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Published: 2021-03-23

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 20-F

¨ REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) or 12(g) OF THE SECURITIES EXCHANGE ACT OF 1934

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

For the fiscal year ended December 31, 2020

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

For the transition period from _______________ to _______________

¨ SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Date of event requiring this shell company report _______________

Commission file number 000-55859

ELECTRAMECCANICA VEHICLES CORP.

(Exact name of Registrant specified in its charter)

Not Applicable

(Translation of Registrant’s name into English)

British Columbia, Canada

(Jurisdiction of incorporation or organization)

102 East 1st Avenue

Vancouver, British Columbia, Canada, V5T 1A4

(Address of principal executive offices)

Bal Bhullar; (604) 428-7656; bal@electrameccanica.com

(Name, Telephone, Email and/or Facsimile number and Address of Company Contact Person)

Securities registered or to be registered pursuant to Section 12(b) of the Act.

Title of Each Class

Trading Symbol(s)

Name of each exchange on which registered

Common Shares

SOLO

The Nasdaq Stock Market LLC

Warrants, each to purchase one Common Share

SOLOW

The Nasdaq Stock Market LLC

Securities registered or to be registered pursuant to Section 12(g) of the Act.

Common Shares Without Par Value

(Title of Class)

Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act.

Common Shares Without Par Value

(Title of Class)

Number of outstanding shares of each of the issuer’s classes of capital or common stock as of the close of business of the period covered by the annualreport.

89,309,563 Common Shares Without Par Value

Indicate by check mark if the Registrant is a well-known seasoned issuer as defined in Rule 405 of the Securities Act.

Yes ¨ No x

If this report is an annual or transition report, indicate by check mark if the Registrant is not required to file reports pursuant to Section 13 or 15(d) of theSecurities Exchange Act of 1934
	Yes ¨ No x

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filingrequirements for the past 90 days.
	Yes x No ¨

Indicate by check mark whether the Registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 ofRegulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the Registrant was required to submit such files).
	Yes x No ¨

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or an emerging growth company. Seedefinition of “accelerated filer,” “large accelerated filer,” and “emerging growth company” in Rule 12b-2 of the Exchange Act. Large Accelerated Filer ¨
		Accelerated Filer ¨
Non Accelerated Filer x		Emerging Growth Company x
If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the Registrant has elected notto use the extended transition period for complying with any new or revised financial accounting standards pursuant to Section 13(a) of the Exchange Act. ¨ Indicate by check mark which basis of accounting the Registrant has used to prepare the financial statements included in this filing:
			U.S. GAAP ¨	International Financial Reporting Standards as issued	Other ¨
						by the International Accounting Standards Board x
If “Other” has been checked in response to the previous question, indicate by check mark which financial statement item the Registrant has elected tofollow: Item 17 ¨ Item 18 ¨ If this is an annual report, indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b 2 of the Exchange Act):
	Yes ¨ No x

(APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PAST FIVE YEARS) Indicate by check mark whether the Registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Securities ExchangeAct of 1934 subsequent to the distribution of securities under a plan confirmed by a court. Not applicable.



	TABLE OF CONTENTS

			Page
PART I			4

ITEM 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS			4
ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE			4
ITEM 3. KEY INFORMATION			4
ITEM 4. INFORMATION ON THE COMPANY			22
ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS			42
ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES			54
ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS			89
ITEM 8. FINANCIAL INFORMATION			97
ITEM 9. THE OFFER AND LISTING			97
ITEM 10. ADDITIONAL INFORMATION			98
ITEM 11. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK			108
ITEM 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES			110

PART II			111

ITEM 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES			111
ITEM 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS			111
ITEM 15. CONTROLS AND PROCEDURES			112
ITEM 16. [RESERVED]			113
ITEM 16A. AUDIT COMMITTEE FINANCIAL EXPERT			113
ITEM 16B. CODE OF ETHICS			113
ITEM 16C. PRINCIPAL ACCOUNTANT FEES AND SERVICES			113
ITEM 16D. EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES			114
ITEM 16E. PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS			114
ITEM 16F. CHANGE IN REGISTRANT’S CERTIFYING ACCOUNTANT.			114
ITEM 16G. CORPORATE GOVERNANCE.			114
ITEM 16H. MINE SAFETY DISCLOSURE.			114

PART III			115

ITEM 17. FINANCIAL STATEMENTS			115
ITEM 18. FINANCIAL STATEMENTS			115
ITEM 19. EXHIBITS			144
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	FORWARD LOOKING STATEMENTS

This Annual Report on Form 20-F contains statements that constitute “forward-looking statements”. Any statements that are not statements of historical factsmay be deemed to be forward-looking statements. These statements appear in a number of different places in this Annual Report and, in some cases, can beidentified by words such as “anticipates”, “estimates”, “projects”, “expects”, “contemplates”, “intends”, “believes”, “plans”, “may”, “will” or their negativesor other comparable words, although not all forward-looking statements contain these identifying words. Forward-looking statements in this Annual Reportmay include, but are not limited to, statements and/or information related to: strategy, future operations, the size and value of the order book and the numberof orders, the number and timing of building pre-production vehicles, the projection of timing and delivery of SOLOs or Tofinos in the future, projectedcosts, expected production capacity, expectations regarding demand and acceptance of our products, estimated costs of machinery to equip a new productionfacility, trends in the market in which we operate and the plans and objectives of management. Forward-looking statements are based on the reasonable assumptions, estimates, analysis and opinions made in light of our experience and our perception oftrends, current conditions and expected developments, as well as other factors that we believe to be relevant and reasonable in the circumstances at the datethat such statements are made, but which may prove to be incorrect. Management believes that the assumption and expectations reflected in such forward-looking statements are reasonable. Assumptions have been made regarding, among other things: the Company’s ability to build pre-production SOLOs andto begin production deliveries within certain timelines; the Company’s expected production capacity; prices for machinery to equip a new production facility;labor costs and material costs remaining consistent with the Company’s current expectations; production of SOLOs and Tofinos meeting expectations andbeing consistent with estimates; equipment operating as anticipated; there being no material variations in the current regulatory environment; and theCompany’s ability to obtain financing as and when required and on reasonable terms. Readers are cautioned that the foregoing list is not exhaustive of allfactors and assumptions which may have been used. Such risks are discussed in Item 3.D - “Risk Factors” herein. In particular, and without limiting the generality of the foregoing disclosure, the statementscontained in Item 4.B. – “Business Overview”, Item 5 – “Operating and Financial Review and Prospects” and Item 11 – “Quantitative and QualitativeDisclosures About Market Risk” herein are inherently subject to a variety of risks and uncertainties that could cause actual results, performance orachievements to differ significantly. Such risks, uncertainties and other factors include but are not limited to:
•			general economic and business conditions, including changes in interest rates;

•			prices of other electric vehicles, costs associated with manufacturing electric vehicles and other economic conditions;

•			natural phenomena, including the current COVID-19 pandemic;

•			actions by government authorities, including changes in government regulation;

•			uncertainties associated with legal proceedings;

•			changes in the electric vehicle market;

•			future decisions by management in response to changing conditions;

•			the Company’s ability to execute prospective business plans;

•			misjudgments in the course of preparing forward-looking statements;
		2



•	the Company’s ability to raise sufficient funds to carry out its proposed business plan;

•	consumers’ willingness to adopt three-wheeled single seat electric vehicles;

•	declines in the range of the Company’s electric vehicles on a single charge over time may negatively influence potential customers’ decisions topurchase such vehicles;


•	developments in alternative technologies or improvements in the internal combustion engine;

•	inability to keep up with advances in electric vehicle technology;

•	inability to design, develop, market and sell new electric vehicles and services that address additional market opportunities;

•	dependency on certain key personnel and any inability to retain and attract qualified personnel;

•	inexperience in mass-producing electric vehicles;

•	inability to reduce and adequately control operating costs;

•	failure of the Company’s vehicles to perform as expected;

•	inexperience in servicing electric vehicles;

•	inability to succeed in establishing, maintaining and strengthening the ElectraMeccanica brand;

•	disruption of supply or shortage of raw materials;

•	the unavailability, reduction or elimination of government and economic incentives;

•	failure to manage future growth effectively; and

•	labor and employment risks.
Although management has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-lookingstatements, there may be other factors that cause results not to be as anticipated, estimated or intended. There is no assurance that forward-looking statementswill prove to be accurate, as actual results and future events could differ materially from those anticipated in such forward-looking statements. Accordingly,readers should not place undue reliance on forward-looking statements. These cautionary remarks expressly qualify, in their entirety, all forward-lookingstatements attributable to our Company or persons acting on our Company’s behalf. We do not undertake to update any forward-looking statements to reflectactual results, changes in assumptions or changes in other factors affecting such statements, except as, and to the extent required by, applicable securitieslaws. You should carefully review the cautionary statements and risk factors contained in this Annual Report and other documents that the Company may filefrom time to time with the securities regulators.
		3



	PART I

The following discussion and analysis, prepared for the year ended December 31, 2020, is a review of our operations, current financial position and outlookand should be read in conjunction with our annual consolidated financial statements for the year ended December 31, 2020 and the notes thereto. Unlessstated otherwise, all amounts herein are reported in U.S. dollars based upon financial statements prepared in accordance with IFRS as issued by the IASB. Asat December 31, 2020, the Company’s functional currency is the Canadian dollar, and the presentation currency is US dollars. The change in presentationcurrency is discussed in Note 3 to our annual consolidated financial statements. ITEM 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS Not applicable. ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE Not applicable. ITEM 3. KEY INFORMATION A. Selected financial data The selected historical consolidated financial information expressed in U.S. dollars as set forth below has been derived from our financial statements for thefiscal years ended December 31, 2020, 2019, 2018, 2017 and 2016.
		Consolidated Statement of Net Loss

		Year ended	Year ended		Year ended		Year ended		Year ended
		December 31,			December 31,						December 31,			December 31,			December 31,

			2020			2019		2018		2017(1)		2016(1)
Revenues		$									568,521 $	585,584 $	599,757 $		84,203 $	-
Gross Profit		$									(130,934) $	98,041 $	155,961 $		34,880 $	-
Net Loss		$	63,046,905 $	23,212,698 $		7,745,313 $		8,766,678 $		6,775,835
Loss per Share – Basic and Diluted		$	1.08 $			0.64 $		0.29 $		0.40 $		0.41

		Consolidated Statement of Financial Position

		December 31,	December 31,				December 31,		December 31,		December 31,

			2020			2019		2018(1)		2017(1)		2016(1)
Cash and cash equivalents		$	129,450,676 $	8,560,624 $		13,951,951 $		6,839,172 $		2,914,228
Current Assets		$	135,312,266 $	14,556,890 $		16,812,234 $		7,948,473 $		3,301,823
Total Assets (2)		$	145,754,382 $	23,362,963 $		21,731,661 $		10,056,138 $		3,562,726
Current Liabilities(2)		$	4,556,443 $	2,614,657 $		1,342,838 $		2,664,408 $			655,710
Total Liabilities(2)		$	23,075,092 $	8,733,492 $		4,846,410 $		5,567,892 $			655,710
Shareholders’ Equity (Deficit)		$	122,679,290 $	14,629,471 $		16,885,251 $		4,488,246 $		2,907,016
Our audited consolidated financial statements for the two years ended December 31, 2020 and 2019 are attached at the end of this Annual Report. (1) Restated in U.S. dollars.(2) IFRS 16 lease standard applied to years ended Dec 31, 2020 and 2019. IAS 17 lease standard applied to years ended Dec 31, 2018, 2017 and 2016.
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B. Capitalization and Indebtedness Not applicable. C. Reasons for the offer and use of proceeds Not applicable. D. Risk Factors An investment in our securities carries a significant degree of risk. You should carefully consider the following risks, as well as the other informationcontained in this Annual Report, including our historical and pro forma financial statements and the financial statements and related notes includedelsewhere in this Annual Report, before you decide to purchase our securities. Any one of these risks and uncertainties has the potential to causematerial adverse effects on our business, prospects, financial condition and operating results which could cause actual results to differ materially fromany forward-looking statements expressed by us and a significant decrease in the value of our securities. Refer to “Forward-Looking Statements”. We may not be successful in preventing the material adverse effects that any of the following risks and uncertainties may cause. These potential risks anduncertainties may not be a complete list of the risks and uncertainties facing us. There may be additional risks and uncertainties that we are presentlyunaware of, or presently consider immaterial, that may become material in the future and have a material adverse effect on us. You could lose all or asignificant portion of your investment due to any of these risks and uncertainties. Risks Related to our Business and Industry We have limited cash on hand and we will require a significant amount of capital to carry out our proposed business plan to develop, manufacture, selland service electric vehicles; there is no assurance that any amount raised through this offering will be sufficient to continue to fund operations of ourCompany. We incurred a net loss and comprehensive loss of $63,046,905 and $58,832,999, respectively, during the year ended December 31, 2020, and a net loss andcomprehensive loss of $23,212,698 and $22,314,225, respectively, during the year ended December 31, 2019. Although we had a cash and cash equivalentsand a working capital surplus of $129,450,676 and $130,755,823, respectively, as at December 31, 2020, and of $8,560,624 and $11,942,233, respectively, atDecember 31, 2019, we believe that we will need significant additional equity financing to continue operations, among other things:
•	we have begun the commercial production of our flagship vehicle, the SOLO, and we expect to incur significant ramp-up in costs and expensesthrough the launch of the vehicle;

•	we anticipate that the gross profit generated from the sale of the SOLO will not be sufficient to cover our operating expenses, and our achievingprofitability will depend, in part, on our ability to materially reduce the bill of materials and per unit manufacturing cost of our products; and

•	we do not anticipate that we will be eligible to obtain bank loans, or other forms of debt financing on terms that would be acceptable to us.
We anticipate generating a significant loss for the next fiscal year.
		5


We have minimal revenue and expect significant increases in costs and expenses to forestall profits for the foreseeable future, even if we generate revenues inthe near term. Even though we have recently launched the SOLO into commercial production, and even if we launch the Tofino or other intended electricvehicles (“EV”s), they might not become commercially successful. If we are to ever achieve profitability we must have a successful commercial introductionand acceptance of our vehicles, which may not occur. We expect that our operating losses will increase substantially in 2021, and thereafter, and we alsoexpect to continue to incur operating losses and to experience negative cash flows for the next several years. We have a limited operating history and have generated minimal revenues. Our limited operating history makes evaluating our business and future prospects difficult. We were formed in February 2015, and we have begun productionbut not the commercial delivery of our first electric vehicle. To date we have no revenues from the sale of electric vehicles as any amounts received from thesale of our pre-production electric vehicles were netted off against research and development costs as cost recovery and have had minimal revenue from thesale of non-electric custom cars. We intend to derive revenues from the sales of our SOLO vehicle, our Tofino vehicle and other intended EVs. The Tofino isstill in the early design development stage, and the first commercially-produced SOLOs are targeted to be delivered to our customers during 2021. Ourvehicles require significant investment prior to commercial introduction and may never be successfully developed or commercially successful. We have a history of operating losses and we expect our operating losses to accelerate and materially increase for the foreseeable future. For the fiscal year ended December 31, 2020, we generated a net loss of $63,046,905, bringing our accumulated deficit to $110,327,159. We have minimal revenue and expect significant increases in costs and expenses to forestall profits for the foreseeable future, even if we generate revenues inthe near term. We have begun the commercial production but not yet the delivery of our flagship vehicle, the SOLO, and we expect to incur significantadditional costs and expenses through the launch of the vehicle. Even with the launch of the SOLO into commercial production, and even if we are able tolaunch the Tofino or other intended EVs, they might not become commercially successful. If we are to ever achieve profitability, we must have a successfulcommercial introduction and acceptance of our vehicles, which may not occur. We expect that our operating losses will increase substantially in 2021 andthereafter, and we also expect to continue to incur operating losses and to experience negative cash flows for the next several years. We expect the rate at which we will incur losses to increase significantly in future periods from current levels as we:
•	design, develop and manufacture our vehicles and their components;

•	develop and equip our manufacturing facility;

•	build up inventories of parts and components for the SOLO, the Tofino and other intended EVs;

