary
crowdfunding orders, (2) as achievement was later than initially scheduled we
fulfilled orders with the “deluxe” model of launcher (together with all options),
in addition to tennis balls, each of which elevated prices, and (3) as a result of sanctions
by the U.S. towards Chinese sourced merchandise, the import responsibility was raised on all
launchers introduced into the U.S. growing our price of gross sales. As a consequence, our
price of gross sales exceeded preliminary gross sales values raised in our crowdfunding
campaigns. As of the start of the third quarter within the prior yr,
considerably all of the preliminary crowdfunding orders had been fulfilled.


Selling and advertising and marketing bills

Selling and advertising and marketing bills elevated $405,079, or 134%, in the course of the three
months ended July 31, 2021 as in comparison with the three months ended July 31, 2020.
This enhance is essentially pushed by a rise in social media promoting,
sponsorships, and different investments in our public relations presence with a purpose to
drive gross sales and construct model consciousness.

General and administrative bills

General and administrative bills, which primarily consist of compensation
(together with share-based compensation) and different employee-related prices, as properly
as authorized charges and charges for skilled providers, elevated $1,635,531, or 215%,
in the course of the three months ended July 31, 2021 as in comparison with the three months
ended July 31, 2020. This enhance is essentially as a result of a rise in compensation
expense as a result of elevated headcount, in addition to elevated shares and warrants
issued for providers as a result of elevated ambassadors, because of this of the continued
development of the enterprise.

Research and improvement prices

Research and improvement prices elevated $145,938, or 519%, in the course of the three
months ended July 31, 2021 as in comparison with the three months ended July 31, 2020.
This enhance is primarily pushed by our funding in a brand new platform and app
that may combine synthetic intelligence (AI) expertise to supply extra worth
to our clients, which we started creating in December 2020.

Other bills (earnings)

Other bills, internet elevated $1,031,875 in the course of the three months ended July 31,
2021 as in comparison with the three months ended July 31, 2020. The enhance was
primarily because of the enhance in loss on extinguishment of debt in the course of the three
months ended July 31, 2021, which was partially offset by an elevated acquire on
the change in truthful worth of derivatives in addition to a lower within the
amortization of debt reductions and associated social gathering curiosity expense because of this of
decrease associated social gathering debt balances yr over yr.

Liquidity and Capital Resources

Our monetary statements have been ready on a going concern foundation which
assumes we can notice our property and discharge our liabilities in
the conventional course of enterprise for the foreseeable future. We had an accrued
deficit of $32,258,585 as of July 31, 2021 and extra losses are anticipated in
the event of the enterprise. Accordingly, there’s substantial doubt about
our means to proceed as a going concern. Our monetary statements don’t
embody any changes associated to the recoverability and classification of
property or the quantities and classification of liabilities that could be essential
ought to we be unable to proceed as a going concern.

The means to proceed as a going concern relies upon our producing
worthwhile operations sooner or later and/or having the ability to receive the required
financing to fulfill our obligations and repay our liabilities arising from regular
enterprise operations once they turn out to be due. Management intends to finance
working prices over the following twelve months with present money available, loans
from associated events, and/or personal placement of debt and/or frequent inventory.

The following is a abstract of our money flows from working, investing and
financing actions for the three months ended July 31, 2021 and 2020:

For the Three Months Ended
July 31, July 31,
2021 2020

Cash flows utilized in working actions $ (104,683 ) $ (1,594,486 )
Cash flows utilized in investing actions
(300,000 ) –

Cash flows offered by financing actions 500,000 1,620,000

We had money and money equivalents of $1,013,309 as of July 31, 2021, as in contrast
to $928,796 as of April 30, 2021.

Net money utilized in working actions was $104,683 in the course of the three months ended
July 31, 2021, in contrast with $1,594,486 throughout the identical interval in 2020. Our internet
money utilized in working actions in the course of the three months ended July 31, 2021
was primarily the consequence of our internet loss of $3,435,312 for the interval in addition to
will increase in stock and pay as you go bills and different present property in the course of the
interval, which was partially offset by internet non-cash bills of $1,659,833 and
will increase in accounts payable and accrued bills, accrued payroll and bonuses,
deferred income and accrued curiosity – associated social gathering in addition to a lower in
accounts receivable in the course of the interval. Our internet money utilized in working actions
in the course of the three months ended July 31, 2020 was primarily the consequence of our internet
loss of $1,374,026 for the interval in addition to will increase in stock and accounts
receivable, internet non-cash good points of $267,133, and decreases in accounts payable
and accrued bills. These objects have been partially offset by will increase in accrued
payroll and bonuses, deferred income and accrued curiosity – associated social gathering as
properly as a lower in pay as you go bills and different present property in the course of the

