MicroCap Review Q2 2022

Q2 - 2022 www.SNN.
Network
Microcap Review
T h e O f f i c i a l M a g a z i n e o f t h e M i c r oC a p S to c k M a r k e t S i n c e 2 0 0 6
10
F E AT U R E
Investing globally:
why investors and issuers are
looking abroad with
• Thomas Bachrach, PFH Capital
• Jason Hirschman, Hudson 215 Capital
• Delilah Panino, TSX & TSX Venture
• Perth Tolle, Life + Liberty Indexes
2 2 | Beware of Buying Biotech on the Bottom: Life Science

60 Investing in 2022
b y A b i g a i l Si ru s a n d Dav i d Sa b l e , Spe ci a l Si t uat i o n s L i f e Sci e n c e s F u n d
F E AT U R E
2 8 | Global Cannabis in 2022
Has the b y E mi l y Pa x hi a a n d M o rg a n Pa x hi a , P o s e i d o n A ss e t Man ag e m e n t
8 2 | Fund Manager Q&A with Tavi Costa

Definition of
‘Value Investing’ 17 Kraken Robotics Inc.
(TSX-V: PNG) / (OTCQB: KRKNF)
32 U.S. Global Investors, Inc.
(NASDAQ: GROW)
Changed? 26 Vision Marine Technologies
by Tobias Carlisle Inc. (NASDAQ: VMAR)
42-53 MCRI Q2 2022 Constituent List

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Microcap Review
In Loving Memory of Our Precious
E d i tor i al
Daughter, and Sister, Sammi Kane Kraft
A
Published Since 2006 s we get bombarded with market information
www.SNN.Network and intel in the news, social media, newsletters,
Follow us: @StockNewsNow
TV ads, YouTube etc. we have to keep our
SNN Inc. own perspective in mind, which is, how does what’s
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holdings in our portfolio? How do we make our decisions of whether we should
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buy, sell or hold? As investors we do need to decipher pertinent details from
Robert K. Kraft, MBA the noise of those trying to sell us their ideas. Picking up morsels of truth is still
SNN Chief Executive Officer,
Executive Editor & Director relevant to our decision making which brings me to the point of staying in our
rkraft@snnwire.com
lane, picking sources we trust with a history of accuracy, doing this will do more
Shelly Kraft to protect our self-made directives while resisting a constant repetitive barrage
SNN Founder, Publisher Emeritus
skraft@snnwire.com of attempted paid influences.
Lynda Lou “Lulu” Kraft
SNN President & Director
lkkraft@snnwire.com
Pundits in the microcap world often preach doing your homework, believe in
your own methods, stick to your plan, learn from your mistakes, and build your
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Leslie Richardson sensibility to maintain focus. I believe for the most part they are correct. How-
SNN Compliance and ever, it’s quite difficult to locate non-biased information during our searching for
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it and even harder to interpret incoming information when it finds you.
chairman of snn advisory board
Dr. Leonard Makowka Although I am a market traditionalist and since I historically lean on using my
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©Copyright 2022 by MicroCap Review Magazine Inc. All Rights Re-
served. Reproduction without permission of the Publisher is prohib-
count brokering, and millennial DIY activity gave investors the power of making
ited. The publishers and editors are not responsible for unsolicited
materials. Every effort has been made to assure that all Information decisions but added the need for discipline, research, and trial & error. As far as
presented in this issue is accurate and neither MicroCap Review
Magazine or any of its staff or authors is responsible for omissions
or information that is inaccurate or misrepresented to the magazine.
I’m concerned and in my opinion, I would rather fail or succeed because of my
MicroCap Review Magazine is owned and operated by SNN Inc.
own decisions rather than being led to slaughter and placing blame elsewhere.
This publication and its contents are not to be construed, under any
circumstances, as an offer to sell or a solicitation to buy or effect
transactions in any securities. No investment advice is provided
or should be construed to be provided herein. MicroCap Review
Magazine and its owners, employees and affiliates are not, nor do
any of them claim to be, registered broker-dealers or registered
Like everything in the Stock Market, MicroCaps are down. As of EOD on June
investment advisors. This publication may contain “forward-looking
statements” within the meaning of the Private Securities Litigation 17, 2022, the MicroCap Review (MCRI), our proprietary MicroCap index tracking
Reform Act of 1995, Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934. All statements
other than statements of historical fact are “forward-looking state-
MicroCap performance, is down 26.73% YTD; the only index we track that is
ments” for purposes of federal and state securities laws, including,
but not limited to, any projections of earnings, revenue or other fi- doing worse is NASDAQ, which is down 31.36% YTD. I don’t want to spend time
nancial items; any statements of the plans, strategies and objectives
of management for future operations; any statements concerning
proposed new services or developments; any statements regarding
in this editorial discussing why; I highly recommend tuning into Planet MicroCap
future economic conditions or performance; any statements of belief;
and any statements of assumptions underlying any of the foregoing.
Such forward-looking statements of or concerning the companies
Podcast to hear what my guests have to say about the matter. The real ques-
mentioned herein are subject to numerous uncertainties and risk
factors, including uncertainties and risk factors that may not be set tion is, well, now what? The summer is an opportune time to start reflecting on
forth herein, which could cause actual results to differ materially from
those stated herein. Accordingly, readers are cautioned not to place
undue reliance on such forward-looking statements. This publication
what your financial goals are for the near and long term using some of the data
undertakes no obligation to update any forward-looking statements
that may be contained herein. MicroCap Review Magazine, its own- enclosed in this issue of the magazine, as well as macro data/indicators. Few
ers, employees, affiliates and their families may have investments
in companies featured in this publication, may purchase securities
of companies featured in this publication and may sell securities of
things we are certain of right now: liquidity has dried up, interest rates have
companies featured in this publication, at any time and from time to
time. However, it is the general policy of this publication that such
persons will refrain from engaging in any pre-publication transactions
gone up (and probably will continue to) in order to rein in inflation, high flying
in securities of companies featured in this publication until two trad-
ing days following the publication date. This publication may contain growth names have taken it on the chin. There’s actually a bunch of things
company advertisements/advertorials indicated as such. Information
about a company contained in an advertisement/advertorial has
been furnished by the company, the publisher has not made any
that we’re now certain of, but at the end of the day, despite rising inflation, this
independent investigation of the accuracy of any such information
and no warranty of the accuracy of any such information is provided may sound otherworldly these days, but CASH IS STILL CASH. Having cash to
by this publication, its owners, employees and affiliates. Pursuant to
Section 17(b) of the Securities Act of 1933, as amended, in situations
where the publisher has received consideration for the advertise-
deploy in times like these is where the greats have made names for themselves.
ment/advertorial of a company or security, the amount and nature
of such consideration will be disclosed in print. Readers should al-
ways conduct their own due diligence before making any investment
At least for me, especially if we are going to continue to see declines, not just in
decision regarding the companies and securities mentioned in this
publication. Investment in securities generally, and many of the com- MicroCaps, but overall markets, is when I’m reflecting on how I want to deploy
panies and securities mentioned in this publication from time to time,
are speculative and carry a high degree of risk. The disclaimers set
forth at http://www.microcapreview.com/disclaimer/ - disclaimer are
cash that will set me up for financial independence in the next 10-15-20 years.
incorporated herein by this reference.
We don’t have all the answers, however, by reading this issue of the magazine,
I hope that you’re able to walk away with a few nuggets that can help you on
your path to financial independence. MicroCap Review Magazine 5
CONTENTS
Fe atu r es
10 Investing Globally: Why Investors and Issuers are Looking Abroad
With Thomas Bachrach, PFH Capital; Jason Hirschman, Hudson 215 Capital; Delilah Panino, TSX & TSX Venture;
and Perth Tolle, Life + Liberty Indexes
60 Has the definition of “Value Investing” Changed? by Tobias Carlisle, Acquirers Funds
Ins ights
8 Ask Mr. Wallstreet: Should I Buy, Sell or 80 Market Maker Corner: Payment for Order
Hold? by Shelly Kraft Flow by Eric Flesche, Glendale Securities
14 My Love Affair with Global Investing 82 Fund Manager Q&A with Tavi Costa
by Brandon Mackie, Private Investor
84 DTC Eligibility
18 EVs – Silver to Play a Minor or Major Role? 86 Financing MicroCap Biotechs
by Erik Nelson, Coral Capital Advisors
by David Morgan, The Morgan Report

22 Beware of Buying Biotech on the Bottom
by John Bonfiglio, PhD MBA, Independent Board Director
88 What is the Role of a MicroCap CFO?

by David Sable and Abigail Sirus, Special Situations Life
by Wesley Ramjeet, PPMT Group
90 Lake Resources: Aligning Operations to

Sciences Fund
28 Global Cannabis in 2022 Power North America’s EV Revolution

94 The Micro-Cap Report 2022: Half Year
by Emily Paxhia and Morgan Paxhia, Poseidon Asset
Management
34 Accounting Corner: CFO Ultimate Stress

Review by Lucosky Brookman LLP
Test by Drew Bernstein, CPA, Marcum Bernstein &

Pinchuk LLP 7 In Remembrance: Igor Levental

38 How EOS® Can Improve Employee 40 Overview of the MicroCap Review Index
Retention by Jackie Kibler (MCRI™)
54 Legal Corner: Vast Changes to Microcap
Financing Part II by Jon Uretsky, Esq., PULLP
56
Profiled Companies
How Public Relations Can Support
MicroCap and SmallCap Companies
17 Kraken Robotics Inc.
by Shelly Kraft, SNN, and Roger Pondel, PondelWilkinson

(TSX-V: PNG) / (OTCQB: KRKNF)
62 Global Electrification for All Vehicles No
Longer a Thing of the Future 26 Vision Marine Technologies, Inc.
66
(NASDAQ: VMAR)
Making Seats for Female Board Members
by Diane Yoo 32 U.S. Global Investors, Inc.
68
(NASDAQ: GROW)
Battery Metals OvervIew by Gavin Wendt, MineLife
78 Asia Corner: Hong Kong IPO Market Hits 42-53 MCRI Q2 2022 Constituent List
Dry Spell by Leslie Richardson
6 MicroCap Review Magazine www.SNN.Network

I n Rememb r a n c e
Igor Levental
mining sage with deep passion for arts and learning
BY: ANTHONY VACCARO, JUNE 20, 2022
The mining universe has lost not only a wise and

generous leader, but also a true renaissance man.
Igor Levental, president of The Electrum Group and

director of Novagold Resources and Gatos Silver,
passed away suddenly and unexpectedly on June
10. Igor’s mining career spanned more than 30 years,
where he held numerous board and senior roles and
was actively involved in many of our industry’s more
notable deals and development projects.
For those of us who had the good fortune to spend

time in his company — and there were many, as Igor
went out of his way to make time for people — we
Igor Levental. Busath Photography
quickly saw that this was a rare individual. His
depth of knowledge, not only about mining but also
cinema, opera, music, books, and pretty much any quintessential Igor, and my eyes are brimming
other subject that could arise, was matched only from this image. Reminiscing upon it now, I last
by his friendliness, humility and incredible sense of said goodbye to Igor in Salt Lake City in May with
humour. my planting a big parting kiss on his forehead — a
tradition we maintained for years. He chuckled, and
He was also a keen student of mining history, and his smile was beatific.
was for myself a great source for background and
colour about some of the liveliest people and most Igor was a positive force in life, and in our industry.
important deals in our industry’s long history. We were indeed very fortunate to benefit from that
force in innumerable ways, both small and large.
Dr. Thomas Kaplan, Novagold’s chairman, wrote
a worthy tribute to Igor entitled “Onwards and Our deepest condolences go to his family, his wife
Upwards: A Tribute to a Cherished Friend, Igor Jessica Levental, sons Casey, Misha and Misha’s wife
Levental.” Out of the many strong memories, this Evan, and Igor’s father Mr. Genady Levental.
one in particular stands out:
We will do our part to let Igor live on by acting with
Among so many wonderful vignettes, on one integrity, thoughtfulness and attentiveness towards
especially memorable occasion, while serving as those around us, and in doing so he will continue to
my plus-one for the screening of a Woody Allen enhance this industry through us.
movie, I introduced him to the virtuoso artist. I left
them alone, and when I returned found Igor and Contributions in Igor’s memory can be made to Hillel
Woody deeply immersed in the nuances of Ingmar 818, Panthera, or the Colorado Mining Association
Bergman’s character studies. This epitomized the Education Foundation.
Originally published in The Northern Miner on June 20, 2022, authored by Anthony Vaccaro.
www.SNN.Network MicroCap Review Magazine 7

ins i ghts
// By Shelly Kraft
AsK Mr. Wallstreet
Should I Buy,
Sell or Hold?
A
s we get bombarded with market information
and intel in the news, social media, newslet-
ters, TV ads, YouTube etc. we have to keep
our own perspective in mind, which is, how does
what’s happening in the stock market affect micro-
cap stocks? How do we manage the holdings in our
portfolio? How do we make our decisions of whether
we should buy, sell or hold? As investors we do need
to decipher pertinent details from the noise of those
trying to sell us their ideas. Picking up morsels of
truth is still relevant to our decision making which
brings me to the point of staying in our lane, picking
sources we trust with a history of accuracy, doing
this will do more to protect our self-made directives
while resisting a constant repetitive barrage of
attempted paid influences.
Pundits in the microcap world often preach doing

your homework, believe in your own methods, stick
to your plan, learn from your mistakes, and build
your sensibility to maintain focus. I believe for the
most part they are correct. However, it’s quite
difficult to locate non-biased information during our marriage, oh by the way, the Internet, social media,
searching for it and even harder to interpret incom- relentless advertising, and regulatory intervention
ing information when it finds you. changed everything. The advent of discount broker-
ing, and millennial DIY activity gave investors the
Although I am a market traditionalist and since I power of making decisions but added the need for
historically lean on using my own common sense, discipline, research, and trial & error. As far as I’m
this method may be costly since it also embeds concerned and, in my opinion, I would rather fail or
learning from one’s own mistakes. For example, for succeed because of my own decisions rather than
generations investors relied on their stockbroker or being led to slaughter and placing blame elsewhere.
wealth advisor to “trust” their advice, timing, ideas,
Ask Mr. Wallstreet is Shelly Kraft. He began on Wall Street in 1984 as a
guidance and performance. For better or for worse
penny stockbroker, investment banker, rising to President of Emanuel &
this marriage could have been a very successful Company, a boutique IPO underwriter and microcap market maker.
Note: This article is not an attempt to provide investment advice. The content is purely the author’s personal opinions and should not be
considered advice of any kind. Investors are advised to conduct their own research or seek the advice of a registered investment professional.

Save the Date
SNN Network presents
2023
The Premier Event in MicroCap Finance

April 25–27, 2023
Bally’s Las Vegas Hotel & Casino
www.PlanetMicroCapShowcase.com
www.SNN.Network PlanetMicrocapShowcase.com MicroCap Review Magazine 9
Fe atu re
Investing Globally
Why Investors and Issuers are Looking Abroad
Over the last 5-10 years, U.S. MicroCap investors and the general
U.S. investment community have been looking for investing
opportunities abroad.
T
here’s nothing new about that statement. of small investors following it closely. Overseas, it
We’ve done a number of interviews on Planet can be hard to find more than one or two peers
MicroCap Podcast with U.S. investors who following a name. All else equal, I’d rather fish a
have found value accretive investments in Canada, pond with less fisherman standing around, even if
Australia, Israel, Poland, London, etc… The most the water is a little murky.
obvious question to answer here is - well, why? Why
are U.S. investors choosing to invest globally? This I’ll add to this all that believe the risks of investing
trend is not limited to U.S. investors; U.S. microcap overseas can easily be exaggerated, with home bias
companies have been increasingly looking to go often the bigger risk to the average US investor.
public on foreign exchanges. Why is this happening? Some cite poor corporate governance overseas,
Using the TSX-V as an example, we seek to figure though I am not sure the US is materially better after
out why. And finally, for those who are noticing this what we’ve witnessed the last half decade. Geopo-
trend and also want to start looking globally, why it’s litical risk is of course elevated in many jurisdictions
important to focus on “Free-er” economies. outside the US, but that is a risk that can be largely
diversified away by monitoring country/region
To help me answer these questions, I’ve enlisted exposures.
the help of my colleagues to provide their insights:
Thomas Bachrach, Jason Hirschman, Delilah Panino •••
and Perth Tolle.
There are no certainties in the
Why are U.S. investors choosing to invest stock market but there are near-
globally? certainties. Here are two of them:
equity investors love Munger
One, if you look at a broad cross quotes and adore sports refer-
section of valuation measures, the ences. Listen to Charlie who
US has clearly been one of the said, “The first rule of fishing is
most expensively priced markets fish where the fish are.” Now for
in the world in recent years. the sports allegory: Which NBA
There is an ample supply of high general manager do you think Jason Hirschman
quality businesses overseas, yet has the better chance of fielding Principal, Hudson 215 Capital
inadequate investor demand often a top notch team? GM #1 who
Thomas J. Bachrach depresses valuations beyond what exclusively scouts and drafts American players?
Principal at PFH Capital is reasonable. Or GM #2 who sifts through both domestic and
international prospects with the hope of identifying
Two, anecdotally, I find the micro/small cap space to great talent like Giannis Antetokounmpo (Greece)
be far less efficient outside the US. Even the most or Luka Doncic (Slovenia)?
obscure microcap in the US seems to have dozens

If you don’t know the difference between an Ante- welcome conversations with American investors and
tokounmpo and an antelope or understand phishing speak workable or fluent English.
more than fishing, please do one more thing before
shifting your attention to the next article. Close your As a younger (and poorer) man I dismissed Canada’s
eyes and imagine the freedom and funds you would software rollup Constellation Software for years
have if you invested in an Endor AG (Germany) because I arrogantly thought, “What do Canadians
or XPEL Inc. (originally listed on the TSX Venture know about acquiring software companies? Maple
in Canada) or Fortnox AB (Sweden) as microcaps syrup rollup count me in … software deals - leave
before they blossomed into multi-bagger success that to us Americans.” Fortunately, I learned my
stories. lesson and purchased as much XPEL as possible
while it traded on the Canadian junior exchange prior
Investing is hard enough already without construct- to uplisting on the NASDAQ.
ing artificial walls that separate you from exciting
opportunities. Sweden, Germany, Canada and others I fished where the fish were and drafted my An-
like Australia operate under the rule of law, produce teokounmpo in XPEL. Now I don’t have to close my
competent shareholder friendly management teams, eyes to imagine freedom and funds because other
and offer Western level consumer markets. Often people’s fantasy existence is my reality. All thanks to
these potential small companies are ignored or un- investing globally in microcap names.
derfollowed so you can buy them at a lower multiple
of EBITDA or sales than comparable USA-based Jason Hirschman and Hudson 215 Capital is a shareholder of XPEL, Inc.
firms. Some service or are located in the United
States despite a foreign listing (like XPEL); many •••

Why are U.S. (and global) issuers now If you want to start looking globally,
starting to seek public listings abroad, why it’s important to focus on “Free-er”
particularly via Canadian exchanges? economies. How should we think about
investing in what some are calling, “a new
With the increasing globalization of world order” with the demonstrable,
capital markets and decentralized horrific invasion of Ukraine by Russia?
financing solutions, CEOs of US high
growth companies are looking at Emerging markets investors, like
all of their capital raising options, microcap investors, seek to capture
including public offerings in foreign high growth from a low base. In
markets. In Canada, the number of the hunt for the growth stories
US companies going public on the of the future, we believe it is
various exchanges has increased advantageous to focus on freer
Delilah Panino
significantly in the past few years. In economies because they tend to
Vice President, U.S.
Capital Formation
2021, 25 US companies went public enjoy 1) better incentives for pro-
Toronto Stock Exchange on Toronto Stock Exchange (TSX) ductivity, 2) lower expropriation risk,
Perth Tolle
/ TSX Venture Exchange and TSX Venture Exchange (TSXV), and 3) favorable demographics.
Founder at Life + Liberty
up 150% from the prior year and Indexes
representing diverse industry sectors. Better Incentives for
Productivity
Companies such as The Planting Hope Company
(TSXV:MYLK), a Chicago-based milk alternative In an unfree economy, a powerful
company, Sabio Holdings (TSXV:SBIO), an LA-based few, typically wielding power through the state,
marketing data company, and Champion Gaming decide who can participate in the market, and tend
(TSXV:WAGR), a sports data and analytics company to make rules to keep out fair competition. High
in Kentucky, all took advantage of the opportunity to taxes, burdensome regulations, and government
access capital in Canada last year. scrutiny on successful businesses all work together
to disincentivize productivity and keeping the few
The value proposition for US companies to list in in power. In such an environment, wealth cannot be
Canada continues to be going public earlier than created, it can only be transferred. Innovators are
is typically seen on the US exchanges. TSX and constrained by high barriers to entry, and success is
TSXV are well regulated public venture capital a zero sum game.
markets that can be attractive alternatives to private
venture capital and a stepping stone to a senior US In a freer economy, new ideas compete on a more
exchange listing. Last year, US companies on TSX level playing field, and succeed by providing value
and TSXV raised $1.6 billion and 45 TSX and TSXV to others in the market, not by the favor of the
companies dual listed on NYSE or Nasdaq. state. Anyone with an idea that provides a benefit to
customers at a competitive price can create wealth.
Ultimately, this is driven by the demand of investors Companies are incentivized to prioritize stakeholder
trading on TSX and TSXV as they are also looking interests above those of the state. Lower taxes,
to diversify their investment portfolios outside of lighter regulations, and less government interference
domestic issuers. Global investors have the unique in private market activity all work together to incen-
opportunity to invest in early stage high growth tivize creativity and innovation.
companies in such trending sectors as cryptocur-
rency, esports and gaming, and renewable energy. Lower Expropriation Risk
For US companies, the right investor base just might
be in Canada. Akin to having a quality factor on the country level,
freer economies are the safe havens of EM. Freer
The author does not own any of the stocks mentioned in this article. economies have stronger institutions and rule of law,
individual and investor protections, and checks and
••• balances on government power, such as freedom
of expression, press, movement and assembly. As

a result, there is lower risk of shareholder value In a world where freedom levels
destruction due to expropriation.
are rapidly diverging, countries
In EM, expropriation risk can happen in many ways.
In the last few months, Sisi has thrown a father and
with higher relative freedom
son in jail for refusing to hand over their business levels – better incentives for
(Juhayna) to the Egyptian army – expropriation by
force; Putin has invaded a peaceful independent productivity, lower expropriation
country, triggering a worldwide response that
rendered Russian securities worthless – expropria-
risk, and favorable
tion by sanctions; and China has cracked down on demographics, among other
their star sectors in the name of common prosperity
– expropriation by government interference. beneficial outcomes – are
Unthinkable just recently, investors are aware of
ground zero for the growth
expropriation risk like never before. stories of the next decade.
Favorable Demographics
Freer economies tend to use their capital more

efficiently, and experience less capital flight and
capital destruction – including both human and unfree countries like Russia, China, Turkey and
economic capital. As a result, freer countries tend to Egypt, and 2) having higher allocations to freer EMs
have more favorable demographic outlooks. China’s like Taiwan, South Korea, Chile and Poland. Contin-
reproductive policies and repression of minorities ued outperformance is never guaranteed, but we will
have led to its having the worst demographic continue to deliver exposure to the freest EMs.
outlook in the world. Russia’s war crimes are also
causing loss of life, capital flight, and capital destruc- Other Beneficial Outcomes of Freedom
tion on a mass scale.
Besides the aforementioned benefits, freer econo-
In contrast, Poland is welcoming a large inflow of mies also enjoy higher life expectancy, lower infant
Ukrainian refugees, likely to strengthen their produc- mortality, higher income per capita, lower poverty
tivity in coming years. Estonia, with its technological rates, higher GDP growth, lower corruption, and
leadership and digital citizenship, is considered the higher gender equality. Moreover, we find that
silicon valley of Europe for its start-up culture. And when the G on the country level is in place, in the
smaller Asian countries like Indonesia, Malaysia, form of higher freedom scores, the E, S, and G
Thailand, and Philippines, with relatively favorable on the security level tends to fall in place as well.
demographics and more business friendly policies, Without any ESG screening on the security level, our
are well positioned to benefit from the global move freedom-weighted FRDM index has an “A” rating for
to diversify manufacturing supply chains out of ESG from MSCI. As our investors have pointed out,
China. it’s a way to incorporate ESG in a way that doesn’t
detract from returns. To the contrary.
The FRDM Index Solution
In a world where freedom levels are rapidly diverg-
The freedom-weighted FRDM index is a freedom ing, countries with higher relative freedom levels
weighted EM equity strategy that uses third-party – better incentives for productivity, lower expropria-
quantitative personal and economic freedom metrics tion risk, and favorable demographics, among other
as primary factors in the investment process. So beneficial outcomes – are ground zero for the
far, the relative outperformance has been stark. The growth stories of the next decade.
FRDM index strategy is up 28% since its inception
(5/23/2019), while EEM is up 13% for the same time
period. The outperformance is due to 1) avoiding

ins i ghts
// By Brandon Mackie
My Love Affair
with Global
Investing
You’ve probably heard the advice… invest in your own backyard.
Y ou know the companies. You’ve used their

products. You can phone up management.
Makes sense doesn’t it?
Well the problem with investing in your own back-

yard is… so can your neighbors.
And often that means more eyeballs, more competi-

tion, and higher prices – which as an investor is the
last thing you want.
I’ve lived my whole life in the United States. And I’ll

let you in on a secret… I haven’t owned a US-listed
stock in over 11 years.
My love affair with global investing started in 2013

with an obscure Swedish stock. The company was
called Kopparbergs Bryggeri. They brewed hard
pear cider and I knew this could be a very good
business at scale.
And here was Kopperbergs trading at 4 times free

cash flow, growing double-digits each year. I even
found their pear cider at a pub in town – it was darn
good.
The company’s reports were all in Swedish. It traded

on an obscure exchange called the Nordic Growth
Market (NGM) – a collection of mostly 30 Nordic
biotech companies. And when I phoned my broker
at Fidelity, I was told he’d have the order delivered…
by hand. I’d hear back in a few days if I got a fill.

