UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q/A

Amendment No. 1

☒ QUARTERLY REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

For Quarterly Period Ended: June 30, 2021

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

For the transition period from __________ to __________

Commission File No. 001-40681

Worksport Ltd.

(Exact Name of Small Business Issuer as specified in its charter)

Nevada		35-2696895
(State or Other Jurisdiction of		(I.R.S. Employer
Incorporation or Organization)		Identification Number)

414-3120 Rutherford Rd

Vaughan, Ontario, Canada L4K 0B1

(Address of Principal Executive Offices, Including Zip Code)

Registrant’s Telephone Number, including area code: (888) 554-8789

With copies to:

Ross Carmel, Esq.

Philip Magri, Esq.

Carmel, Milazzo & Feil LLP

55 W 39th Street, 18th Floor

New York, NY 10018

Tel: 212-658-0458

Fax: 646-838-1314

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

Title of each class:	Trading Symbol(s)	Name of each exchange on which registered:
Common Stock	WKSP	NASDAQ CAPITAL MARKET
Warrants	WKSPW	NASDAQ CAPITAL MARKET

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

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months (or such shorter year that the registrant was required to submit and post such files. Yes ☒ No ☐

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

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

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

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

As of August 16, 2021 11,453,446 shares of Common Stock outstanding.

EXPLANATORY NOTE

This Amendment No. 1 to the Form 10-Q (this “Amendment”) amends the Quarterly Report on Form 10-Q of Worksport Ltd. for the period ended June 30, 2021, filed on August 16, 2021 (the “Form 10-Q”) for the sole purpose of amending non-material language contained in Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations. In addition, as required by Rule 12b-15 under the Securities Exchange Act of 1934, as amended, new certifications by our principal executive officer and principal financial officer are filed as exhibits to this Amendment.

This Amendment does not reflect events that may have occurred subsequent to the original filing date.

WORKSPORT LTD.

TABLE OF CONTENTS

	Page
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements.
Condensed Consolidated Balance Sheets at June 30, 2021 and December 31, 2020 (Unaudited)	3
Condensed Consolidated Statements of Operations for the three and six months ended June 30, 2021 and 2020 (Unaudited)	4
Condensed Consolidated Statements of Cash Flow for the six months ended June 30, 2021 and 2020 (Unaudited)	5
Condensed Consolidated Statement of Shareholders’ Deficit for the three and six months ended June 30, 2020 and 2021 (Unaudited)	6
Notes to the Condensed Consolidated Financial Statements (Unaudited)	8

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	16

Item 3. Quantitative and Qualitative Disclosures About Market Risk	19

Item 4. Controls and Procedures	19

PART II OTHER INFORMATION

Item 1. Legal Proceedings	20

Item 1A. Risk Factors	20

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	20

Item 3. Defaults Upon Senior Securities	20

Item 4. Mine Safety Disclosures	20

Item 5. Other Information	20

Item 6. Exhibits	21

SIGNATURES	22

PART I – FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

Worksport Ltd.

Condensed Consolidated Balance Sheets

(Unaudited)

	June 30, 2021			December 31, 2020
Assets
Current Assets
Cash and cash equivalents	$	12,266,597		$	1,107,812
Accounts receivable net		106,283			122,787
Other receivable		56,348			167,836
Inventory (note 3)		73,435			40,803
Prepaid inventory (note 3)		179,713			-
Prepaid expenses and deposits		435,536			245,526
Related party receivable (note 7)		2,538			-
Total Current Assets		13,120,450			1,684,764
Investment		24,423			24,423
Property and Equipment, net		340,934			91,511
Right-of-use asset, net (note 10)		631,753			38,506
Intangible Assets, net		298,114			62,948
Total Assets	$	14,415,674		$	1,902,152