•	open ElectraMeccanica stores;

•	expand our design, development, maintenance and repair capabilities;

•	develop and increase our sales and marketing activities; and

•	develop and increase our general and administrative functions to support our growing operations.
		6


Because we will incur the costs and expenses from these efforts before we receive any revenues with respect thereto, our losses in future periods will besignificantly greater than the losses we would incur if we developed the business more slowly. In addition, we may find that these efforts are more expensivethan we currently anticipate or that these efforts may not result in profits or even revenues, which would further increase our losses. Our ability to achieve profitability will depend, in part, on our ability to materially reduce the bill of materials and per unit manufacturing cost of ourproducts. We anticipate that the gross profit generated from the sale of the SOLO will not be sufficient to cover our operating expenses for the foreseeable future. Toachieve our operating and strategic goals while remaining competitive, we will, among other things, need to reduce the bill of materials and the per-unitmanufacturing cost of the SOLO. We expect the primary factors to contribute to a reduced bill of materials and per unit manufacturing cost to include:
•	continued product development to make the SOLO easier and cheaper to mass produce commercially;

•	our ability to utilize less expensive suppliers and components that meet the requirements for the SOLO;

•	increasing the volume of components that we purchase in order to take advantage of volume-based pricing discounts;

•	improving assembly efficiency;

•	enhancing the automation of our strategic manufacturing partner’s facility to increase volume and reduce labour costs; and

•	increasing our volume to leverage manufacturing overhead costs.
Continued product development is subject to feasibility and engineering risks. Any increase in manufacturing volumes is dependent upon a correspondingincrease in sales. The occurrence of one or more factors that negatively impact the manufacturing or sales of the SOLO, or reduce our manufacturingefficiency, may prevent us from achieving our desired reduction in manufacturing costs, which would negatively affect our operating results and may preventus from attaining profitability. We currently have negative operating cash flows, and if we are unable to generate positive operating cash flows in the future our viability as anoperating business will be adversely affected. We have made significant up-front investments in research and development, sales and marketing and general and administrative expenses to rapidly developand expand our business. We are currently incurring expenditures related to our operations that have generated a negative operating cash flow. Operatingcash flow may decline in certain circumstances, many of which are beyond our control. We might not generate sufficient revenues in the near future. Becausewe continue to incur such significant future expenditures for research and development, sales and marketing and general and administrative expenses, wemay continue to experience negative cash flow until we reach a sufficient level of sales with positive gross margins to cover operating expenses. An inabilityto generate positive cash flow until we reach a sufficient level of sales with positive gross margins to cover operating expenses or raise additional capital onreasonable terms will adversely affect our viability as an operating business. We may require additional capital to carry out our proposed business plan for the next 12 monthsif our cash on hand and revenues from the sale of ourcars are not sufficient to cover our cash requirements. If our cash on hand, revenue from the sale of our cars, if any, and cash received upon the exercise of outstanding warrants, if any are exercised, are notsufficient to cover our cash requirements, we will need to raise additional funds through the sale of our equity securities, in either private placements orregistered offerings and/or shareholder loans. If we are unsuccessful in raising enough funds through such capital-raising efforts we may review otherfinancing possibilities such as bank loans. Financing might not be available to us or, if available, may not be available on terms that are acceptable to us.
		7


Our ability to obtain the necessary financing to carry out our business plan is subject to a number of factors, including general market conditions and investoracceptance of our business plan. These factors may make the timing, amount, terms and conditions of such financing unattractive or unavailable to us. If weare unable to raise sufficient funds, we will have to significantly reduce our spending, delay or cancel our planned activities or substantially change ourcurrent corporate structure. We might not be able to obtain any funding, and we might not have sufficient resources to conduct our business as projected,both of which could mean that we would be forced to curtail or discontinue our operations. Terms of future financings may adversely impact your investment. We may have to engage in common equity, debt or preferred stock financing in the future. Your rights and the value of your investment in our securitiescould be reduced. Interest on debt securities could increase costs and negatively impacts operating results. Preferred stock could be issued in series from timeto time with such designation, rights, preferences and limitations as needed to raise capital. The terms of preferred stock could be more advantageous to thoseinvestors than to the holders of common shares. In addition, if we need to raise equity capital from the sale of common shares, institutional or other investorsmay negotiate terms at least as, and possibly more, favorable than the terms of your investment. Common shares which we sell could be sold into any marketwhich develops, which could adversely affect the market price. Our future growth depends upon consumers’ willingness to adopt three-wheeled single-seat electric vehicles. Our growth highly depends upon the adoption by consumers of, and we are subject to an elevated risk of, any reduced demand for alternative fuel vehicles ingeneral and electric vehicles in particular. If the market for three-wheeled single seat electric vehicles does not develop as we expect, or develops moreslowly than we expect, our business, prospects, financial condition and operating results will be negatively impacted. The market for alternative fuel vehiclesis relatively new, rapidly evolving, characterized by rapidly changing technologies, price competition, additional competitors, evolving governmentregulation and industry standards, frequent new vehicle announcements and changing consumer demands and behaviors. Factors that may influence theadoption of alternative fuel vehicles, and specifically electric vehicles, include:
•	perceptions about electric vehicle quality, safety (in particular with respect to lithium-ion battery packs), design, performance and cost, especiallyif adverse events or accidents occur that are linked to the quality or safety of electric vehicles;

	•	perceptions about vehicle safety in general and, in particular, safety issues that may be attributed to the use of advanced technology, includingvehicle electronics and braking systems;

	•	the limited range over which electric vehicles may be driven on a single battery charge;

	•	the decline of an electric vehicle’s range resulting from deterioration over time in the battery’s ability to hold a charge;

	•	concerns about electric grid capacity and reliability, which could derail our efforts to promote electric vehicles as a practical solution to vehicleswhich require gasoline;

	•	the availability of alternative fuel vehicles, including plug-in hybrid electric vehicles;

	•	improvements in the fuel economy of the internal combustion engine;

	•	the availability of service for electric vehicles;
		8



•	the environmental consciousness of consumers;

	•	volatility in the cost of oil and gasoline;

	•	government regulations and economic incentives promoting fuel efficiency and alternate forms of energy;

	•	access to charging stations, standardization of electric vehicle charging systems and consumers’ perceptions about convenience and cost to chargean electric vehicle;

	•	the availability of tax and other governmental incentives to purchase and operate electric vehicles or future regulation requiring increased use ofnonpolluting vehicles; and

	•	perceptions about and the actual cost of alternative fuel.
The influence of any of the factors described above may cause current or potential customers not to purchase our electric vehicles, which would materiallyadversely affect our business, operating results, financial condition and prospects. The range of our electric vehicles on a single charge declines over time which may negatively influence potential customers’ decisions whether topurchase our vehicles. The range of our electric vehicles on a single charge declines principally as a function of usage, time and charging patterns. For example, a customer’s use oftheir vehicle as well as the frequency with which they charge the battery of their vehicle can result in additional deterioration of the battery’s ability to hold acharge. We currently expect that our battery pack will retain approximately 85% of its ability to hold its initial charge after approximately 3,000 chargecycles and eight years, which will result in a decrease to the vehicle’s initial range. Such battery deterioration and the related decrease in range maynegatively influence potential customer decisions whether to purchase our vehicles, which may harm our ability to market and sell our vehicles. Developments in alternative technologies or improvements in the internal combustion engine may materially adversely affect the demand for our electricvehicles. Significant developments in alternative technologies, such as advanced diesel, ethanol, fuel cells or compressed natural gas, or improvements in the fueleconomy of the internal combustion engine, may materially and adversely affect our business and prospects in ways we do not currently anticipate. Forexample, fuel which is abundant and relatively inexpensive in North America, such as compressed natural gas, may emerge as consumers’ preferredalternative to petroleum-based propulsion. Any failure by us to develop new or enhanced technologies or processes, or to react to changes in existingtechnologies, could materially delay our development and introduction of new and enhanced electric vehicles, which could result in the loss ofcompetitiveness of our vehicles, decreased revenue and a loss of market share to competitors. If we are unable to keep up with advances in electric vehicle technology, we may suffer a decline in our competitive position. We may be unable to keep up with changes in electric vehicle technology and, as a result, may suffer a decline in our competitive position. Any failure tokeep up with advances in electric vehicle technology would result in a decline in our competitive position which would materially and adversely affect ourbusiness, prospects, operating results and financial condition. Our research and development efforts may not be sufficient to adapt to changes in electricvehicle technology. As technologies change, we plan to upgrade or adapt our vehicles and introduce new models to continue to provide vehicles with thelatest technology, in particular battery cell technology. However, our vehicles may not compete effectively with alternative vehicles if we are not able tosource and integrate the latest technology into our vehicles. For example, we do not manufacture battery cells which makes us depend upon other suppliers ofbattery cell technology for our battery packs.
		9


If we are unable to design, develop, market and sell new electric vehicles and services that address additional market opportunities, our business,prospects and operating results will suffer. We may not be able to successfully develop new electric vehicles and services, address new market segments or develop a significantly broader customerbase. To date, we have focused our business on the sale of the SOLO, a three-wheeled single seat electric vehicle, and have targeted mainly urban residentsof modest means and fleets. We will need to address additional markets and expand our customer demographic to further grow our business. Our failure toaddress additional market opportunities would harm our business, financial condition, operating results and prospects. Demand in the vehicle industry is highly volatile. Volatility of demand in the vehicle industry may materially and adversely affect our business, prospects, operating results and financial condition. Themarkets in which we will be competing have been subject to considerable volatility in demand in recent periods. Demand for automobile sales depends to alarge extent on general, economic, political and social conditions in a given market and the introduction of new vehicles and technologies. As a new start-upmanufacturer, we will have fewer financial resources than more established vehicle manufacturers to withstand changes in the market and disruptions indemand. We depend on a third-party for our near-term manufacturing needs. In October 2017, we entered into a manufacturing agreement with Chongqing Zongshen Automobile Co., Ltd. “Zongshen”), acting through its wholly-owned subsidiary (the “Manufacturing Agreement”). Zongshen is an affiliate of Zongshen Power Machinery Co., Ltd., a large-scale scientific and technicalenterprise which designs, develops, manufactures and sells a diverse range of motorcycles and motorcycle engines in China., located in Chongqing, China.Under the Manufacturing Agreement Zongshen has contracted to produce 75,000 SOLO vehicles in the three full years from the commencement ofproduction. The delivery of SOLO vehicles to our future customers and the revenue derived therefrom depends on Zongshen’s ability to fulfil its obligationsunder the Manufacturing Agreement. Zongshen’s ability to fulfil its obligations is outside of our control and depends on a variety of factors, includingZongshen’s operations, Zongshen’s financial condition and geopolitical and economic risks that could affect China. Our Manufacturing Agreement withZongshen provides that non-performance by either us or Zongshen shall be excused to the extent that such performance is rendered impossible by strike, fire,flood, earthquake or governmental acts, orders or restrictions; provided that either we or Zongshen, as applicable, use commercially reasonable efforts tomitigate the impact of such non-performance. Notwithstanding any such efforts, any such non-performance by either us or Zongshen shall be cause fortermination of the Manufacturing Agreement by the other party if the non-performance continues for more than six months. The novel coronavirus (COVID-19) pandemic or measures taken by the Chinese government relating thereto may result in non-performance by Zongshen under our ManufacturingAgreement. If Zongshen is unable to fulfil its obligations or is only able to partially fulfil its obligations under our existing Manufacturing Agreement withthem, or if Zongshen either voluntarily or is forced to terminate our Manufacturing Agreement with them, either as a result of the coronavirus outbreak, theChinese government’s measures relating thereto or otherwise, we will not be able to produce or sell our SOLO vehicle in the volumes anticipated and on thetimetable that we anticipate, if at all.
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The impact of the novel coronavirus (COVID-19) pandemic on the global economy and our operations remains uncertain, which could have a materialadverse impact on our business, results of operations and financial condition and on the market price of our common shares. In December 2019, a strain of novel coronavirus (now commonly known as COVID-19) was reported to have surfaced in Wuhan, China. COVID-19 hassince spread rapidly throughout many countries, and, on March 11, 2020, the World Health Organization declared COVID-19 to be a pandemic. In an effortto contain and mitigate the spread of COVID-19, many countries, including the United States, Canada and China, have imposed unprecedented restrictionson travel, and there have been business closures and a substantial reduction in economic activity in countries that have had significant outbreaks of COVID-19. Although our manufacturing partner, Zongshen, reports that its operations have not been materially affected at this point, significant uncertainty remainsas to the potential impact of the COVID-19 pandemic on our and Zongshen’s operations (including, without limitation, staffing levels), supply chains forparts and sales channels for our products, and on the global economy as a whole. It is currently not possible to predict how long the pandemic will last or thetime that it will take for economic activity to return to prior levels. The COVID-19 pandemic has resulted in significant financial market volatility anduncertainty in recent weeks. A continuation or worsening of the levels of market disruption and volatility seen in the recent past could have an adverse effecton our ability to access capital, on our business, results of operations and financial condition, and on the market price of our common shares. We do not currently have all arrangements in place that are required to allow us to fully execute our business plan. To sell our vehicles as envisioned, we will need to enter into certain additional agreements and arrangements that are not currently in place. These includeentering into agreements with distributors, arranging for the transportation of the mass-produced SOLOs to be delivered pursuant to our ManufacturingAgreement with Zongshen, obtaining battery and other essential supplies in the quantities that we require. If we are unable to enter into such agreements, orare only able to do so on terms that are unfavorable to us, we may not be able to fully carry out our business plans. We depend on certain key personnel, and our success will depend on our continued ability to retain and attract such qualified personnel. Our success depends on the efforts, abilities and continued service of Paul Rivera, our Chief Executive Officer, Bal Bhullar, our Chief Financial Officer,Henry Reisner, our President and Chief Operating Officer, and Isaac Moss, our Chief Administrative Officer and Corporate Secretary. A number of these keyemployees and consultants have significant experience in the automobile manufacturing and technology industries. A loss of service from any one of theseindividuals may adversely affect our operations, and we may have difficulty or may not be able to locate and hire suitable replacements. We have obtained“key person” insurance on certain key personnel. Since we have little experience in mass-producing electric vehicles, any delays or difficulties in transitioning from producing custom vehicles to mass-producing vehicles may have a material adverse effect on our business, prospects and operating results. Our management team has experience in producing custom designed vehicles and is now switching focus to mass producing electric vehicles in a rapidlyevolving and competitive market. If we are unable to implement our business plans in the timeframe estimated by management and successfully transitioninto a mass-producing electric vehicle manufacturing business, then our business, prospects, operating results and financial condition will be negativelyimpacted and our ability to grow our business will be harmed. We are subject to numerous environmental and health and safety laws and any breach of such laws may have a material adverse effect on our businessand operating results. We are subject to numerous environmental and health and safety laws, including statutes, regulations, bylaws and other legal requirements. These laws relateto the generation, use, handling, storage, transportation and disposal of regulated substances, including hazardous substances (such as batteries), dangerousgoods and waste, emissions or discharges into soil, water and air, including noise and odors (which could result in remediation obligations), and occupationalhealth and safety matters, including indoor air quality. These legal requirements vary by location and can arise under federal, provincial, state or municipallaws. Any breach of such laws and/or requirements would have a material adverse effect on our Company and its operating results.
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Our vehicles are subject to motor vehicle standards and the failure to satisfy such mandated safety standards would have a material adverse effect on ourbusiness and operating results. All vehicles sold must comply with federal, state and provincial motor vehicle safety standards. In both Canada and the United States vehicles that meet orexceed all federally mandated safety standards are certified under the federal regulations. In this regard, Canadian and U.S. motor vehicle safety standardsare substantially the same. Rigorous testing and the use of approved materials and equipment are among the requirements for achieving federal certification.Failure by us to have the SOLO, the Tofino or any future model EV satisfy motor vehicle standards would have a material adverse effect on our business andoperating results. If we are unable to reduce and adequately control the costs associated with operating our business, including our costs of manufacturing, sales andmaterials, our business, financial condition, operating results and prospects will suffer. If we are unable to reduce and/or maintain a sufficiently low level of costs for designing, manufacturing, marketing, selling and distributing and servicing ourelectric vehicles relative to their selling prices, our operating results, gross margins, business and prospects could be materially and adversely impacted. If our vehicles fail to perform as expected, our ability to develop, market and sell our electric vehicles could be harmed. Our vehicles may contain defects in design and manufacture that may cause them not to perform as expected or that may require repair. For example, ourvehicles use a substantial amount of software code to operate. Software products are inherently complex and often contain defects and errors when firstintroduced. While we have performed extensive internal testing, we currently have a very limited frame of reference by which to evaluate the performance ofour SOLO in the hands of our customers and currently have no frame of reference by which to evaluate the performance of our vehicles after several years ofcustomer driving. With the Tofino we are still in early design development phase, whereby the similar evaluations are further behind. We have very limited experience servicing our vehicles. If we are unable to address the service and warranty requirements of our future customers ourbusiness will be materially and adversely affected. If we are unable to successfully address the service requirements of our future customers our business and prospects will be materially and adverselyaffected. In addition, we anticipate the level and quality of the service we will provide our customers will have a direct impact on the success of our futurevehicles. If we are unable to satisfactorily service our customers, our ability to generate customer loyalty, grow our business and sell additional vehiclescould be impaired. We have very limited experience servicing our vehicles. We have begun production of the SOLO vehicles for targeted deliveries during 2021. The totalnumber of production SOLOs that we have produced as at December 31, 2020 is 30. The total number of SOLOs that we have produced as pre-production asof December 31, 2020 is 124 (64 from Canada and 60 from Zongshen). Throughout its history, our subsidiary, InterMeccanica International Inc.(“InterMeccanica”), has produced approximately 2,500 cars, which include providing after sales support and servicing. We only have limited experienceservicing the SOLO as a limited number of SOLOs have been produced. Servicing electric vehicles on a mass scale is different than servicing electricvehicles and vehicles with internal combustion engines and requires specialized skills, including high voltage training and servicing techniques on a massscale. In addition, we presently expect that our warranty covering the SOLO will cover 24 months, however, the final details on such coverage have not yet beencompleted. Furthermore, the SOLO battery pack is potentially a two to five year warranty period, however, the final details on the exact warrantyspecifications is still being determined and is being developed in conjunction with our battery pack and cell suppliers.
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We may not succeed in establishing, maintaining and strengthening the ElectraMeccanica brand, which would materially and adversely affect customeracceptance of our vehicles and components and our business, revenues and prospects. Our business and prospects heavily depend on our ability to develop, maintain and strengthen the ElectraMeccanica brand. Any failure to develop, maintainand strengthen our brand may materially and adversely affect our ability to sell our planned electric vehicles. If we are not able to establish, maintain andstrengthen our brand, we may lose the opportunity to build a critical mass of customers. Promoting and positioning our brand will likely depend significantlyon our ability to provide high quality electric cars and maintenance and repair services, and we have very limited experience in these areas. In addition, weexpect that our ability to develop, maintain and strengthen the ElectraMeccanica brand will also depend heavily on the success of our marketing efforts. Todate, we have limited experience with marketing activities as we have relied primarily on the internet, word of mouth and attendance at industry trade showsto promote our brand. To further promote our brand, we may be required to change our marketing practices, which could result in substantially increasedadvertising expenses, including the need to use traditional media such as television, radio and print. The automobile industry is intensely competitive, and wemay not be successful in building, maintaining and strengthening our brand. Many of our current and potential competitors, particularly automobilemanufacturers headquartered in Detroit, Japan and the European Union, have greater name recognition, broader customer relationships and substantiallygreater marketing resources than we do. If we do not develop and maintain a strong brand, our business, prospects, financial condition and operating resultswill be materially and adversely impacted. Increases in costs, disruption of supply or shortage of raw materials, in particular lithium-ion cells, could harm our business. We may experience increases in the cost or a sustained interruption in the supply or shortage of raw materials. Any such increase or supply interruption couldmaterially negatively impact our business, prospects, financial condition and operating results. We use various raw materials in our business, includingaluminum, steel, carbon fiber and non-ferrous metals such as copper and cobalt. The prices for these raw materials fluctuate depending on market conditionsand global demand for these materials and could adversely affect our business and operating results. For instance, we are exposed to multiple risks relating toprice fluctuations for lithium-ion cells. These risks include:
•	the inability or unwillingness of current battery manufacturers to build or operate battery cell manufacturing plants to supply the numbers oflithium-ion cells required to support the growth of the electric or plug-in hybrid vehicle industry as demand for such cells increases;