This was all music to my ears. I had a good feeling 1) Less Competition
why the stock was so mispriced. Kopparbergs went
on to 10x that year on strong results and market The US is the largest stock market in the world.
discovery. I was hooked. Nearly every US-based investor invests in domestic
stocks (well except me of course). But on top of that,
Next my interest turned north, to Canada. Same many foreign investors will buy in their home market
language, same time zones, and mispriced stocks? and in the US. This dynamic piles on the competition
What’s not to love!? and is why you shouldn’t be afraid to look elsewhere.
This time it was a small company called XPEL 2) Access to earlier stage companies
Technologies (XPEL). My colleague Paul Andreola
mentioned he’d found it at $.14. It now traded While the US Venture Capital industry has been a
around $1.15. The company was growing triple digits boon for tech entrepreneurs – it’s been bad for the
and still trading at a single-digit P/E ratio. average investor.
This company was literally in my backyard. I was Intel (INTL) went public in 1974 at a 4 million valua-
living in Houston at the time, they were down the tion. It was a microcap (even in today’s dollars). You
road in San Antonio. I visited management and felt don’t see many opportunities like that in the US
their growth was just beginning. these days.
I went to buy, delighted to find them trading with an But in other markets like Canada with less developed
obscure listing in Canada (DAP.U). I bought all I could VC industries, promising growth companies often
at the time. have no choice but to fund themselves in the public
markets.
Though I sold far too soon, XPEL touched over $100
last year after uplisting to the NASDAQ and continu- And that means you the investor has access to
ing to execute – a 700+-bagger for anyone fortunate growth companies far sooner than you’d typically
enough to find it early and hold on for dear life. find in the US.
Then it was Hamilton Thorne (HTL), an innovative 3) Access to growing markets

Boston-based life sciences company. The company’s
ticker was stuck in Canada where it was left for dead The US has seen fabulous growth over the last 100
by the analysts. I liked the growth potential and years. But will it continue?
participated in a small private placement at $.10 CAD
in early 2014. With real GDP growth in the low single-digits, other
global markets – particularly in Asia – can offer
A few years later the company attracted a few investors access to higher growth rates.
sophisticated US-based life science investors and
the company began getting attention. It now trades As they say, a rising tide lifts all boats. And when you
around $2.00 CAD. I still own all my shares. invest in a growing market, picking winning stocks
becomes that much easier.
I went on to start a newsletter Smallcap Discoveries
with Paul called Small Discoveries – all about high- Happy hunting. And happy translating!
lighting the global investing opportunity in non-
resource Canadian stocks. And yet after all these -Brandon
years, and after discovering many more 10-baggers,
it amazes me how few investors give global investing
a serious look.
I’ll leave you with 3 reasons why global investing

can beat the market – if you’re willing to leave the
comfort of your backyard.

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Kraken Robotics Inc. (TSX-V: PNG) / (OTCQB: KRKNF)
INVESTOR OVERVIEW COMPANY OVERVIEW

(Data compiled as of market close on May 27, 2022)
Kraken Robotics Inc. (TSX-V: PNG) / (OTCQB: KRKNF) is a marine
SUMMARY technology company providing advanced sonar and laser systems
and subsea power solutions for Unmanned Underwater Vehicles for
Share Price ($) 0.355 military and commercial applications. Kraken’s series of SAS prod-
Market Cap ($M) 71.4 ucts, AquaPix®, offers comparable performance to existing high-
end military systems at a fraction of the cost. As a result of the
52-Week Low/High ($) 0.32 / 0.66
acquisition of PanGeo Subsea in 2021, Kraken now provides subsea
Shares on Issue (M) 201.2
Robotics as a Service capabilities including geophysical surveys, so-
Warrants (M) 10.0 nar surveys, and 3D laser inspections.
Options (M) 13.8
Fully Diluted Shares (M) 225.0 12-MONTH SHARE PRICE CHART
Volume Weekly (M) 0.5
FINANCIAL STATEMENT OVERVIEW
Currency $CAD
Cash ($m) 1.2
Debt ($m) 11.1
1Q ’22 Revenue ($M) 5.5
1Q’22 Net Profit/Loss($ ($M) -2.6
TOP 5 INSIDER HOLDINGS (basic) %

Karl Kenny 12.0
Ocean Infinity Ltd 10.6
Greg Raid 2.4 ANALYST COMMENT provided by Independent
Tocqueville Asset Management 1.7 Investment Research
Lawrence Puddister 0.9
The company delivered strong FY21 results with revenue for
Total Insider shareholdings 16 the year ended December 2021 of $25.7m, a 109% increase on
FY20 revenue. The company delivered the growth despite the
MANAGEMENT & CONTACTS global supply chain issues. Growth was driven by the delivery of
CORPORATE FOCUS a minehunting system to the Remontowa shipyard for the Polish
Navy, the continued work with the Royal Danish Navy on multiple
Sector Technology minehunting systems, the addition of PanGeo Subsea in July
2021 and multiple deliveries of our AquaPix® synthetic aperture
Key Product/Market Marine technology
sonar and SeaPower™ batteries. Despite the revenue growth the
company reported a net loss of $3.5m. The company is forecasting
SENIOR MANAGEMENT & CONTACT
FY22 revenue to be in the range of $36m-42m, a 40%-53%
CEO Name Karl Kenny increase on FY21. Adjusted EBITDA is forecast to be in the range
Investor Relations Name Sophic Capital of $5m-$7m in FY22, more than double FY21, with the company on
IR Email Address investors@krakenrobotics.com the path to becoming profitable.
Headquarters Location Newfoundland, Canada
Website/URL http://www.krakenrobotics.com
Please visit the company’s website for more information:
www.krakenrobotics.com
Note: This article has been undertaken by Independent Investment Research LLC (CRD#299837) & Independent Investment Research (Aust.) Pty Limited (Lic. No. 001242826), a corporate authorized representative of Australian Financial Services Licensee (AFSL no. 410381) (“IIR”). Any opinion contained in the article is unsolicited general information only. The reader
of the article should seek advice from a qualified wealth adviser. This publication is not and should not be construed as, an offer to sell or the solicitation of an offer to purchase or subscribe for any investment, nor should it be construed as a recommendation.
This material contains forward-looking statements. In addition, from time to time, we or our representatives may make forward-looking statements orally or in writing. We base these forward-looking statements on our expectations and projections about future events, which we derive from the information currently available to us. Such forward-looking statements
relate to future events or our future performance, including: our financial performance and projections; our growth in revenue and earnings; and our business prospects and opportunities. You can identify forward-looking statements by those that are not historical in nature, particularly those that use terminology such as “may,” “should,” “expects,” “anticipates,”
“contemplates,” “estimates,” “believes,” “plans,” “projected,” “predicts,” “potential,” or “hopes” or the negative of these or similar terms. In evaluating these forward-looking statements, you should consider various factors, including: our ability to change the direction of the Company; our ability to keep pace with new technology and changing market needs;
and the competitive environment of our business. These and other factors may cause our actual results to differ materially from any forward-looking statement. Forward-looking statements are only predictions. The forward-looking events discussed in this document and other statements made from time to time by us or our representatives, may not occur, and
actual events and results may differ materially and are subject to risks, uncertainties and assumptions about us. We are not obligated to publicly update or revise any forward-looking statement, whether as a result of uncertainties and assumptions, the forward-looking events discussed in this document and other statements made from time to time by us or our
representatives might not occur.

ins i ghts
// By David Morgan
EVs – Silver to
play a minor or
major role?
Almost everyone now knows the term EV means electric vehicle.
Elon Musk has brought about massive attention to electric vehicles.
But it wasn’t an easy ride. Tesla was not an overnight success. The
company was founded in 2003 by two Silicon Valley engineers,
Martin Eberhard and Marc Tarpenning, who wanted to prove that
“electric vehicles can be better, quicker and more fun to drive than
gasoline cars.”
T
he seeds of the company go back to 1990 estimated that hybrid vehicles use anywhere from 18
when Tarpenning met Eberhard, who at that to 34 grams of silver per vehicle. But EV’s need as
time was an engineer at Wyse Technology, and much as 25-50 grams for each vehicle.
they became good friends. The two had much in
common, including a passion for starting companies; Some of the key features in EVs that require silver
one that they soon launched was NuvoMedia, which for conducting purposes include an EV’s infotain-
released the Rocket eBook in 1998. ment system, electric power steering, and even
safety features such as automatic braking and
Elon, being the visionary, saw the potential and airbags.
bought the company. Recently, Mr. Musk has stated
he might be interested in buying a mining company. The renewable energy industry might even affect
Why? Because EVs take massive amounts of miner- the price of silver as demand increases. It’s pre-
als, everything from Rare Earths to silver. dicted that there will be over 120 million EVs on our
national highways by the year 2030, which means
Silver is an essential part of electric car parts; silver is that carmakers will start becoming more conscious
used in the EV manufacturing process because of its of the way they use silver in manufacturing, which is
chemical properties. Silver has a very high corrosion ongoing.
resistance (important for battery making, which
involves the use of corrosive acids), and is also a As an aside, solar uses about 100 million ounces of
stellar conductor of electricity. silver per year. However, solar panels are at least
twice as efficient as they were in the year 2000. If
Some silver bugs have overstated the case for silver this “thrifting” (continual improvement) of silver had
needed as the world is asked to shift to EVs. First, not taken place, the silver market would be in a very
car manufacturers use up to 55 million ounces of serious deficit by now.
silver per year (that’s over 3 million pounds!). It’s

Forward looking investors have asked me, Do attracted interest from a range of industries, par-
electric vehicles make silver the investment of the ticularly military and aerospace. According to the
decade? Silver Institute, the military and aerospace utilized
silver-zinc in a range of applications and undertook a
Before we look at silver as an investment and its considerable amount of research and development
potential, we need to understand the EV market to further develop the technology.
better. The real story on EVs is batteries. What is so
interesting about batteries is the fact that nothing The National Aeronautics and Space Administration
comes close to silver as far as a battery is con- (NASA) became increasingly involved in the develop-
cerned! Silver oxide acts as the positive electrode ment of a rechargeable version of silver-zinc. While
and zinc the negative electrode. Therefore, it is also NASA was ultimately not able to improve on the
called a “silver-zinc battery.” This battery has many most used rechargeable nickel-cadmium technology
advantages compared to its equivalents. It is much at the time, their R&D efforts led to high density
more durable, has a very high energy-to-weight silver-zinc cells, one-third of the size of anything else
ratio, and can tolerate high current loads. available.
Silver oxide battery is considered one of the best Even though a silver-based battery is superior in
batteries if you must compare it with other types many ways, it will not be used as the power basis for
of batteries. You must prefer a silver oxide battery EVs. The use currency is Lithium and in fact not the
over an alkaline battery due to its major features and most efficient lithium battery available, due to cost.
better use.
The market for silver-based batteries remains single-
The high energy density of silver oxide batteries use silver oxide button cell batteries in devices such

With this potential range, and a car last for 800,000 km (497,000 mi) as a standard.
capacity to endure 1,000 cycles, In March of 2022, Samsung SDI announced they had
started building a new pilot assembly line in South
this new solid-state cell could Korea that’ll produce the first prototypes of its solid
make a car last for 800,000 km state batteries. At this point, it’s too early to tell how
soon Samsung or any of the other battery manufac-
(497,000 mi) as a standard. turers will put their designs into full-scale production
for an EV. However, the pace at which the tech is
developing, we expect to see solid state batteries in
electric cars by the end of this decade in 2030.
as quartz watches, hearing aids, and medical ap- Initially, solid state battery powered EVs could be
plications. Lithium-based batteries can be prone to more expensive to buy than those with conventional
leakage and, in rare cases, thermal runaway, which batteries. Other than Samsung SDI, battery manufac-
can cause lithium-ion batteries to catch fire. Under turers such as QuantumScape and even carmakers
normal conditions of use, silver oxide batteries such as Toyota and Dongfeng Motor are working on
are non-toxic. the upcoming tech. This means that future EVs will
get better range than we see today, and charging
However, before we dismiss silver totally as the times are likely to improve as well.
power source for EVs we need to inform our readers
that some researchers from the Samsung Advanced The bottom line is that EV’s use roughly twice the
Institute of Technology (SAIT) and the Samsung R&D amount of silver that an internal combustion engine
Institute Japan (SRJ) have used a very thin silver- uses without using silver-based batteries as the
carbon film (Ag-C) in a prototype pouch cell. This power source. If the Samsung technology proves
announcement was made in 2020. itself and it moves into EV’s around 2030, you might
consider the value of silver for our high-tech world,
We are guessing that this design is probably the versus the fact silver is at an inflation adjusted low
adequate format for a solid-state battery. for the past thousand years.
The silver-carbon film is extremely thin. It was crucial Wouldn’t it make a lot of sense to have the best
to make the anode thinner and to increase energy conductor of electricity (silver) power your new EV?
density. Anyway, the silver-carbon film has the Further, assuming recycling is possible, driving a
purpose of preventing dendrite formation. Dendrites car that increases in value because the batteries are
are needle-like crystals that form on anodes and increasing in value could prove profitable.
damage the battery.
David Morgan is the publisher of the Morgan Report, found at www.
TheMorganReport.com. This website offers three levels of service for
Another significant advantage the Ag-C film offered investors in the resource sector. Although considered a leading voice in
relates to the size of the cell, which is around 50 per- the silver industry, TMR focuses on the entire sector having been first in
rare earths, cobalt, and cyanide free recycling. Visit the About tab on the
cent smaller in terms of volume than an equivalent website and view The Four Horsemen film for free. This documentary is
lithium-ion battery. Less volume means less weight. must viewing for people during these fast changing times.
Weight is a key factor in all EVs! Anytime weight can

be reduced the performance and range improve.
The researchers claim that an EV with such batteries

could have a range of 800 km (497 mi). It is not clear
if it could reach that with a battery pack equivalent
in size to that used by a Tesla, for example, or with a
smaller one.
With this potential range, and a capacity to endure

1,000 cycles, this new solid-state cell could make a
Note: This article is not an attempt to provide investment advice. The content is purely the author’s personal opinions and should not be considered advice of any kind. Investors are
advised to conduct their own research or seek the advice of a registered investment professional. David Morgan does not own any of the stocks mentioned in this article.

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ins i ghts
// By David Sable and Abigail Sirus
Beware of
Buying Biotech
on the Bottom
Life Science Investing in 2022
Greetings from the epicenter of a biotech bear market. To our

rational, valuation-conscious, general investor friends who figure
that at this point, the biotech sector — having been cut in half over
the past year - must be a pretty attractive place to look for new
names, right?
I n theory, yes, but step lightly. Let us offer up two

pieces of advice.
of directors and the investment bankers advising the
company have inadvertently conspired to weaken
the connection between company progress and
1) Mind your cap structure movements in the share price, by burdening the
company with a poor capital structure.
2) Trust analyst reports for “who”, “what,”
“where” and “when”, but not for “why.” And The cap structure of a company is the combination
definitely not for “how much.” of debt and equity used to build and grow it. A clean,
logical cap structure tells a story of prudent financial
We’ll start with capital structure. management; transparent ownership; and proper
alignment of the incentives of management, equity
Some of the more eye-rolling moments in meetings owners and debt holders.
with company management teams occur when CEOs
argue that the stock market grossly undervalues A poorly constructed cap structure attests to hap-
their company. Sometimes they’re right. But more hazard and careless company financing, a condition
often, the market has rationally chosen to ignore that can make an otherwise interesting company
the value of the underlying assets of the company, completely un-investable. And when are manage-
instead focusing (correctly) on the stock price as an ment teams and boards of directors most vulnerable
entity in and of itself. to a poorly-constructed term sheet? When the
capital markets are reluctant to finance difficult-to-
A share of common stock should represent owner- value companies, like pre-revenue biotech.
ship of a percentage of the assets of the issuing
company, or a percentage of the discounted future A common component of the black-hole capital
cash flows of the company. But sometimes a share structures that come out of “creative financing” dur-
of stock is a just a share of stock: a free-floating ing down markets are large pools of warrants from
financial widget whose value floats merrily along, ig- secondary stock sales. Warrants are call options
norant of any value added to the company’s assets. issued by the company —usually with strike prices 10
In these cases, the company’s management, board to 15 percent higher than the price of the stock when

issued— with five-year expiration dates. In theory, warrant. When the shares rise again the process can
the warrants provide the basis for subsequent be repeated, each time with a well-quantified risk.
financing; if the stock rises, making the warrants “in
the money,” the holders exercise the warrants and When a large number of warrant holders hedge their
purchase stock from the company at a discount. portfolios in a similar way, the underlying stock has dif-
ficulty rising too far above the strike price of the warrant.
In reality, only a small percentage of these are
exercised before their expiration date. The rest are This should be preventable. The five-year duration is
kept in a portfolio and often used as the basis for a an industry standard for no obvious reason. Limiting
hedged short sale. the duration of warrants to six or 12 months would
remove this unintended derivatization of the com-
In very volatile sectors, like the life sciences sector pany’s stock. But that is the board’s responsibility.
in which I invest (at the time of writing the 30 day Our responsibility as investors is to avoid situations
rolling volatility of S&P Biotech ETF “XBI” was where the value the company may create flows to
48.396), the ability to strictly define the exposure of everyone but us, the holders of the common stock.
a stock sold short is unusual and the opportunity to
hedge a portfolio with defined risk is very valuable. Speaking of common stock and how much it is worth,
If portfolio managers own warrants and sell the let’s turn to piece of advice #2:
stock short, they risk nothing more than the strike
price of the warrants for each share sold short. If the Ignore. Biotech. Price. Targets.
stock runs, managers can easily cover. Even better,
if managers sell the stock short and the stock price Consider a publicly-traded biotechnology company,
drops, they can cover the short sale in the open mar- which we’ll call Science Project Inc. (SPI)— a real
ket, reap the profits from the trade and still own the company that I am disguising with a made-up name

and ticker symbol. SPI announced its quarterly re- any number they wish with their sums of estimates,
sults a ways back. The five investment bank research guesses and discretionary variables force-fed into an
analysts who cover the company each published otherwise straightforward formula.
a research report interpreting the announcement
and each reaffirmed 12-month price targets which As a life sciences investment team, we know many
ranged from $8 to $14 a share, significantly higher biotechnology equity analysts. We frequently rely
than the $5.35 market price at the time of the on their reports to answer the who, what, when
announcement. and where questions of due diligence. They work
tirelessly, addressing the often-conflicting pulls from
SPI has a proprietary drug discovery platform and colleagues in banking, clients on the buy-side and
partnerships with five larger pharmaceutical com- management teams from the companies they cover.
panies, and it also plans to develop drug candidates They are superbly trained, many with PhD’s in the
independently. None of the partnered or internal sciences or engineering and are all smart enough to
drug candidates have been tested on humans yet, recognize the futility of building a seemingly precise
and none will generate sales for years. model on guesstimates and almost random variables.
But it’s part of their job, and they do it as methodi-
The analysts derive their price targets by estimating cally as they can. But the laws of math, statistics and
the future cash generation for each product in probability yield to no one, PhD or not.
development and then what that flow of money
would be worth as a lump sum today. In doing this So let’s be honest: price targets for pre-revenue
“present value” calculation, the analysts adjust future biotech companies like our SPI are exercises in
revenue estimates by guessing a peak sales year, precise inaccuracy, not the type of evidence that we
multiplying that year’s sales by 15 to 20 and then as investors want to rely upon to make rational, data-
discounting this figure by 35 to 50 percent to reflect driven decisions in a down market from which not all
the risk that the predictions will be inaccurate. The companies will rebound when the market does.
analysts then add together the present values for a
sum-of-the-parts target price. David Sable MD directs healthcare and life science investing for the Special
Situations Funds and is portfolio manager for the Special Situations Life
Sciences Fund and Life Sciences Innovation Venture Capital funds. After
When performed on a portfolio of low-risk bonds, graduating from the Wharton School and the University of Pennsylvania
School of Medicine, he trained in obstetrics and gynecology at New York
this exercise— formally called a discounted cash- Hospital - Cornell Medical Center, and in reproductive endocrinology at
flow analysis or DCF— is precise and accurate. When the Brigham and Women’s Hospital. He co-founded and served as director
of the Institute for Reproductive Medicine and Science at Saint Barnabas
applied to company earnings, the analysis, while still Medical Center in New Jersey, was founder of Assisted Reproductive Medical
precise, becomes increasingly inaccurate as inputs Technologies, which was acquired by Saint Barnabas in 1999, and co-
founder of Reprogenetics, acquired by Cooper Surgical in 2015. After leaving
into the equation become more variable. DCF is clinical medicine, Dr. Sable managed a proprietary healthcare portfolio at
most helpful when analyzing companies with fixed Deutsche Bank before joining the Special Situations Funds. Dr. Sable is an
prices, steady earnings and predictable growth. adjunct in the department of biology at Columbia University, and teaches
“Entrepreneurship in Biotechnology” at Columbia’s Graduate School of Arts
and Sciences. He serves on the boards of directors for Hamilton Thorne
The opposite is true for companies with uncertain Ltd, MedAnswers Inc, and Celmatix Inc, and is a clincal advisory board
member and board observer for TMRW Life Sciences. He previously served
pricing, difficult-to-predict markets, long develop- as a board member for Ohana Biosciences, Genenews Inc, for the nonprofit
ment stages and huge optionality. Development- advocacy organization RESOLVE, on the medical advisory board for
Progyny Inc and on the scientific advisory board of Ovascience Inc. In addi-
stage biotechnology is the most difficult sector for tion to his academic publications, he has written for the Newark Star-Ledger,
this type of analysis. Yoga Journal, Xconomy, Genetic Engineering and Biotechnology News, the
Timmerman Report, Wharton Magazine, and Forbes.
Let’s return to SPI. Between now and the predicted Abigail Sirus is a member of the life sciences investment team for the Special
arrival of sales revenue, each of the company’s prod- Situations Funds. After graduating from Boston College, Abigail joined
IBM as a technology consultant focused on blockchain implementations
ucts will face a series of clinical and regulatory tests. for healthcare and life sciences clients. Abigail was IBM lead for the FDA
Failure during any of these stages can drop the DSCSA Blockchain Interoperability Pilot collaboration with KPMG, Merck,
and Walmart, and for the New York State Excelsior Pass Project (COVID-19
value of that drug candidate to zero. SPI’s product HealthPass) which used blockchain for digital identity validation, then joined.
pipeline could ultimately be worth nothing. IBM’s Alternative Monetization team which monetizes IP assets across IBM’s
business units and was part of a core team that provided strategy and M&A
activities for emerging technologies like blockchain and quantum computing.
DCF price targets trivialize the complexity of placing
https://biot4180.weebly.com
a value on this type of company. Analysts can justify
Note: This article is not an attempt to provide investment advice. The content is purely the author’s personal opinions and should not be considered advice of any
kind. Investors are advised to conduct their own research or seek the advice of a registered investment professional. Not an XBI holder (we do not invest in ETF’s.)