Net money utilized in investing actions was $300,000 and $0 for the three months
ended July 31, 2021 and 2020. Our internet money utilized in investing actions throughout
the three months ended July 31, 2021 consisted of a $300,000 issuance of a


Net money offered by financing actions was $500,000 for the three months
ended July 31, 2021, in contrast with $1,620,000 for a similar interval in 2020. Cash
offered by financing actions for the three months ended July 31, 2021
consisted of proceeds of $500,000 from a word payable with a associated social gathering. Cash
offered by financing actions for the three months ended July 31, 2021
consisted of proceeds of $1,500,000 from notes payable with a associated social gathering and
proceeds of $120,000 from a word payable.


Description of Indebtedness

Notes Payable – Related Party

Total excellent borrowings from the Company’s associated social gathering lender as of July
31, 2021 amounted to $500,000. Accrued curiosity as a result of this associated social gathering as of
July 31, 2021 amounted to $803,869.

On August 4, 2021, the Company entered right into a mortgage settlement with its associated
social gathering lender for borrowings of $500,000. The mortgage is to be repaid inside 30 days
of receipt and shall bear curiosity at a price of 12% each year.

On August 11, 2021, the Company repaid the excellent principal to its associated
social gathering lender for the July 23, 2021 mortgage of $500,000 and the August 4, 2021

of $500,000.

See Note 5 and Note 11 to the condensed consolidated monetary statements for
further info.

Note Payable

On April 15, 2021, the Company entered right into a $2,000,000 word payable (the
“Note”). The Note matures April 14, 2023 and bears curiosity at fifteen p.c
(15%) per yr. The Company pays curiosity at maturity, at which period all
principal and unpaid curiosity is due.

On August 6, 2021, the Company used the online proceeds from the sale of the
Securities (see Note 11) to pay 100% of the excellent principal and accrued
curiosity via August 6, 2021 of the $2,000,000 Note.

See Note 6 and Note 11 to the condensed consolidated monetary statements for
further info.

Future quantities due as of July 31, 2021 are summarized as follows:

Payments due by interval
Less than More than 5
Total 1 yr 1-3 years 3-5 years years

Notes Payable – Related Party $ 500,000 $ 500,000 $ –

$ – $ –
Note Payable 2,000,000 – 2,000,000 – –
Total $ 2,500,000 $ 500,000 $ 2,000,000 $ – $ –

We count on that working capital necessities will proceed to be funded via a
mixture of our present funds, money flows from operations and additional
issuances of debt and/or securities. Our working capital necessities are
anticipated to extend in keeping with the expansion of our enterprise.

Existing working capital, additional advances and debt devices, and anticipated
money move are anticipated to be sufficient to fund our operations over the following
twelve months. We haven’t any strains of credit score or different financial institution financing preparations.
Generally, now we have financed operations to this point via the proceeds of personal
placement of fairness and debt devices. In reference to our marketing strategy,
administration anticipates further will increase in working bills and capital
expenditures regarding the (i) acquisition of stock; (ii) developmental
bills related to a start-up enterprise; and (iii) advertising and marketing bills. We
intend to finance these bills with additional issuances of securities and debt
issuances. Thereafter, we count on we might want to elevate further capital and
generate revenues to fulfill long-term working necessities. Additional issuances
of fairness or convertible debt securities will lead to dilution to our present
shareholders. Further, such securities may need rights, preferences or
privileges senior to our frequent inventory. Additional financing will not be out there
upon acceptable phrases, or in any respect. If sufficient funds are usually not out there or not
out there on acceptable phrases, we could not be capable to take benefit of
potential new enterprise endeavors or alternatives, which might considerably
and materially prohibit our enterprise operations.

Off-Balance Sheet Arrangements

We haven’t any off-balance sheet preparations.

Effect of Inflation and Changes in Prices

We don’t imagine that inflation and modifications in costs could have a cloth
impact on our operations.

Going Concern

Our impartial registered public accounting agency auditors’ report accompanying
our April 30, 2021 monetary statements contained an explanatory paragraph
expressing substantial doubt about our means to proceed as a going concern.
The monetary statements have been ready assuming that we’ll proceed as a
going concern, which contemplates that we’ll notice our property and fulfill
out liabilities and commitments within the unusual course of enterprise.

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