Liabilities and Shareholders’ Deficit
Current Liabilities
Accounts payable and accrued liabilities	$	906,640		$	971,667
Payroll taxes payable		51,186			48,216
Related party loan (note 7)		-			23,393
Promissory notes payable (note 4)		263,211			367,058
Convertible promissory note, net (note 5)		-			98,982
Loan payable (note 11)		28,387			184,854
Current lease liability (note 10)		213,775			23,883
Total Current Liabilities		1,463,199			1,718,053
Long Term – Lease Liability (note 10)		420,369			14,624
Total Liabilities		1,883,568			1,732,677

Shareholders’ Equity (Deficit)
Series A & B Preferred Stock, $0.0001 par value, 100,100 shares authorized, 100 Series A and 0 Series B issued and outstanding, respectively (note 6)		-			1
Common stock, $0.0001 par value, 299,000,000 shares authorized, 11,148,292 and 3,820,618 shares issued and outstanding, respectively (note 6)		1,115			382
Additional paid-in capital		26,609,130			12,665,854
Share subscriptions receivable		(1,577	)		(1,577	)
Share subscriptions payable		833,229			379,428
Accumulated deficit		(14,901,211	)		(12,866,033	)
Cumulative translation adjustment		(8,580	)		(8,580	)
Total Shareholders’ Equity (Deficit)		12,532,106			169,475
Total Liabilities and Shareholders’ Equity (Deficit)	$	14,415,674		$	1,902,152

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

Worksport Ltd.

Condensed Consolidated Statements of Operations

For the three and six months ended June 30, 2021 and 2020

(Unaudited)

	2021			2020			2021			2021
	Three Months ended June 30						Six Months ended June 30,
	2021			2020			2021			2021

Net Sales	$	186,239		$	66,102		$	193,889		$	107,129
Cost of Goods Sold		137,333			58,883			197,554			85,894
Gross Profit (Loss)		48,906			7,219			(3,665	)		21,235

Operating Expenses
General and administrative		272,022			12,824			406,306			46,730
Sales and marketing		165,156			7,921			327,807			10,747
Professional fees		410,485			119,469			1,057,599			228,934
(Gain) loss on foreign exchange		3,799			282			9,005			(7,444	)
Total operating expenses		851,462			140,496			1,800,717			278,967
Loss from operations		(802,556	)		(133,277	)		(1,804,382	)		(257,732	)

Other Income (Expense)
Interest expense (note 5)		(18,100	)		(58,908	)		(249,000	)		(86,719	)
Gain (loss) on settlement of debt		8,997			-			18,204			-
Total other income (expense)		(9,103	)		(58,908	)		(230,796	)		(86,719	)

Net Loss	$	(811,659	)	$	(192,185	)	$	(2,035,178	)	$	(344,451	)

Loss per Share (basic and diluted)	$	(0.08	)	$	(0.08	)	$	(0.27	)	$	(0.15	)
Weighted Average Number of Shares (basic and diluted)		9,827,576			2,466,875			7,505,625			2,360,511

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

Worksport Ltd.

Condensed Consolidated Statements of Cash Flows

For the six Months Ended June 30, 2021 and 2020

(Unaudited)

	2021			2020
Operating Activities
Net Loss	$	(2,035,178	)	$	(344,451	)
Adjustments to reconcile net loss to net cash from operating activities:
Shares and warrants issued for services		1,106,025			69,210
Depreciation and amortization		38,014			13,157
Interest on lease liability		6,704			2,789
Accrued interest		24,691			-
Amortization of debt discount		-			42,038
Amortization on OID interest		211,340			3,735
Gain on settlement of debt		(18,203	)		-
		(666,607	)		(213,522	)
Changes in operating assets and liabilities (note 8)		(329,319	)		(16,031	)
Net cash used in operating activities		(995,926	)		(229,553	)

Cash Flows from Investing Activities
Loan receivable		(5,507	)		-
Purchase of investment		-			(8,764	)
Purchase of intangible assets		(23,700	)		-
Purchase of property and equipment		(257,305	)		-
Net cash used in investing activities		(286,512	)		(8,764	)