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www.SNN.Network 25
Vision Marine Technologies Inc. (NASDAQ: VMAR)
INVESTOR OVERVIEW Vision Marine Technologies Inc. designs, develops, and manufac-
(Data compiled as of market close on May 20, 2022) tures fully electric outboard powertrain systems, the E-Motion™
180E and electric boats in Canada, the United States, and interna-
SUMMARY
tionally. Revenue is generated through various channels – Direct
sales of the E-Motion™ 180E powertrain to Original Equipment
Share Price ($) 4.23
Manufacturers (OEMs), Sale of Electric Boats to consumers and
Market Cap ($M) 35.37
Electric Boats rental operations, located in Newport Beach, Cali-
52-Week Low/High ($) 3.70 / 11.99 fornia, with the rental business expanding to Diana Beach, Florida.
Warrants (M) 0.15 Vision Marine strives to change and be a contributing factor in fight-
ing the problem of waterway pollution by disrupting the boating
Options (M) 1.7
industry with electric power, contributing to zero pollution, zero
Fully Diluted Shares (M) 10.3
emission, wave less water, and a noiseless environment.
FINANCIAL STATEMENT OVERVIEW 12-MONTH SHARE PRICE CHART
Currency $CAD
Cash ($m) 9.76
Debt ($m) 0.2
FY21 Revenue ($M) 3.5
FY21 Net Profit/Loss ($M) -15.1
TOP INSIDER HOLDINGS (basic) %

9134-0489 Quebec Inc. 25.6
Alexandre Mongeon 16.3
Patrick Bobby 12.9
Robert Ghetti 12.8
ANALYST COMMENT provided by Independent

MANAGEMENT & CONTACTS
Investment Research
CORPORATE FOCUS
The company listed in November 2020, raising US$27.6m through
Sector Consumer Cyclical the issue of 2.76m shares at $10 per share. The company’s flagship
outboard motor, E-motion, is the first fully electric purpose-built
Key Product/Market Recreational boats
outboard powertrain system with 180hp. The company has partnered
with Octillion Power Systems to develop proprietary high density
batteries for its E-motion powertrain system and Weismann Marine,
CEO Name Alexandre Mongeon LLC to design and develop a lower unit assembly for the E-motion
Investor Relations Name Bruce Nurse 180hp outboard propulsion system. The lower unit is expected to
IR Email Address bn@v-mti.com reduce power loss through the gear system, reduce hydrodynamic
Phone Number 303-919-2913 drag and mitigate operational gear noise. After being adversely
Headquarters Location Quebec, Canada impacted by COVID-19, the company is seeking to grow its sales as
Website/URL http://www.investors.visionmarinetechnologies.com/ well as expand its high margin rental business which has offset the
decline in boat sales in recent times.
www.visionmarinetechnologies.com/
COMPANY OVERVIEW
The company paid consideration to SNN or its affiliates for this article.

ins i ghts
// By Emily Paxhia and Morgan Paxhia
Global Cannabis
in 2022 A Tale of the Half and Half Not
W
e are quickly reaching the halfway point tations
in 2022. The first half of the year will not •• A largely incapable federal government of
be missed but should not be forgotten. accomplishing even the most simplistic oppor-
Cannabis investors experienced a multi-pronged set tunities that the majority of their constituents
of headwinds: support.
•• a very challenging macro backdrop with many
•• a deepening equity bear market/continued risk assets suffering from excessive valuations
decline in capital flows and a federal reserve finally waking up
•• rampant cost inflation & supply chain disrup-
tions plus deflationary pricing of cannabis Any one of these issues would prove to be challenging
•• sequential softness in growth with operators in an emerging market like cannabis, but together they
and analysts continuing to adjust future expec- present a dynamic most investors have not dealt with

before. Warren Buffett and Charlie Munger have been is too early to have much confidence there yet. We’ll
known to say that investors should not be owning continue to watch the various data sources in can-
equities if they are unable to tolerate a 50% decline. nabis and macro economic data for insights there.
The challenge is, many investors today have not
experienced that or seem to forget that can happen. There is an ocean of opportunity in cannabis for
Periods like this are very challenging mentally and those willing to look beyond their shadows and see
emotionally. We are seeing a lot of people exiting the what is out there on the horizon.
sector as they are not willing or able to tolerate the
short term pain any longer. This is sad to see but this is Emily Paxhia is a co-founder and Managing Partner of Poseidon. Emily
has reviewed thousands of companies in the cannabis industry and has
a human behavior that has and will continue to repeat worked with countless founders in many capacities. She had helped to
itself. As we say at Poseidon, the only way is through. shape founders’ pitch preparations, their go-to-market strategies/ product
launches, and advised on day-to-day business operations. Emily has
held board seats for multiple portfolio companies and participates as
Some of the first half headwinds may start to subside an adviser to multiple teams. Extremely active in the investment decision
making and ongoing investment oversight processes, she works closely
in the back half of 2022. We are not holding our with her partners to create meaningful deal structures, ensuring that
breath for any federal progress with cannabis but we proper governance is carried out at the company level. Further, Emily has
dedicated time and energy to supporting policy groups and has served on
are watching closely regarding an industry led lawsuit the Board of Directors of the Marijuana Policy Project. She also currently
against the federal government. That action merits serves on the Board of Athletes for CARE and The Initiative. Emily has
attention, which was an effective way for Draft Kings over 10 years of experience working as a consultant and researcher, and
as such, has become an expert at extracting actionable insights from
to open up online gambling as a states’ rights matter. research and applying them to make corporations function more efficiently
We see a Supreme Court with a very conservative, and successfully. She also leverages this experience to engage in detailed
market analysis for determination around product-market fit and potential
constitutionalism focused bench being receptive to scalability. Emily graduated from New York University with an M.A. in
the states’ rights matters like cannabis. Price deflation Psychology in 2008. She graduated from Skidmore College with a B.A. in
Psychology in 2002.
is likely a long term theme for the global cannabis
industry until operators learn to better plan/manage Morgan Paxhia is a co-founder and Managing Partner of Poseidon, one
of the longest running funds in the cannabis industry. With over ten
their vertical integration versus wholesale. Too much years experience in investing and finance, Morgan has developed a deep
supply means lower prices. However, US sales growth understanding of individual company analysis, portfolio construction,
seems to have troughed in 1Q, especially for those and risk mitigation. Since 2012, he has dedicated his investment focus
primarily to the cannabis industry. Given the limited amount of information
operators with exposure to New Jersey. Legacy in this emerging vertical, the lack of institutional research, and relative
markets have been overcoming the elevated sales industry immaturity, Morgan embraces an active approach of working
closely with companies. He utilizes a “boots on the ground” methodology
levels during COVID and could see some growth to better understand individual companies and the industry. Through his
green shoots as well, especially those with growing extensive travel across the US and Canada, reviewing hundreds of business
plans and overseeing several existing cannabis investments, Morgan has
consumer access to legal cannabis. International developed Poseidon’s investment methodology tailored specific to the
has the benefit of coming off a low base, meaning business of cannabis. Poseidon’s proprietary process is driven by the
time spent in the industry and the considerable data collected over the
revenues are still small relative to the US market and last several years. He has created frameworks for analysis depending on
have a lot of market share growth potential on their sub-sector, company stage, and participation across the capital spectrum
horizon with improving access across Europe. We see through our database of contacts, valuations, metrics, and other relevant
factors. Morgan started his investment career at UBS Financial Services
this growth as evidenced by public companies with working in a Wealth Management/ Investment Banking hybrid training
exposures in countries such as Germany and Israel. program. The training brought a wide range of first hand experience
working through several facets of the organization, including advisory
teams managing assets for high net worth individuals and municipal
It is very important to remember that cannabis is a bonds trading. Following UBS, Morgan transitioned to a Providence-based
Registered Investment Advisor as an Investment Consultant. During that
regulatory driven growth industry, meaning as more time, he worked under the partners of the firm doing fundamental portfolio
laws are passed, more growth follows. Regulations management. Morgan graduated from the University of Rhode Island with
a B.S. in Applied Mathematics in 2005.
are a key factor to the cannabis economic cycle,
which means we can see some potential countercycli- Website: www.PoseidonAssetManagement.com
cal behavior as growth opens despite a potential
recessionary macro backdrop. Consumer behavior
and buying changes as it relates to the macro envi-
ronment. We have also seen consumption of cannabis
increase when consumers are not going to dinner as
much or traveling as much and have more time on
their hands. This could feed into more than currently
expected growth in the back half of this year but it

o Interact with our retail broker/dealer/banking network to o Develop plans for aggressive outbound media outreach, when
facilitate the Company to potential Media Networks and set up requested, including existing shareholders, potential institutional
small group Dinner. and retail shareholders to ingest companies media.
o Continue periodic meetings, with locations to be determined, o Work with management to develop a clear comparison of the
with Media Anchors and Producers. firm's results to those of similar companies or competitors;
o Leverage relationships with media and financial journalists to o Position the management to effectively demonstrate the
effectively communicate the Company’s message; Including but Company’s strategies and objectives so that companies
not limited to, Cheddar, Fox Business News, TD Ameritrade interviews are clear & effective.
Network, Yahoo Finance, Nasdaq Marketsite, Jane King Media,
Modern Wall Street o Pinpointing of the proper media outlets to meet – and even the
right individuals within those firms for maximizing interviews.
o Work with Company to develop a full release calendar, timing
releases and important press announcements for utmost o Monthly analysis of who is watching interviews, along with
effectiveness; commentary on the ‘why’ behind these moves.
o Coordinate additional relationships with the goal of creating o Context around effective interviews, i.e. how does it pertain to
media awareness for the company; what we are seeing amongst peers, the sector and the broader
market. The qualitative analysis that comes from this assessment
o 24 h
hour situational crisis management with a concise strategy. provides company with insight into why Media Networks are
Assist in addressing issues such as product recalls, contract losses, doing what they are doing within their respective sector, allowing
regulatory actions, litigation, loss of key employees, and all Major them to have more pointed conversations with these Media
Media actions. Professionals and be more efficient with their time spent.
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U.S. Global Investors, Inc. (NASDAQ: GROW)
INVESTOR OVERVIEW COMPANY OVERVIEW

(Data compiled as of market close on May 20 2022)
U.S. Global Investors, Inc. is a boutique investment management
SUMMARY firm specializing in actively managed equity and bond strategies,
and has a longstanding history of expertise in gold and precious
Share Price ($) 4.71 metals, natural resources, airlines and emerging markets. The com-
Market Cap ($M) 60.8 pany offers eight no-load mutual funds and three exchange-traded
funds (ETFs), in a variety of niche global industries. As of 31 March
52-Week Low/High ($) 4.13 / 6.88
2022, the company and its subsidiaries reported average assets un-
der management of $4.1 billion.
Warrants (M) 0
Options (M) 0
12-MONTH SHARE PRICE CHART
Fully Diluted Shares (M) 12.9
FINANCIAL STATEMENT OVERVIEW
Currency $USD
Cash ($m) 26.77
Debt ($m) 0.0
FY21 Revenue ($M) 21.65
FY21 Net Profit/Loss ($M) 31.96
TOP 5 INSIDER HOLDINGS (basic) %

Frank Holmes 17
The Vanguard Group, Inc. 5
ANALYST COMMENT provided by Independent
Royce Investment Partners 4.67
Investment Research
Perritt Capital Management, Inc. 4.44
The Company has been increasing its cash position for the past 18
Heartland Advisors, Inc. 3.48
months, and it is accomplishing this in part through its investments
Total Insider shareholdings 17.8 in HIVE Blockchain Technologies Ltd. (“HIVE”), a Vancouver-
based technology firm that is involved in the mining of Bitcoin
MANAGEMENT & CONTACTS and Ethereum. The investments in HIVE include 8.0% interest-
CORPORATE FOCUS bearing unsecured convertible debentures, payable in quarterly
installments. The company is choosing to receive the cash in
Sector Financial Services quarterly installments rather than convert them into HIVE shares
with the company seeking to build up cash to $30m for future
Key Product/Market Asset Management
growth opportunities and to manage future economic downturns.
The company continues to expand its product offering with the
launch of the new smart-beta 2.0 ETF, the U.S. Global Sea to
CEO Name Frank Holmes Sky Cargo ETF (SEA) during the March quarter, along with the
Investor Relations Name Holly Schoenfeldt company’s airlines ETF, the U.S. Global Jets ETF (JETS), recently
IR Email Address info@usfunds.com receiving approval by Ameriprise Financial. The company has
Headquarters Location San Antonio, Texas increased its share purchase program to $5.0m. The Company
Website/URL http://www.usfunds.com strategically repurchases stock on down days using an algorithm.
www.usfunds.com

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Ac co u n ti n g CORNE R
// By Drew Bernstein, CPA
CFO Ultimate
Stress Test
Recently, my conversations with clients have centered on one
topic: What the heck is going on with this economy?
O
n the one hand, you have a technology telling their companies they need to take a scalpel to
darling like Tesla announcing layoffs of 10% staff because “winter is coming.”
of their staff. But just try ordering one of
their cars, and you will have to wait 3-6 months to CFOs who honed their craft over the past decade
take delivery. are facing raging inflation, global commodity shocks,
and rising interest rates. Most “old hands” who have
America’s businesses currently have over 11 million experienced this kind of macro environment retired
job openings — more than twice the number of decades ago.
people seeking jobs. Yet, venture capitalists are

The message sending a chill up the spine of senior Companies must constantly
management: “The 1970s are calling, and they say
everything you ever learned is irrelevant.” evaluate pricing, sourcing
strategies, and supply contracts
To survive this stress test, CFOs must learn and
adapt at lightning speed. Here are a few lessons to to maintain their margins and
keep in mind.
keep revenues flowing.
Capital has a cost.
Since the global financial crisis in 2008, we have

been living through an unprecedented experiment in
monetary policy that, over time, skewed corporate Stay nimble.
decision-making. “Quantitative easing,” or QE,
flooded financial institutions with more liquidity than The past twelve months have underscored the
they could deploy through traditional channels. At importance of remaining flexible within a clear
the same time, the Fed has held interest rates close strategic framework.
to zero to support the fragile recovery from the GFC
and the subsequent pandemic. Producer price index (PPI) inflation is running
at double digits. Energy costs spiked by 60% in
What was the result? Investors piled into a range of just a year. Rolling lockdowns have roiled supply
speculative assets and businesses whose economics chains as China seeks to maintain “zero COVID”
were unproven but had the lure of potentially high against new strains bent on spreading COVID
returns. Growth was privileged over profits. And everywhere.
“story stocks” tapped a geyser of capital at nominal
cost. A five-year plan may become irrelevant in this
environment before the ink is dry. Companies must
Today, the Federal Reserve has made it clear we are constantly evaluate pricing, sourcing strategies, and
in for a series of painful rate hikes. Yields are soaring. supply contracts to maintain their margins and keep
We have gone from QE forever to QE cold turkey. In revenues flowing. Fail to adjust or employ the wrong
other words, capital again has a cost. hedging strategy, and your P&L can turn upside
down in a heartbeat.
In this environment, companies need to be much
more strategic about how they invest in growth, CFOs need to embrace this turbulence as a test of
when they tap the capital markets, and what they their mettle. Labor shortages can spur accelerated
say to investors about capital allocation. product and service automation or reengineering to
reduce labor content. The resiliency of supply chains
CFOs can expect a barrage of questions about now must be given equal weight with efficiency and
how the company will manage its liquidity and the cost considerations.
thresholds applied to capital expenditure, marketing
expense, and M & A decisions. Companies must also CFOs need to be able to create dynamic forecasts
present a clear runway to transition from growth- and supply senior leaders with real-time data
at-any-cost to profitable growth. Or, as Uber’s CEO, required to pivot on a dime as market conditions
Dara Khosrowshahi, put it, “We have to make sure change. How do we protect our margins while
our unit economics work before we go big.” ensuring continuity with suppliers? How do we
create a business plan able to thrive under multiple
In an environment of capital scarcity, going big and scenarios?
blind means going under. But companies that can
clearly explain how they plan to earn their cost of CFOs need to step into the role of a master tactician,
capital will enjoy a substantial competitive advan- laying out a range of options to traverse market
tage. storms and bring the company safely to port.

If the current bout of monetary the best in the industry. Just as you will never forget
tightening and asset deflation how friends and family react during a crisis, your
company’s response to a downturn will send lasting
devolves into a full-blown messages to your team.
recession, CFOs may be Just as CFOs need to gird themselves for the ulti-
tempted to look at employees mate stress test, investors should be watching the
companies they follow for signals about manage-
as cost items on a spreadsheet ment’s ability to weather the storm that may be just
over the horizon. Are they calm, determined, and
that need to be shed. This would able to articulate a clear action plan? Or are their
communications jittery, reactive, verging on panic?
be a huge mistake. The answer to that question reveals much about the
companies on which you want to bet.
Drew Bernstein, Co-Managing Partner Marcum Bernstein & Pinchuk (MBP)–

a leader in SEC audit, accounting and consulting services to Chinese
Focus on talent. companies seeking access to capital markets.
In 1983, Drew Bernstein co-founded Bernstein & Pinchuk. Additionally, he

Over the past twelve months, management has had co-founded MarcumBP, which is a member of the Marcum Group and an
to contend with what the media dubbed “the Great affiliate of Marcum LLP, a leading U.S. accounting and advisory firm. Both
firms have multiple offices within the United States and Asia.
Resignation,” in which many employees reconsid-
ered their previous relationships to work. Remote Bernstein is a distinguished expert with deep knowledge of the China and
U.S. financial ecosystem with experience extending across Asia, Europe
work, flexible hours, job hopping, and bidding wars and Africa. Industry experience encompasses technology, retail, manu-
for top talent were the order of the day. facturing, hospitality, pharmaceutical and real estate. Bernstein directs a
global team, featuring highly trained PCAOB and SEC accounting experts
and financial consultants working in New York as well as Beijing, Tianjin,
Fast forward a few months, the media is sounding Shanghai, Shenzhen, Hangzhou, and Guangzhou.
the war drums of an impending recession, employ- Additionally, Bernstein is considered a valuable thought leader and news
commentator. He has published articles for Forbes.com and China Daily
ees are bracing for potential layoffs, and CEOs are and is a frequently called upon source by prominent media such as China
talking about getting lean. Global Television Network, CNBC, Bloomberg TV, The Financial Times,
The South China Morning Post, The Wall Street Journal, Yahoo! Finance,
and more regarding Chinese IPOs, China’s economic growth, investment
If the current bout of monetary tightening and asset appetite, innovation trends, corporate governance, SEC regulations and
more.
deflation devolves into a full-blown recession, CFOs
may be tempted to look at employees as cost items Bernstein graduated from the University of Maryland with a B.S. in
on a spreadsheet that need to be shed. This would Accounting. Currently, he resides in New York City with his wife and children.
About MBP
be a huge mistake.
Marcum Bernstein & Pinchuk LLP (MBP) offers specialized audit and
advisory services to support SPAC sponsors and SPAC targets in Asia.
Even if the business environment softens, demo- MBP and its parent company, Marcum LLP, have been involved in more
graphics are not on employers’ side, as a declining SPAC transactions than any other audit firm. MBP is the only audit firm to
have a dedicated SPAC team for Asia. MBP performs all audits for Marcum
working age population and restricted immigration in Greater China, and MBP is a top-five auditor for Chinese companies
make skilled labor in short supply. Rather than listed in the United States.
slashing indiscriminately, CFOs need to partner with The dedicated SPAC team has worked with SPAC sponsors, underwriters,
HR to align short-term staffing adjustments to the and targets. MBP draws on wide-ranging experience with the initial public
business’s strategic needs. offerings and subsequent business transactions forged by such companies.
MBP has designed its audit platform to deliver the technical expertise,
efficiency, and urgency required by SPAC IPOs. This includes high-quality,
Who are the top contributors of value in our busi- PCAOB-compliant audits for private Asian companies that are contemplat-
ing entering a SPAC merger.
ness? What talent will be most difficult to replace as
demand recovers? How can we increase the sticki- Website: U.S.: https://www.marcumbp.com;
China: https://cn.marcumbp.com
ness of employees’ relationship with the company
and our strategic goals?
The primary business of every business is to gener-

ate, nurture, and sustain the talent required to be

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MicroCap Review Magazine 37
www.SNN.Network
ins i ghts
// By Jackie Kibler
How EOS® Can

Improve Employee
Retention
Holding on to the best employees is a top priority for every
business—and if you run one, you know how expensive it is to find,
evaluate, and train a new hire.
G
ood retention strategies are essential but
aren’t always given the attention they
deserve. Sometimes a great employee quits,
and the rest of the team must scramble to fill the
sudden void. It’s not easy, and it hurts productivity
and slows growth.
As a Certified EOS Implementer® I’ve seen first-hand

examples of how EOS has improved my clients’
employee retention rates. I’d like to share some of
them with you.
When the going gets tough…
Everyone loves to be part of a winning organization.

Entrepreneurs usually start running EOS to make an
already-successful business even more successful.
During times of growth, employees might be too
busy or too engaged to think about finding a differ-
ent job.
But what happens when the work slows down?