	•	disruption in the supply of cells due to quality issues or recalls by the battery cell manufacturers; and

	•	an increase in the cost of raw materials, such as cobalt, used in lithium-ion cells.
Our business depends on the continued supply of battery cells for our vehicles. We do not currently have any agreements for the supply of batteries anddepend upon the open market for their procurement. Any disruption in the supply of battery cells from our supplier could temporarily disrupt the plannedproduction of our vehicles until such time as a different supplier is fully qualified. Moreover, battery cell manufacturers may choose to refuse to supplyelectric vehicle manufacturers to the extent they determine that the vehicles are not sufficiently safe. Furthermore, current fluctuations or shortages inpetroleum and other economic conditions may cause us to experience significant increases in freight charges and raw material costs. Substantial increases inthe prices for our raw materials would increase our operating costs, and could reduce our margins if we cannot recoup the increased costs through increasedelectric vehicle prices. We might not be able to recoup increasing costs of raw materials by increasing vehicle prices. We have also already announced anestimated price for the base model of our SOLO and the Tofino. However, any attempts to increase the announced or expected prices in response to increasedraw material costs could be viewed negatively by our potential customers, result in cancellations of SOLO and Tofino reservations and could materiallyadversely affect our brand, image, business, prospects and operating results.
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The unavailability, reduction or elimination of government and economic incentives could have a material adverse effect on our business, financialcondition, operating results and prospects. Any reduction, elimination or discriminatory application of government subsidies and economic incentives that are offered to purchasers of EVs or personsinstalling home charging stations, the reduced need for such subsidies and incentives due to the perceived success of the electric vehicle, fiscal tightening orother reasons may result in the diminished competitiveness of the alternative fuel vehicle industry generally or our electric vehicles in particular. This couldmaterially and adversely affect the growth of the alternative fuel automobile markets and our business, prospects, financial condition and operating results. If we fail to manage future growth effectively, we may not be able to market and sell our vehicles successfully. Any failure to manage our growth effectively could materially and adversely affect our business, prospects, operating results and financial condition. We planto expand our operations in the near future in connection with the planned production of our vehicles. Our future operating results depend to a large extent onour ability to manage this expansion and growth successfully. Risks that we face in undertaking this expansion include:
•	training new personnel;

	•	forecasting production and revenue;

	•	controlling expenses and investments in anticipation of expanded operations;

	•	establishing or expanding design, manufacturing, sales and service facilities;

	•	implementing and enhancing administrative infrastructure, systems and processes;

	•	addressing new markets; and

	•	establishing international operations.
We intend to continue to hire a number of additional personnel, including design and manufacturing personnel and service technicians, for our electricvehicles. Competition for individuals with experience in designing, manufacturing and servicing electric vehicles is intense, and we may not be able toattract, assimilate, train or retain additional highly qualified personnel in the future. The failure to attract, integrate, train, motivate and retain these additionalemployees could seriously harm our business and prospects. Our business may be adversely affected by labor and union activities. Although none of our employees are currently represented by a labor union, it is common throughout the automobile industry generally for many employeesat automobile companies to belong to a union, which can result in higher employee costs and increased risk of work stoppages. We have a ManufacturingAgreement with Zongshen to produce 75,000 SOLO vehicles in the first three full years from the commencement of production. Zongshen’s workforce is notcurrently unionized, though they may become so in the future or industrial stoppages could occur in the absence of a union. We also directly and indirectlydepend upon other companies with unionized work forces, such as parts suppliers and trucking and freight companies, and work stoppages or strikesorganized by such unions could have a material adverse impact on our business, financial condition or operating results. If a work stoppage occurs within ourbusiness, or that of Zongshen or our key suppliers, it could delay the manufacture and sale of our electric vehicles and have a material adverse effect on ourbusiness, prospects, operating results or financial condition. Additionally, if we expand our business to include full in-house manufacturing of our vehicles,our employees might join or form a labor union and we may be required to become a union signatory.
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We may become subject to product liability claims, which could harm our financial condition and liquidity if we are not able to successfully defend orinsure against such claims. We may become subject to product liability claims, which could harm our business, prospects, operating results and financial condition. The automobileindustry experiences significant product liability claims and we face inherent risk of exposure to claims in the event our vehicles do not perform as expectedor malfunction resulting in personal injury or death. Our risks in this area are particularly pronounced given we have limited field experience of our vehicles.A successful product liability claim against us could require us to pay a substantial monetary award. Moreover, a product liability claim could generatesubstantial negative publicity about our vehicles and business and inhibit or prevent commercialization of other future vehicle candidates which would havea material adverse effect on our brand, business, prospects and operating results. We plan to maintain product liability insurance for all our vehicles withannual limits of approximately $30 million on a claims-made basis, but any such insurance might not be sufficient to cover all potential product liabilityclaims. Any lawsuit seeking significant monetary damages either in excess of our coverage, or outside of our coverage, may have a material adverse effecton our reputation, business and financial condition. We may not be able to secure additional product liability insurance coverage on commercially acceptableterms or at reasonable costs when needed, particularly if we do face liability for our products and are forced to make a claim under our policy. Our patent applications may not result in issued patents, which may have a material adverse effect on our ability to prevent others from interfering withour commercialization of our products. The registration and enforcement of patents involves complex legal and factual questions and the breadth and effectiveness of patented claims is uncertain.We cannot be certain that we are the first to file patent applications on these inventions, nor can we be certain that our pending patent applications will resultin issued patents or that any of our issued patents will afford sufficient protection against someone creating competing products, or as a defensive portfolioagainst a competitor who claims that we are infringing its patents. In addition, patent applications filed in foreign countries are subject to laws, rules andprocedures that differ from those of the United States, and thus we cannot be certain that foreign patent applications, if any, will result in issued patents inthose foreign jurisdictions or that such patents can be effectively enforced, even if they relate to patents issued in the United States. We may need to defend ourselves against patent or trademark infringement claims, which may be time-consuming and would cause us to incursubstantial costs. Companies, organizations or individuals, including our competitors, may hold or obtain patents, trademarks or other proprietary rights that would prevent,limit or interfere with our ability to make, use, develop, sell or market our vehicles or components, which could make it more difficult for us to operate ourbusiness. From time to time, we may receive communications from third parties that allege our products are covered by their patents or trademarks or otherintellectual property rights. Companies holding patents or other intellectual property rights may bring suits alleging infringement of such rights or otherwiseassert their rights. If we are determined to have infringed upon a third party’s intellectual property rights, we may be required to do things that include one ormore of the following:
•	cease making, using, selling or offering to sell processes, goods or services that incorporate or use the third-party intellectual property;

	•	pay substantial damages;
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•	seek a license from the holder of the infringed intellectual property right, which license may not be available on reasonable terms or at all;

	•	redesign our vehicles or other goods or services to avoid infringing the third-party intellectual property; or

	•	establish and maintain alternative branding for our products and services.
In the event of a successful claim of infringement against us and our failure or inability to obtain a license to the infringed technology or other intellectualproperty right, our business, prospects, operating results and financial condition could be materially adversely affected. In addition, any litigation or claims,whether or not valid, could result in substantial costs, negative publicity and diversion of resources and management attention. You may face difficulties in protecting your interests, and your ability to protect your rights through the U.S. federal courts may be limited because weare incorporated under the laws of the Province of British Columbia, a substantial portion of our assets are in Canada and all of our executive officersand most of our directors reside outside the United States We are organized pursuant to the laws of the Province of British Columbia under the Business Corporations Act (British Columbia) (the “BusinessCorporations Act”), and our executive offices are located outside of the United States in Vancouver, British Columbia. Three of our four officers, our auditorand all but four of our directors reside outside the United States. In addition, a substantial portion of their assets and our assets are located outside of theUnited States. As a result, you may have difficulty serving legal process within the United States upon us or any of these persons. You may also havedifficulty enforcing, both in and outside of the United States, judgments you may obtain in U.S. courts against us or these persons in any action, includingactions based upon the civil liability provisions of U.S. federal or state securities laws. Furthermore, there is substantial doubt as to the enforceability inCanada against us or against any of our directors, officers and the expert named in this Annual Report who are not residents of the United States, in originalactions or in actions for enforcement of judgments of U.S. courts, of liabilities based solely upon the civil liability provisions of the U.S. federal securitieslaws. In addition, shareholders in British Columbia companies may not have standing to initiate a shareholder derivative action in U.S. federal courts. As aresult, our public shareholders may have more difficulty in protecting their interests through actions against us, our management, our directors or our majorshareholders than would shareholders of a corporation incorporated in a jurisdiction in the United States. Global economic conditions could materially adversely impact demand for our products and services. Our operations and performance depend significantly on economic conditions. Uncertainty about global economic conditions could result in customerspostponing purchases of our products and services in response to tighter credit, unemployment, negative financial news and/or declines in income or assetvalues and other macroeconomic factors, which could have a material negative effect on demand for our products and services and, accordingly, on ourbusiness, results of operations or financial condition. We are vulnerable to a growing trade dispute between the United States and China A growing trade dispute between the United States and China could increase the proposed sales price of our products or decrease our profits, if any. In June2018, the previous U.S. administration has imposed tariffs on $34 billion of Chinese exports, including a 25% duty on cars built in China and shipped to theUnited States. Following the imposition of these tariffs, China has imposed additional tariffs on U.S. goods manufactured in the United States and exportedto China. Subsequently, the U.S. administration indicated that it may impose tariffs on up to US$500 billion of goods manufactured in China and importedinto the United States. These tariffs may escalate a nascent trade war between China and the United States. This trade conflict could affect our businessbecause we intend to mass produce the SOLO in China and our intended principal market is the west coast of North America. If a trade war were to escalateor if tariffs were imposed on any of our products, we could be forced to increase the proposed sales price of such products or reduce the margins, if any, onsuch products.
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Recently, U.S. Customs and Border Protection ruled that the SOLO has a classification under the Harmonized Tariff Schedule of the United States thatapplies to passenger vehicles for less than 10 people with only electric motors. The total applicable duty for this classification was recently raised to 27.5%(2.5% is a “most-favored-nation” tariff for this classification and 25% derives from this classification being on the China 301 List 1). We envision that thesuggested retail purchase price for our SOLO will be US$18,500. As the landscape for tariffs involving imports to the United States from the People’sRepublic of China (the “PRC”) has been changing over the past year and may change again, we have not determined how to adjust the purchase price in theUnited States in response to the recent tariff increase. On January 15, 2020, the United States and the PRC signed “Phase One” of an Economic and Trade Agreement (the “Phase One Agreement”), which enteredinto force on February 14, 2020. Notwithstanding the coming into force of the Phase One Agreement, the United States will maintain its tariffs on cars builtin China and shipped to the United States. Uncertainties in the interpretation and enforcement of Chinese laws and regulations could limit the legal protections available to you and us. The legal system in the PRC is based on written statutes. Unlike common law systems, it is a system in which legal cases have limited value as precedents. Inthe late 1970s, the PRC government began to promulgate a comprehensive system of laws and regulations governing economic matters in general. Theoverall effect of legislation over the past three decades has significantly increased the protections afforded to various production services in the PRC.Zongshen, our manufacturing partner, is subject to various PRC laws and regulations generally applicable to companies in China. However, since these lawsand regulations are relatively new and the PRC legal system continues to rapidly evolve, the interpretations of many laws, regulations and rules are notalways uniform and enforcement of these laws, regulations and rules involve uncertainties. From time to time, we may have to resort to administrative and court proceedings to enforce our legal rights or Zongshen may have to resort toadministrative and court proceedings to fulfill its obligations under the Manufacturing Agreement. However, since PRC administrative and court authoritieshave significant discretion in interpreting and implementing statutory and contractual terms, it may be more difficult to evaluate the outcome ofadministrative and court proceedings and the level of legal protection we enjoy than in more developed legal systems. Furthermore, the PRC legal system isbased in part on government policies and internal rules (some of which are not published in a timely manner or at all) that may have retroactive effect. As aresult, we or Zongshen may not be aware of our violation of these policies and rules until sometime after the violation. Such uncertainties, includinguncertainty over the scope and effect of our contractual, property (including intellectual property) and procedural rights, and any failure to respond tochanges in the regulatory environment in China, could materially and adversely affect our business and impede our ability to continue our operations. Risks Related to Our Common Shares Our executive officers and directors beneficially own approximately 15.99% of our common shares. As of March 23, 2021, our executive officers and directors beneficially own, in the aggregate,15.99% of our common shares, which includes shares that ourexecutive officers and directors have the right to acquire pursuant to warrants and stock options which have vested. As a result, they are able to exercise asignificant level of control over all matters requiring shareholder approval, including the election of directors, amendments to our Articles and approval ofsignificant corporate transactions. This control could have the effect of delaying or preventing a change of control of our Company or changes inmanagement and will make the approval of certain transactions difficult or impossible without the support of these shareholders.
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The continued sale of our equity securities will dilute the ownership percentage of our existing shareholders and may decrease the market price for ourcommon shares. Our Notice of Articles authorize the issuance of an unlimited number of common shares and the issuance of preferred shares. Our Board of Directors has theauthority to issue additional shares of our capital stock to provide additional financing in the future and designate the rights of the preferred shares, whichmay include voting, dividend, distribution or other rights that are preferential to those held by the common shareholders. The issuance of any such commonor preferred shares may result in a reduction of the book value or market price, if one exists at the time, of our outstanding common shares. Given our lack ofrevenues, we will likely have to issue additional equity securities to obtain working capital we require for the next 12 months. Our efforts to fund ourintended business plans will therefore result in dilution to our existing shareholders. If we do issue any such additional common shares, such issuance alsowill cause a reduction in the proportionate ownership and voting power of all other shareholders. As a result of such dilution, if you acquire common sharesyour proportionate ownership interest and voting power could be decreased. Furthermore, any such issuances could result in a change of control or areduction in the market price for our common shares. Additionally, we had 12,275,863 stock options and 12,539,558 warrants outstanding as of March 23, 2021. The exercise price of some of these options andwarrants is below our current market price, and you could purchase shares in the market at a price in excess of the exercise price of our outstanding warrantsor options. If the holders of these options and warrants elect to exercise them, your ownership position will be diluted and the per share value of the commonshares you have or acquire could be diluted as well. As a result, the market value of our common shares could significantly decrease as well. Issuances of our preferred stock may adversely affect the rights of the holders of our common shares and reduce the value of our common shares. Our Notice of Articles authorize the issuance of an unlimited number of shares of preferred stock. Our Board of Directors has the authority to create one ormore series of preferred stock and, without shareholder approval, issue shares of preferred stock with rights superior to the rights of the holders of commonshares. As a result, shares of preferred stock could be issued quickly and easily, adversely affecting the rights of holder of common shares and could beissued with terms calculated to delay or prevent a change in control or make removal of management more difficult. Although we currently have no plans tocreate any series of preferred stock and have no present plans to issue any shares of preferred stock, any creation and issuance of preferred stock in the futurecould adversely affect the rights of the holders of common shares and reduce the value of our common shares. The market price of our common shares may be volatile and may fluctuate in a way that is disproportionate to our operating performance. Our common shares began trading on the Nasdaq Capital Market (“Nasdaq”) in August 2018, and before that it had been trading on the OTCQB starting inSeptember 2017. The historical volume of trading has been low (within the past year, the fewest number of our shares that were traded on Nasdaq was28,706 shares daily), and the share price has fluctuated significantly (since trading began on Nasdaq our closing price has been as low as US$0.91 and ashigh as US$10.81). The share price for our common shares could decline due to the impact of any of the following factors:
•	sales or potential sales of substantial amounts of our common shares;