Financing Activities
Repayment of lease liability		(35,063	)		-
Proceeds from issuance of common shares, net of issuance cost		6,928,617			-
Proceeds from warrant exercise		5,636,505			-
Proceeds from loan payable		-			60,836
Repayment of loan payable		(62,905	)		-
Proceeds from promissory notes		-			182,500
Shareholder assumption of debt		(25,931	)		4,099
Net cash provided by financing activities		12,441,223			247,435
Change in cash		11,158,785			9,118
Cash and cash equivalents - beginning of year		1,107,812			11,993
Cash and cash equivalents end of year	$	12,266,597		$	21,111
Supplemental disclosure of cash flow information:
Interest paid	$	9,737		$	7,400
Supplemental Disclosure of non-cash investing and financing Activities
Shares issued for purchase of software	$	212,671		$	-
Shares issued to service providers	$	1,192,279		$	-
Cashless warrant exercise	$	51,901		$	-
Shares issued for share subscriptions payable	$	76,830		$	1,035,660
Shares issued for loan repayment	$	174,500		$	-
Conversion of convertible promissory note to common stock	$	368,320		$	-
Convertible promissory note – equity discount	$	-		$	182,500
Convertible promissory note – original issue discount	$	-		$	16,215
Conversion of preferred stock to common stock	$	171		$	-
Reverse stock split	$	21,182		$	-

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

Worksport Ltd.

Condensed Consolidated Statements of Shareholders’ Deficit

For the Three Months Ended June 30, 2020 and 2021

(Unaudited)

	Shares			Amount			Shares		Amount		Capital			Receivable			Payable			Deficit			Adjustment			(Deficit)
	Preferred Stock						Common Stock				Additional Paid-in			Share Subscriptions			Share Subscription			Accumulated			Cumulative Translation			Total Stockholders’ Equity
	Shares			Amount			Shares		Amount		Capital			Receivable			Payable			Deficit			Adjustment			(Deficit)
Balance at April 1, 2020		-			-			2,450,329	$	245	$	9,797,341		$	(1,577	)	$	1,315,923		$	(11,830,679	)	$	(8,580	)	$	(727,327	)
Issuance for prepaid services		-			-			78,667		8		136,792			-			-			-			-			136,800
Issuance for prepaid services and subscriptions payable		-			-			107,500		11		67,177			-			(67,188	)		-			-			-
Issuance of Series A Preferred Stock		1,000			1			-		-		89			-			-			-			-			90
Conversion of preferred stock to common stock
Consulting Service for share subscriptions
Issuance of shares from Reg-A
Conversion of convertible promissory note to shares
Cashless warrant exercise
Share issuance cost
Issuance for services and subscriptions payable
Issuance of shares from private placement
Warrant exercise
Loan repayment
Issuance of share subscriptions payable
Warrants issuance in connection to convertible promissory note
Share issuance in connection to convertible promissory note
Issuance for settlement of payables
Issuance of Preferred Stock
Warrants issuance for services
Net loss		-			-			-		-		-			-			-			(192,185	)		-			(192,185	)
Balance at June 30, 2020		1,000		$	1			2,636,496	$	264	$	10,001,399		$	(1,577	)	$	1,248,735		$	(12,022,864	)	$	(8,580	)	$	(782,622	)

Balance at April 1, 2021		1,000		$	1			8,138,199	$	814	$	22,554,768		$	(1,577	)	$	372,131		$	(14,089,552	)	$	(8,580	)	$	8,828,005
Conversion of preferred stock to common stock		(900	)		(1	)		1,717,535		172		(171	)		-			-			-			-			-
Consulting Service for share subscriptions		-			-			-		-		-			-			225,923			-			-			225,923
Issuance for services and subscriptions payable		-			-			97,100		9		585,363			-			-			-			-			585,372
Share issuance cost		-			-			-		-		(64,824	)		-			-			-			-			(64,824	)
Issuance of shares from private placement		-			-			516,000		52		1,031,948			-			(32,000	)		-			-			1,000,000
Warrant exercise (note 14)		-			-			581,404		58		2,325,556			-			378,785			-			-			2,704,399
Loan repayment (note 11)		-			-			98,054		10		176,490			-			(111,610	)		-			-			64,890
Net loss		-			-			-		-		-			-			-			(811,659	)		-			(811,659	)
Balance at June 30, 2021		100			-			11,148,292	$	1,115	$	26,609,130		$	(1,577	)	$	833,229		$	(14,901,211	)	$	(8,580	)	$	12,532,106