When the pandemic began, one of my clients
found out. A big slice of their business comes from
restaurant and entertainment venues owners. So,
as you might expect, many of their clients stopped
calling—and stopped paying when the lockdowns rest of their team together through the downturn.
began.
Their Visionary saw the energy in the room and
Our mid-year quarterly meeting in 2020 began declared: “We’re going to keep everybody, and
with a room of unhappy faces. One employee had we’re going to keep them happy.”
already quit, and they were desperate to keep the

For each of the quarterly rocks they chose in that Think of EOS as a framework of frameworks. The
meeting, they asked if it would help retention. If it topmost level provides a structure for thinking about
didn’t, they punted it to the next quarter. the entire business with tools like the Account-
ability Chart and the V/TO™. In addition, the system
They also doubled down on Delegate and Elevate™. provides similar structures for distinct business units
Their Visionary said: “If we can’t grow from outside, and even the specific seats within the organization.
let’s grow from inside.” Opening up employees
to shape their own path through the slowdown Dialing in the details of those seats is a great way to
unleashed potential they didn’t know they had. As retain those employees who do best with structure.
a result, they kept their people while kick-starting
growth sooner than anticipated. I saw this play out as a client began their EOS
journey. At the start, their Visionary wanted every-
Hire for values one at his business to create their dream job. Each
employee offered ideas, and at first, it seemed great,
Retaining employees is easier if they’re a great fit but before long, the team began to notice that
from the beginning. significant work wasn’t getting done on time, making
everyone unhappy.
One of the first things an EOS business does is
identify its Core Values. We start with Core Values Their Integrator pointed out that a lot of their
because they are foundational to everything a employees were struggling. “We’ve asked them to
company does, including hiring. reinvent themselves, but they just want to follow
instructions,” he said. So they threw out the “dream
A poor value fit probably means that the employee jobs” plan and focused on carefully defining the role
will quit. I’ve seen it happen many times as clients of each employee’s seat.
begin to fully embrace Core Values that someone on
the team doesn’t share. This is a normal part of the “I was worried my team would be upset about the
process, and ultimately it’s good for everyone. change,” the Visionary told me. “I was shocked
when they thanked me instead.”
On the other hand, a great value fit enables employ-
ees to thrive by making them feel at home in the Use EOS to build a thriving workforce
culture. A new hire who shares the company’s Core
Values will automatically pull in the right direction. What retention strategies are you using to keep
your team happy and motivated? Let’s start a
To keep it going, I encourage clients to make a habit conversation. You can reach me through my website
of revisiting their Core Values with their team. For or by visiting me on LinkedIn.
example, one of my clients likes to discuss one of
Jackie Kibler grew up in an entrepreneurial family with her father in the music
their Core Values at every all-hands meeting.
and entertainment business. Her father had a passion for music and like
many entrepreneurs, wasn’t able to create a solid business infrastructure to
Their Integrator says it has paid dividends. “We have grow the business. At a very early age, Jackie realized her passion was to
help business owners get more from their businesses.
a challenging client who doesn’t share our Core Val-
ues at all,” he told me. “Keeping our team focused After college, Jackie worked for larger companies like Dun and Bradstreet,
Wells Fargo, Corporate Executive Board and Vistage Worldwide to learn
on the values we share keeps each other feeling best practices. She progressed through the leadership ranks and over the
good when the client relationship feels strained.” next 25 years, quickly became known as the “go-to person” for underper-
forming offices, regions, or companies using a strategic mix of goal setting,
process development, and personal accountability.
The benefits of clarity
At Vistage Worldwide, and partnered with over 100 entrepreneurial CEOs to
help them improve their businesses. Within 12 months her region improved
Visionaries love to work without limits and thrive in rankings from #10 to #2 nationally. It was there that she learned about
when they have the freedom to explore new ideas. EOS and when she read the book Traction, she immediately aligned. It was
everything she had done, in a proven process that was being used globally
However, what they sometimes forget is that not with entrepreneurs in all types of businesses.
everyone is a Visionary: many people do their best
work within a clear framework.

Overview of the
MicroCap Review
Index (MCRI™)
The MCRI is as pure an index for microcap stocks as can be. We
believe the MCRI provides a much more accurate, in-depth,
benchmark of the microcap stock universe, with equal weighting
given across the board, regardless of size.
M
ost of the other microcap indices are market •• On the final day of the quarter, all public com-
cap weighted, giving preference to larger panies:
companies with higher trading volumes, and ºº Between $10 and $300 million in Market
are reconstituted bi-annually or annually, versus Capitalization
quarterly. ºº Share price equal to or greater than $0.10
•• Filed a 10Q or 10K in the preceding quarter
Why MCRI
In my experience in the MicroCap space, the idea From there, the index comprises the Top 30
of “discovery” has been a singular driving force for companies from each sector based on 90-day share
me. Whether its helping folks discover new MicroCap price appreciation. At most, MCRI will consist of
investing strategies or discover new companies that 330 constituents, all equally weighted. While you
may not show on their screen. may expect most, if not all, the Top 30 for each
sector will have positive share price appreciation for
Criteria the quarter, but that’s not always the case, and in
my opinion what makes MCRI the purest index for
•• U.S. (NYSE/AMEX, NASDAQ, OTCM) or Canada MicroCaps.
(TSX, TSX Venture, CSE, NEO)
•• Primary Listing only (meaning, primary symbol
dual-listed companies
Microcap Review INDEX Microcap Review INDEX

Q2 2022 Key Data Points

Microcap Review INDEX
Q2 2022 Constituent List
AACG ATA Creativity Global ANTE AirNet Technology Inc.

Consumer Defensive Communication Services
https://ir.atai.net.cn/ http://ir.airnetgroup.cn/
AAME Atlantic American Corporation AP Ampco-Pittsburgh Corporation

Financial Services Industrials
https://www.atlam.com/ http://ampcopgh.com/
ACU Acme United Corporation AQMS Aqua Metals Inc.

Consumer Defensive Industrials
https://www.acmeunited.com/ https://www.aquametals.com/
ADN Advent Technologies Holdings Inc. ARKR Ark Restaurants Corp.

Utilities Consumer Cyclical
https://www.advent.energy/ https://arkrestaurants.com/
AEI Alset Ehome International Inc. ARL American Realty Investors Inc.
Real Estate Real Estate
https://www.alsetehomeintl.com/ http://www.americanrealtyinvest.com/
AGN:CNX Algernon Pharmaceuticals Inc. ART:CA ARHT Media Inc.

Healthcare Technology
https://algernonpharmaceuticals.com/ https://arhtmedia.com/
AGRI AgriFORCE Growing Systems Ltd. ARTW Art’s-Way Manufacturing Co. Inc.
https://agriforcegs.com/ https://artsway-mfg.com/
AKT.A:CA Akita Drilling Ltd. ASC Ardmore Shipping Corporation

Energy Industrials
https://www.akita-drilling.com/ https://ardmoreshipping.com/
ALCO Alico, Inc. ASRT Assertio Holdings, Inc.

Consumer Defensive Healthcare
https://www.alicoinc.com/ https://www.assertiotx.com/
ALCU:CNX Alpha Copper Corp. ATIF ATIF Holdings Limited

Basic Materials Financial Services
https://alphacopper.com/ https://ir.atifchina.com/
ALJJ ALJ Regional Holdings Inc. ATX:CA ATEX Resources Inc.

Industrials Basic Materials
https://aljregionalholdings.com/ https://www.atexresources.com/
ALOT AstroNova Inc. AUUD Auddia Inc.

Technology Technology
https://astronovainc.com/ https://auddiainc.com/
ALPA:CNX Alpha Metaverse Technologies Inc. AXAS Abraxas Petroleum Corporation

Communication Services Energy
http://www.alphametaverse.com/ http://www.abraxaspetroleum.com/
AMPY Amplify Energy Corp. AXIS:CA Axis Auto Finance Inc.

Energy Financial Services
https://www.amplifyenergy.com/home/default.aspx https://www.axisfinancegroup.com/
Note: As of rebalance date 04/01/2022, please see SNN’s criteria for inclusion in the MicroCap Review Index here: https://snn.network/key-criteria

AXL:CA Arrow Exploration Corp. BLCM Bellicum Pharmaceuticals Inc.

Energy Healthcare
https://arrowexploration.ca/ https://www.bellicum.com/
AXR AMREP Corporation BRAG:CA Bragg Gaming Group Inc.

Real Estate Communication Services
https://amrepcorp.com/ https://www.bragg.games/
AZS:CA Arizona Silver Exploration Inc. BRE:CA Bridgemarq Real Estate Services Inc.
Basic Materials Real Estate
https://arizonasilverexploration.com/ https://www.bridgemarq.com/
BABY:CA Else Nutrition Holdings Inc. BRFH Barfresh Food Group Inc.
Consumer Defensive Consumer Defensive
https://elsenutrition.com/ https://www.barfresh.com/
BBGI Beasley Broadcast Group Inc. BSFC Blue Star Foods Corp.
Communication Services Consumer Defensive
https://bbgi.com/ https://bluestarfoods.com/
BBTV:CA BBTV Holdings Inc. BSK:CA Blue Sky Uranium Corp.

https://investors.bbtv.com/overview/default.aspx https://blueskyuranium.com/
BCML BayCom Corp. BTCS BTCS Inc.

Financial Services Financial Services
https://www.unitedbusinessbank.com/ https://www.btcs.com/
BCU:CA Bell Copper Corporation BTN Ballantyne Strong Inc.

Basic Materials Consumer Cyclical
https://www.bellcopper.net/ https://ballantynestrong.com/
BDL Flanigan’s Enterprises Inc. BULL:CNX Canadian Palladium Resources Inc.

Consumer Cyclical Basic Materials
https://www.flanigans.net/investors/ https://canadianpalladium.com/
BEEM Beam Global CAAS China Automotive Systems Inc.

Technology Consumer Cyclical
https://beamforall.com/ can’t find website
BELFB Bel Fuse Inc. CAPT:CA Capitan Mining Inc.

Technology Basic Materials
https://www.belfuse.com/ https://capitanmining.com/
BGI Birks Group Inc. CBIT:CA Cathedra Bitcoin Inc.

Consumer Cyclical Financial Services
https://www.maisonbirks.com/en_us/investor-relations https://www.cathedra.com/
BHAT Blue Hat Interactive Entertainment CC:CNX Core Assets Corp.

Basic Materials
Technology https://coreassetscorp.com/
Communication Services
https://ir.bluehatgroup.com/

CCW:CA Canada Silver Cobalt Works Inc. CLPS CLPS Incorporation

Basic Materials Technology
https://canadasilvercobaltworks.com/ https://www.clpsglobal.com/
CDZI Cadiz Inc. CMC:CA Cielo Waste Solutions Corp.

Utilities Industrials
https://www.cadizinc.com/ https://cielows.com/
CELZ Creative Medical Technology Holdings COE China Online Education Group
Consumer Defensive
Inc. http://ir.51talk.com/
Healthcare
https://creativemedicaltechnology.com/
COMS ComSovereign Holding Corp.
CET:CA Cathedral Energy Services Ltd. https://www.comsovereign.com/
Energy
https://www.cathedralenergyservices.com/
CPHC Canterbury Park Holding Corporation
Consumer Cyclical
CFRX ContraFect Corporation https://www.canterburypark.com/investor-relations/
Healthcare
https://www.contrafect.com/
CPSH CPS Technologies Corp.
Technology
CGRN Capstone Green Energy Corporation https://cpstechnologysolutions.com/
Industrials
https://www.capstonegreenenergy.com/
CTRM Castor Maritime Inc.
Industrials
CHCI Comstock Holding Companies Inc. https://castormaritime.com/
Real Estate
https://comstockcompanies.com/
CVCY Central Valley Community Bancorp
Financial Services
CHMI Cherry Hill Mortgage Investment https://www.cvcb.com/
Corporation
Real Estate
https://www.chmireit.com/
CVGI Commercial Vehicle Group Inc.
Consumer Cyclical
https://cvgrp.com/
CHNR China Natural Resources Inc.
Basic Materials
https://www.chnr.net/
CVW:CA CVW CleanTech Inc.
Basic Materials
https://cvwcleantech.com/
CKI:CA Clarke Inc.
Consumer Cyclical
https://www.clarkeinc.com/
CWBK CW Bancorp
Financial Services
https://www.cwbk.com/
CLEU China Liberal Education Holdings Limited
Consumer Defensive
http://chinaliberal.com/
CWCO Consolidated Water Co. Ltd.
Utilities
https://cwco.com/
CLIR ClearSign Technologies Corporation
Industrials
https://clearsign.com/
CYAN Cyanotech Corporation
Consumer Defensive
https://www.cyanotech.com/
CLPR Clipper Realy Inc.
Real Estate
https://www.clipperrealty.com/
DALN DallasNews Corporation
https://www.dallasnewscorporation.com/

DC.A:CA Dundee Corporation ELTK Eltek Ltd.

Consumer Defensive Technology
https://www.dundeecorporation.com/home/default.aspx https://www.eltek.com/us/
DME:CA Desert Mountain Energy Corp. ENS:CA E Split Corp.

https://www.desertmountainenergy.com/ https://www.middlefield.com/
DPRO:CNX Draganfly Inc. ENSV Enservco Corporation

Industrials Energy
https://draganfly.com/ http://enservco.com/
DS Drive Shack Inc. EOG:CA Eco (Atlantic) Oil & Gas Ltd.
Consumer Cyclical Energy
https://www.driveshack.com/ https://www.ecooilandgas.com/
DTSS Datasea Inc. EQOS EQONEX Limited

Technology Financial Services
http://www.dataseainc.com/ https://group.eqonex.com/
DUO Fangdd Network Group Ltd. ESEA Euroseas Ltd.

Real Estate Industrials
https://www.fangdd.com/ http://www.euroseas.gr/
DUOT Duos Technologies Group EVGN:CA Evergen Infrastructure Corp.

Technology Utilities
https://www.duostechnologies.com/ https://www.evergeninfra.com/
EBON Ebang International Holdings Inc. EXPR Express Inc.

Technology Consumer Cyclical
https://www.ebang.com.cn/about https://www.express.com/
EDRY EuroDry Ltd. FBIZ First Business Financial Services Inc.

Industrials Financial Services
http://www.eurodry.gr/ https://firstbusiness.bank/
EDT:CA Spectral Medical Inc. FDM:CNX Fandom Sports Media Corp.

https://spectraldx.com/ https://www.fandomesports.com/#/
EDTK Skillful Craftsman Education FGBI First Guaranty Bancshares Inc.

Financial Services
Technology Limited https://www.fgb.net/
Consumer Defensive
http://ir.kingwayup.com/
FHYD:CA First Hydrogen Corp.
Consumer Cyclical
EIGR Eiger BioPharmaceuticals Inc. https://firsthydrogen.com/
Healthcare
https://www.eigerbio.com/
FINW FinWise Bancorp
Financial Services
ELA Envela Corporation https://www.finwisebank.com/
Consumer Cyclical
https://envela.com/
FLNT Fluent Inc.
https://investors.fluentco.com/

FORD Forward Industries Inc. GMDA Gamida Cell Ltd.

Consumer Cyclical Healthcare
https://forwardindustries.com/ https://www.gamida-cell.com/
FUNC First United Corporation GMGI Golden Matrix Group Inc.

Financial Services Communication Services
https://mybank.com/ https://goldenmatrix.com/
GBR New Concept Energy Inc. GNE Genie Energy Ltd.

Real Estate Utilities
http://www.newconceptenergy.com/ https://genie.com/
GCL:CA Colabor Group Inc. GNPX Genprex Inc.

http://www.colabor.com/en/ https://www.genprex.com/
GDC:CA Genesis Land Development Corp. GNRS The Greenrose Holding Company Inc.
Real Estate Financial Services
https://www.genesisland.com/ https://www.greenroseholdings.com/
GFAI Guardforce AI Co. Limited GNUS Genius Brands International Inc.

Industrials Communication Services
https://www.guardforceai.com/ https://www.gnusbrands.com/
GGE Green Giant Inc. GQC:CA GoldQuest Mining Corp.

Real Estate Basic Materials
http://www.gge.com/ https://goldquestcorp.com/
GGI:CA Garibaldi Resources Corp. GRB:CA Greenbriar Capital Corp.

Basic Materials Utilities
https://www.garibaldiresources.com/ https://greenbriarcapitalcorp.ca/
GH:CA Gamehost Inc. GRDM:CA Grid Metals Corp.

Consumer Cyclical Basic Materials
https://www.gamehost.ca/ https://gridmetalscorp.com/
GIP:CA Green Impact Partners Inc. GROW U.S. Global Investors, Inc.
Utilities Financial Services
https://www.greenipi.com/ https://www.usfunds.com/
GIPR Generation Income Properties Inc. GTWO:CA G2 Goldfields Inc.

https://gipreit.com/ https://g2goldfields.com/
GIVX:CA Givex Information Technology Group GVC:CA Glacier Media Inc.

Limited https://www.glaciermedia.ca/
Technology
https://www.givex.com/
GVP GSE Solutions
Technology
GLAS.A.U:AQL Glass House Brands Inc. https://www.gses.com/
Healthcare
https://www.glasshousebrands.com/

GYRO Gyrodyne LLC IBEX ibex

Real Estate Technology
https://www.gyrodyne.com/ https://www.ibex.co/
HBOR:CNX Harborside Inc. IEI:CA Imperial Equities Inc.

Healthcare Real Estate
https://www.investharborside.com/ https://imperialequities.com/
HCDI Harbor Custom Development Inc. IIN IntriCon Corporation

Real Estate Healthcare
https://harborcustomhomes.com/ https://intricon.com/
HELI:CA First Helium Inc. IMRN Immuron Limited

Basic Materials Healthcare
https://www.firsthelium.com/ https://www.immuron.com.au/
HEO:CA H2O Innovation Inc. IMTE Integrated Media Technology Limited

Utilities Technology
https://www.h2oinnovation.com/ https://www.imtechltd.com/
HHS Harte-Hanks, Inc. INDO Indonesia Energy Corporation

https://www.hartehanks.com/ http://indo-energy.com/
HME:CA Hemisphere Energy Corporation INOD Innodata Inc.

Energy Technology
https://www.hemisphereenergy.ca/ https://innodata.com/
HMLP Hoegh LNG Partners INUV Inuvo Inc.

Energy Communication Services
https://www.hoeghlngpartners.com/home/default.aspx https://inuvo.com/
HRTG Heritage Insurance Holdings, Inc. ISSC Innovative Solutions and Support Inc.
Financial Services Industrials
https://investors.heritagepci.com/ https://innovative-ss.com/
HSON Hudson Global Inc. IVQ:CA Invesque Inc.

Industrials Real Estate
https://www.hudsonrpo.com/ https://www.invesque.com/
HTOO Fusion Fuel Green PLC IZEA IZEA Worldwide Inc.

Utilities Communication Services
https://ir.fusion-fuel.eu/ https://izea.com/
HUSA Houston American Energy Corp. JAKK JAKKS Pacific Inc.

Energy Consumer Cyclical
https://houstonamerican.com/ https://www.jakks.com/
HYMC Hycroft Mining JE:CA Just Energy Group Inc.

Basic Materials Utilities
http://www.hycroftmining.com/ https://justenergy.com/
HYW Hywin Holdings Ltd. JFIN Jiayin Group Inc.

Financial Services Communication Services
https://ir.hywinwealth.com/ NO WEBSITE

KAVL Kaival Brands Innovations Group Inc. LOAN Manhattan Bridge Capital Inc.
Consumer Defensive Real Estate
https://ir.kaivalbrands.com/overview/default.aspx https://manhattanbridgecapital.com/
KEI:CA Kolibri Global Energy Inc. LPCN Lipocine Inc.

Energy Healthcare
https://www.kolibrienergy.com/ https://www.lipocine.com/
KEQU Kewaunee Scientific Corporation LTBR Lightbridge Corporation

Consumer Cyclical Industrials
http://www.kewaunee.com/ https://www.ltbridge.com/
KLXE KLX Energy Services Holdings Inc. LTRPA Liberty TripAdvisor Holdings, Inc.
Energy Communication Services
https://klxenergy.com/ https://www.libertytripadvisorholdings.com/
KPT:CA KP Tissue Inc. LUMO Lumos Pharma Inc.

https://www.kptissueinc.com/home https://lumos-pharma.com/
KRKR 36Kr Holdings Inc. LWAY Lifeway Foods Inc.

Communication Services Consumer Defensive
https://36kr.com/ https://lifewaykefir.com/
KRN:CA Karnalyte Resources Inc. MACK Merrimack Pharmaceuticals Inc.

http://karnalyte.com/ https://www.merrimack.com/
LEJU Leju Holdings Limited MAX:CA MAX Resource Corp.

https://www.leju.com/ https://www.maxresource.com/
LGHL Lion Group Holding Ltd. MAYS J.W. Mays Inc.

Financial Services Real Estate
http://ir.liongrouphl.com/#/Overview http://www.jwmays.com/
LINC Lincoln Educational Services MCHX Marchex Inc.

Corporation https://www.marchex.com/
Consumer Defensive
https://www.lincolntech.edu/
MDJH MDJM Ltd.
Real Estate
LITM Snow Lake Resources Ltd. https://www.mdjhchina.com/
Basic Materials
https://snowlakelithium.com/
MEDS TRxADE Health Inc.
LIVE Live Ventures Incorporated https://investors.trxadegroup.com/
Consumer Cyclical
https://www.liveventures.com/
MFG:CA Mayfair Gold Corp.
Basic Materials
LMNR Limoneira Co https://mayfairgold.ca/
Consumer Defensive
https://www.limoneira.com/

MFIN Medallion Financial Corp. NINE Nine Energy Service Inc.

Financial Services Energy
http://www.medallion.com/ https://nineenergyservice.com/
MINE:CA Inomin Mines Inc. NRSN NeuroSense Therapeutics Ltd.

https://inominmines.com/ http://www.neurosense-tx.com/
MLP Maui Land & Pineapple Company Inc. NTP Nam Tai Property Inc.
Real Estate Real Estate
https://www.mauiland.com/ https://www.namtai.com/
MMLP Martin Midstream Partners L.P. NVOS Novo Integrated Sciences Inc.
Energy Healthcare
https://mmlp.com/home/default.aspx https://novointegrated.com/
MOVE:AQL PowerTap Hydrogen Capital Corp. OEG Orbital Energy Group

Utilities Utilities
https://powertapcapital.com/ https://www.orbitalenergygroup.com/
MRM MEDIROM Healthcare Technologies Inc. OMEX Odyssey Marine Exploration Inc.
https://medirom.co.jp/ https://www.odysseymarine.com/
MVMD:CNX Mountain Valley MD Holdings Inc. OMQS OMNIQ Corp.

https://www.mountainvalleymd.com/ https://www.omniq.com/
MXC Mexco Energy Corporation ONDS Ondas Holdings Inc.

Energy Technology
http://www.mexcoenergy.com/ https://www.ondas.com/
MXG:CA Maxim Power Corp. OPTN OptiNose Inc.

Utilities Healthcare
https://maximpowercorp.com/ https://www.optinose.com/
MYNZ Mainz Biomed B.V. PANL Pangaea Logistics Solutions Ltd.

Healthcare Industrials
https://mainzbiomed.com/ https://www.pangaeals.com/
NCMI National CineMedia Inc. PAT:CA Patriot One Technologies Inc.

Communication Services Technology
https://www.ncm.com/ https://patriot1tech.com/investors/
NCSM NCS Multistage Holdings Inc. PAYS Paysign Inc.

Energy Industrials
https://www.ncsmultistage.com/ https://paysign.com/
NEN New England Realty Associates Limited PBHC Pathfinder Bancorp Inc.
Real Estate Financial Services
https://www.thehamiltoncompany.com/ https://www.pathfinderbank.com/
NHTC Natural Health Trends Corp PBPB Potbelly Corporation

Consumer Cyclical Consumer Cyclical
https://www.naturalhealthtrendscorp.com/ https://www.potbelly.com/

PCYO Pure Cycle Corporation QNC:CA Quantum eMotion Corp.

Utilities Technology
https://www.purecyclewater.com/ https://quantumemotion.com/
PEA:CA Pieridae Energy Limited QUIK QuickLogic Corporation

Energy Technology
https://www.pieridaeenergy.com/ https://www.quicklogic.com/
PFMT Performant Financial Corporation QYOU:CA Qyou Media Inc.