	•	announcements about us or about our competitors;

	•	litigation and other developments relating to our patents or other proprietary rights or those of our competitors;
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•	conditions in the automobile industry;

	•	governmental regulation and legislation;

	•	variations in our anticipated or actual operating results;

	•	change in securities analysts’ estimates of our performance, or our failure to meet analysts’ expectations;

	•	change in general economic trends; and

	•	investor perception of our industry or our prospects.
Many of these factors are beyond our control. The stock markets in general, and the market for automobile companies in particular, have historicallyexperienced extreme price and volume fluctuations. These fluctuations often have been unrelated or disproportionate to the operating performance of thesecompanies. These broad market and industry factors could reduce the market price of our common shares regardless of our actual operating performance. We do not intend to pay dividends and there will thus be fewer ways in which you are able to make a gain on your investment. We have never paid any cash or stock dividends and we do not intend to pay any dividends for the foreseeable future. To the extent that we require additionalfunding currently not provided for in our financing plan, our funding sources may prohibit the payment of any dividends. Because we do not intend todeclare dividends, any gain on your investment will need to result from an appreciation in the price of our common shares. There will therefore be fewerways in which you are able to make a gain on your investment. FINRA sales practice requirements may limit your ability to buy and sell our common shares, which could depress the price of our shares. Financial Industry Regulation Authority (“FINRA”) rules require broker-dealers to have reasonable grounds for believing that an investment is suitable for acustomer before recommending that investment to the customer. Prior to recommending speculative low-priced securities to their non-institutionalcustomers, broker-dealers must make reasonable efforts to obtain information about the customer’s financial status, tax status and investment objectives,among other things. Under interpretations of these rules, FINRA believes that there is a high probability such speculative low-priced securities will not besuitable for at least some customers. Thus, FINRA requirements may make it more difficult for broker-dealers to recommend that their customers buy ourcommon shares, which may limit your ability to buy and sell our common shares, have an adverse effect on the market for our common shares and, thereby,depress their market prices. Our common shares have been thinly traded, and you may be unable to sell at or near ask prices or at all if you need to sell your common shares to raisemoney or otherwise desire to liquidate your shares. From October 2017 until August 2018, our common shares were quoted on the OTCQB where they were “thinly-traded”, meaning that the number ofpersons interested in purchasing our common shares at or near bid prices at any given time was relatively small or non-existent. Since we listed on Nasdaq inAugust 2018, the volume of our common shares traded has increased, but that volume could decrease until we are thinly-traded again. That could occur dueto a number of factors, including that we are relatively unknown to stock analysts, stock brokers, institutional investors and others in the investmentcommunity that generate or influence sales volume, and that even if we came to the attention of such persons, they tend to be risk-averse and might bereluctant to follow an unproven company such as ours or purchase or recommend the purchase of our common shares until such time as we became moreseasoned. As a consequence, there may be periods of several days or more when trading activity in our common shares is minimal or non-existent, ascompared to a seasoned issuer which has a large and steady volume of trading activity that will generally support continuous sales without an adverse effecton share price. Broad or active public trading market for our common shares may not develop or be sustained.
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Volatility in our common shares or warrant price may subject us to securities litigation. The market for our common shares may have, when compared to seasoned issuers, significant price volatility, and we expect that our share or warrant pricesmay continue to be more volatile than that of a seasoned issuer for the indefinite future. In the past, plaintiffs have often initiated securities class actionlitigation against a company following periods of volatility in the market price of its securities. We may, in the future, be the target of similar litigation.Securities litigation could result in substantial costs and liabilities and could divert management’s attention and resources. We are a foreign private issuer within the meaning of the rules under the Exchange Act, and as such we are exempt from certain provisions applicable toUnited States domestic public companies. We are a foreign private issuer within the meaning of the rules under the Exchange Act. As such, we are exempt from certain provisions applicable to UnitedStates domestic public companies. For example:
•	we are not required to provide as many Exchange Act reports, or as frequently, as a domestic public company;

	•	for interim reporting we are permitted to comply solely with our home country requirements, which are less rigorous than the rules that apply todomestic public companies;

	•	we are not required to provide the same level of disclosure on certain issues, such as executive compensation;

	•	we are exempt from provisions of Regulation FD aimed at preventing issuers from making selective disclosures of material information;

	•	we are not required to comply with the sections of the Exchange Act regulating the solicitation of proxies, consents or authorizations in respect ofa security registered under the Exchange Act; and

	•	we are not required to comply with Section 16 of the Exchange Act requiring insiders to file public reports of their share ownership and tradingactivities and establishing insider liability for profits realized from any “short-swing” trading transaction.
Our shareholders may not have access to certain information they may deem important and are accustomed to receive from U.S. reporting companies. As an “emerging growth company” under applicable law, we will be subject to lessened disclosure requirements. Such reduced disclosure may make ourcommon shares less attractive to investors. For as long as we remain an “emerging growth company”, as defined in the JOBS Act, we will elect to take advantage of certain exemptions from variousreporting requirements that are applicable to other public companies that are not “emerging growth companies” and including, but not limited to, not beingrequired to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executivecompensation in our periodic reports, exemptions from the requirements of holding a non-binding advisory vote on executive compensation and shareholderapproval of any golden parachute payments not previously approved. Because of these lessened regulatory requirements, our shareholders would be leftwithout information or rights available to shareholders of more mature companies. If some investors find our common shares less attractive as a result, theremay be a less active trading market for such securities and their market prices may be more volatile.
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We incur significant costs as a result of being a public company, which costs will grow after we cease to qualify as an “emerging growth company.” We incur significant legal, accounting and other expenses as a public company that we did not incur as a private company. The Sarbanes-Oxley Act, as wellas rules subsequently implemented by the SEC and Nasdaq, impose various requirements on the corporate governance practices of public companies. We arean “emerging growth company”, as defined in the JOBS Act, and will remain an emerging growth company until the earlier of : (1) the last day of the fiscalyear (a) following May 23, 2022, (b) in which we have total annual gross revenue of at least US$1.07 billion or (c) in which we are deemed to be a largeaccelerated filer, which means the market value of our common shares that is held by non-affiliates exceeds US$700 million as of the prior June 30th; and (2)the date on which we have issued more than US$1.0 billion in non-convertible debt during the prior three-year period. An emerging growth company maytake advantage of specified reduced reporting and other requirements that are otherwise applicable generally to public companies. These provisions includeexemption from the auditor attestation requirement under Section 404 of the Sarbanes-Oxley Act in the assessment of the emerging growth company’sinternal control over financial reporting and permission to delay adopting new or revised accounting standards until such time as those standards apply toprivate companies. Compliance with these rules and regulations increases our legal and financial compliance costs and makes some corporate activities more time-consumingand costlier. After we are no longer an emerging growth company, we expect to incur significant expenses and devote substantial management effort towardensuring compliance with the requirements of Section 404 and the other rules and regulations of the SEC. For example, as a public company, we have beenrequired to increase the number of independent directors and adopt policies regarding internal controls and disclosure controls and procedures. We haveincurred additional costs in obtaining director and officer liability insurance. In addition, we incur additional costs associated with our public companyreporting requirements. It may also be more difficult for us to find qualified persons to serve on our board of directors or as executive officers. We arecurrently evaluating and monitoring developments with respect to these rules and regulations, and we cannot predict or estimate with any degree of certaintythe amount of additional costs we may incur or the timing of such costs.
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ITEM 4. INFORMATION ON THE COMPANY Summary We were incorporated on February 16, 2015, under the laws of the Province of British Columbia, Canada, and our principal activity is the development andmanufacturing of electric vehicles (EVs). Our head office is located at, and our principal address is, 102 East 1st Avenue, Vancouver, British Columbia, Canada, V5T 1A4. Additional information related us is available on SEDAR at www.sedar.com and on our website at www.electrameccanica.com. We do not incorporate thecontents of our website or of sedar.com into this Annual Report. Information on our website does not constitute part of this Annual Report. Our registered and records office is located at Suite 1500, 1055 West Georgia Street, P.O. Box 11117, Vancouver, British Columbia, Canada, V6E 4N7. A. History and development of the Company We are a development-stage electric vehicle, or EV, manufacturing company which was incorporated on February 16, 2015 under the laws of BritishColumbia, Canada. We have four subsidiaries: InterMeccanica, a British Columbia, Canada, corporation; EMV Automotive USA Inc., a Nevada corporation; SOLO EV LLC, aMichigan corporation; and EMV Automotive Technology (Chongqing) Inc., a PRC corporation. We currently have 10 existing retail locations: six in Southern California; three in Scottsdale, Arizona; and one in Portland, Oregon; and we anticipateopening up three additional retail locations in each of the three foregoing states.
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B. Business Overview General We are a development-stage electric vehicle, or EV, manufacturer company located in Vancouver, British Columbia, Canada. Our initial product line targetsurban commuters, commercial fleets/deliveries and shared mobility seeking to commute in an efficient, cost-effective and environmentally friendly manner. Our first flagship EV is the SOLO, a single seat vehicle, of which we have built 64 prototype vehicles in-house as of December 31, 2020 and 60 pre-production vehicles with our manufacturing partner, Zongshen. We have used some of these pre-mass production vehicles as prototypes and for certificationpurposes, have delivered some to customers and have used others as test drive models in our showroom. We believe our schedule to mass produce EVs,combined with our subsidiary, InterMeccanica’s, 61-year history of automotive design, manufacturing and deliveries of motor vehicles to customers,significantly differentiates us from other early and development stage EV companies. We launched commercial production of our SOLO on August 26, 2020. For the year ended December 31, 2020, we have produced 30 SOLOs. We currentlyhave 10 existing retail locations: six in Southern California; three in Scottsdale, Arizona; and one in Portland, Oregon; and we anticipate opening up threeadditional retail locations in each of the three foregoing states. Deliveries will be made to key markets along the U.S. west coast as the Company continues toexpand. The Company has targeted sometime in 2021 for initial deliveries to customers. On September 16, 2020, we announced plans to produce an alternative “utility and fleet” version of our flagship SOLO EV.. To support our production, we have entered into a Manufacturing Agreement with Zongshen, acting through its wholly-owned subsidiary. Zongshen is anaffiliate of Zongshen Power Machinery Co., Ltd., a large-scale scientific and technical enterprise which designs, develops, manufactures and sells a diverserange of motorcycles and motorcycle engines in China. Zongshen has previously purchased common shares and warrants to purchase common shares fromus, and beneficially owns approximately2.4% of our common shares. We have another EV candidate in early design development stage, the Tofino, an all-electric, two-seater roadster. We have devoted substantial resources to create an affordable EV which brings significant performance and value to our customers. To this end, we envisionthe SOLO carrying a manufacturer’s suggested retail price of US$18,500, prior to any surcharge to cover tariffs (discussed below), and being powered by ahigh-performance electric rear drive motor which enables the SOLO to achieve:
•	a top speed of 80 mph and an attainable cruise speed of 68 mph resulting from its lightweight aerospace composite chassis;

	•	acceleration from 0 mph to 60 mph in approximately ten seconds; and

	•	a range of up to 100 miles generated from a lithium ion battery system that requires up to four hours of charging time on a 220-volt chargingstation (up to eight hours from a 110-volt outlet) that utilizes approximately 8.64 kW/h.
In addition, the SOLO contains a number of standard features found in higher price point vehicles, including:
•	LCD Digital Instrument Cluster;

	•	Power Windows, Power Steering and Power Brakes;
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•	AM/FM Stereo with Bluetooth/CD/USB;

	•	Rear view backup camera;

	•	Air conditioning;

	•	Heated seats;