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

Worksport Ltd.

Condensed Consolidated Statements of Shareholders’ Deficit

For the Six Months Ended June 30, 2020 and 2021

(Unaudited)

	Preferred Stock						Common Stock				Additional Paid-in			Share Subscriptions			Share Subscription			Accumulated			Cumulative Translation			Total Stockholders’ Equity
	Shares			Amount			Shares		Amount		Capital			Receivable			Payable			Deficit			Adjustment			(Deficit)
Balance at January 1, 2020		-			-			2,095,340	$	210	$	8,646,404		$	(1,577	)	$	2,159,395		$	(11,678,413	)	$	(8,580	)	$	(882,561	)
Issuance for prepaid services		-			-			78,667		8		136,792			-			-			-			-			136,800
Issuance for prepaid services and subscriptions payable		-			-			107,500		11		67,177			-			57,812			-			-			125,000
Issuance of share subscriptions payable		-			-			222,942		22		510,978			-			(511,000	)		-			-			-
Warrants issuance in connection to convertible promissory note (note 5 and 10)		-			-			-		-		59,110			-			-			-			-			59,110
Share issuance in connection to convertible promissory note (note 5)		-			-			22,500		2		123,388			-			-			-			-			123,390
Issuance for settlement of payables		-			-			109,548		11		457,461			-			(457,472	)		-			-			-
Issuance of Preferred Stock		1,000			1			-		-		89			-			-			-			-			90
Net loss		-			-			-		-		-			-			-			(344,451	)		-			(344,451	)
Balance at June 30, 2020		1,000		$	1			2,636,496	$	264	$	10,001,399		$	(1,577	)	$	1,248,735		$	(12,022,864	)	$	(8,580	)	$	(782,622	)

Balance at January 1, 2021		1,000		$	1			3,820,618	$	382	$	12,665,854		$	(1,577	)	$	379,428		$	(12,866,033	)	$	(8,580	)	$	169,475
Conversion of preferred stock to common stock		(900	)		(1	)		1,717,535		172		(171	)		-			-			-			-			-
Consulting Service for share subscriptions		-			-			-		-		-			-			337,145			-			-			337,145
Issuance for services and subscriptions payable		-			-			413,158		42		1,155,238			-			(241,559	)		-			-			913,721
Issuance of shares from Reg-A		-			-			1,502,409		150		3,003,171			-			(32,700	)		-			-			2,970,621
Share issuance cost		-			-			-		-		(123,984	)		-			-			-			-			(123,984	)
Issuance of shares from private placement		-			-			2,040,990		204		4,081,776			-			-			-			-			4,081,980
Warrants issuance for services		-			-			-		-		37,000			-			-			-			-			37,000
Conversion of convertible promissory note to shares (note 5)		-			-			204,622		20		368,298			-			-			-			-			368,318
Cashless warrant exercise (note 14)		-			-			39,512		4		(4	)		-			-			-			-			-
Warrant exercise (note 14)		-			-			1,311,394		131		5,245,460			-			390,915			-			-			5,636,506
Loan repayment (note 11)		-			-			98,054		10		176,492			-			-			-			-			176,502
Net loss		-			-			-		-		-			-			-			(2,035,178	)		-			(2,035,178	)
Balance at June 30, 2021		100			-			11,148,292	$	1,115	$	26,609,130		$	(1,577	)	$	833,229		$	(14,901,211	)	$	(8,580	)		12,532,106