Industrials Communication Services
https://investors.performantcorp.com/investors/overview/ https://www.qyoumedia.com/
default.aspx
RAIL FreightCar America Inc.
PHNM:CA Phenom Resources Corp. Industrials
Basic Materials https://freightcaramerica.com/
https://www.phenomresources.com/
RAVE Rave Restaurant Group Inc.
PLBC Plumas Bancorp Consumer Cyclical
Financial Services https://www.raverg.com/company/
https://www.plumasbank.com/
RBY:CA Rubellite Energy Inc.
PME Pingtan Marine Enterprise Ltd. Energy
Consumer Defensive https://rubelliteenergy.com/
https://www.ptmarine.com/
RCMT RCM Technologies Inc.
PMET:CNX Patriot Battery Metals Inc. Industrials
Basic Materials https://www.rcmt.com/
https://patriotbatterymetals.com/
RDCM Radcom Ltd.
PNG:CA Kraken Robotics Inc. Communication Services
Technology https://radcom.com/investor-relations/
https://krakenrobotics.com/
RDI Reading International, Inc.
PPR:CA Prairie Provident Resources Inc. Communication Services
Energy https://www.readingrdi.com/
https://www.ppr.ca/
REDU RISE Education Cayman Ltd.
PRQ:CA Petrus Resources Ltd. Consumer Defensive
Energy https://ir.risecenter.com/
https://www.petrusresources.com/
REFR Research Frontiers Inc.
PSTI Pluristem Therapeutics Inc. Technology
Healthcare https://www.smartglass.com/
https://www.pluristem.com/
RGCO RGC Resources, Inc.
PT Pintec Technology Holdings Limited Utilities
Financial Services https://www.rgcresources.com/
https://pintec.com/
RGD:CA Reunion Gold Corporation
QD Qudian Inc. Basic Materials
Financial Services https://www.reuniongold.com/
https://ir.qudian.com/

RGF The Real Good Food Company Inc. SDH Global Internet of People Inc.
https://realgoodfoods.com/ https://www.sdh365.com/
RGS Regis Corporation SELF Global Self Storage

Consumer Cyclical Real Estate
https://www.regiscorp.com/ https://ir.globalselfstorage.us/
RIBT RiceBran Technologies SFET Safe-T Group Ltd.

https://www.ricebrantech.com/ https://www.terrazone.io/
RMCF Rocky Mountain Chocolate Factory Inc. SGA Saga Communications Inc.
Consumer Defensive Communication Services
https://www.rmcf.com/ https://sagacom.com/
RVI Retail Value Inc. SGLB Sigma Labs Inc.

Real Estate Technology
https://retailvalueinc.com/ https://sigmalabsinc.com/
RVLP RVL Pharmaceuticals plc SHIP Seanergy Maritime Holdings Corp.

https://www.rvlpharma.com/ https://www.seanergymaritime.com/en
RZE:CA Razor Energy Corp. SMHI SEACOR Marine Holdings Inc.

Energy Industrials
https://www.razor-energy.com/ https://seacormarine.com/
S:CA Sherritt International Corporation SMM Salient Partners, L.P.

Basic Materials Financial Services
https://www.sherritt.com/English/Home/default.aspx https://www.salientpartners.com/
SACH Sachem Capital Corp. SND Smart Sand, Inc.

Real Estate Energy
https://www.sachemcapitalcorp.com/ https://smartsand.com/
SALM Salem Media Group Inc. SOHO Sotherly Hotels Inc.

Communication Services Real Estate
https://salemmedia.com/ https://sotherlyhotels.com/
SAMG Silvercret Asset Management Group SOU:CA Southern Energy Corp.

Energy
Inc. http://southernenergycorp.com/
Financial Services
https://www.silvercrestgroup.com/
SPG:CA Spark Power Group Inc.
Utilities
SBEV Splash Beverage Group Inc. https://sparkpowercorp.com/
Consumer Defensive
https://splashbeveragegroup.com/
SRAX SRAX Inc.
SBFM Sunshine Biophara Inc. https://srax.com/
Healthcare
https://sunshinebiopharma.com/
SREV ServiceSource International Inc.
Technology
https://ir.servicesource.com/

SRTS Sensus Healthcare Inc. TOPS TOP Ships Inc.

https://www.sensushealthcare.com/ https://www.topships.org/
SSBK Southern States Bancshares Inc. TRVI Trevi Therapeutics Inc.

Financial Services Healthcare
https://southernstatesbank.net/ https://www.trevitherapeutics.com/
STEP:CA STEP Energy Services Ltd. TRZ:CA Transat A.T. Inc.

Energy Consumer Cyclical
https://www.stepenergyservices.com/ https://www.transat.com/en-CA?search=package
SURG SurgePays Inc. TSQ Townsquare Media inc.

Technology Communication Services
https://surgepays.com/ https://www.townsquaremedia.com/
SXP:CA Supremex Inc. TUSK Mammoth Energy Services Inc.

https://www.supremex.com/ https://www.mammothenergy.com/
SYPR Sypris Solutions Inc. TWIN Twin Disc Incorporated

https://www.sypris.com/ https://twindisc.com/
TBRD:CA Thunderbird Entertainment Group TWR:CA Tower Resources ltd.

Communication Services Basic Materials
https://thunderbird.tv/ https://www.towerresources.ca/
TCBS Texas Community Bancshares Inc. UG United-Guardian Inc.

Financial Services Consumer Defensive
https://www.tx-communitybank.com/ https://u-g.com/
TCF:CNX Trillion Energy International URB.A:CA Urbana Corporation

https://trillionenergy.com/ https://www.urbanacorp.com/
TEDU Tarena International Inc. UTI Universal Technical Institute Inc.

Consumer Defensive Consumer Defensive
https://ir.tedu.cn/ https://www.uti.edu/
TGO:CA TeraGo Inc. VIA Via Renewables, Inc.

Communication Services Utilities
https://terago.ca/ https://viarenewables.com/
TGOD:CNX Green Organic Dutchman Holdings Ltd. VIAO VIA optronics AG

https://www.tgod.ca/ https://via-optronics.com/en/
TISI Team Inc. VINO Gaucho Group Holdings, Inc.

Industrials Real Estate
https://www.teaminc.com/ https://www.gauchoholdings.com/

VIRX Viracta Therapeutics Inc. XOP:CNX Canadian Overseas Petroleum Limited

Healthcare Energy
https://www.viracta.com/ http://www.canoverseas.com/
VLN:CA Velan Inc. XPL Solitario Zinc Corp.

Industrials Basic Materials
https://www.velan.com/ https://solitarioxr.com/
VMAR Vision Marine Technologies Inc. XTD:CA TDb Split Corp.

Consumer Cyclical Financial Services
https://visionmarinetechnologies.com/ https://www.quadravest.com/#!xtd-home/c1e63
VWTR Vidler Water Resources Inc. YAK:CA Mongolia Growth Group Ltd.
Utilities Real Estate
http://www.vidlerwater.com/ https://www.mongoliagrowthgroup.com/
VYGR Voyager Therapeutics Inc. YGR:CA Yangarra Resources Ltd.

Healthcare Energy
https://www.voyagertherapeutics.com/ https://www.yangarra.ca/
WAVE Eco Wave Power Global AB YJ Yunji Inc.

Utilities Consumer Cyclical
https://www.ecowavepower.com/ https://investor.yunjiglobal.com/
WILC G. Willi-Food International Ltd. YORK:CA York Harbour Metals Inc.

Consumer Defensive Basic Materials
http://willi-food.co.il/ https://yorkharbourmetals.com/
WKSP Worksport Ltd. YQ 17 Education & Technology Group Inc.

Consumer Cyclical Consumer Defensive
https://investworksport.com/ https://ir.17zuoye.com/
WRR:CA Walker River Resources Corp. YTRA Yatra Online Inc.

Basic Materials Consumer Cyclical
https://wrrgold.com/ https://www.yatra.com/
WRX:CA Western Resources Corp. ZIVO Zivo Bioscience Inc.

https://www.westernresources.com/ https://www.zivobioscience.com/
WVVI Willamette Valley Vineyards Inc. ZOMD:CA Zoomd Technologies Ltd.

https://www.wvv.com/ https://zoomd.com/
XELB Xcel Brands Inc.

Consumer Cyclical
https://xcelbrands.co/
XIN Xinyuan Real Estate Co Ltd.

Real Estate
http://www.xyre.com/

L E GA L CORN ER
// By Jon Uretsky, Esq.
Vast Changes to
Microcap Financing
Part II
The SEC Strikes Back
In Q1’s Legal Corner, we said that vast changes would be coming to

the structure of microcap financing – get ready because they’re here.
I
n my last article, I highlighted a string of enforce- Prior to this rule, a dealer was someone “who
ment actions the SEC had begun pursuing in 2019 engaged in the business of buying and selling securi-
against various lenders who all earned money in a ties for his own account.” An individual who bought
similar way: sending funds to a microcap company and sold for his or her own account, but not as part
in exchange for shares based on convertible debt, of a regular business, fell under the trader exception
and then after a six-month waiting period, selling the and thus was not required to register and file with
suddenly unrestricted shares on the open market. the SEC – which can often be an expensive process.
This financing structure existed because, when it Now, a dealer will be considered anyone who
worked out, it was mutually beneficial for both the engages “in a routine pattern of buying and selling
lender and the microcap company. Lenders saw securities that has the effect of providing liquidity to
large profits while these companies got financing other market participants.” How many funds does
they couldn’t get elsewhere. Sometimes, disputes, that include? All of them, perhaps?
and thus litigation, was involved, and we have been
on both sides of those disputes. More often than What does the SEC’s new definition mean,
not, settlements were reached, and the company exactly?
and lender worked together afterwards. This financ-
ing structure is hardly ideal, but it was “the done According to the SEC, the new definition of dealer
thing” in the microcap industry for decades. Critically, sweeps in investors who, for example:
this financing structure, where lenders are seen as
“traders,” instead of “dealers,” had been deemed •• Routinely make roughly comparable purchases
legal for decades. That’s changing. and sales of the same or substantially similar
securities in a day; or
We defended lenders against the SEC by arguing that •• Routinely express trading interests that are at
the SEC should not be permitted to regulate by en- or near the best available prices on both sides
forcement – arguing that the SEC can make rules if it of the market and that are communicated and
wants to. Well, the SEC just did. As I discussed at the represented in a way that make them acces-
Planet Microcap Showcase, the SEC Commissioners sible to other market participants; or
just unanimously proposed rules that would change •• Earn revenue primarily from capturing bid-ask
the letter of the law to further define a “dealer” and spreads, by buying at the bid and selling at the
dealer activity. The SEC’s purported focus here was offer, or from capturing any incentives offered
to “reflect Congress’ statutory intent” that firms who by trading venues to liquid-supplying interests.
engage in important “liquidity-providing roles” in the Keep in mind that though the SEC provides these
securities markets should be registered. standards, it warns that no presumption should be

made that certain persons are not dealers solely but what’s to stop these smaller lenders from
because those persons do not meet the standards structuring their operation to be owned by
of the rule. In other words, there is no safe harbor. different individuals?
•• As for the microcap companies themselves,
There could be some light at the end of this tunnel, this new definition could cause publicly listed
as the SEC included a provision for excluded per- microcap companies to go back to being
sons against whom the new rules would not apply: private companies. Without the benefit of being
persons who have or control total assets of less a public company – i.e., being able to raise
than $50 million. The SEC believes that individuals funds – what is the purpose of going through
who are not part of a business, but are buying and onerous public filing requirements? Other
selling securities with less than $50 million controlled, microcap companies may cease to exist at all
are less likely to pose the type of risk to the market without the necessary funding, causing lost
– and other market participants – that the SEC is jobs and generally stagnating microcap market
trying to address. activity.
What now? In the end, this rule may have the opposite effect the
SEC intended, as those in the microcap industry with
The net that the SEC’s new dealer definition casts is more funds may find alternatives and ways around
wide indeed, and as I’ve mentioned before, this will the rule, while the smaller microcap companies – the
change how the microcap industry is financed. Here very ones the SEC is seeking to protect with the new
is what I see happening to this industry: rules by “levelling the playing field” – will likely be
hurt. With that said, experienced counsel can help
•• Larger microcap lenders and issuers with navigate the process so you don’t end up one of
deeper pockets might start looking at interna- those hurt by the SEC’s new rule. The SEC is provid-
tional exchanges instead of ones in the United ing a one-year compliance period from the effective
States that are regulated by the SEC. Issuers date of any final rules adopted by the SEC, which
can choose to list microcap securities interna- will likely be sometime this summer.
tionally in, for example, the United Kingdom.
The Financial Conduct Authority (“FCA”) So you’ll have a year to figure it out. Retaining
regulates markets in the UK with less stringent experienced microcap counsel like PULLP can help.
listing requirements, where debt securities can We invite you to contact uretsky@pullp.com or call
be sold on an alternative market to qualified 212.571.1164 for a complimentary analysis.
investors. And when microcap securities are
listed internationally – what’s to stop the larger PULLP, “The Microcap Litigators” is one of the only law firms specializing
in microcap litigation. Jon Uretsky is the founding and managing partner
lenders from moving their money internationally of PULLP. Mr. Uretsky has a broad multidisciplinary practice that includes
as well? extensive experience in litigation and dispute resolution, regulatory
investigations (including FINRA and SEC matters like those described
•• Smaller lenders could structure their funds above). In addition, he counsels corporate boards, board committees
differently to qualify as an “excluded person,” (including special committees) as well as being a personal adviser to
many entrepreneurs, business leaders and corporate executives. He has
avoiding registration. However, the SEC may counseled clients on significant litigation, regulatory and transactional
have anticipated this and as a result, clarified matters across multiple industry sectors. Additionally, the PULLP team
has extensive experience negotiated mergers and acquisitions (including
the definition of “own account” to now include reverse mergers); domestic and cross-border investments/joint ventures;
“parallel account structure” which the SEC the representation of private equity; venture capital and other private
defines as “a structure in which one or more investment funds; securities offerings; and private and public financings.
private funds (each a ‘parallel fund’), accounts, www.PULLP.com

or other pools of assets (each a ‘parallel man-
Notes:
aged account’) managed by the same invest- 1. Special thanks to Anna Adelstein, Director of Litigation at PULLP, and
ment adviser pursue substantially the same Kayshana Mohanaraj, a Law Clerk at PULLP, for their assistance in
researching and the preparation of this article, as well as their help in the
investment objective and strategy and invest many matters PULLP handles.
side by side in substantially the same positions 2. This article is not an attempt to provide investment advice. The content
is purely the author’s personal opinions and should not be considered
as another parallel fund or parallel managed advice of any kind. Investors are advised to conduct their own research or
account.” In short, the SEC may come after seek the advice of a registered investment professional.
lenders who have “parallel account structure,”

ins i ghts
// By Shelly Kraft and Roger Pondel
How Public
Relations
Can Support
MicroCap and
SmallCap Companies
A Q&A with PondelWilkinson’s Roger Pondel
While public companies of all sizes work hard to confront today’s

unprecedented communications demands in a volatile marketplace,
microcap and smallcap companies must work even harder to get
their messages out.
T
hey have to compete for attention with bigger of disclosure. Public relations, at times working in
public companies, which by virtue of size alone, concert with IR, typically reaches many audiences
typically create more interest and news that beyond the investment community. The true value of
commands wider attention. And many microcap and PR is best explained by comparing it to advertising.
smallcap companies, with generally smaller corpo- For instance, with advertising is a company talks
rate staffs, are just not able to put their best faces about itself; with public relations, someone else
forward with messaging or use increasingly available talking about the company, whether it is a feature
communications tools. story in a news outlet, podcast or even on social
SNN’s Shelly Kraft recently sat down with veteran media. This third-party dialogue creates a value for
investor relations and public relations advisor Roger publicly traded and privately owned companies in
Pondel, CEO of PondelWilkinson Inc., to ask a few terms of credibility and awareness, which build buzz
questions about the role public relations plays to and interest, ultimately circling back to an equity’s
support microcap and smallcap companies in the value proposition, and thereby generating interest
communications mix: among myriad audiences, including investors.
SK: To set the stage, what is public relations, and SK: Getting to the heart of the matter, how does PR
how does it differ from investor relations? differ for the microcap and smallcap company than
it does for bigger-cap companies?
RP: For publicly traded companies, investor rela-
tions is a needed discipline for communicating with RP: Perhaps one of the biggest differences is that
existing and prospective shareholders, while being larger companies typically generate more organic
sensitive to “materiality” and following the rules news. For the microcap and smallcap company,

there needs to be much more proactivity. That’s Just as an investor relations
why a basic understanding of journalism and what
constitutes news is imperative. Providing natural professional cannot – or should
fodder for the media and more opportunities to get
information out is a key component of performing not – automatically be held
public relations for smaller companies. PR profes- responsible for a stock’s price,
sionals are trained to identify hidden nuggets of
news and to develop ideas to create news and the PR professional should not
attention. PR pros also are knowledgeable in identi-
fying and grabbing the attention of journalists, since automatically be expected to
they repeatedly serve as business news resources
and know who to contact and how to do so. That
guarantee news coverage.
all said, there is more to public relations than work-
ing with the news media, and that’s usually where
creativity and communications skillsets come in vs.
the more left-brain centric investor relations mindset.
of news flow during the often long quiet period,
SK: Why should microcap and smallcap companies which technically starts when earnest discussions
consider using public relations in the first place? begin with the bankers and lasts 25 days beyond
the time a company begins public trading. But the
RP: Public relations as a business discipline provides left hand needs to know what the right hand is
the microcap and smallcap company with a com- doing, meaning that PR must work hand-in-hand
petitive edge, a boost, in getting its story out. It’s not with IR ahead of an IPO. What to announce, when
really enough to prepare a press release on earn- to announce it, and assuring that there will be no
ings or a new contract, distribute it via a wire service forward-looking statements in the CEO’s quote
and hope for the best. Applying a public relations are imperatives that cannot be overlooked. Here’s
approach can help move that story beyond hope where the public relations and investor relations
and enable it to get more traction. It also can help folks must be 100 percent aligned.
with marketing a company’s products and services,
reaching customers and prospective customers. SK: How does a PR firm manage client expecta-
Investors really like that. Public relations also fortifies tions? In other words, what should a client expect
investor relations. For example, a CEO presenting at from his PR firm?
an investor conference certainly is taking advantage
of an important forum that represents a critical tool RP: Great question. Just as an investor relations
of investor relations. But taking the essence of that professional cannot – or should not – automatically
presentation and getting it beyond the meeting be held responsible for a stock’s price, the PR
room with the help of a public relations pro can pay professional should not automatically be expected
bigger benefits and provide tangible ROI. to guarantee news coverage. On the IR side, it’s up
to the company to perform financially for enhanced
SK: Should microcap and smallcap companies valuation to occur. With regard to PR, it’s up to the
planning an IPO consider public relations before company to perform operationally, i.e., with a great
they start the process? story, to attract attention. Just as with IR, it is up to
the practitioner to get in front of investors communi-
RP: I would answer that with an emphatic YES. cating the company’s stellar financial performance,
Especially for microcap and smallcap companies, it is up to the PR pro to identify the right outlets and
which aren’t usually that well known in the first place, get the company covered. But PR is much more
public relations can help a company gain notoriety, than press releases and news generation. Social
and with that, credibility. Both are important media, speaking opportunities, email marketing, and
attributes when the investment banks approach website SEO are just a few of the many ways PR
prospective investors. Establishing a steady flow of can help build awareness for a company.
news well in advance of filing the S1 and registering
for an IPO also is critical. It will allow a continuation

A good public relations firm performance issues, either on behalf of the issuer
or the PR firm. Our firm has been in the fortunate
regards itself as part of the position of maintaining long client retention, with
client and staff tenure averaging more than a
management team. Just as a decade. Our largest client today started with us as
a classic microcap company more than 20 years
CEO would not consider hiring a ago, when it went public through a reverse merger.
key employee for a month, the At that time, the company’s market cap was about
$30 million, with about the same in annual sales.
same holds true when engaging Today, its market cap is nearly $50 billion, with sales
approaching $6 billion. The company’s graduation
a PR firm. from the ranks of microcap took time and patience,
persistent hard work, consistent performance and
transparency in communications throughout the
journey.
SK: What differentiates one PR firm from another? SK: Does it make sense for a microcap or smallcap
company to employee a full-time internal head
RP: In a word – experience – especially when it of communications, blending both PR and IR
comes to doing public relations for microcap and disciplines?
smallcap companies, or for that matter, for publicly
traded companies of any size. The PR firm and its RP: I am admittedly biased, but my answer is
key executives who are assigned to the account probably not. For microcap companies in particular,
should understand certain concepts that are unique and for most smallcap companies, there is typically
to the publicly traded company… knowledge of not enough to do to warrant, or for a company to
“materiality” and basic familiarity with disclosure afford, a full-time internal public relations or investor
rules, including Regulation FD. Differentiation also relations position, let alone the ability to find a
should be viewed in terms of the public relations professional who is experienced and adept at both
objectives. If the goal is merely product promotion, PR and IR. The benefits of engaging an outsourced
for example, an emphasis on digital communica- firm – especially one that provides both PR and
tions and product marketing is critical. However, if IR services – include access to highly experienced
the objective is corporate in nature, there is much executives who have met many PR and IR chal-
more involved, and a PR firm should have an active lenges and who work day-to-day with client teams,
working knowledge of traditional mass and business journalists and investors. It also provides for easy
media, in addition to social and other key marketing collaboration under the same roof at the intersec-
functions. tion of both disciplines.
SK: How should an issuer allocate a PR budget? Roger Pondel is CEO of PondelWilkinson Inc., a full-service investor
relations and strategic public relations firm that has earned a national
Monthly, annually? reputation for innovative, aggressive, professional service. He can be
reached at rpondel@pondel.com, or 310-279-5965.
RP: Unless the subject is crisis communications or About PondelWilkinson and Roger Pondel
specifically event-driven, such as a product introduc- PondelWilkinson Inc. is a venerable name in strategic public relations and
investor relations. Founded in 1968 and under present management since
tion, practicing public relations is a process, with 1989, the firm has earned a national reputation for innovative, professional
many building blocks along the way, starting with service, providing clients with focused expertise, sound strategic counsel
and results-driven program execution. PondelWilkinson’s quality client
development and articulation of key messages. A roster includes emerging and established publicly traded, pre-public and
good public relations firm regards itself as part of privately owned companies in diverse sectors.
the management team. Just as a CEO would not
Roger Pondel and his team advise clients on day-to-day corporate public
consider hiring a key employee for a month, the relations and investor relations strategies. Roger has been the architect
same holds true when engaging a PR firm. For an of communications programs involving corporate transformations and
restructurings, mergers and acquisitions, crises, litigation support and
ongoing program, budget planning for a year is complex shareholder matters. Heading the firm since 1989, he previously
best, with controls built into the contract should was investor and public relations director of several publicly traded
corporations. Early in his career, he was a reporter with the San Jose
chemistry not work out or in an unlikely scenario of Mercury News.