	•	Heater and defogger; and

	•	Keyless remote entry.
Unique to Canada, the SOLO is under the three-wheeled vehicle category and is subject to the safety standards listed in Schedule III of the Canadian MotorVehicle Safety Regulations. See “Government Regulation” herein. For sale into the United States, we and our vehicles must meet the applicable provisions of the U.S. Code of Federal Regulations Title 49 —Transportation.Since the U.S. regulations do not have a specific class for three-wheeled “autocycles”, the SOLO falls under the definition of a motorcycle pursuant to Sec.571.3 of 49 CFR Part 571. However, currently a motorcycle license is not required to drive them in all but the States of Florida, Minnesota, New Mexico,New England, North Carolina, Indiana and Oklahoma. The State of New York and Massachusetts are pending legislation which would allow them to bedriven with a driver’s license. Motorcycle helmets must be worn while operating in the State of Massachusetts. Helmets are also required if the driver isunder 18 years old in the States of Alaska, Montana, Colorado and New Hampshire. See “Government Regulation” herein. Potential Impact of the COVID-19 Pandemic In December 2019, a strain of novel coronavirus (now commonly known as COVID-19) was reported to have surfaced in Wuhan, China. COVID-19 hassince spread rapidly throughout many countries, and, on March 11, 2020, the World Health Organization declared COVID-19 to be a pandemic. In an effortto contain and mitigate the spread of COVID-19, many countries, including the United States, Canada and China, have imposed unprecedented restrictionson travel, and there have been business closures and a substantial reduction in economic activity in countries that have had significant outbreaks of COVID-19. Our manufacturing partner, Zongshen, reports that its operations have not been materially affected at this point, and with our partner Zongshen we havebegun producing the SOLO for targeted deliveries to customers during 2021. However, significant uncertainty remains as to the potential impact of theCOVID-19 pandemic on our and Zongshen’s operations, and on the global economy as a whole. Government-imposed restrictions on travel and other“social-distancing” measures, such as restrictions on assemblies of groups of persons, have potential to disrupt supply chains for parts and sales channels forour products, and may result in labor shortages. It is currently not possible to predict how long the pandemic will last or the time that it will take for economic activity to return to prior levels. We willcontinue to monitor the COVID-19 situation closely, and intend to follow health and safety guidelines as they evolve. Potential Impact of Tariffs A growing trade dispute between the United States and China could increase the proposed sales price of our products or decrease our profits, if any. In June2018, the previous U.S. administration imposed tariffs on $34 billion of Chinese exports, including a 25% duty on cars built in China and shipped to theUnited States. Following the imposition of these tariffs, China has imposed additional tariffs on U.S. goods manufactured in the United States and exportedto China. Subsequently, the U.S. administration indicated that it may impose tariffs on up to US$500 billion of goods manufactured in China and importedinto the United States. These tariffs may escalate a nascent trade war between China and the United States. This trade conflict could affect our businessbecause we intend to mass produce the SOLO in China and our intended principal market is the west coast of North America. If a trade war were to escalateor if tariffs were imposed on any of our products, we could be forced to increase the proposed sales price of such products or reduce the margins, if any, onsuch products.
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Recently, U.S. Customs and Border Protection ruled that the SOLO has a classification under the Harmonized Tariff Schedule of the United States thatapplies to passenger vehicles for less than 10 people with only electric motors. The total applicable duty for this classification was recently raised to 27.5%(2.5% is a “most-favored-nation” tariff for this classification and 25% derives from this classification being on the China 301 List 1). As indicated above, weenvision that the base purchase price for our SOLO will be approximately US$18,500. As the landscape for tariffs involving imports to the United Statesfrom the PRC has been changing over the past year and may change again, we have not determined how to adjust the base purchase price in the United Statesin response to the recent tariff increase. On January 15, 2020, the United States and the PRC signed an Economic and Trade Agreement commonly referred to as the Phase 1 Trade Agreement,which entered into force on February 14, 2020. Notwithstanding the coming into force of the Phase 1 Trade Agreement, the United States will maintain itstariffs on cars built in China and shipped to the United States. Corporate Structure and Principal Executive Offices We were incorporated on February 16, 2015 under the laws of British Columbia, Canada, and have a December 31st fiscal year end. As of March 23, 2021,we had 112,908,266 common shares outstanding. Our principal executive offices are located at 102 East 1st Avenue, Vancouver, British Columbia, Canada, V5T 1A4. Our telephone number is (604) 428-7656. Our website address is www.electrameccanica.com. Information on our website does not constitute part of this Annual Report. Our registered andrecords office is located at Suite 1500, 1055 West Georgia Street, P.O. Box 11117, Vancouver, British Columbia, Canada, V6E 4N7. We have four subsidiaries: Intermeccanica, a British Columbia, Canada, corporation; EMV Automotive USA Inc., a Nevada corporation; SOLO EV LLC, aMichigan limited liability company; and EMV Automotive Technology (Chongqing) Ltd., a PRC corporation. Strategy Our near-term goal is to commence and expand sales of the SOLO while continuing to develop our other EVs. We intend to achieve this goal by:
•	Beginning commercial production of the SOLO: Zongshen, our manufacturing partner, began production of the SOLO on August 26, 2020 withtargeted deliveries to customers in 2021;

•	Increasing orders for our EVs: We have an online reservation system which allows a potential customer to reserve a SOLO by paying arefundable US$250 deposit, and Tofino by paying a refundable $1,000 deposit. Once reserved, the potential customer is allocated a reservationnumber and, although we cannot guarantee that such pre-orders will become binding and result in sales, we intend to fulfill the reservations as therespective vehicles are produced. We maintain certain refundable deposits from various individuals for SOLOs and Tofinos;

•	Having sales and services supported by local corporate stores: We will monitor all cars in real time via telematics which provides early warningof potential maintenance issues; and

•	Expanding our product offering: In parallel with the production and sale of the SOLO, we aim to continue the development of our other proposedproducts, including the Tofino, a two-seater sports car in the expected price range of US$50,000 to US$60,000.
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We have achieved our pre-order book through an online “direct sales to customers and corporate sales” platform, as well as a showroom at our headquartersin Vancouver, British Columbia, Canada. Additionally, we have a service and distribution center in Studio City, California. We plan on expanding thecorporate retail stores model and will be opening retail stores in key urban areas. We currently have 10 U.S. corporate retail stores, located in SouthernCalifornia, Arizona and Oregon, and we anticipate opening up three additional retail locations in each of the three foregoing states. We will continue to identify other retail targets in additional regions. The establishment of stores will depend on regional demand, available candidates andlocal regulations. Our vehicles will initially be available directly from us. We plan to only establish and operate corporate stores in those states in the UnitedStates that do not restrict or prohibit certain retail sales models by vehicle manufacturers. Marketing Plan We recognize that marketing efforts must be focused on customer education and establishing brand presence and visibility which is expected to allow ourvehicles to gain traction and subsequently gain increases in orders. Our marketing and promotional efforts emphasize the SOLO’s image as an efficient, cleanand attainable EV for the masses to commute on a daily basis, for commercial fleets/deliveries and for shared mobility. A key point to the marketing plan is to target metropolitan areas with high population density, expensive real estate, high commuter traffic load and pollutionlevels which are becoming an enormous concern. Accordingly, our management has identified California, Washington, Oregon, Arizona and SouthernFlorida as areas with cities that fit the aforementioned criteria, and we have plans to seek out suitable locations for additional stores there. We plan to develop a marketing strategy that will generate interest and media buzz based on the SOLO’s selling points. Key aspects of our marketing planinclude:
•	Digital marketing: Organic engagement and paid digital marketing media with engaging posts aimed to educate the public about EVs and developinterest in our SOLO;

•	Earned media: We have already received press coverage from several traditional media sources and expect these features and news stories tocontinue as we embark on our commercial launch;

•	Investor Relations/Press Releases: Our in-house investor relations team will provide media releases/kits for updates and news on our progress;

•	Industry shows and events: We displayed the SOLO at the Vancouver International Autoshow in March 2017, the Consumer Electronics Show inLas Vegas in January 2018 and the Vancouver International Autoshow in March 2018 and 2019. Promotional merchandise giveaways areexpected to enhance and further solidify our branding in consumer minds. Computer stations and payment processing software will be readily onhand at such events to accept SOLO reservations; and

•	First-hand experience: Test-drives and public viewings are available at our existing stores in the Vancouver downtown core and in SouthernCalifornia, Arizona and Oregon.
We anticipate that our marketing strategy and tactics will evolve over time as our SOLO gains momentum and we identify appropriate channels and mediathat align with our long-term objectives. In all of our efforts we plan to focus on the features that differentiate our SOLO from the existing EVs on themarket.
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SOLO
We created the SOLO’s first prototype in September of 2016. Since the completion of the prototype, our engineers and designers have devoted significantefforts to provide the SOLO with an appealing design and have engaged in proprietary research and development leading to a high-performance electric reardrive motor. The SOLO has a suggested retail purchase price of US$18,500 and features a lightweight chassis to allow for a top speed of 80/mph, an attainable cruisespeed of 68/mph and is able to go from 0/mph to 60/mph in approximately 10 seconds. Our SOLO features a lithium ion battery system that requires only upto four hours of charging time on a 220-volt charging station or up to eight hours from a 110-volt outlet. The lithium battery system utilizes approximately8.64 kW/h for up to 100 miles in range. We will be offering a warranty package for two years for the SOLO and potentially two to five years for the battery.Standard equipment in the SOLO includes, but is not limited to the following:
•	LCD Digital Instrument Cluster;

•	Power Windows, Power Steering and Power Brakes;

•	AM/FM Stereo with Bluetooth/CD/USB;

•	Rear view backup camera;

•	Air conditioning;
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•	Heated seats;

•	Heater and defogger; and

•	Keyless remote entry.
SOLO Utility
In September 2020 we announced our plans to produce an alternative “utility and fleet” version of our flagship SOLO EV, however, at this time we do notknow when such will become available. This modified vehicle is being developed based on direct input from potential commercial and fleet partners and willbe equipped with a stylish and functional cargo “cap”, offering additional capacity and versatility to suit a variety of different, single-occupant commercialand utility fleet applications. Our engineers and designers have devoted efforts to provide the SOLO Utility with an appealing design and have engaged inproprietary research and development leading to a high-performance electric rear drive motor. The SOLO Utility is expected to have the similar features as the SOLO; however, we anticipate that there will be some additional fleet technology andfeatures that would be able to add to the SOLO Utility. In addition, the terms of any warranty for the SOLO Utility have not been determined at this time.
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The Tofino
We announced on March 28, 2017, at the Vancouver International Auto Show, that we intended to build the Tofino; an all-electric, two-seater roadsterrepresenting an evolution of the Intermeccanica Roadster. We are designing the Tofino to be equipped with a high-performance, all-electric motor. TheTofino is still in early design stage development. Sources and Availability of Raw Materials We continue to source duplicate suppliers for all of our components and, in particular, we are currently sourcing our lithium batteries from Panasonic,Samsung and LT Chem. Lithium is subject to commodity price volatility which is not under our control and could have a significant impact on the price oflithium batteries. At present we are subject to the supply of our chassis from one supplier for the production of the SOLO. We are exploring additional suppliers of the chassisto mitigate the risk of depending on only one supplier. Patents and Licenses We have filed patent and design applications for inventions and designs that our legal counsel deems necessary to protect our products. We do not rely on anylicenses from third-party vendors at this time. Our success depends, at least in part, on our ability to protect our core technology and intellectual property. To accomplish this we rely on a combination ofpatent and design applications and registrations, trade secrets, including know-how, employee and third-party non-disclosure agreements, copyright,trademarks and other contractual rights to establish and protect our proprietary rights in our technology and other intellectual property. As at March 23, 2021,we have 13 issued design registrations, one allowed design application, 17 pending invention patent applications and one granted invention patent in specificcountries which we consider core to our business in a broad range of areas related to the design of the SOLO and its powertrain. Additionally, and pursuantto our Manufacturing Agreement with Zongshen, legal title has been transferred for 24 pending Chinese design applications and six granted Chinese designregistrations from Chongqing Zongshen Institute of Innovation and Technology Co., Ltd. to EMV Automotive Technology (Chongqing) Inc., our wholly-owned subsidiary. We intend to continue to file additional patent and design applications with respect to our technology and designs. Examination isproceeding with our pending patent applications, but it is not yet clear whether these applications will result in the issuance of patents or whether theexamination process will require us to narrow our claims such that, even if patents are granted, they might not provide us with adequate protection.
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Trademarks We have recently revised our Brand Guidelines, removing the space between “ELECTRA” and “MECCANICA”, such that, with the next generation SOLOvehicle we will operate under the trademark “ELECTRAMECCANICA SOLO”. Until ELECTRAMECCANICA SOLO is used in commerce, we willcontinue to maintain the mark “ELECTRA MECCANICA SOLO” which is registered in Canada, China, the European Union and Japan, and which is thesubject of pending applications in the United States. We have also registered the trademark “ELECTRA MECCANICA TOFINO” in Canada, Japan, theEuropean Union and China, and we have applied to register the trademark in the United States. We have additional trademark registrations and pending applications for trademarks (other than those noted above) in Canada, China, Japan, the UnitedStates and the European Union. As of March 23, 2021, there are three pending applications in Canada, three pending applications in China and six pendingapplications in the United States. There is also an additional registration in each of the European Union, China and Japan for the trademark“MONSTERRA”. We also own six registrations in each of the European Union and Japan and we own 41 registrations in China. This Annual Report contains references to our trademarks and service marks and to those belonging to other entities. Solely for convenience, trademarks andtrade names referred to in this Annual Report may appear without the ® or TM symbols, but such references are not intended to indicate, in any way, that wewill not assert, to the fullest extent possible under applicable law, our rights or the rights of the applicable licensor to these trademarks and trade names. Wedo not intend our use or display of other companies’ trade names, trademarks or service marks to imply a relationship with, or endorsement or sponsorship ofus by, any other companies. Industry Overview Investment in clean technology has been trending upwards for several years as nations, governments and societies overall become more aware of thedamaging effects that pollution and greenhouse gas emissions have on the environment. In an attempt to prevent and/or slow-down these damaging effectsand create a more sustainable environment, consumers have taken to exploring and purchasing clean technology while nations and government agencies haveundertaken programs to reduce greenhouse gas emissions, contribute funding into research and development in clean technology and offer incentives/rebatesfor clean technology investments by businesses and consumers. EVs are a growing segment of this clean technology movement. EV is a broad term for vehicles that do not solely operate on gas or diesel. Within this alternative vehicle group there are sub-categories of alternativevehicles that utilize different innovative technologies such as: (i) battery electric vehicles (“BEV”s); (ii) fuel-cell electric vehicles (“FCV”s) and (iii) plug-inhybrid electric vehicles (“PHEV”s). BEVs draw on power from battery management systems to power electric motors instead of from an internal combustion engine, a fuel cell or a fuel tank.The Nissan Leaf, Tesla Model S and our vehicles are BEVs.
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FCVs typically utilize a hydrogen fuel cell that, along with oxygen from the air, converts chemical energy into electricity which powers the vehicle’s motor.Emissions from FCVs are water and heat, hence making FCVs true zero-emission vehicles. The Honda Clarity, Hyundai Tucson and Toyota Mirai areexamples of FCVs. PHEVs are the hybrid vehicles that have both an electric motor and an internal combustion engine. A PHEV can alternate between using electricity while inits all-electric range and relying on its gas-powered engine. The Chevrolet Volt and the Toyota Prius are examples of PHEVs. The popularity of EVs have also been met with difficulties in charging convenience. There are far more gas stations available than public EV chargingstations. The convenience and availability of public EV charging stations may prove to be an obstacle of mass adoption of EVs. Consumers may be afraid that their EVs may run out of charge while they are out on the road and this fear is recognized by the public and has beenpopularized with the term “range anxiety”. Despite this fear, the distance travelled by most urban commuters is a lot lower than the typical range of an EV.Data from Statistics Canada’s National Household Survey in 2011 reported the average Canadian takes 25 minutes to commute to work. There currently exists different categories of charging stations depending on the voltage they provide. EV owners can often charge at home on a regular 110-volt outlet which may take between 10 hours to 20 hours depending on the model and make of the EV. This type of outlet and charging is termed level 1charging. Level 2 charging means the voltage at the charging station is typically around 240 volts and this type of outlet is usually available at publiccharging stations, shopping malls and big box retailer parking lots, and even located in certain residential hi-rises. Charging at a level 2 station typically cutsdown the level 1 charge time in half and may require a small fee for the service which may vary depending on the provider and the location. Global EV Market EVs have been around for over 100 years but have only recently gained widespread adoption and public interest due to open discussions of greenhouse gasemission levels, government and international policies on climate change and pollution, increased literature on EVs, fluctuating fuel costs and improvedbattery management systems and EV range. In addition, the market for electric vehicles has experienced significant growth in recent years due to consumerdemand for vehicles that achieve greater fuel efficiency and lower environmental emissions without sacrificing performance. Traditional automotive manufacturers have entered into the EV market to capitalize on its growth. The majority of growth in the EV market has been led bythe following EV models: the Nissan Leaf, the Honda Clarity (PHEV), the Toyota Prius (PHEV), the Tesla Model 3 and the Mitsubishi Outlander (PHEV).Four of the five models above are made by traditional automotive manufacturers, and the fifth is made by Tesla Motors, one of several manufacturers that aresolely devoted to the manufacturing of EVs. Oil was the predominant energy source in the transport sector, providing 92% of final energy over the past decade, down only two percentage points from1973. Increased demand for transport for people and goods called for more oil use, which was accompanied by increased carbon dioxide (CO2) emissions.Today, the transport sector is responsible for nearly one-quarter of global energy-related direct CO2 emissions and is a significant contributor to air pollution.Global and local objectives and commitments to improve climate and air quality underscore that the transport sector has a critical role to play. Even with the ongoing dominance of oil products in transport, these drivers drove rapid change. Over the last decade momentum accelerated to deploy arange of powertrains and alternative fuels. The 2010s were ground breaking for the introduction of electric vehicles and to shape a promising nascent market.Electrification is a key technological strategy to reduce air pollution in densely populated areas and a promising option to contribute to countries’ energydiversification and greenhouse gas (“GHG”) emissions reduction objectives. Electric vehicle benefits include zero tailpipe emissions, better efficiency thaninternal combustion engine vehicles and large potential for GHG emissions reduction when coupled with a low-carbon electricity sector.
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Hitting the commercial market in the first-half of the decade, the sales of electric cars have soared over the last five years. The top sellers were both fastgrowing emblematic companies such as Tesla as well as established automakers such as Nissan (Leaf model) and Renault (Zoe model). Notably, a rapidlydeveloping industry in the PRC had the biggest impact on electric car sales. Only about 17 000 electric cars were on the world’s roads in 2010. Just five countries could count more than 1,000 on their roads: China, Japan, Norway,United Kingdom and the United States. The electric vehicle market was in its infancy and made up of early adopters. Yet by 2019 there were about 7.2 million electric cars on the world’s roads. Nine countries had more than 100,000 electric cars on the road. The global stockremains concentrated in China, Europe and the United States. At least 20 countries reached market shares above 1% in 2019.
Prospects for Electric Mobility Deployment to 2030 Below is an outlook for electrification of road transport to 2030. It considers deployment of electric vehicles and charging infrastructure, battery capacity andrelated materials demand as well as the implications for energy demand and GHG emissions.
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The projections in this analysis rely on the gross domestic product (“GDP”) assumptions in the World Energy Outlook 2019 (IEA, 2019) as at the time ofwriting there was not yet an updated GDP projection. Given the economic disruption related to the Covid-19 crisis, the assumption in this outlook implies aneconomic recovery following the pandemic that leads to a similar level of economic activity over the next few years as was previously estimated, whichmeans a relatively speedy global recovery. The analysis also assumes that policy targets that were in place by end-2019 for transport in general and EVs inparticular remain in the context of the Covid-19 pandemic and its economic repercussions. The global EV stock (excluding two/three-wheelers) expands from around 8 million in 2019 to 50 million by 2025 and close to 140 million vehicles by 2030,corresponding to an annual average growth rate close to 30%. Thanks to this continuous increase in sales share, EVs are expected to account for about 7% ofthe global vehicle fleet by 2030. EV sales reach almost 14 million in 2025 and 25 million vehicles in 2030, representing, respectively, 10% and 16% of allroad vehicle sales.
	33