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

Worksport Ltd.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

1. Basis of Presentation and Business Condition

a) Interim Financial Information

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) for interim financial information pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (SEC). Accordingly, they do not include all of the information and notes required by GAAP for complete financial statements. In the opinion of management, all adjustments and reclassifications considered necessary in order to make the financial statements not misleading and for a fair and comparable presentation have been included and are of a normal recurring nature. Operating results for the six-month period ended June 30, 2021 are not necessarily indicative of the results that may be expected for the year ending December 31, 2021. The accompanying unaudited condensed consolidated financial statements should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2020 filed with the SEC on April 13, 2021.

On May 21, 2021, the Board of Directors authorized the submission of a Certificate of Change/Amendment to the Nevada Secretary of State in which the Company sought to affect a reverse split of its common stock at the rate of 1 for 20 for the purpose of increasing the per share price for the Company’s stock in an effort to meet the minimum listing requirements of the NADAQ. The Certificate of Change was submitted to the Nevada Secretary of State on May 21, 2021 and the FINRA corporate action was announced on August 3, 2021. FINRA declared the 1 for 20 reverse stock split effective on August 4, 2021. These condensed interim financial statements including, prior period comparative share amounts, have been retrospectively restated to reflect this reverse split.

b) Functional and Reporting Currency

Effective January 1, 2020, the Company changed the functional currency of its subsidiary to United States dollars given the increasing prevalence of U.S. dollar-denominated activities of the subsidiary over time. The change in functional currency from Canadian dollars to United States dollars is accounted for prospectively from January 1, 2020. The subsidiary’s balance sheet was converted from Canadian dollars to United States dollars using the year ended December 31, 2019 United States dollar balance as the opening for January 1, 2020 in accordance to ASC 830. These condensed interim financial statements are presented in United States Dollars. The functional and presentation currency of the Company and its subsidiary is the United States Dollar. As a result of the change in functional currency the Company recognized a loss on foreign exchange of $29,940.

c) Use of Estimates

The preparation of condensed unaudited financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed interim financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates.

d) Business condition

The Company has evaluated whether there are conditions and events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date the financial statements are issued.

As of June 30, 2021, the Company had working capital of $11,657,250 and an accumulated deficit of $14,901,211. As of June 30, 2021, the Company had cash and cash equivalents of $12,266,597. Based on its current operating plans, the Company believes it has sufficient level of funding for anticipated operations, capital expenditures and debt repayments for a period of at least 12 months from the issuance date of this Annual Report.

During the six month ended June 30, 2021 the Company through its Reg-A public offering, private placement offering, and exercises of warrants had raised in aggregate of approximately $12,700,000. In addition, as of August 2021 the Company has approximately 2,500,000 (50,000,000 pre-stock split) warrants exercisable at $4 ($0.20 pre-stock split) per warrant compare to an average share price of approximately $4.30 ($0.22 pre-stock split) per share, anticipating additional warrant exercises.

Based on the Company’s future operating plans, existing cash of $12,266,597 combined with possible warrants exercises of approximately $10,000,000; management believes the Company have sufficient funds to meet its contractual obligations and working capital requirements for the next 12 months and the foreseeable future.

Worksport Ltd.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

2. Significant Accounting Policies

The accounting polices used in the preparation of these condensed consolidated interim financial statements are consistent with those of the Company’s audited financial statements for the year ended December 31, 2020 in addition to:

Property and Equipment – During the six month ended June 30, 2021 the Company purchased an automobile. As such the Company has updated its accounting policy of its capital assets. Capital assets are recorded at cost and are amortized using the straight-line method over the following estimated useful lives:

●

Automobile

5 years

3. Inventory

Inventory consists of the following at June 30, 2021 and December 31, 2020:
	2021		2020
Finished goods	$	64,990	$	32,358
Promotional items		552		552
Raw materials		7,893		7,893
Inventory	$	73,435	$	40,803
Prepaid inventory	$	179,713	$	-

4. Promissory Notes

The following tables shows the balance of the notes payable as of June 30, 2021 and December 31, 2020:

Schedule of Notes Payable

Balance as at December 31, 2019	$	267,881
Reclassification		99,177
Balance as at December 31, 2020	$	367,058
Repayment		(103,847	)
Balance as at June 30, 2021	$	263,211

During the year ended December 30, 2020, the Company reclassified $88,120 from accounts payable to promissory notes. The terms of the note is under negotiation and is currently due on demand.