EVER WONDER
WHERE THE PEOPLE
WITH ALL THE ANSWERS,
GET ALL THE ANSWERS?
Ask MARCUM
For More Information:
CLICK HERE

fe atu re
// By Tobias Carlisle
Has the definition

of “value investing”
changed?
It’s been a tough run for value investors. Depending on how it’s
measured, value has underperformed for about a decade.
T
he decade in the wilderness led many to
abandon the strategy. Many others have drifted
away from the strict implementation of it pro-
moted by Benjamin Graham. They favor a modified
version that embraces its spirit while ignoring some of
its narrowest precepts. Does this mean the definition
of “value investing” has changed?
Known as the Dean of Wall Street because he taught

investing at Columbia while operating an investment
practice, Graham authored the value investor’s
bibles Security Analysis (1934) and The Intelligent
Investor (1949). He was also famously Warren Buf-
fett’s teacher. Graham promoted the idea of treating
stocks as part ownership of businesses and ignoring
price movements. Stocks could be bought only if
they were undervalued on a conservative assessment
of intrinsic value. He favored a valuation based on the
liquidation value of a company—the dourest assess-
ment of value—and a widely diversified portfolio. But
Graham didn’t invent value investing—he codified it.
There are many early examples of investors imple-

menting what is clearly a value-type strategy. The
great economist John Maynard Keynes is one such
example. Buffett cited Keynes’s philosophy approv-
ingly in his 1991 Berkshire Hathaway, Inc. Chairman’s
Letter, quoting from a letter Keynes wrote to a
business associate in 1934:1
1 Extracted from Concentrated Investing: Strategies of the World’s Greatest

Concentrated Value Investors (2016) https://amzn.to/3qApGq1

As time goes on, I get more and more convinced business, and the defensibility of the business. None
that the right method in investment is to put fairly of that prevents a valuation based on robust growth
large sums into enterprises which one thinks one when it’s warranted. All it suggests is that valuations
knows something about and in the management of that depend on a rapid improvement in business
which one thoroughly believes. prospects should be subject to intense scrutiny and
skepticism.
Keynes was a contemporary of Graham’s but
favored a more concentrated approach that relied For a short time between 2018 and 2020 the prevail-
on the performance of the business, rather than ing attitude in the market was that only the highest
the value of the assets. Buffett’s evolution from a growth stocks were worth buying. Damn the losses,
strict Grahamite investor to a Phil Fisher-influenced so the theory went, and buy. The business would
“franchise” investor, a strategy remarkably similar to turn on the cash-flow spigot once it won its niche.
the one Keynes finally adopted, is well documented. Just look at Amazon. It lost money all the way to
online shopping dominance. Given the number of
Modern value investors typically style themselves observations in the sample—one—you might have
on the strategy adopted by Buffett and Keynes. been forgiven for some hesitation in extrapolating
They have two criticisms of Graham’s strategy. They the idea that all the money-losers were going to
point to the problems with book value as a proxy lose their way to Amazon-like dominance. The base
for intrinsic value. They also argue statistically rates, after all, said take the under. But who looks
cheap stocks—those on low multiples of assets or at base rates when there’s money to be made? All
earnings—deserve to be cheap because they are we had to fear was the fear of missing out. And so,
bad businesses. Screening is so easy now that the FOMO-ing at the mouth, investors paid 20, 30, 50
market is picked over, they say. Only superior busi- times sales for marginal businesses. Now, two years
ness analysis will lead to superior returns. And that later many are chastened. They have rediscovered
means paying up for quality. the reasons for Graham’s conservatism.
Many believe Graham was a captive of his time. He The definition of value investing today is the same as
endured the Great Crash in 1929, so the argument it was in Graham’s day. Buy the businesses that will
goes, and was understandably conservative for the earn the most on capital and pay as little as possible
rest of his career. They may be surprised to learn for them. The implementation is hard because it’s
that Graham also took a shot at old-fashioned book hard to know what the future holds. Most busi-
value in a 1932 Forbes article, writing, “It is undoubt- nesses mean revert. Most earnings yields mean
edly true that the old-time investor laid too much revert—sometimes the price goes up, sometimes the
stress upon book values and too little upon what earnings go down. A portfolio of stocks that earn
the property could earn.”2 Book values have always reasonable returns on investment bought at a price
been more favored by academics, who seek ease of low enough to allow investors to participate in those
calculation, than practitioners who seek returns. returns will always do well given time.
In truth, the distinction between so-called Grahamite Tobias Carlisle provides a list of these types of
value investing and other forms of fundamental stocks for free on his website, acquirersmultiple.com.
analysis has always been less about the precise He also runs two ETFs that implement a deep value
metrics used to assess intrinsic value and more strategy, the mid and large cap Acquirers Fund (ZIG),
about the proper attitude to take when making and the small and micro Roundhill Acquirers Fund
the assessment. Graham has always emphasized a (DEEP)
business-like approach to the appraisal, a margin of
Tobias Carlisle is founder and managing director of Acquirers Funds, LLC.
safety in the valuation, and the safety of principal.
He serves as portfolio manager of the firm’s deep value strategy. Tobias is
The second-order implications of that philosophy are the creator of The Acquirer’s Multiple®. He is also the author of the books
conservatism in the valuation and financing of the The Acquirer’s Multiple (2017), Concentrated Investing (2016), Deep Value
(2014), and Quantitative Value (2012). Tobias has extensive experience in
investment management, business valuation, public company corporate
governance, and corporate law.
2 Graham, Benjamin, “Inflated Treasuries And Deflated Stockholders,” www.acquirersfunds.com

Forbes Magazine, (1932). https://www.forbes.com/2008/10/23/inflated-
treasuries-stockholders-cz_bg_1023forbesarchive.html?sh=b7b43d474647

ins i ghts
Global Electrification
for All Vehicles No
Longer a Thing of the
Future
The global electrification of automobiles, trucks, buses, marine
vessels, and in fact all vehicles, is no longer seen as a futuristic idea.
W
e are currently in the midst of one of the
E-MOTION™ 180E is
biggest global industrial and technological
the WORLD’S FIRST
revolutions in history. Global mandates
and regulation have solidified and further enabled PERFORMANCE
carbon neutral goals. Electric vehicle (“EV”) sales ELECTRIC PROPULSION
have skyrocketed, charging infrastructure initiatives ENGINE
have been ramped up (and will accelerate greatly in
coming years), and industry leaders have doubled UNPARALLELED POWER
down on their respective focus on improved battery & TORQUE
technology. What was once thought of as a debat-
able endeavor has now caused mass acceptance •• EFFICIENT –
MASSIVE FUEL
and excitement in the marketplace.
SAVINGS
The auto industry began its ascent towards •• PROPRIETARY
electrification quite some time before the marine UNION ASSEMBLY
industry. Some of the auto industry’s biggest and •• LOW MAINTENANCE
most prestigious names have already planned to go COST
completely electric within the next 5 or 10 years. JLR •• RAPID, INEXPENSIVE
(Jaguar Land Rover) plans to sell only electric cars CHARGING
by 2025; Volvo plans to achieve that same goal by •• RANGE
2030; General Motors plans to go fully electric by
2035. Well-respected high-performance auto manu-
facturers Lotus and McLaren will no longer sell ICE more cost effective and conscientious green future.
powered sports cars by 2028. Volkswagen, 2021’s
leading seller of EVs in Europe (with approximately In 2021, electric automobiles, including hybrid
25% of the market), aims to have EVs account for electric vehicles and plug-in-hybrid vehicles, made
at least half of its global production by 2030. Even up 9.7% of US auto sales. This is nearly double
luxury brands such as Lamborghini, Bentley, Porsche, 2020’s 5.4% number. Auto sales in general rose
and Ferrari, now have an expanding footprint in the only 3.4% from 2020 to 2021. However, total sales
electric sector. And of course, there’s Tesla. Addi- growth for electric vehicles skyrocketed 85.9% year
tionally, major ground shipment logistics companies over year. In the first quarter of 2022, EV sales have
such as UPS, Amazon, and FedEx, have supported a soared, even with the overall industry reporting a

15.3% decline in new vehicle sales. In 2021, the global addition, Finland is the home to Nextfour Solutions, a
electric boat and ship market reached a benchmark company that Vision Marine has recently partnered
value of nearly $5 billion and is expected by many in with that has designed a unique and highly ad-
the boating industry to reach well over $10 billion by vanced navigation and entertainment system called
2027. the Q Display.
The exponential growth of the electric boat market As many boaters and marine industry OEMs move
can partly be attributed to the burgeoning global increasingly towards acceptance of electric transi-
government mandates and restrictions surrounding tion of worldwide waterways, consumers are eagerly
gas and diesel engines (internal combustion engine, awaiting the mass production of high performance
or ‘ICE’). In addition to the global “zero emission” electric outboard and powertrain systems, much
initiative, astronomically high fuel costs have also like consumer anticipation during the early stages of
played a large role. electric automobiles.
It is well known that Europe and North America This is the perfect inflection point for Vision Marine
have held the largest global market share in the Technologies, Inc. (VMAR-NASDAQ) to assert
electric boat market for quite some time, but smaller market dominance via it’s highly proprietary, 180E
markets have also witnessed carbon neutral goals powertrain, which is the first fully electric high
being fast tracked. performance purpose built outboard powertrain
system The E-Motion™ showcases immense power
The Port of Auckland in New Zealand has announced and torque, while also producing zero pollution,
its goal of becoming a zero emissions harbor by zero emission, a noiseless environment, requires
2040. Kenya’s fishing village Mbita, located in Lake very minimal maintenance, and more than a 90%
Victoria (which is home to around 25,000 diesel reduction in in operating cost versus currently very
powered boats) has recently been equipped with expensive gasoline pump prices. It is the most
its first line of electric powered fishing boats by technologically advanced electric outboard motor on
Dutch startup Asobo. Scandinavian countries have the market, and to Vision Marine’s knowledge, there
seen several startup electric boat manufacturers, is no other electric outboard motor even close to
including Candela, which has an electric ferry slated market which rivals it. Vision Marine’s recent Manu-
to commence operation next year in Sweden. In facture and Supply Agreement (‘MSA’) with McLaren

Engineering, a division of Linamar Corporation, will extensive control software. Our E-Motion™ and
enable first mover advantage for the E-Motion™ to related technologies used in this powertrain system
scale mass production, therefore readily available to are uniquely designed to maximize efficiency, and
serve major OEMs. as a result, enhance both range and performance.
Virtually any powerboat can become fully electric by
Vision Marine’s CEO Alexandre Mongeon and incorporating our disruptive powertrain technology.
co-founder, and his team have been developing
an innovative cutting edge fully electric powertrain Vision Marine also designs, innovates, manufactures,
technology for the marine industry for years. Years and sells handcrafted, high performance, environ-
ahead of the competition, Vision Marine has been mentally friendly, electric recreational power boats
at the forefront of the boating industry’s recent to customers. These boats can be found globally,
shift to electrification as the only company with a branded, and ready for use at many other rental
deep footprint into the high-performance electric operations operated by both startups and large
powerboat market. Vision Marine’s focus has specifi- OEMs, for example, Freedom Boat Club, Carefree
cally been on the high-end outboard market, which Boat Club, Aquatic on Lake Windermere, in England,
will exhibit the fastest growth segment within the Electric Boat Rentals of Bermuda, On A Boat in
general outboard sales market. The E-Motion™180E Melbourne, Australia, Yachtsy in Washington D.C.,
is the world’s first electric propulsion engine provid- and Maine Electric Boats, to name just a few. Vision
ing what we believe to be the only ready for mass Marine’s boats can also be rented at prestigious
production high performance electric outboard that hotels, such as Montage Palmetto Bluff in South
offers the exceptional speed and torque otherwise Carolina, Grupo Vidanta in Mexico, Grand Palladium
not available within the boating industry. Hotel in Isla Mujeres, among others. For some of
these businesses, Vision Marine’s boats are the
The E-Motion™ is the first fully electric purpose-built cornerstone of their respective rental operations.
outboard powertrain system that combines an
www.visionmarinetechnologies.com
advanced battery pack, inverter, and high efficiency
motor with proprietary union assembly between the
transmission and the electric motor design, utilizing

ins i ghts
// By Diane Yoo
Making Seats for

Female Board
Members
Earlier this year, global HR giant Korn Ferry took note of what it
called a “curious paradox,” writing: “Technology companies are
some of the most innovative businesses in terms of strategies,
products and services, but are among the least progressive when
it comes to the number of women serving on their boards of
directors.”
A
ccording to the firm’s research, less than 15 strains on working women and caused many to
percent of the 1,000 or so corporate directors leave the workforce temporarily, will be used as an
serving the country’s top 100 tech companies excuse to maintain the status quo. Change needs to
are women — far less than the 20 percent represent- accelerate, not stop, and men in particular must call
ing large companies overall. Moreover, 16 of the out the double standard that we women face.
top 100 tech companies’ boards had no women
members at all. This double-standard, expressed by so many eu-
phemistic roadblocks that only women seem to hear
Perhaps even more stunning is the underrepresenta- — “show us proof”; “build a network and come back
tion of minorities on large corporate boards. A study to us”; “you need more traction” and many others
by Institutional Shareholder Services, a company — has created huge discrepancies in the percentage
that advises large shareholders on corporate gover- of women (especially minority women) executives
nance, found that just 1.5% of the 20,000 directors and entrepreneurs, the twin pools from which board
of the country’s 1,000 largest companies are black members are culled from. Last week, Sheryl Sand-
women. And the pace of change has been glacial, at berg of Meta Networks (formerly Facebook) quit the
best. From 2015-2020, the tech industry increased company after twelve years, apparently because
its share of board members who are underrepre- she was feeling burned out. Sandberg proved that
sented minorities by just 3.9%, a bit better than women could go toe-to-toe with the biggest empire
other industries, but still far short of what would be builders in tech, while also becoming a best-selling
needed to make corporate governance truly diverse author and role model for millions. It is my goal and
in our lifetimes. the women I partner with to expand the room and
opportunity for legacies such as this.
As a minority woman, entrepreneur, and investor in
Silicon Valley startups, I am often the only woman As a tech venture capitalist, I seek out women
at the table. I have called out the toxic culture that founders, but men need to join me in this search.
prevents women from leaning in, or even being Unfortunately, there simply aren’t enough women
considered for a high-level position, many times. I’m already at the highest levels needed to pull the rest
concerned that the pandemic, which placed unique up without help from our male counterparts. This is

firm in partnership with the largest medical center of the world. With VC
not a philanthropic exercise. We women are natural and accelerator expertise, she works extensively with over 700+ global
leaders and born networkers. We thrive in disciplines companies and her firm has deployed significant capital into the startup
ecosystem. She now has become one of the only Asian- American women
like engineering and mathematics, but we also have
to run a Private Equity firm. She has launched numerous venture funds for
that extra touch of empathy and appreciation for over 15 universities across the US and has built a powerful co-investor US
relationships that is so vital to team-building. Our network with offices in Texas and New York. Diane is Co-founder of Global
She Ventures, an accelerator in partnership with Rice University to catalyze
dual roles as leaders and nurturers should not be global women entrepreneurs. Diane is also Co-founder to a national media
seen as a weakness, but rather as a competitive platform, Identity Unveiled highlights trailblazing Asian American women
who have broken barriers and become firsts in their industry. She is also
advantage. According to Harvard Business Review, an investment partner to several Silicon Valley funds including the largest
companies that place women in executive or senior women’s fund and the first FemTech fund in the nation.
leadership roles not only tend to provide a higher
quality of consumer experiences, but are also more Diane is an entrepreneur turned investor with experience in launching
and founding Angel Funds, Investment Networks, private equity and
socially responsible and profitable overall.
Venture Capital. As Founding Partner, she secured a Venture Capital
fund partnership with the world’s largest medical center. As the former
Companies cannot afford to lose talented execu- Managing Director of The Rice Angel Network, Diane has expertise in
operating funds. She is Also the founder of national pitch competitions in
tive women, yet there would be so many more if 10+ cities with a focus on creating impact for diverse entrepreneurs. With a
representation and the opportunity were there. history of operating funds and portfolio companies, Diane founded venture
capital funds for over 12+ universities. With extensive experience advising
This conversation is not one just about women, but over 100+ companies and 30+ venture backed investments, she serves as a
about improving diversity, equity, and inclusion. As mentor and investor to several nationally ranked top-tier accelerators. She
is also Co-Founder and Partner to accelerators including Curated Advisors.
an Asian0 American woman, I can attest to the fact
that, in a global industry like tech, we need as many Diane is also an investment partner to Silicon Valley funds including the
largest women’s fund and the nation’s first FemTech fund. Additionally, she
voices as possible on board — and on the board.
is a US partner to Korean government agency focusing on venture capital,
acquisitions, and consulting early stage companies. Diane is national
Diane Yoo Bio:Diane Yoo is a results-driven entrepreneur and venture capi- speaker on Venture Capital and Entrepreneurship. Her topics include “101
talist with more than 15+ years of experience. As an accredited investor, for Investors”, “Million Dollar Women”, and “Pitch Perfect”. Her publication
she has invested in 35+ companies with a focus on diverse founders. She is has trended #1 for Venture Capital on Crunchbase and also spotlighted on
in the 1% of Asian-American female founders who are also a partner. Diane numerous media outlets includingStartup Nation and Women 2.0. As an
has founded angel networks, venture funds, and investment networks. influencer, Diane serves on the official Forbes Business Council.
She is Founding Partner for a Medtech and Healthtech venture capital

ins i ghts
// By Gavin Wendt
Battery Metals
Overview
We are at an interesting point with respect to battery materials,
especially with regards to demand-supply dynamics – and most
importantly pricing. There are opposing views on where prices are
headed, but irrespective of one’s position, it’s a discussion that’s
certainly worth having.
F
ront and centre in the battery materials space into the share price performances of lithium equities
has been lithium – which has been far and around the world – whether it be established pro-
away the best-performing battery sector com- ducers or junior companies.
modity. This positive momentum has flowed through
Source: International Energy Agency

Russia’s war on Ukraine, combined with a surge which accounts for about 17% of production capacity,
in demand from car companies looking to secure would add to pressure on prices. Indonesia, which
supply for ever more ambitious EV growth plans, holds almost a quarter of global nickel reserves,
pushed the prices of raw materials such as nickel, limited some exports a couple years ago and is now
lithium and cobalt to record levels during March. The luring investments into higher-value processing,
major battery commodities can be summarised as mainly from China.
follows:
COBALT: More than two-thirds of the mined metal
LITHIUM: Australia’s hard rock mines account for comes from the Democratic Republic of Congo
about half the world’s supply. Chile, where it’s (DRC), though Australia, Cuba and Canada are
harvested by pumping salt-rich brines from under- expanding capacity. The DRC has long faced allega-
ground into vast evaporation ponds, is the No. 2 tions of corruption, human rights abuses and the
producer - and holds more than 40% of the world’s use of child labour. Small-scale “artisanal” producers
known reserves. China has more than half of all accounted for about 12% of the country’s output in
capacity for refining it into specialist battery chemi- 2020. China has little of the raw material but refining
cals. Almost $14 billion is needed to develop planned is concentrated there, with about 80% of global
lithium production capacity by 2025, according to capacity. Capacity is growing elsewhere, though,
BloombergNEF. And money isn’t the only hurdle: including at Finland’s giant Kokkola refinery.
Serbia in January blocked Rio Tinto Group’s plans to
build Europe’s biggest lithium mine after running into GRAPHITE: Battery makers can use either a natural
public opposition over environmental concerns. graphite extracted from mines to make anodes or a
synthetic material that is typically more expensive
NICKEL: The U.S. warned in a 2021 report of the but lasts longer, charges faster and improves safety.
prospect of large shortages of the highly purified, China accounts for about 60% of natural graphite
battery-grade type, known as class one nickel, in production capacity and 90% for the synthetic. It
three to seven years because of a lack of enough also is a big source of the raw material, but new
specialized processing. Any trade curbs on Russia, supplies are being developed in places including

Tanzania, Madagascar and Canada. South Korea and without worrying too much whether they will get a
Japan are alternative sources of processed materials. return on their investment.
Tesla last year struck a deal with Syrah Resources, a
supplier with a mine in Mozambique and a plant in Elsewhere amongst the sceptics, US investment
Louisiana. bank, Goldman Sachs, has gone even further –
“calling the end of the bull market” on lithium. A
Over recent weeks there has been an emergence recent Goldman Sachs report has referenced new
of dissenting voices when it comes to the immedi- investment, particularly in respect of Chinese break-
ate price prospects of lithium in particular. Some throughs in extraction of lithium from an alternative
banking analysts including UBS believe that the mineral called lepidolite. Also pushing the theme of
peak of the price craziness may be over. The price lower pricing was news that Chinese battery and
per kWh for a high-nickel NMC811 lithium-ion bat- vehicle maker, BYD, was in talks to buy six lithium
tery had fallen from $150 in March to $135 by the mines in Africa with the potential to provide the raw
end of May. It is also estimated that the increase materials to eventually refine enough lithium to make
in raw material prices has now added $1,200, or 28 million EVs with a battery size of around 60kWh.
roughly 3%, to the materials cost for a battery-
electric car compared with the price at end of last In my view, Goldman’s prognosis is misplaced.
year. Lithium sector fundamentals are far more posi-
tive that the sceptics are describing. For starters,
For as long as the car market remains undersupplied, lepidolite production is complicated and yet to be
manufacturers will likely be able to pass on the lion’s commercially proven on the scale necessary to make
share of the cost burden. That means customers, a meaningful impact in the battery sector. Further-
for now anyway, are willing to pay the higher prices more, acquiring an undeveloped resource in Africa
to get into a new car, which in turn means the car is very much a different story to actually pushing
makers can progress with their electrification plans the button on a mining development. There are a

lot of hurdles to be jumped through before African a significant lithium supply deficit of around 20%
resource projects are commercialised. for the period 2023-2030. While the spot market
might see some sort of easing in price, it’s important
Just look at the iron ore space, where China has to note that the spot market reflects a very small
been trying for a couple of decades to break the amount of product that’s actually traded - most
market dominance of Australian and Brazilian iron lithium is sold via contracts. Another Australian
ore suppliers, by developing projects in Africa. Quite producer, Allkem (ASX: AKE), has just announced
simply, China’s African iron ore ambitions have that the average price it would receive during the
been frustrated by uncertainty and massive capex June quarter would be 14% above previous guidance
requirements. at US$40,000/t on sales of ~3,500 tonnes.
And the anecdotal evidence from lithium producers At current lithium prices, all producers are generat-
tells a positive story on pricing and demand, not ing peak cycle returns, yet a recent retreat in share
a negative one like the sceptics are suggesting. prices has resulted in implied pricing of $US18,435-
Producers are seeing end-users that are desperate $US23,716/t LCE.
to secure supply – shooting down the argument that
there is a situation of oversupply in the market. For Benchmark Minerals has pulled no punches when it
example, Pilbara Minerals (ASX: PLS) at a recent con- comes to its analysis of the current view of lithium
ference in Queensland, Australia pointed to ongoing sector sceptics, commenting: “We’ve seen this be-
strength in the auction prices that it is receiving via fore, we will see it again. Goldman Sachs: you can’t
its website for spodumene concentrate. Quite simply, just add up all the lithium mine level potential and
it cannot satisfy the demand from end-users that are make an oversupply call. The speciality chemicals
clamouring for supply. world is more nuanced than iron ore. It’s why the
world doesn’t rely on investment banks for research
In actual fact, most industry groups are modelling anymore!”

It’s important to bear in mind that the conse- As is often the case in the resource sector, today’s
quences of failure to produce enough lithium are price surge had its origins back in the period 2018-
potentially devastating. Global investment in EVs 2020, when there was a substantial price slump.
has grown faster than any other new-energy Back then, lithium prices halved in value, which in
sector over the past few years, outstripping turn led to chronic underinvestment in new sources
even wind and solar power. Along with higher of supply. This all took place just as EV demand was
prices of other raw materials, it is a reversal of taking off, amplified by the post-covid move towards
years of falling prices as EVs race to become EVs as part of mandated climate goals. For battery
cost-competitive with gasoline-powered vehicles. makers, these supply woes have been compounded
If battery makers can’t get access to enough by the covid pandemic and Russia’s war in Ukraine
lithium, it would curb the expansion of clean- - impacting supplies of not only lithium but other
energy vehicles, making it harder to meet global ingredients they need - including nickel, graphite
emissions targets. and cobalt.

Tightening supply and higher prices have prompted Much of the remaining supply comes from deposits
a flurry of acquisitions and joint ventures as battery of an igneous rock called spodumene, with Australia
makers and automakers try to secure supplies, as the biggest miner. The ore is roasted and leached
which has also unleashed a wave of resource with sulfuric acid and the silvery-gray residue is
nationalism among governments. As early as June typically shipped to China to be made into lithium
last year, Fitch Solutions said lithium had become hydroxide and lithium carbonate – compounds that
a “strategic mineral,” and warned of “rising govern- can be combined with nickel or cobalt to make bat-
ment intervention.” tery electrodes, or with solvents to make electrolytes.
To provide some sort of perspective on the scale of The quickest way to increase supply is to ramp up
the industry, EVs and batteries drew $271 billion and output from these existing sources. Australia’s Pil-
$7.9 billion of investment respectively during 2021, bara aims to raise production capacity more than
according to BloombergNEF. The upstream part of 50% by the September quarter by expanding its
the value chain has, on the other hand, attracted Pilgangoora mine in Western Australia, a project that
relatively low investment over the last five years, includes Chinese partners Great Wall Motor Co. and
adding to supply problems. CATL.
More than half of the global resources of lithium For many brine-lithium producers however, increas-
are located in what is known as the ‘lithium triangle’ ing output quickly is constrained by their per-
between Argentina, Bolivia and Chile, where produc- mits and the time taken to let the liquid evaporate.
ers pump lithium-rich brine from underground lakes Joe Lowry, founder of advisory firm Global Lithium,
and allow the liquid to evaporate for 12-28 months says it best: “There is plenty of lithium in the ground,
to yield a slurry that can be profitably processed. but timely investment is the issue. “Tesla can build a
Current technology recovers only about 50% of the gigafactory in about two years, cathode plants can
lithium in the brine. be built in less time, but it can take up to 10 years to
build a greenfield lithium brine project.”