North American EV Market Our primary market is North America, with a focus on the west coast of the United States – especially California. As of December 2019, cumulativeregistrations of plug-in electric passenger cars totaled 668,827 units, making California the leading plug-in market in the U.S. While the state representsabout 10% of nationwide new car sales, California has accounted for almost half of cumulative plug-in sales in the American market. Plug-in electric carsrepresented about 0.5% of the passenger fleet on California’s roads by September 2015. Until December 2014, California not only had more plug-in electric vehicles than any other American state but also more than any other country in theworld. In 2015 only two countries, Norway (22.4%) and the Netherlands (9.7%), achieved a higher plug-in market share than California. Sales of plug-inelectric cars in the state passed the 200,000 unit milestone in March 2016. By November 2016, with about 250,000 plug-in cars sold in the state since 2010,China was the only country market that exceeded California in cumulative plug-in electric car sales. Cumulative plug-in car registrations achieved the500,000 unit milestone by the end of November 2018.
	34



Annual registrations of plug-in electric vehicles in California increased from 6,964 units in 2011 to 20,093 in 2012, and reached 42,545 units in 2013. In2014, California’s plug-in car market share reached 3.2% of total new car sales in the state, up from 2.5% in 2013, while the national plug-in market share in2014 was 0.71%. The state’s plug-in market share fell to 3.1% in 2015, with the plug-in hybrid segment dropping from 1.6% in 2014 to 1.4%, while the all-electric segment increased to 1.7% from 1.6% in 2014. Still, California’s market share was 4.7 times higher than the U.S. market (0.66%), and registrationsof plug-in electric cars in the state in 2015 represented 54.5% of total plug-in car sales in the U.S. that year. California’s plug-in car market share rose to 3.5% of new car sales in 2016, while the U.S. take-rate was 0.90%. In 2017, California’s plug-in market sharereached 4.8%, while the national share was 1.13%. Also, in 2017, the state’s plug-in segment market share surpassed the take-rate of conventional hybrids(4.6%) for the first time. The plug-in market share rose to 7.8% in 2018, again ahead of conventional hybrids (4.2%), with the all-electric segment reaching for the first time a highershare than conventional hybrids. In addition, the combined market share of pure electrics and plug-in hybrids surpassed the maximum share ever achieved byconventional hybrids; 6.9% in 2013. The electrified segment attained a record 11.9% market share, passing the 10% mark for the first time. The combinedtake-rate of plug-in cars in California slightly declined to 7.7% in 2019, while the market share of conventional hybrids rose to 5.5% from 4.2% in 2018.While the share of all electric cars rose to 5.3%, the rate of plug-in hybrids fell to 2.4% from 3.1% in 2018.
	35


The following table presents annual registrations and market share of new car sales for all-electric and plug-in hybrids sold in California between 2010 and2019.
	Annual new plug-in electric passenger car registrations and market share in California
		by type of plug-in (2010 - 2019)

				California[1][2][74]			U.S.[7][83][79][73][84][85][86][87][88]					CA share	Ratio
					BEV			PHEV	Total	PEV									Total	PEV	of U.S.	CA/US
					market		market		market										market		PEV
						Plug-in			PEV	PEV	market
Year				All-electric											share(1)										hybrid						share(1)	California	share(1)						sales					share(2)	sales(3)	shares
2010					300	0.0%										97	0.0%	397	0.0%							397	0.003%							100%	-
2011					5,302	0.4%									1,662	0.1%								6,964	0.5%				17,821	0.14%							39.1%	3.57
2012					5,990	0.4%									14,103	0.9%								20,093	1.3%				53,392	0.37%							37.6%	3.51
2013													21,912	1.3%								20,633	1.2%					42,545	2.5%				96,602	0.62%						44.0%	4.03
2014													29,536	1.6%								29,949	1.6%					59,485	3.2%				123,347	0.71%						48.2%	4.27
2015													34,477	1.7%								27,740	1.4%					62,217	3.1%				114,248	0.66%						54.5%	4.70
2016													40,347	1.9%								34,727	1.7%					75,074	3.6%				157,181	0.90%						47.8%	4.00
2017													53,500	2.6%								45,040	2.2%					98,540	4.8%				194,479	1.13%						50.7%	4.23
2018													94,801	4.7%								62,847	3.1%					157,648	7.8%				361,307	2.10%						43.6%	3.71
2019													99,704	5.3%								46,160	2.4%					145,864	7.7%				329,528	1.95%						44.3%	3.96
Total													385,869	n.a.								282,958	n.a.					668,827	n.a.						1,448,250	n.a.						46.2%	n.a.

Notes: (1) Market share of total new car registrations in California. (2) U.S. market share of total nationwide sales (3) California’s market share of totalnationwide registrations

Data Sources: International Energy Agency, Wikipedia, Alliance of Automobile Manufacturers; National Automobile Dealers Association, California EnergyCommissionChart: International Energy Agency, Wikipedia
			36


Fleet and Urban Driving market We designed the SOLO with a view to redefining SOLO mobility for fleets in terms of car share, deliveries and other mobility purposes; and for urbandrivers who use a personal vehicle by cutting their commuting costs and reducing their environmental footprint. We believe that a substantial number offleets and urban drivers will find the capacity of our EVs attractive in comparison to cars designed to carry more people. As cars designed to carry betweenfour and eight people generally weigh substantially more than those that carry one or two people, they require more fuel or energy to operate. This significantmismatch between capacity and utilization leads to a significant excess of traffic and pollution and higher operating costs. Although consumers may be afraid that their EVs may run out of charge while they are out on the road, the average U.S. one-way commute was only 27minutes in2018. The 100-mile range of our SOLO on a full charge would more than cover such a round-trip commute. [Data Source: United StatesConsensus Bureau] Government Support There has been a growing trend for governments as a matter of public policy to favor EVs. This has taken the form of initiatives aimed at improving transit,financial incentives for the purchase of EVs and financial incentives for the manufacture of EVs. Initiatives to Improve Transit Many localities try to reduce or regulate traffic, and particularly in places where there is high population density, chronic congestion, narrow roads andlimited urban space. While these initiatives might be onerous to owners of traditional internal combustion engine vehicles, they often exempt or partiallyexclude EVs. These initiatives include various forms of congestion charging (which often exempt or provide discounts for EVs), priority lanes for high-occupancy vehicles and EVs, restrictions on new registrations of vehicles (excluding EVs) and subsidies for the installation of public charging stations forEVs. Going further than restrictions on cars fueled by petrol or diesel, several European countries and cities are formulating programs that would actually banthem. Norway’s Minister for the Environment has expressed an indication that they expect to implement a ban on the sale of cars that are not EVs by 2025.President Macron of France has expressed an indication that they will eliminate the sale of cars with internal combustion engines in France by 2040, and cityhall in Paris has expressed an indication calling for a ban on all cars with traditional combustion engines from its streets by 2030. In the United Kingdom thegovernment has announced a strategy that calls for sales of new gas and diesel cars and vans to end by 2030. Purchaser Incentives To promote the purchase of EVs, many state and local governments offer financial incentives to purchasers. These incentives can take the form of rebates,tax credits or the elimination or reduction of sales tax. Financial incentives available in selected North American jurisdictions for the purchase of EVs are setout in the following table:
				British
	U.S. Federal	California	New York		Columbia	Ontario	Quebec
Tax credit								US $7,500	—		—		—	—	—
Rebate									—	US $2,500		US $2,000 $		5,000 $		14,000 $	8,000
Although these financial incentives may not continue at this level or at all, we believe that our SOLO would currently qualify for these tax credits and rebatesin the States of California and Oregon. As of March 12, 2020, we have passed the CARB test for the State of California, and we are currently waiting for the$750 rebate to be posted on the Clean Vehicle Rebate Project website and for a $2,500 rebate from the State of Oregon.
		37


Several jurisdictions offer similar financial incentives for the purchase and installation of home charging stations for EVs. Manufacturing Incentives To promote the manufacture and development of EVs, many federal, state and local governments provide financial incentives to EV companies. Theseincentives can take the form of tax credits or grants. In 2020, we received $187,421 in a Scientific Research and Experimental Development (“SR&ED”)grant and $176,088 from the Innovation Assistance Program administered by the National Research Council. In 2019, we received $797,002 in a SR&EDgrant. In 2018, we received $559,872 in a SR&ED grant and $6,659 from Canada’s Industrial Research Assistance Program (“IRAP”) administered by theNational Research Council. In 2017, we received $149,273 from the IRAP and $85,907 in a SR&ED grant. We will continue to apply for grants where webelieve warranted. Competitive Factors The EV market is evolving and companies within it must be able to adapt without jeopardizing the timing, quality or quantity of their products. Othermanufacturers have entered the electric vehicle market and we expect additional competitors to enter this market within the next several years. As they do,we expect that we will experience significant competition. With respect to the SOLO, we face strong competition from established automobilemanufacturers, including manufacturers of EVs such as the Tesla Model 3, the Chevrolet Bolt and the Nissan Leaf. We believe the primary competitive factors in our market include but are not limited to: (i) technological innovation; (ii) product quality and safety; (iii)service options; (iv) product performance; (v) design and styling; (vi) brand perception; (vii) product price; and (viii) manufacturing efficiency. Most of our current and potential competitors have significantly greater financial, technical, manufacturing, marketing and other resources than we do andmay be able to devote greater resources to the design, development, manufacturing, distribution, promotion, sale and support of their products. Virtually allof our competitors have more extensive customer bases and broader customer and industry relationships than we do. In addition, almost all of thesecompanies have longer operating histories and greater name recognition than we do. Our competitors may be in a stronger position to respond quickly to newtechnologies and may be able to design, develop, market and sell their products more effectively. Furthermore, certain large manufacturers offer financing and leasing options on their vehicles and also have the ability to market vehicles at a substantialdiscount, provided that the vehicles are financed through their affiliated financing company. We do not currently offer any form of direct financing on ourvehicles. The lack of our direct financing options and the absence of customary vehicle discounts could put us at a competitive disadvantage. We expect competition in our industry to intensify in the future in light of increased demand for alternative fuel vehicles, continuing globalization andconsolidation in the worldwide automotive industry. Our ability to successfully compete in our industry will be fundamental to our future success in the EVmarket and our market share. We might not be able to compete successfully in our market. If our competitors introduce new cars or services that competewith or surpass the quality, price or performance of our vehicles or services, we may be unable to satisfy existing customers or attract new customers at theprices and levels that would allow us to generate attractive rates of return on our investment. Increased competition could result in price reductions andrevenue shortfalls, loss of customers and loss of market share, which could harm our business, prospects, financial condition and operating results.
	38


We believe that our experience, production capability, product offering and management give us the ability to successfully operate in the EV market in a waythat our competitors cannot. In particular, we believe that we have a number of competitive advantages:
•	Extensive in-house development capabilities: Our acquisition of InterMeccanica. in 2017 enables us to leverage InterMeccanica’s extensive 61years of experience in vehicle design, manufacture, sales and customer support. InterMeccanica was founded in Turin, Italy, in 1959, as a speedparts provider and soon began producing in-house designed, complete vehicles like the Apollo GT, Italia, Murena, Indira and the Porsche 356replica. InterMeccanica’s former owner, Henry Reisner, is our President and Chief Operating Officer and one of our directors, and, together withhis family, is the second largest shareholder in our Company. We have integrated InterMeccanica’s staff with the research and development teamthat we had prior to the acquisition to develop and enhance current and future model offerings;

	•	In-house production capabilities: We have the ability to manufacture our own products on a non-commercial scale. As at March 23, 2021, wehave produced 64 prototype SOLOs at our facilities in Vancouver, British Columbia, and 60 pre-production SOLOs with our manufacturingpartner, Zongshen;

	•	Commercial production of the SOLO commenced August 26, 2020: We have a Manufacturing Agreement with Zongshen whereby they haveagreed to produce a total of 75,000 SOLOs over a three-year period once we have started full scale production. As at December 31, 2020,Zongshen has produced 60 pre-production production vehicles and 30 production vehicles;

	•	Unique product offering: The SOLO’s manufacturer suggested retail price of US$18,500, prior to any surcharge for tariffs, is far below the retailprice of EVs offered by those who we consider to be our principal competitors; and we believe that the SOLO compares favorably against them;and