During the year ended December 30, 2020, the Company reclassified a debit balance of $11,058 from notes payable to other receivable.

During the year ended December 31, 2016, the Company issued a secured promissory note in the amount of $73,452 ($123,231 Canadian Dollars). During the year ended December 31, 2018, the Company issued two additions to the original unsecured promissory note of July 2016, totaling $22,639 ($30,884 Canadian dollars). The secured promissory note bears interest at a rate of 18% per annum. The payment terms of the original note including these additions are due “upon completion of going public on the Canadian Securities Exchange, with no change in interest rate. The secured promissory note is secured by all present and after-acquired property and assets of the Company. During the year ended December 31, 2019, the Company extended the maturity dates of the secured promissory notes to be due on April 1, 2021. As at June 30, 2021, principal balance owing was $96,091 ($123,231 Canadian Dollars) (December 31, 2020 - $96,091 ($123,231 Canadian Dollars)). As of June 30, 2021, the accrued interest on this note payable was $57,582 ($75,102 Canadian Dollars) (December 31, 2020 - $48,770 ($64,102 Canadian Dollars)) included in accounts payable and accrued liabilities. As of June 30, 2021, the Company and the secured promissory note holder are in dispute.

During the year ended December 31, 2016, the Company issued secured promissory notes in the amount of $79,000. The secured promissory notes bears interest at a rate of 18% per annum, payable monthly. The secured promissory notes are secured by all present and after-acquired property and assets of the Company. During the year ended December 31, 2019, the Company extended the maturity dates of all secured promissory notes to be due on April 1, 2021. As at June 30, 2021 principal balance owing was $79,000 (December 31, 2020 - $79,000). As of June 30, 2021, the accrued interest on this note payable was $38,032 (December 31, 2020 – $31,000) included in accounts payable and accrued liabilities. As of June 30, 2021, the Company and the secured promissory note holder are in dispute.

During the years ended December 31, 2017, the Company issued secured promissory notes in the amount of $53,848 ($67,700 Canadian Dollars). The secured promissory notes were due in October and November 2018 and bears interest at a rate of 12% per annum. The secured promissory notes are secured by Company inventory and personal assets held by the CEO. During the year ended December 31, 2019, the Company extended the maturity date of the secured promissory notes to November 3, 2020. During the six months ended June 30, 2021, the Company and promissory note holders reached an agreement to repay $62,905 ($80,108 Canadian Dollars) for outstanding principal of $53,848 and interest of $14,740. As a result of the Company recognized a gain on settlement of debt of $5,682. As of June 30, 2021 the secured promissory notes has been repaid in full.

Worksport Ltd.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

4. Promissory Notes (continue)

During the years ended December 31, 2017, the Company issued secured promissory notes in the amount of $60,000. The secured promissory notes are due in August and November 2018 and bear interest at a rate of 12% per annum. The secured promissory notes are secured by Company inventory and personal assets held by the CEO. During the year ended December 31, 2019 the Company extended the maturity dates of this secured promissory note to November 3, 2020. During the year ended December 31, 2019, the Company a principal repayment of $10,000. During the quarter ended June 30, 2021 the Company and secured promissory note holder agreed to repay all outstanding principal and interest through the issuance of 36,048 (720,966 pre-stock split) common shares valued at $0.09 per share. As at June 30, 2021, the Company had

SEC Form 10-Q/A filed by Worksport Ltd. (Amendment)