But lithium producers face an in Nevada are others that have to negotiate local
opposition.
even bigger problem. Part of the
Chile’s Constitutional Convention recently ap-
reason consumers are prepared proved an expansion of environmental governance
that includes reshaping water rules and other
to pay a premium for an electric environmental protections that could affect lithium
vehicle is that it’s better for the producers if the charter is ratified in a September
referendum. So, lithium producers don’t know what
environment. But the lithium the rules will be.
supply chain is far from green. But lithium producers face an even bigger problem.
Part of the reason consumers are prepared to pay a
premium for an electric vehicle is that it’s better for
the environment. But the lithium supply chain is far
from green.
And then there are political factors that can hamper
the development pipeline. Rio Tinto’s proposed $2.4 The Atacama desert of northern Chile is one of
billion Jadar mine in western Serbia, which would the driest places on Earth, but extracting the
be Europe’s biggest, has stalled due to community mineral from salt flats 10 times the size of New
opposition. Rio says the mine, originally scheduled York’s Central Park and processing it requires a
to open in 2026, would create more than 2,000 lot of water. According to BloombergNEF, it can
jobs and meet the highest environmental standards, take about 70,000 litres of water to make one ton
including using recycled water and electric trucks. of lithium. Mining spodumene is energy intensive
Elsewhere, Savannah Resources’ Barroso project and together with shipping the concentrate to
in Portugal and Lithium Americas’ proposed mine China for refining can emit 3.5 times more carbon

dioxide than lithium extracted from brine, according
to Wood Mackenzie.
There is little real-world evidence
to support any sort of sustained
Companies are pursuing new technologies to lower
expenses, cut water use and green their opera- pullback in lithium prices due to
tions. Albemarle Corp, the world’s biggest lithium
producer, is seeking responsible mining certification
an oversupply situation. In fact,
for its operations in Chile and said it will reduce the the anecdotal evidence from
intensity of freshwater use by 25% by 2030 in areas
of high water-risk. Many are pursuing direct lithium major producers is the opposite.
extraction, a term used to describe ways to chemi-
cally capture lithium compounds that would speed
up production. Albemarle, which carries out its own
research, said DLE so far has shown to be “typically
less economic and less sustainable than conven- sort of sustained pullback in lithium prices due to an
tional brine resources.” The company will continue oversupply situation. In fact, the anecdotal evidence
to investigate DLE and other processes to meet from major producers is the opposite. End-users are
sustainability goals. still scrambling to ensure enough supply, a situation
that could well be exacerbated the with reopening of
Environmental and supply issues have prompted China’s major cities, Shanghai and Beijing. We could
companies to look for alternatives to the lithium-ion well see a resurgence in EV purchases now that
battery, including hydrogen. But none have come Chinese citizens can move about with greater free-
close to supplanting lithium in the all-important pas- dom, which will mean pressure on battery supplies
senger car market, and most are years away from and in turn commodity demand. China represents
commercial viability. Therefore, lithium-ion will likely the world’s biggest EV market and purchases had
remain the dominant battery technology at least up slowed over recent months, due to lockdowns. The
to 2035. Lithium-ion batteries fall into a sweet spot reality is that most industry groups are modelling
that balances high energy density and safety. The a significant lithium supply deficit of around 20%
mineral is the least-dense solid element with the for the period 2023-2030. Nevertheless, the recent
greatest electro-chemical potential and a very low pullback in equity and commodity prices is a healthy
melting point, producing an excellent energy-to- thing in any overheated market, as it typically
weight performance. provides the breather the market needs, allowing for
price consolidation and the opportunity for industry
Ulderico Ulissi, battery research lead at London- fundamentals to be properly reassert themselves.
based Rho Motion Ltd., an energy transition
researcher, predicts that solid-state and sodium-ion Gavin is based in Sydney, Australia and has followed the fortunes of
international resource markets for the past 25 years, covering both
batteries could eventually challenge lithium-ion equities and commodities, as a research analyst. He believes that the most
packs in some applications in the second half of interesting resource opportunities are typically found at the smaller end of
the market, which these days is his exclusive area of focus.
the decade. “EV qualification, however, is a lengthy
process and scaling up manufacturing of new tech- The resource sector is on an inexorable growth path, driven by an
ever-increasing world population and modernization of living standards
nologies can bring several challenges.” in emerging economies, as well as a significant shift in how we generate
energy. This will provide enormous growth in the demand for commodities
of all types.
Another potential source of lithium is from recycling
old batteries, a practice that could meet 16% of Gavin is the Head of Mining & Metals with research group Independent
annual demand by 2035. But battery retirements are Investment Research (IIR) and he is the Founding Director and Senior
Resource Analyst with MineLife.
only set to surge after 2030. Basically, there’s just
not enough batteries to be recycled right now, whilst For more information about MineLife, please visit: www.minelife.com.au
recycling presents its own environmental problems.
Summary
There is little real-world evidence to support any

advised to conduct their own research or seek the advice of a registered investment professional. Gavin Wendt doesn’t own any stock in any companies mentioned in this article.

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AS IA CORN ER
// By Leslie Richardson
Hong Kong IPO

Market Hits Dry Spell
Starting in early January with the fifth Covid-19 wave, the Hong
Kong financial market has been hit with a steady stream of
punches this year.
T
hree months of strict social distancing restric- ing Hong Kong, requiring all Chinese companies
tions led to a sizable cut back on much of pursuing overseas IPOs to file with the CSRC. As
the local business activity causing the overall part of the new draft regulation, companies can still
economy to shrink by four percent in the first quarter. list overseas as variable interest entities if they meet
Compounding the pressures of the local economic compliance rules, a sign that China is trying to avoid
struggles are heightening geopolitical tensions and financial decoupling from the US.
increasing interest rates resulting in the Hang Seng
Index down around 9% YTD as of June 20th. JD Technology, the fintech, cloud and AI arm of
Chinese e-commerce company JD.Com, is one of
Adding to the challenges of Asia’s most popular the first high profile IPOs to be impacted by the new
fundraising venue, just 22 companies listed in the regulations. The company hoped to lodge its IPO
first half of the year, with only one IPO competed filing in Hong Kong by the end of March followed by
in May. Total proceeds raised were HK$17.1 billion, an IPO later this year. However due to the updated
representing a 92 percent plunge in proceeds domestic regulatory approval requirement, it has
raised from the first half 2021. JL Mag Rare Earth, a been forced to delay its plans to raise up to US$2
producer of permanent-magnet materials, has been billion as it waits to secure regulatory approval from
biggest Hong Kong IPO so far in 2022, raising over the CSRC. Full Truck Alliance Co Ltd, China’s ‘Uber
US$500 million in January. for trucks’, plans to raise US$1 billion in a secondary
Hong Kong listing this year have also been paused
The IPO drought is due to a combination of China’s as the company waits for the Chinese cybersecurity
sharp economic slowdown, new regulatory frame- regulator to announce findings of a probe into the
work for overseas listings and companies choosing company. The company raised US$1.68 billion in a
to postponed their listing due to the weaker US IPO last year.
secondary markets. Insurance group FWD delayed
its US$1bn Hong Kong initial public offering stating Additionally, companies like Ximalaya and Green Tea
volatile market conditions as the cause. Group are taking a wait and see approach to their
IPOs. Ximalaya, China’s largest online podcasting
Highlighting the IPO market uncertainties is the platform, scrapped its US IPO plans after China
impact of Beijing’s ongoing technology crackdown. implemented new regulatory rules targeting technol-
Following last year’s tech crackdown and the blow ogy firms. The company filed its IPO application in
to the Didi Chuxing IPO, China is putting more Hong Kong last September but has re-evaluated its
scrutiny on Chinese companies offshore listing plans IPO plans while Chinese fusion cuisine restaurant,
as it revises its overseas listing rules. In December Green Tea Group, pushed back its plans to raise
2021, the China Securities Regulatory Commission US$150 million in March amid the increasing poor
(CSRC) released new rules for overseas IPOs includ- market conditions.

Considering the poor IPO performance in the first Homecoming listing are anticipated to remain a
half of the year, PwC cut its full-year IPO forecast theme through 2024 as US regulator have flagged a
for in Hong Kong to US$23.4 -US$26 billion down total of 149 US-listed Chinese companies for failing
from its forecast at the beginning of the year of to meet the audit regulations. These companies will
US$45.5 – US$52 billion. The number of deals PwC be required to delist from the US market as early as
expects is now 80, down from 120 with three to 2024 if they fail to meet the regulations contained
four companies raising more than HK$10 billion each in the Holding Foreign Companies Accountable Act
in the second half as the market gradually regains (HFCCA). The first delisting of non-compliant foreign
momentum. stocks is expected to start in late 2023.
Hong Kong’s IPO pipeline for the second half of Since new reforms introduced in 2018 to allow
2022 includes one of China’s top lithium producers, companies with multiple classes of voting rights and
Tianqi Lithium Corp. The company is looking to raise biotechnology companies without any revenue to
up to US$1.2 billion in what could be the biggest ini- list in Hong Kong, the Hong Kong stock exchange
tial public offering this year. Listed on the Shenzhen has seen significant growth in new economy and
Stock Exchange, Tianqi Lithium was ranked third in biotech listing. It is now the world’s second-largest
terms of revenue generated from lithium globally in biotechnology fundraising hub with 93 IPOs that
2020, according to a report from data analytics firm raised a total of HK$258.5 billion. It has also listed
Wood Mackenzie. 198 new economy companies that have raised a total
of HK$853 billion, representing 26 per cent of the
In June, Baidu backed Chinese electric-vehicle exchange’s daily turnover. Being the IPO destina-
maker, WM Motor, filed for an IPO in Hong Kong tion for China’s new economy and biotech compa-
as it looks to raise up to US$1 billion, according to nies, the Hong Kong Stock Exchange is considering
Bloomberg. WM Motor plans to deliver affordable new listing reforms to allow pre-revenue tech giants
EVs on mass scale. Its first model, a sport utility start-ups to raise funds.
vehicle starting at 160,000 yuan, nearly US$24,000,
became a best-seller in its price segment after its The Hong Kong exchange is dominated by mainland
launch in 2018. Hangzhou-based Leapmotor applied companies with 80 percent of total market capi-
in March this year to raise up to US$1billion through talization represented by the mainland and seven
a Hong Kong IPO. The company targets the mid- to of the top 10 Hang Seng Index constituent stocks
high-end segment with its smart EVs. EV companies are mainland companies. With the sheer size of
have become highly attractive since China is promot- China’s economy and the preference of Chinese
ing cutting carbon emissions with its plan to achieve firms to raise capital internationally, Hong Kong’s IPO
carbon neutrality by 2060. prospects are expected to bounce back as the city
remains an important “venue that bridges China with
Re-routing its original plan for a U.S. listing, Tencent- the rest of the world.”
backed Tuhu, an online automotive service platform
in China, filed for an IPO in Hong Kong to raise up to Ms. Leslie Richardson has over 20 years of investment management and equity
research experience. She operates a boutique investor relations firm in Hong
US$400 million. China being home to the world’s Kong for Asian companies listed in the U.S. and Hong Kong. She also assists
largest car market, makes it a fertile ground for private companies develop investment material and build an investor following
in preparation for a public listing. Additionally, she is the Asian Correspondent
development of an aftermarket offering services for for Micro-Cap Review, www.microcapreview.com, a financial magazine focused
the millions of cars on its roads. on mirco-cap companies. Previously, she worked for CCG Elite in assisting
Asian-based, U.S. listed clients formulate key communication strategies. Ms.
Richardson began her investment career at U.S. Trust Company then went on
Joining the wave of homecoming listings, Chinese to join Odyssey Advisors as a portfolio manager and Director of Research. Ms.
Richardson specialized in high growth sectors such as bio-tech, alternative
EV start-up Nio and KE Holding completed its Hong energy, IT and telecommunications. She earned her M.B.A. from the University
Kong listing by introduction without raising any of Southern California. Ms. Richardson is based in Hong Kong. www.elite-ir.com.
money this spring. Companies that seek a listing by
introduction are able to do so because their existing
shares are already widely held and have an open
market for their shares after the new listing. Q&A
platform akin to Quora, Zhihu, made its homecoming
in April, raising US$106 million in a Hong Kong.
advised to conduct their own research or seek the advice of a registered investment professional. Leslie Richardson doesn’t own any stock in any companies mentioned in this article.

m a r k et ma k er co rner
// By Eric Flesche
Payment for
order flow
At Glendale Securities, Inc., we mainly make markets in OTC
securities for our customers. We charge our customers a
commission for execution and use our market making capabilities
to facilitate customer executions.
W
e are often asked why we don’t offer send your order to an exchange or ATS, but those
commission free trading like some of the often charge the broker on a net basis for execution.
online retail brokerage firms offer. Wait, They can execute the order internally as a market
how can a broker dealer offer commission free maker, but that requires staff, technology, and risk
trading? The answer to that question requires a capital that may be too cost prohibitive. Another
discussion on the practice of payment of order flow, option is to send customer orders to a wholesale
and a clarification on when payment for order flow market maker who pays the brokerage firm for its
is paid to brokers. Many large retail brokerage firms order flow. If you must choose between the three
including the online ones you are probably familiar options outlined above, receiving payment for order
with do not make markets in stocks. To fill your flow for sending orders to a wholesale market maker
order, brokerage firms have a couple of options, seems like it’s the smartest option for the brokerage
each with their own cost/profit structure. They can firm. The brokerage firm eliminates costs, doesn’t

Not all market makers pay for
order flow, and many provide
best execution regardless of
their payment for order flow
arrangements. At Glendale
Securities, Inc., we focus on
executing our customer’s
orders to obtain best execution,
regardless of how the order is
executed.
need to add technology, increase its staff, or have makers tip the table in their favor is by selecting
excess risk capital available to execute orders. The the types of orders that they will make payments
brokerage firm then can pass those savings on to for order flow to brokers that send them orders.
customers in the form of zero commissions. Sounds Wholesale market makers will typically not pay for
like everyone wins, doesn’t it? But wait, how does orders in OTC stocks, including for OTC foreign
the wholesale market maker pay for order flow, securities that are quoted in the US with an “F” as
when it must have the technology, staff, and risk the fifth letter in their ticker that denotes that they
capital necessary to execute the orders it receives? are foreign incorporated companies. Online brokers
that do take orders in OTC stocks will often charge
Wholesale market makers must be able to profitably commission for OTC stocks. Other zero commission
trade against client orders (on average) for the brokers will not even take an order in an OTC stock,
practice of payment for order flow to make sense possibly because they are not receiving payment for
for the wholesale market maker. This profit must be order flow.
significant enough to continue to make payments
to brokers that send them order flow. How does the Wholesale market makers compete for business
wholesale market maker continue to make enough by paying out larger amounts to brokers that send
profit off these orders? Are wholesale market mak- them orders. So, your broker may be choosing to
ers just smarter than everyone else, so smart that send your order to the wholesale market maker that
they always are profitable on average? It’s possible pays the broker the highest payment for order flow
that the profits may come at the expense of clients versus to the wholesale market maker that offers the
in the form of inferior execution. That can’t be legal, best execution.
can it? One famous brokerage firm was charged
$65 million by the SEC because it “provided inferior Not all market makers pay for order flow, and many
trade prices that in aggregate deprived customers provide best execution regardless of their payment
of $34.1 million even after taking into account the for order flow arrangements. At Glendale Securities,
savings from not paying a commission.” So its Inc., we focus on executing our customer’s orders to
possible that wholesale market makers are smarter, obtain best execution, regardless of how the order is
they just are giving enough inferior execution to executed.
keep their average trading profits high enough to
www.GlendaleSecurities.com
be able to afford and profit from payment for order
flow arrangements. Another way wholesale market

ins i ghts
Fund Manager
Q&A with
Tavi Costa
In this new Q&A series in the MicroCap Review Magazine, we
want to highlight fund managers that we’ve come across
from our interviews on the Planet MicroCap Podcast, that
have recently given Keynotes, Moderated Panels, have had
exceptional performance and/or are up-and-coming whose star
is on the rise.
O
ur first Q&A is with Tavi Costa, Member
and Portfolio Manager at Crescat Capital. I
met Tavi recently at our event, the Planet
MicroCap Showcase, in Las Vegas, where he gave
a keynote presentation titled, “A Trifecta of Macro
Imbalances” (we have that presentation up on the
SNN Network YouTube Channel if you’d like to check
it out). In mining circles, Tavi has been compared to
the likes of the next Rick Rule. He’s in his early 30s
with a long and prosperous career ahead of him
with a new and refreshing take on how and why
he focuses his time investing in Natural Resources.
I appreciate Tavi taking the time to answer a few
short questions:
1. How would you describe your investing

philosophy?
We deploy tactical investment themes based on

proprietary value-driven equity and macro models.
Our goal is industry leading absolute and risk-
adjusted returns over complete business cycles with
low correlation to common benchmarks. We apply
our investment process across a mix of asset classes
and strategies to assist with each client’s unique
needs and objectives. Tavi Costa

2. What is the “Ideal Investment”? Can you 5. How are you positioning yourself for
describe your criteria? the rest of 2022 and beyond?
We look for historically undervalued opportunities •• Long tangible assets such as: precious and base
that are strongly supported by our macro views metals, soft commodities, energy and uranium.
and quant models. Examples of themes that we are •• Long Brazilian assets: Steel producers, cellulose
currently invested: businesses and the overall Brazilian equity
market
•• Energy Shortage •• Short: technology companies (mostly mega
•• Global Fiat Currency Debasement cap), short companies that are likely to be
•• Mega Cap Growth Ceiling margin squeezed by energy/labor cost or cost
•• Mispriced Cost of Capital of capital.
•• Resource Underinvestment •• Short the Chinese Yuan and the HK dollar vs.
•• SaaS Rationalization the US dollar.
•• Brazil Liftoff

Tavi Costa is a Member and Portfolio Manager at Crescat Capital and has
3. How has your fund performed recently?
been with the firm since 2013. He is responsible for developing Crescat’s
macro models as part of our thematic investment process. His research has
Our flagship fund, Global Macro, is up about 40% YTD. been featured in financial publications such as Bloomberg, The Wall Street
Journal, Reuters, Yahoo Finance, Real Vision, and others. Tavi is a native of
São Paulo, Brazil and is fluent in Portuguese, Spanish, and English. Before
4. What has been your strategy to mitigate joining Crescat, he worked with the underwriting of financial products and
in international business at Braservice, a large logistics company in Brazil.
all the global turmoil and market Tavi graduated cum laude from Lindenwood University in St. Louis with a
drawdown? B.A. degree in Business Administration with an emphasis in Finance and
a minor in Spanish. Tavi played NCAA Division 1 tennis for Liberty University.
We are long inflationary assets (i.e. commodities) www.crescat.net

and short historically overvalued financial assets and
currencies (CNH & HKD)

ins i ghts
// By Erik Nelson
DTC Eligibility
What is it And Why a Company Needs It
What is DTC eligibility? And what does it mean to “DTC Eligible?”

Simply put, the importance of having DTC Eligibility has never been
greater.
I
realize that this can be an obscure issue that has brokerage and clearing firms. Stocks and bonds
you asking “Why does my company need it?” which are eligible for deposit into the DTC system
Very simply put, DTC eligible means that when a are known as being “DTC Eligible.” When they are
company’s shares are DTC Eligible, they are eligible held in electronic format by DTC, they are common
able to be held in a brokerage account in electronic and referred to as being in “streetname”. DTC then
format. To understand why this is so key one must tracks the allocation of the shares to its various
understand how we got to our current system of participants, and electronically adjusts the allocation
holding shares in electronic format. of these shares to correspond with trade settlement.
The individual brokerage and clearing firms are then
Historically, in the U.S., stocks and bonds traded responsible for the allocation of the shares to their
within the United States traded on one of the respective client accounts. It is this system that has
national or regional stock exchanges. Those that did allowed trading volume to grow exponentially since
not were traded as what was known as “Over the its creation.
Counter” (“OTC”). The settlement of trades, where-
by securities purchased were exchanged for cash It is important to remember that shares of compa-
payment was literally done physically. At the end of nies that are not DTC Eligible, still trade the same
each day’s trading, brokerage firms would pull stock way they did prior to the creation of DTC. This
certificates from their vaults, and send runners with creates a lot of extra fees. Brokerage firms charge
the certificates to the various stock transfer agents higher commissions due to the difficulty and
to have the stock certificates split into the appropri- added time for processing these trades, which are
ate denominations for delivery to the brokerage firm ultimately passed along to the shareholders. These
representing the buyers. The brokerage firm receiv- fees include transfer agent fees, and lots of shipping
ing those certificates would then need to have them fees. Investors and traders do not like to pay these
re-registered in its name. This was a very slow and fees, and as a result trading volume is a lot lower for
cumbersome process, which made settling trades non-DTC Eligible securities. Moreover, most broker-
very expensive. By the early 1970’s the processing age firms do not want to execute trades in non-DTC
of stock trades in this manner was a crushing task Eligible securities. Therefore, companies whose
due to the growth in trading volume. securities are not DTC Eligible see dramatically lower
investor interest, trading volume, and lower valua-
The securities industries’ solution to the growing tions.
burden of processing stock trades was the creation
of the Depository Trust Company (“DTC”) in 1973. Clearly there is a tremendous benefit for a
The Depository Trust Company is a centralized company’s shares to be DTC Eligible and held in
securities depository which holds securities in streetname, however is not an automatic process.
electronic and physical format for the benefit of For eligibility a company’s shares must undergo an

underwriting process, which includes a very strict While this is just a brief look at what it means for a
review before they can become DTC eligible. Once company’s shares to be DTC Eligible, it is a key level
this review process is completed, a company’s of approval for a company’s shares which corporate
shares are then able to be held on deposit at DTC by executives, investment bankers, and potential inves-
brokerage and clearing firms. tors need to be aware of. Afterall, everyone should
have an idea of how they will potentially be able to
exit an investment before they invest their money.
The benefits to a company be being DTC eligible are Corporate Bio

very significant. Investors and shareholders have a
Erik Nelson is the President of Coral Capital Advisors, LLC. www.
much easier time depositing shares, and the cost of
coralcapital.com, an independent consulting and advisory firm focused on
trading shares, which are DTC Eligible, is dramati- companies and participants in the lower and middle markets. Coral Capital
cally lower as the settlement of the trades is handled Advisors specializes in DTC Eligibility services, due diligence, and corporate
restructurings. Coral Capital Advisors. provides services to Investment
within the DTC system. This leads to greater investor Banks, Private Equity Funds, investors, and both privately held and publicly
interest and improved company valuations, as well traded companies, as well as various stakeholders in those organizations.
This has included international public companies with operations on
as increased trading volume. three (3) continents to smaller privately held domestic companies. Our
experience in the areas of corporate advisory, due diligence reviews, and
regulatory compliance allows for a cost effective and efficient solution to
These are important considerations that impact a the issues at hand. Please feel free to visit our web site at: www.coralcapi-
variety of companies in differing situations, includ- tal.com or call our offices via. telephone # (404)-816-9220 to see how we
ing startups, companies which are new to the U.S. may be of assistance.
markets, or trading within the U.S., as well as foreign

corporations whose shares are dually listed on an
exchange in their home country, and in the states.
Basically, if a company is going to have its shares
traded within the US, then they need to be DTC
Eligible.