	•	Management expertise: We have selected our management with an eye towards providing us with the business and technical expertise needed tobe successful. They include Paul Rivera, our Chief Executive Officer, Bal Bhullar, our Chief Financial Officer, Henry Reisner, our President andChief Operating Officer, and Isaac Moss, our Chief Administrative Officer and Corporate Secretary. A number of these key employees andconsultants have significant experience in the automobile manufacturing and technology industries. We have supplemented additional expertiseby adding consultants and directors with corporate, accounting, legal and other strengths.
Government Regulation As a vehicle manufacturer we are required to ensure that all vehicle production meets applicable safety and environmental standards. Issuance of theNational Safety Mark (the “NSM”) by the Minister of Transport for Canada will be our authorization to manufacture vehicles in Canada for the Canadianmarket. Receipt of the NSM is contingent on us demonstrating that our vehicles are designed and manufactured to meet or exceed the applicable sections ofthe Canadian Motor Vehicle Safety Act (C.R.C. Chapter 1038) and that appropriate records are maintained. Unique to Canada, the SOLO is under the three-wheeled vehicle category and is subject to the safety standards listed in Schedule III of the Canadian Motor Vehicle Safety Regulations (“CMVSR”), whichcan be found at (http://laws-lois.justice.gc.ca/eng/regulations/C.R.C.,c.1038/section-sched3.html). For sales into the United States, we and our vehicles mustmeet the applicable parts of the U.S. Code of Federal Regulations (“CFR”) Title 49 — Transportation. This includes providing manufacture identificationinformation (49 CFR Part 566), VIN-deciphering information (49 CFR Part 565), and certifying that our vehicles meet or exceeds the applicable sections ofthe Federal Motor Vehicle Safety Standards (40 CFR Part 571) and Environmental Protection Agency noise emission standards (40 CFR 205). Since the U.S.regulations do not have a specific class for three-wheeled “autocycles”, the SOLO falls under the definition of a motorcycle pursuant to Sec. 571.3 of 49CFR Part 571. We certified the SOLO for compliance with the applicable US requirements in the first quarter of 2018. Results from third party vehicle testing at a facility inQuebec, Canada, were used for this certification. We continue to use third party facilities for certification testing to ensure that any changes to the SOLO’sdesign continue to meet safety requirements. Compliance certification of the SOLO for Canada began in 2018.
		39


Within the three-wheel vehicle classification in Canada, CMVSR Standard 305 sets out the regulation for prevention of injury to the occupant during andafter a crash as related to the vehicle’s batteries. Under this standard, the security and integrity of electric drive system components and their isolation fromthe occupant are evaluated in the course of a frontal barrier crash test in accordance with Technical Standard Document No. 305. The equivalent U.Sstandard, FMVSS No. 305, is not applicable to the motorcycle category under the U.S. regulations. We and our vehicles must meet the applicable parts of the U.S. Code of Federal Regulations Title 49 —Transportation. Since the U.S. regulations do not havea specific class for three-wheeled “autocycles”, the SOLO falls under the definition of a motorcycle pursuant to Sec. 571.3 of 49 CFR Part 571. However,currently a motorcycle license is not required to drive them in all but the States of Florida, Minnesota, New Mexico, New England, North Carolina, Indianaand Oklahoma. The State of New York and Massachusetts have pending legislation which would allow them to be driven with a driver’s license. Motorcyclehelmets must be worn while operating in the State of Massachusetts. Helmets are also required if the driver is under 18 years old in the States of Alaska,Montana, Colorado and New Hampshire. Research and Development We have allocated substantial resources in developing our first vehicles. We expended $7,854,866 during the fiscal year ended December 31, 2020, and$7,179,646 during the fiscal year ended December 31, 2019, on research and development costs which include labor and materials. InterMeccanica Business In October 2017, we acquired InterMeccanica. In addition to the manufacturing and design experience that the acquisition provided us, we acquired abusiness of custom car manufacturing. InterMeccanica, throughout its operating history, has built approximately 2,500 vehicles. We intend to continue thelegacy business of Intermeccanica, but we do not envision that it will be central to our operations, or represent a material portion of our revenue if wedevelop our business as planned, or account for a material portion of our expenses. Legal Proceedings We are not involved in, or aware of, any legal or administrative proceedings contemplated or threatened by any governmental authority or any other partythat is likely to have a material adverse effect on our business. As of the date of this Annual Report, no director, officer or affiliate is a party adverse to us inany legal proceeding or has an adverse interest to us in any legal proceeding. C. Organizational structure We have four subsidiaries: InterMeccanica, a British Columbia, Canada, corporation; EMV Automotive USA Inc., a Nevada corporation; SOLO EV LLC, aMichigan corporation; and EMV Automotive Technology (Chongqing) Inc., a PRC corporation. We own 100% of the voting and dispositive control over allof our subsidiaries. Employees As of March 17, 2021, we employed a total of 119 full-time and 18 part-time people. None of our employees are covered by a collective bargainingagreement. The breakdown of full-time employees by main category of activity is as follows:
	Number of
Activity	Employees
Engineering/R&D		62
Sales & Marketing		35
General & Administration		18
Executives		4
			40

D. Property, plant and equipment We operate from our head office located in Vancouver, Canada. We do not own any real property. We have leased the following properties:

Area

Location

(In square feet)

2020 Gross Monthly Rent

Lease Expiration Date

Use

Vancouver BC, Canada

7,235 $

9,972

CAD

October 31, 2021

Head office

New Westminster, BC, Canada

10,803 $

11,037

CAD

July 31, 2022

Development office

Studio City, CA, USA

9,600 $

30,766

USD

August 31, 2021

Sales office

Santa Monica, CA, USA

300 $

6,250

USD

November 30, 2021

Retail kiosk

Sherman Oaks, CA, USA

298 $

5,443

USD

September 30, 2023

Retail kiosk

Portland, OR, USA

200 $

9,000

USD

December 31, 2020

Retail kiosk

Scottsdale Fashion Square, AZ, USA

200 $

9,203

USD

December 31, 2020

Retail kiosk

San Diego, CA, USA

180 $

3,500

USD

January 31, 2022

Retail kiosk

Brea, CA, USA

200 $

5,909

USD

April 19, 2021

Retail kiosk

Kierland Commons, Scottsdale, AZ, USA

200 $

8,232

USD

January 31, 2021

Retail kiosk

Glendale, AZ, USA

200 $

8,272

USD

November 14, 2021

Retail kiosk

Walnut Creek, CA, USA

200 $

9,000

USD

March 31, 2021

Retail kiosk

Santa Clara, CA, USA

300 $

7,500

USD

December 31, 2021

Retail kiosk

We believe that our current facilities are adequate to meet our ongoing needs and that, if we require additional space, we will be able to obtain additionalfacilities on commercially reasonable terms.


ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS General This Annual Report should be read in conjunction with the accompanying financial statements and related notes. The discussion and analysis of the financialcondition and results of operations are based upon the financial statements, which have been prepared in accordance with International Financial ReportingStandards (“IFRS”), as adopted by the International Accounting Standards Board (“IASB”). The preparation of financial statements in conformity with these accounting principles requires us to make estimates and assumptions that affect the reportedamounts of assets and liabilities, disclosure of contingent liabilities at the financial statement date and reported amounts of revenue and expenses during thereporting period. On an on-going basis we review our estimates and assumptions. The estimates were based on historical experience and other assumptionsthat we believe to be reasonable under the circumstances. Actual results are likely to differ from those estimates or other forward-looking statements underdifferent assumptions or conditions, but we do not believe such differences will materially affect our financial position or results of operations. Our actualresults may differ materially as a result of many factors, including those set forth under “Forward-Looking Statements” and “Risk Factors” herein. Critical accounting policies, the policies we believe are most important to the presentation of our financial statements and require the most difficult,subjective and complex judgments, are outlined below under the heading “Critical Accounting Policies and Estimates”, and have not changed significantlysince our founding. Overview We were incorporated on February 16, 2015, under the laws of the Province of British Columbia, Canada, and our principal activity is the development andmanufacturing of single occupancy electric vehicles. Our head office and principal address is located at 102 East 1st Avenue, Vancouver, British Columbia,Canada, V5T 1A4. Additional information related to the Company is available on www.electrameccanica.com. Information on our website does not constitute part of thisAnnual Report. Financing Our ability to continue operations will depend on our continued ability to raise capital on acceptable terms. We incurred losses of $63,046,905 in 2020,$23,212,698 in 2019, $7,745,313 in 2018 and anticipate incurring losses in our 2021 fiscal year. We had negative operating cash flows of $22,486,630 for theyear ended December 31, 2020 and anticipate negative operating cash flows during 2021. Although we had working capital surplus of $130,755,823,including cash and cash equivalents of $129,450,676, at December 31, 2020, and anticipate deriving revenue 2021 from the sale of EVs and high-end customcars, we believe that we will need additional financing to continue operations.. If we are unable to continue to access private and public capital on terms thatare acceptable to us, we may be forced to curtail or cease operations. Market conditions, trends or events Our ability to continue operationsalso depends on market conditions outside of our control. Significant developments in alternative technologies, such asadvanced diesel, ethanol, fuel cells or compressed natural gas, or improvements in the fuel economy of the internal combustion engine, may materially andadversely affect our business and prospects. Failure to keep up with advances in electric vehicle technology would result in a decline in the Company’scompetitive position which may materially and adversely affect our business, prospects, operating results and financial condition.
	42


A. Operating Results Results of Operations for the Year ended December 31, 2020 as Compared to the Year Ended December 31, 2019 Revenues Revenue for the year ended December 31, 2020 was $568,521 (2019: $585,584). The cost of revenue was $699,455 (2019: $487,543) providing a gross lossof $130,934 (2019: gross profit $98,041) or -23.0% (2019: 16.7%).The revenue of the Company derives from sales of high-end custom build cars. Theproduction volume is decreased under the breakeven point. The Company plans to use the resource for feasibility study to add electronical components to thecurrent high-end custom build cars. The Company operates in two reportable business segments in Canada. The two reportable business segments offer different products, require different production processes and are based on how the financial information isproduced internally for the purposes of making operating decisions. The following summary describes the operations of each of the Company’s reportablebusiness segments:
•	Electric Vehicles – development and manufacture of electric vehicles for mass markets, and
	•	Custom build vehicles – development and manufacture of high-end custom built vehicles.
Sales between segments are accounted for at prices that approximate fair value. No business segments have been aggregated to form the above reportablebusiness segments. (Financial statement note 19 for the year ended December 31, 2020). Revenue for custom build vehicles is recognized when the Company has transferred control to the customer which generally occurs upon shipment. Norevenue from sales of electric vehicles is recognized because the vehicle has not been commercialized. Proceeds from these sales are incidental revenue andare not being made with expectation of profit. The following table indicates the number of vehicles produced for either delivery to customers, testing ormarketing purposes.
			Production		Customer Deliveries
				Twelve Months Ended			Twelve Months Ended
Vehicle Type						Dec. 31, 2020		Dec. 31, 2019		Dec. 31, 2020	Dec. 31, 2019
Custom build vehicles – Roadster/Speedster			7	8				7	7
Electric vehicles – Prototype made in-house			0	22				1	21
Electric vehicles – Pre-production, made by Zongshen			10	50				0	0
Electric vehicles – Production, made by Zongshen			30	0				0	0
Operating Expenses During the year ended December 31, 2020, the Company incurred a net loss of $63,046,905 compared to a net loss of $23,212,698 for the correspondingperiod in 2019. The increase in net loss between the two years resulted from an increase in an operating loss to $27,210,487 for the year ended December 31,2020, from $20,609,266 for the prior year, and an increase in the loss from other items; principally changes in the fair value of warrant derivative of$31,923,727 for the year ended December 31, 2020 from $2,228,256 for the prior year. The largest expense items in net comprehensive loss are describedbelow.
			43


General and administrative expenses. For the year ended December 31, 2020, general and administrative expenses were $8,825,317 compared to $6,101,360for the year ended December 31, 2019. The following items are included in such expenses:
•	Rent decreased to $616,968 for the year ended December 31, 2020, from $320,927 for the year ended December 31, 2019. The increase was causedby the opening of retail kiosks in the US;
	•	Office expenses increased to $1,331,356 for the year ended December 31, 2020, from $1,192,785 for the corresponding year ended December 31,2019. The increase was caused by increases in insurance costs and software subscriptions, offset by a decrease in travel expenses;
	•	Legal and professional expenses were $2,073,022 for the year ended December 31, 2020, from $1,393,004 for the corresponding year endedDecember 31, 2019. The increase in legal and professional expenses was caused by the increases in legal fees related to various capital raising,governance, employment and corporate matters, as well as increase in accounting fees and recruiting fees;
	•	Consulting expenses were $1,323,803 for the year ended December 31, 2020, compared to $1,512,126 for the corresponding year ended December31, 2019. The decrease in fees related to the use of fewer consultants for investor relations and executive advisory services;
	•	Investor relations expenses, not including the consulting fees above, increased to $316,145 for the year ended December 31, 2020, from $249,322for the corresponding year ended December 31, 2019. The increase is related to expenses incurred for a myriad of registration filings conducted bythe Company; and
	•	Salaries increased to $3,164,023 for the year ended December 31, 2020, compared to $1,433,196 for the corresponding year ended December 31,2019. The increase is related to the addition of new employees, performance increases to certain salaried employees and certain bonus costs.
Research and development expenses. Research and development expenses increased to $7,854,866 for the year ended December 31, 2020, from $7,179,646for the corresponding year ended December 31, 2019. Research and development costs relate to the electric vehicle segment as the Company continues todevelop its first electric vehicle, the SOLO. All costs related to pre-production vehicles are being expensed to research and development and SR&ED fundsare being booked to reduce the research and development expenses. During the year ended December 31, 2020, the Company received $187,421 (2019:$797,002) in SR&ED funds under the program administered by the Canada Revenue Agency. In addition, the Company received $176,088 (2019: $Nil) ingovernment grants from the Innovation Assistance Program administered by the National Research Council. Sales and marketing expenses. Sales and marketing expenses increased to $2,534,731 for the year ended December 31, 2020, from $1,314,689 for thecorresponding year ended December 31, 2019. The Company increased its sales and marketing efforts by developing brand assets, increasing presence insocial media, opening retail kiosks and rapidly growing its sales team. Stock-based compensation expense. For the year ended December 31, 2020, stock-based compensation expense was $6,260,985 (2019: $5,147,573). TheCompany issued 1,790,000 stock options with exercise prices between US$3.41 and US$3.77 per share during the year ended December 31, 2020. TheCompany also issued 507,849 restricted stock units (“RSU”s) and 44,623 deferred stock units (“DSU”s) to Company executives and directors, respectively,during the same period. In addition, the stock-based compensation charges relate to stock options issued during previous years wherein charges arerecognized over the stock option vesting period. The Company uses the Black-Scholes method of calculating the stock-based compensation expense underthe graded method. Share-based payment expense. For the year ended December 31, 2020, share-based payment expense was $Nil (2019: $159,833). These charges relate toshares issued to consultants as compensation for services performed and are valued at the market price of the Company’s share price at the time of issuance. Other Items Changes in fair values of warrant derivative. The Company incurred a loss relating to changes in the fair value of warrant derivatives of $31,923,727 (2019:$2,228,256) mainly caused the increase of our share price from $2.15 at December 31, 2019 to $6.19 at December 31, 2020, as well as the exercising of3,460,212 warrants when our share prices were between $2.63 and $10.81. Warrants priced in US dollars are classified as derivative liabilities because theCompany’s functional currency is in Canadian dollars. As a result of this difference in currencies, the proceeds that are received by the Company are notfixed and will vary based on foreign exchange rates; hence the warrants are a derivative under IFRS and are required to be recognized and measured at fairvalue at each reporting period. Any changes in fair value from period to period are recorded as a non-cash gain or loss in our consolidated statement of netloss and comprehensive loss.
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Foreign exchange loss. The Company incurred a foreign exchange loss of $4,447,387 on net working capital in the year ended December 31, 2020 (2019:$597,464) as caused by fluctuations between the US and Canadian dollar. Net Loss As a result of the above factors, we reported a net loss for the year ended December 31, 2020 of $63,046,905, compared to a net loss of $23,212,698 for thecorresponding period in 2019. Results of Operations for the year ended December 31, 2019 as Compared to the Year Ended December 31, 2018 Revenues Revenue for the year ended December 31, 2019 was $585,584 (2018: $599,757). The cost of revenue was $487,543 (2018: $443,796) providing a grossprofit of $98,041 (2018: $155,961) or 16.7% (2018: 26%). The Company operates in two reportable business segments in Canada. The two reportable business segments offer different products, require different production processes and are based on how the financial information isproduced internally for the purposes of making operating decisions. The following summary describes the operations of each of the Company’s reportablebusiness segments:

•

Electric Vehicles – development and manufacture of electric vehicles for mass markets, and

•

Custom build vehicles – development and manufacture of high-end custom built vehicles.