ins i ghts
// By John Bonfiglio, PhD, MBA
Financing MicroCap
Biotechs
Mistakes to Avoid
A friend of mine recently suggested I write about my experiences

and mistakes I’ve made while trying to finance micro cap
companies I’ve run over the last 25 years. There are many
potential pitfalls when raising capital and every company will have
its own set of issues. Below are some of the most common.
Do your Homework stringing you along with the hope that someone
they introduce you to ends up on their “tail” for a
B
efore approaching investors or the market future financing.
there are a few key items you should have in
hand: Also, if proposed deal terms seem too good to be
true – they probably are. This goes back to doing
•• How much do you need to raise? This number your homework. You need to understand what the
should be large enough to get comfortably to market is offering for financing a company similar to
the next milestone investors would want to see. yours.
•• What are the milestones or inflection points you
are going to base your pitch on? Dilution or Financing?
•• What type of financing are you willing to ac-
cept? PIPE? Convertible debt? Other? We’ve all heard from Board members and investors
•• A well thought out and appropriate pitch deck about the perils of doing a financing which could
designed to be modified for different groups. cause substantial dilution. In my opinion, this is a
It is extremely important the deck is short, to myth and has no real value in the strategy. If the
the point, and spells out exactly the what, why company meets its milestones and the technology
, how and who about the company and the proves itself, then dilution won’t matter. The valu-
market. Even if the deck is sent ahead of the ation of the company will increase and either the
call or meeting it is imperative that the actual dilution won’t matter or the company can execute
pitch is practiced and doesn’t sound like you a reverse stock split. If the company fails, it also
are reading off the deck. doesn’t matter. Just to be clear, I’m not advocating
outrageous financing that would give away the
Trust your Gut company for a small amount of capital. I am saying
I’d rather have 50% of a company worth $100M
We’ve all been approached by groups that say they than have 100% of a company worth $5M because it
can get the financing done easily even after you’ve didn’t have the capital to execute the development
already been turned down by several reputable plan.
investment groups. Many of these “bottom feeders”
are only interested in getting a retainer fee and

Also, if you are a private company your valuation the names of the primary bankers in the company.
expectation may be in for a shock. Even if you raised It’s amazing what a simple search can turn up about
capital at a higher valuation previously, there is a past issues. Make sure the terms of engagement
good chance the valuation could be lower during this meet with your needs. I usually want a six month
raise. This depends on whether you’ve met previ- engagement with a six month tail. The tail has to be
ously announced milestones, market environment, in writing and agreed to by you and the company.
therapeutic area/market size and most importantly Some forms will try to put companies on the tail that
how desperate are your immediate capital needs. they spoke to on the phone but you have not talked
(see next section below). In my experience, it is to directly.
appropriate to negotiate the valuation. However, if
there is only one term sheet on the table you may It is clear there are many other issues that need
be compelled to take the deal. to be addressed which I’ll save for another time.
The important thing to remember is in most cases
Raise Capital When It’s Not Immediately raising capital requires a good team, hard work and
Needed (If possible) perseverance. I remember being in grad school and
thinking I could never be a great salesman because
The absolute worst time to raise capital is when you I hate rejection. Then as an active CEO I’ve been
have little or no capital left in the bank. I’ve been in rejected by more investors than I could imagine!
Board meetings where I presented a term sheet to Keep pushing and keep working!
the Board from an investor and the feedback was
John N. Bonfiglio PhD MBA and has over 30 years’ experience in the
“We have money now we should wait until we finish
biotech/pharmaceutical industry Including over 20 years as a C-level
this trial and then raise capital at a better valuation executive in the biotech industry.
and less dilution”. To me, this is like playing Russian
Dr. Bonfiglio started his career with 11 years at Allergan pharmaceuticals.
roulette. How many clinical trials have failed to reach He spent 3 years at Baxter HealthCare before starting a career in small
their primary endpoint or even worse barely met the biotech companies. He rose to the position of CEO at Peregrine Pharma-
ceuticals where he turned around the financially strapped public company.
endpoint? If this occurs how will you raise capital
to do the next trial even though your team has Dr. Bonfiglio was named COO at Cypress Bioscience while the company
was reinventing itself as neuro-pharmaceutical company. He then joined
determined what the issues were and know how to the Immune Response Corporation as CEO and was responsible for raising
fix them for the next trial. over $50M and restarting clinicals in the HIV and MS areas.
As CEO at Argos Therapeutics a privately held oncology company, he

Hire the Right Outside Team(s) raised $35M through a series C financing. His tenure at Argos produced
clinical data which led to an IPO and subsequent financings.
No man is an island. In this environment it’s nearly Following Argos, he became President and CEO at Oragenics in Tampa, Fl.
impossible to raise capital without a great team Here he completed two strategic deals with Intrexon Corporation, raised
$29M relisted the company on the NYSE:MKT and refocused the company
assisting you. Assuming your internal team was on new novel and proprietary antibiotics
hand-picked by you and the Board, picking the right
Dr. Bonfiglio was the COO at TapImmune where he was responsible for
external team is paramount. I have used Investment starting a clinical program, raising capital and relisting the company on
Relations (IR) firms for many years to help get me Nasdaq. The company is now known as Marker Therapeutics (MRKR
in front of of the right investors. Not all IR firms are -Nasdaq).
created equal. Again do your homework! Ask the Dr. Bonfiglio has held independent Board positions at GT BioPharma
candidate company for references and follow-up (GTBP), Microlin and Genprex (GNPX).
with calls. Many of these firms call on the same He recently joined Sequella a private company developing new therapies
people repeatedly and it’s difficult to get traction for Multi Drug Resistant tuberculosis as an executive Board director.
when they are inundated with companies. To reach Dr. Bonfiglio:

bonfiglio.john@gmail.com
Likewise with investment bankers. There are of
course very reputable investment banks ranging
from the well-known larger firms to the small bou-
tique firms. Some of the smaller firms are spinouts
from the larger ones and have great contacts and
investors that have invested with them before. A
good first move is to use search engines to look into

ins i ghts
// By Wesley Ramjeet, CPA
What is the role of

a microcap CFO?
In today’s business world, it is more important than ever to find
a capable chief financial officer (“CFO”). These leaders are
responsible for the financial well-being of companies. While there
isn’t a one-size-fits-all answer to finding the perfect CFO, there
are several qualities that should be looked for in any potential
candidate. In this article, we will discuss the qualities needed in a
Microcap CFO and how they can help a company succeed.
A
Microcap company is defined as a public these toxic financings so that existing shareholders
company with less than $300 million in and management do not get blown up.
market capitalization. Typically, they are
undercapitalized and need capital for growth and Integrity and Trust
expansion. The qualities of a microcap CFO are
quite different than a fortune 1000 company as When you are responsible for a company that has
typically a microcap company has fewer resources a market capitalization of less than $300 million,
to fill a complete financing and accounting team. there are a lot of things that can go wrong. The CFO
As a result, the Microcap CFO has to wear multiple must be the voice of reason and compliance. The
hats and pitch in to solve financial and operational microcap CFO must ensure communication with
issues. shareholders, management and other constituencies
be truthful and above board. This means disclosing
A microcap CFO must be a great partner with the all relevant information, both good and bad promptly
CEO to plan and execute the vision of the company. through appropriate channels. A CFO must have in-
tegrity and ethical values to be successful in this role.
The CEO lays out the vision and the CFO works on They must be able to make sound financial decisions
the planning to execute the vision. One of the most that are in the best interest of the company, even if
important points is how much capital is required to it means making tough choices. They must also be
execute the vision and how to get the right capital to able to maintain high standards of ethical behavior
fund the vision. and set an example for others in the organization.
Capital Technical expertise
Raising capital is a critical need for most microcap In larger organizations, the CFO has an army of
companies. A microcap CFO must be well versed in accountants and finance professionals that are
the different structures and impacts on the microcap responsible for all financial statement preparation,
company’s future. I have seen too many companies SEC filings, Budgets Technical Accounting Research,
raise capital with toxic convertible features that Reviewing Contracts, and signing off on payments.
decimate the company’s stock price and capitaliza- The larger company’s CFO has oversight but does
tion table. A microcap CFO must be able to navigate not typically get involved in the details. A typical

microcap CFO has to be able to dive into the details cover its expenses and that it is making smart invest-
and has to deal with new pronouncements, drafting ments with its money. Additionally, the CFO must be
10Ks and 10Qs, and be very involved with the external able to communicate effectively with investors and
auditors and other issues without the resources of an other members of the executive team about the
army of accountants and financial professionals. company’s financial status.
Strategic vision To quote Neil Levine, Partner at Friedman LLP,

“The CFO of a microcap company should provide
A microcap CFO is a critical member of the executive qualified financial controls and guidance to help the
team and must be able to think strategically. They CEO execute his business plan accordingly. It is very
must be able to see the big picture and help guide difficult to come back from hasty decisions in the
the company in the right direction. They need to eyes of the investors.”
understand where the company is today, where
it wants to go, and how it plans to get there. They Too often I see good Microcap Companies miss
also need to be able to manage financial resources their SEC filing deadlines, take on toxic financing
efficiently and make sound financial decisions that that leads to the demise of the company. A great
will benefit the company in the long run. microcap CFO is worth his/her weight in gold take
the time to find a good one.
Financial acumen
Wesley Ramjeet is the founder and CEO of PPMT Strategic Group, a
consulting firm that provides Management and CFO consulting services.
A microcap CFO must have the financial acumen to Mr. Ramjeet is the Founder and Chairman of MD Logic Health a nutritional
be successful in the role. Financial acumen includes supplements company. Mr. Ramjeet is also the Chairman of SNN, Inc a
financial media company that covers the micro-cap market. Mr. Ramjeet
an understanding of financial statements, cash flow, received his bachelor’s degree in accounting from St. John’s University and
and budgeting. The Microcap CFO is responsible is a CPA.
for ensuring that the company has enough cash to Email Wesley@ppmgroup.com www.ppmtgroup.com

ins i ghts
Lake Resources
Aligning Operations to Power North
America’s EV Revolution
Lake Resources is advancing clean lithium production as the

world’s electrification drive picks up speed. With the United States,
Europe and other regions putting increasing focus on supply chain
security, the ASX-listed company is realigning its operations to
North America to support the accelerating electric vehicle (EV)
industry.
O
n June 20, Lake stated its ambitions by an-
nouncing plans to establish a North American
presence, becoming even closer to its key
partners and markets.
“Lake’s aspirational target is to reach capacity of

100,000 tpa [tonnes per annum] by 2030, which will
underpin Lake’s ambition to become a leading global
producer of sustainable high purity lithium,” said
Lake’s Executive Chairman, Stu Crow.
“We are now establishing a North American pres-

ence to serve our offtake customers, continue to
work with our US-based technology partner, Lilac “There is enormous interest in Lake and we have
Solutions, and engage capital markets. We are been delighted by the depth of talent available to
aligning project delivery, extraction technology, and us, as we take the next step in our journey towards
operations.” becoming a leading global producer of sustainably
produced, battery-grade lithium.”
The Australian company has flagged a six-month
transition to its new North American headquarters, Lake is currently developing four lithium projects in
with Crow taking the reins as executive chairman to Argentina, led by its flagship Kachi project, with more
oversee the process. than 150 people working across its portfolio. Signifi-
cantly, the company has amassed one of the largest
Speaking from New York City, Crow said he was lithium lease holdings in the South American nation,
excited by the company’s new phase. amounting to more than 2,200 square kilometers
(1,367 miles), with the majority owned 100 percent.
“We are interviewing candidates with exceptional
experience for the CEO and Managing Director role, “Argentina is part of the ‘Lithium Triangle,’ home to
and also candidates for the board to reflect growth the world’s lowest cost lithium production, and aims
of the company in U.S. markets,” he said. to become the region’s leading lithium producer. We

have received strong support from government and Australia’s leading companies in the lithium sector,”
other local stakeholders and are proud to support its he said.
efforts in this key industry of the 21st century,” Crow
said. “However, we have no plans to slow down and are
aiming even higher.”
Top 200 company
Lake’s promotion to the benchmark index is expect-
Lake’s growth under Stu’s leadership has been rapid. ed to see more institutional buying of the company
From a micro-cap company in January 2021, Lake from major investors such as superannuation funds
was officially admitted to the ranks of Australia’s top and investment banks.
200 companies in June with a market capitalisation
of around A$3 billion (U.S. $2 billion). While global stock markets have been rocked in
2022 by rising inflation and interest rates and war in
The announcement by S&P Dow Jones that Lake Ukraine, Lake continues to enhance its engagement
would join the S&P/ASX200 index on June 20 was a with international capital markets.
proud moment for Crow and his company.
On June 17, the company announced it had appointed
However, this is only the start of the journey, Crow two leading project finance institutions, Citi and J.P.
says. Morgan, as joint coordinators for its Kachi project.
“Joining the top 200 index recognises our enormous Lake said the appointment followed a tender panel
growth in market value and our status as one of that indicated bank appetite for the project was “in
Stu Crow, Executive Chairman

“Backed by the strength and In March 2022, Lake announced a non-binding
memorandum of understanding (MOU) with Japa-
status of the export credit nese trading house Hanwa Co. Under the agreement,
Lake could provide up to 25,000 tpa of lithium
agencies of Britain and carbonate over 10 years, with a minimum of 15,000
Canada, Lake has extremely tpa LCE, priced at average quarterly benchmark
prices.
strong financial backing for
The MOU also allows for Hanwa to provide financial
our flagship project, providing support, such as equity investment, a potential
prepayment on offtake, and trade finance facilities
confidence to our investors and to secure a long-term agreement with Lake.
project partners.”
“The market for lithium-ion batteries for EV is unstop-
pably expanding, and we are handling raw materials
for those sophisticated products and increasing
our involvement in all aspects of the supply chain,”
excess of five times the required amount, reflect- Hanwa’s J. Tomono said.
ing the strong interest by international banks and
support from export credit agencies.” “We have been seeking the right products, at scale,
with the right partner, to advance development of
Citi and J.P. Morgan have been tasked with assem- the latest technology in batteries and its cathodes.”
bling the debt financing package for Kachi, with the
support of GKB Ventures and SD Capital Advisory. Lake’s Crow said the MOU and finalization of a
binding offtake agreement with Hanwa would “allow
Importantly, Lake has also gained support from Lake to stay an independent supplier into global
Britain’s official export credit agency, UK Export lithium supply chains and ensure security of supply
Finance (UKEF), to fund around 70 percent of to the market and potential customers.”
Kachi’s requirements, subject to UKEF approval and
to standard project finance conditions. “Increasing customer and consumer scrutiny around
the environmental credentials of lithium production,
Canada’s export credit agency, Export Development and concerns about security of supply has given us
of Canada, is expected to participate alongside the confidence to enter into this partnership with
UKEF, further strengthening the project’s finances Hanwa,” he added.
and providing access to low-cost lending.
Less than a month after the Hanwa announcement,
“We are pleased to partner with Citi and J.P. Morgan, Lake followed up with another non-binding MOU,
who support Lake’s commitment to sustainable this time with leading global automaker Ford Motor
extraction and minimizing our environmental foot- Company.
print,” Crow said.
On April 11, Lake announced plans for offtake of
“Backed by the strength and status of the export around 25,000 tpa from the Kachi project with Ford,
credit agencies of Britain and Canada, Lake has supporting Ford’s EV drive and the development of
extremely strong financial backing for our flagship a “clean lithium supply chain.”
project, providing confidence to our investors and
project partners.” “As we’ve shared, Ford is sourcing deeper into the
battery supply chain,” said Lisa Drake, Ford’s vice
Ford, Hanwa MOU’s president, EV Industrialization.
Lake’s production targets have received backing “This is one of several agreements we’re exploring to
from both the United States and Asia, following this help us secure raw materials to support our aggres-
year’s signing of two significant agreements. sive EV acceleration,” she said.

“Both Lake and Ford see this as an opportunity for On April 11, Lake announced
a potential long-term agreement, with the ability to
scale up environmentally responsible production plans for offtake of around
and participate in Lake’s other projects to ensure
high-quality lithium products are available to Ford,” 25,000 tpa from the Kachi
Lake said.
project with Ford, supporting
The Ford tie-up followed the U.S. automaker’s April Ford’s EV drive and the
launch of an electric F-150 Lighting pickup, a move
it described as “the Model T moment for the 21st development of a “clean lithium
century.”
supply chain.”
The first mainstream, full-size electric pickup
launched on the U.S. market, the new vehicle has a
starting price of below US$40,000 and an estimated
range of up to 320 miles.
needs, supplied by its own iron ore and coking coal
Built at Ford’s historic Rouge Complex in Michigan, mines in Michigan and Kentucky.
the vehicle is part of the Ford F-Series, America’s
best-selling truck for 45 years straight, second only Now, amid soaring prices and declining supply of key
to the iPhone in revenue among U.S. consumer battery metals such as lithium, Ford plans to take
products. control of its supply chains “all the way back to the
mines,” Farley said.
Ford said it had seen “unprecedented” demand for
the new F-150 Lightning, with some 200,000 orders Industry analysts Benchmark Mineral Intelligence
already received. It plans to ramp up production to have flagged a continued structural deficit in the
150,000 vehicles per annum from 2023, following lithium market through 2025.
a US$950 million investment in its Rouge Electric
Vehicle Center. And with the EV revolution entering the mainstream,
lithium resources such as Lake’s are in strong
“America’s real transition to electric vehicles [EVs] demand, particularly those capable of meeting the
starts now,” Ford President and CEO Jim Farley said high-quality battery grades and exacting sustain-
in an April 26 statement. ability requirements of European Union and U.S.
automakers.
LMC Automotive projects the U.S. electric pickup
truck market will increase from around 25,000 www.lakeresources.com.au
vehicles in 2022 to more than 1 million by the

end of the decade. The current five electric
pickup models are seen rising to more than 20
by 2030.
Ford aims to deliver more than 2 million EVs annually

by 2026, equal to one-third of its global volume,
targeting 50 per cent by 2030. The increase to 2
million EVs would make Ford second only to Tesla,
although General Motors aims to surpass Tesla in
domestic EV sales by 2025.
Ford is also following its founding principle of

self-sufficiency in reviving vertical integration. Dur-
ing World War One, Ford’s River Rouge complex
produced iron and steel for its vehicle manufacturing

THE
MICRO-CAP
REPORT
2022
HALF YEAR
REVIEW
Lucosky Brookman is the industry leader in micro-cap IPOs and in
uplisting domestic or foreign quoted OTC companies and foreign
exchange listed companies to the Nasdaq or NYSE.
Each month, Lucosky Brookman publishes The Uplisting Report and

The Micro-Cap IPO Report - the most comprehensive resources
dedicated to the Uplist, cross-list and micro-cap IPO marketplaces. The
reports bring powerful and in-depth market data and analytics to help
issuers, management teams, boards of directors, consultants and others
involved in the IPO, uplisting and cross-listing processes make better
decisions.
Placing a particular emphasis on issuers operating in the micro-cap

space (issuers with up to $300 million market cap), the following is a
synopsis of our Uplisting and Micro-IPO Reports for the First Half of
2022 (H1). To view current monthly and archived Reports, please visit:
https://www.lucbro.com/our-firm/uplisting-monthly
Please contact us at uplist@lucbro.com if you would like to discuss your

company's IPO, uplisting or cross-listing prospects, if you would like to
better understand the IPO, uplisting and cross-listing marketplace, or if
you would like to receive a comprehensive 7-8 page listing Analysis of
your company.
Lucosky Brookman LLP

www.lucbro.com
uplist@lucbro.com

MICRO-CAP 2022
H1 SUMMARY
Like the larger capital markets, the micro-cap marketplace continued to be active
in the first half of 2022 (H1). Micro-cap uplisted and cross-listed companies raised
approximately $215 million in H1, while companies completing micro-cap IPOs
raised approximately $810 million.
UPLISTING/CROSS-LISTING
A total of 30 micro-cap companies which operate in 11 different sectors made up

the 2022 H1 class of uplisted and cross-listed companies. Twelve (12) of the newly
exchange traded companies were listed organically, meaning they did not require a
simultaneous underwritten public offering in order to consummate the uplisting
or cross-listing to a Senior U.S. Exchange. Eighteen (18) of the uplists and cross-
lists included simultaneous underwritten public offerings, ranging from
approximately $2,500,000 to $40,000,000.
MICRO-CAP IPOs
A total of 38 micro-cap issuers, operating in 8 different sectors completed their

IPOs in H1, with offerings ranging from approximately $6,000,000 to
$108,000,000. Seventeen (17) micro-cap foreign private issuers (FPIs) from 9
different jurisdictions completed their IPOs in the U.S. during H1.
UPLISTS & CROSS-LISTS MICRO-CAP IPOs
30 9 38 17
MICRO-CAP ISSUERS FOREIGN PRIVATE MICRO-CAP IPOs
UPLISTING AND MICRO-CAP IPOs COMPLETED BY
ISSUERS CROSS-
CROSS-LISTING IN COMPLETED IN H1 FOREIGN PRIVATE
LISTING IN H1
H1 ISSUERS IN H1
18 12 9 92%
UPLISTS AND CROSS- ISSUERS LISTED ON ISSUERS FROM NINE OF ISSUERS
LISTS ASSISTED BY A SENIOR U.S. JURISDICTIONS COMPLETING MICRO-
INVESTMENT EXCHANGE COMPLETED MICRO- CAP IPOs IN H1
BANKERS ORGANICALLY CAP IPOs IN H1 LISTED ON NASDAQ
$215M $12.6M $810M $15.6M

RAISED BY
AVERAGE OFFERING MEDIAN OFFERING
UPLISTING AND RAISED IN MICRO-
SIZE FOR UPLISTING SIZE FOR MICRO-CAP
CROSS-LISTING CAP IPOs DURING H1
AND CROSS-LISTING IPOs IN H1
MICRO-CAP
MICRO-CAP ISSUERS
ISSUERS IN H1

UPLISTS & CROSS-LISTS
During H1, 30 micro-cap uplisting and cross-listing issuers listed on a Senior U.S.
Exchange, an increase of 3 issuers compared to the same period in 2021.
Micro-cap uplisting and cross-listing issuers raised, in a total of 18 offerings, a
combined $215 million, representing a decrease of $132 million from the combined
$347 million raised in a total of 20 offerings during H1 of 2021.
The average offering size in H1 was $12.6 million, a decrease of $4.4 million from the
$17 million average offering size in H1 2021.
A total of 12 issuers listed organically during H1, an increase of 5 issuers when
compared to the same period in 2021.
Dollars Raised
$125M
$100M
$75M
$50M
H1
30
$25M
20
2022 $0M
30
H1 Jan Feb Mar Apr May June

10 20
2021
H1 2022 H1 2021
10
0
30 18 12 9
0
Uplists & Cross-Lists
27 20 7 7 8
6
4
Total Listings Organic Listings 2
Offerings Cross-ListingS
0
Jan Feb Mar Apr May June
MICRO-CAP IPOs
In H1, 38 micro-cap issuers completed their IPOs, a decrease of 12 issuers compared

to the same period in 2021.
Such issuers raised a total of $810 million, representing a decrease of $729 million
from the combined $1.57 billion raised during H1 of 2021.
The median capital raise in H1 was $15.6 million, a decrease of $9.4 million from the
$25 million median offering size in H1 2021.
Seventeen (17) of the offerings in H1 came from foreign private issuers, a decrease of
7 when compared to the same period in 2021.
Dollars Raised
$400M IPOs
$300M
FPIs
$200M
H1
$100M $810M
Raised
$0M
Jan Feb Mar Apr May June $15.6M
Median 2022
H1 2022 H1 2021
Micro-Cap IPOs $25M

10 Median
H1
7.5
$1.57B
Raised
5
2.5
2021 FPIs
0
Jan Feb Mar Apr May June IPOs

Save the Date
SNN Network presents
2023
The Premier Event in MicroCap Finance

April 25–27, 2023
Bally’s Las Vegas Hotel & Casino
www.PlanetMicroCapShowcase.com
www.SNN.Network PlanetMicrocapShowcase.com MicroCap Review Magazine 97

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