Sales between segments are accounted for at prices that approximate fair value. No business segments have been aggregated to form the above reportablebusiness segments. (Financial statement note 16 for the year ended December 31, 2019). Revenue recognition for custom build vehicles is based on the percentage completion method. No revenue from sales of electric vehicles is recognizedbecause the vehicle has not been commercialized. Proceeds from these sales are incidental revenue and are not being made with expectation of profit. Thefollowing table indicates the number of vehicles produced for either delivery to customers, testing or marketing purposes.

Production

Customer Deliveries

Twelve Months Ended

Vehicle Type

Dec. 31, 2019

Dec. 31, 2018

Dec. 31, 2019

Dec. 31, 2018

Custom build vehicles

Electric vehicles

Operating Expenses During the year ended December 31, 2019, the Company incurred a net loss of $23,212,698 compared to a net loss of $7,745,313 for the correspondingperiod in 2018. The increase in net loss between the two years resulted from an increase in an operating loss to $20,609,266 for the year ended December 31,2019, from $13,007,744 for the prior year, and an increase in the loss from other items; principally changes in the fair value of warrant derivative of$2,228,256 for the year ended December 31, 2019 from a gain of $5,946,668 for the prior year. The largest expense items in net comprehensive loss aredescribed below.


General and administrative expenses. For the year ended December 31, 2019, general and administrative expenses were $6,101,360 compared to $4,236,742for the year ended December 31, 2018. The following items are included in such expenses:
•	Rent decreased to $320,927 for the year ended December 31, 2019, from $376,746 for the year ended December 31, 2018. The decrease wascaused by some rent expense being reclassified as interest and depreciation expense under IFRS 16, offset by the increase of rent expense related tothe opening of our Los Angeles showroom;
	•	Office expenses increased to $1,192,785 for the year ended December 31, 2019, from $728,974 for the corresponding year ended December 31,2018. The increase was caused by increases in insurance costs for directors’ and officers’ liability and vehicle insurance, travel costs related toinvestor meetings, travel to the Company’s China electric vehicle production facility and additional office costs associated with the opening of ourshowroom in Los Angeles;
	•	Legal and professional expenses were $1,393,004 for the year ended December 31, 2019, from $1,151,069 for the corresponding year endedDecember 31, 2018. The increase in legal and professional expenses relate to the increases in accounting fees and recruiting fees;
	•	Consulting expenses were $1,512,126 for the year ended December 31, 2019, compared to $919,418 for the corresponding year ended December31, 2018. The increase in fees related to the use of additional consultants for investor relations and executive advisory services, and for directors’fees;
	•	Investor relations expenses, not including the consulting fees above, decreased to $249,322 for the year ended December 31, 2019, from $474,375for the corresponding year ended December 31, 2018. The decrease is related to a reduction in filing fees and in investor meetings and conferenceexpenses; and
	•	Salaries increased to $1,433,196 for the year ended December 31, 2019, compared to $586,160 for the corresponding year ended December 31,2018. The increase is related to the addition of new employees, performance increases to certain salaried employees and certain severance andbonus costs.
Research and development expenses. Research and development expenses increased to $7,179,646 for the year ended December 31, 2019, from $4,294,687for the corresponding year ended December 31, 2018. Research and development costs relate to the electric vehicle segment as the Company continues todevelop its first electric vehicle, the SOLO. All costs related to pre-production vehicles are being expensed to research and development and SR&ED fundsare being booked to reduce the research and development expenses. During the year ended December 31, 2019, the Company received $797,002 (2018:$559,872) in SR&ED funds under the program administered by the Canada Revenue Agency. In addition, the Company received $Nil (2018: $6,659) ingovernment grants due from the IRAP program administered by the National Research Council. We also accrued $187,421 (2018: $520,830) in SR&EDcredits which is the estimated amount we will receive after filing 2018 SR&ED claims. Sales and marketing expenses. Sales and marketing expenses increased to $1,314,689 for the year ended December 31, 2019, from $1,070,116 for thecorresponding year ended December 31, 2018. The Company increased its sales and marketing efforts by attending trade shows, by re-establishing its socialmedia presence and by increasing its staff in its Los Angeles showroom. Stock-based compensation expense. For the year ended December 31, 2019, stock-based compensation expense was $5,147,573 (2018: $2,491,078). TheCompany issued 8,755,000 stock options with exercise prices between $1.80 and $3.40 per share during the year ended December 31, 2019. In addition, thestock-based compensation charges relate to stock options issued during previous quarters wherein charges are recognized over the stock option vestingperiod. The Company uses the Black-Scholes method of calculating the stock-based compensation expense under the graded method.
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Share-based payment expense. For the year ended December 31, 2019, share-based payment expense was $159,833, (2018: $856,101). These charges relateto shares issued to consultants as compensation for services performed and are valued at the market price of the Company’s share price at the time ofissuance. Other Items Share issue costs allocated to derivative liability. The Company did not incur share issue costs related to derivative liability for the year ended December 31,2019 (2018: $1,152,408). Changes in fair values of warrant derivative. The Company incurred a loss relating to changes in the fair value of warrant derivatives of $2,228,256 (2018:gain of $5,946,668) caused by warrants priced in US dollars while the Company’s functional currency is in Canadian dollars. As a result of this difference incurrencies, the proceeds that are received by the Company are not fixed and will vary based on foreign exchange rates; hence the warrants are a derivativeunder IFRS and are required to be recognized and measured at fair value at each reporting period. Any changes in fair value from period to period arerecorded as a non-cash gain or loss in our consolidated statement of net loss and comprehensive loss. Foreign exchange loss. This totaled $597,464 on net working capital in the year ended December 31, 2019 (2018: gain of $466,885) as caused byfluctuations between the US and Canadian dollar. Net Loss As a result of the above factors, we reported a net loss for the year ended December 31, 2019 of $23,212,698, compared to a net loss of $7,745,313 for thecorresponding period in 2018. B. Liquidity and Capital Resources Liquidity The Company’s operations consist of the designing, developing and manufacturing of electric vehicles. The Company’s financial success depends upon itsability to market and sell its electric vehicles and to raise sufficient working capital to enable the Company to execute its business plan. The Company’shistorical capital needs have been met by the sale of the Company’s stock. Equity funding might not be possible at the times required by the Company. If nofunds can be raised and sales of its electric vehicles do not produce sufficient net cash flow, then the Company may require a significant curtailing ofoperations to ensure its survival or may be required to cease operations. The financial statements have been prepared on a basis which assumes that the Company will be able to realize its assets and discharge its liabilities in thenormal course of business for the foreseeable future. The Company incurred a net loss of $63,046,905 during the year ended December 31, 2020, and had acash and cash equivalents balance and a working capital surplus of $129,450,676 and $130,755,823, respectively, as at December 31, 2020. The Company’sability to meet its obligations as they fall due and to continue to operate depends on the continued financial support of its creditors and its shareholders. Inthe past the Company has relied on sales of its equity securities to meet its cash requirements. Funding from this or other sources might not be sufficient inthe future to continue its operations. Even if the Company is able to obtain new financing, it may not be on commercially reasonable terms or terms that areacceptable to it. Failure to obtain such financing on a timely basis could cause the Company to reduce or terminate its operations. As of December 31, 2020, the Company had 89,309,563 issued and outstanding shares and 117,941,282 shares on a fully-diluted basis. The Company begantrading on Nasdaq on August 9, 2018. The Company had $130,755,823 of working capital surplus as at December 31, 2020, compared to $11,942,233 of working capital surplus as at December31, 2019. The increase in working capital resulted from cash generated from financing activities of $138,927,009 (2019: $13,785,934) due to the to theissuance of 46,498,936 common shares for net cash proceeds of $127,894,718 (2019: $10,965,269) and an increase in restricted cash, offsee by cash used inoperations of $22,486,630 (2019: $16,929,823) and cash used in investing activities of $1,399,068 (2019: $2,807,103) related to the additions to property,plant and equipment.
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Capital Resources As at December 31, 2020, the Company had cash and cash equivalents of $129,450,676 (2019: $8,560,624). The Company continues to pursue additionalequity financing although there can be no guarantees given that the Company will be successful in such endeavors. In connection with the Manufacturing Agreement, on October 16, 2017, the then CEO of the Company, Jerry Kroll (the “Pledgor”), entered into a SharePledge Agreement (“Share Pledge”) to guarantee the payment by the Company for the cost of the prototype tooling and molds estimated to be CNY ¥9.5million ($1.4 million) to Zongshen through the pledge of 400,000 common shares of the Company. The Company approved its obligations under the SharePledge and had agreed to reimburse the Pledgor on a one for one basis for any pledged shares realized by Zongshen. During third quarter of 2020, theCompany has paid 100% of the cost of the prototype tooling and molds and, accordingly, the Share Pledge has been terminated. Critical Accounting Policies and Estimates The preparation of the Company’s financial statements requires management to use estimates and assumptions that affect the reported amounts of assets andliabilities as well as revenue and expenses. These are based on the best information available at the time utilizing generally accepted industry standards Significant estimates and assumptions The preparation of financial statements in accordance with IFRS requires the Company to make estimates and assumptions concerning the future. TheCompany’s management reviews these estimates and underlying assumptions on an ongoing basis, based on experience and other factors, includingexpectations of future events that are believed to be reasonable under the circumstances. Revisions to estimates are adjusted for prospectively in the period inwhich the estimates are revised. Estimates and assumptions, where there is significant risk of material adjustments to assets and liabilities in future accounting periods, include the estimatedrecoverable amount of goodwill, intangible assets and other long-lived assets, the useful lives of plant and equipment, the estimated amount of SR&ED taxcredits, fair value measurements for financial instruments and share-based payments and the recoverability and measurement of deferred tax assets. The COVID-19 outbreak brings significant uncertainty as to the potential impact on our operations, supply chains for parts and sales channels for ourproducts and on the global economy as a whole. It is currently not possible to predict how long the pandemic will last or the time that it will take foreconomic activity to return to prior levels. Therefore, the Company has not changed any estimates and assumptions in the preparation of its financialstatements. Significant judgements The preparation of financial statements in accordance with IFRS requires the Company to make judgements, apart from those involving estimates, inapplying accounting policies. The most significant judgements in applying the Company’s financial statements include:
•	the classification of financial instruments; and

	•	the calculation of income taxes require judgement in interpreting tax rules and regulations.
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Financial Instruments The Company classifies its financial instruments in the following categories: at fair value through profit or loss (“FVTPL”) or at amortized cost. TheCompany determines the classification of financial assets at initial recognition. The classification of financial assets is driven by the Company’s businessmodel for managing the financial assets and their contractual cash flow characteristics. Equity instruments that are held for trading are classified as FVTPL.For other equity instruments, on the day of acquisition the Company can make an irrevocable election (on an instrument-by-instrument basis) to designatethem as at fair value through other comprehensive income (loss) (“FVTOCI”). Financial liabilities are measured at amortized cost, unless they are required tobe measured at FVTPL (such as instruments held for trading or derivatives) or if the Company has opted to measure them at FVTPL. Financial assets and liabilities at amortized cost are initially recognized at fair value plus or minus transaction costs, respectively, and subsequently carried atamortized cost less any impairment. Financial assets and liabilities carried at FVTPL are initially recorded at fair value and transaction costs are expensed in the consolidated statements ofcomprehensive loss. Realized and unrealized gains and losses arising from changes in the fair value of the financial assets and liabilities held at FVTPL areincluded in the consolidated statements of comprehensive loss in the period in which they arise. The Company recognizes a loss allowance for expected credit losses on financial assets that are measured at amortized cost. At each reporting date, theCompany measures the loss allowance for the financial asset at an amount equal to the lifetime expected credit losses if the financial risk on the financialasset has increased significantly since initial recognition. If, at the reporting date, the financial asset has not increased significantly since initial recognition,the Company measures the loss allowance for the financial asset at an amount equal to the 12 month expected credit losses. The Company will recognize inits consolidated statements of comprehensive loss, as an impairment gain or loss, the amount of expected credit losses (or reversal) that is required to adjustthe loss allowance at the reporting date to the amount that is required to be recognized. The Company derecognizes financial assets only when the contractual rights to cash flows from the financial assets expire, or when it transfers the financialassets and substantially all of the associated risks and rewards of ownership to another entity. Gains and losses on derecognition are generally recognized inthe consolidated statements of comprehensive loss. Revenue from contracts with customers Revenue is recognized to the extent that the amount of revenue can be measured reliably and collection is probable. Part sales Sales of parts are recognized when the Company has transferred control to the customer which generally occurs upon shipment. Services, repairs and support services Services, repairs and support services are recognized in the accounting period when the services are rendered. Sales of custom build vehicles The Company manufactures and sells custom built vehicles typically on fixed fee arrangements with its customers. Revenue is recognized when theCompany has transferred control to the customer which generally occurs upon shipment.
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Sales of electric vehicles The Company started commercial production of electric powered one-seat vehicles, the SOLO, in August 2020. At this time no production vehicle has beendelivered to customers. A few prototype vehicles were sold to ‘beta’ customers who provide real-world testing and feedback on the vehicles. Proceeds ofthese sales are considered to be incidental revenue and are not being made with the expectation of profit. The revenue generated from sales are recordedagainst research and development expenses. Government grants A government grant is recognized if there is reasonable assurance that it will be received and that the Company will comply with the conditions associatedwith the grant. If the conditions are met, the Company recognizes the grant in profit or loss on a systematic basis in line with its recognition of the expensesthat the grant is intended to compensate. For grants related to income, the Company can elect to either offset the grant against the related expenditure orinclude it in other income. Government assistance received by the Company during the period has been accounted for as government grants related to incomeand have been included in other income. Share-based payments Share-based payments to employees are measured at the fair value of the instruments issued and amortized over the vesting periods. Share-based payments tonon-employees are measured at the fair value of goods or services received or the fair value of the equity instruments issued, if it is determined the fair valueof the goods or services cannot be reliably measured, and are recorded at the date the goods or services are received. The corresponding amounts arerecorded to the option reserve. The fair value of options is determined using a Black–Scholes pricing model. The number of options expected to vest isreviewed and adjusted at the end of each reporting period such that the amount recognized for services received as consideration for the equity instrumentsgranted shall be based on the number of equity instruments that eventually vest. Restricted Stock Units Restricted Stock Units (“RSU”s) are stock-based awards that may be granted by the Company to certain eligible participants pursuant to its current 2020Stock Incentive Plan (the “2020 Stock Incentive Plan”) which was ratified by Company shareholders on July 9, 2020. RSUs are accounted for as equity-settled share-based payment transactions as the obligations under an RSU will be settled through the issuance of common shares. The Company measures thecost of equity-settled share-based transactions by reference to the fair value of the equity instruments at the date at which they are granted and is recorded inthe statement of comprehensive loss over the vesting period. Deferred Stock Units Deferred Stock Units (“DSU”s) are stock-based awards that may be granted by the Company to certain eligible participants pursuant to its 2020 StockIncentive Plan. DSUs are accounted for as equity-settled share-based payment transactions as the terms of a DSU provide the Company with the choice ofwhether to settle in cash or by issuing equity instruments. The Company measures the cost of equity-settled share-based transactions by reference to the fairvalue of the equity instruments at the date at which they are granted and is recorded in the statement of comprehensive loss in the period they are granted(immediate vesting) Research and development expenses Research costs are expensed when incurred and are stated net of government grants. Development costs, including direct material, direct labor and contractservice costs, are capitalized as intangible assets when: we can demonstrate that the technical feasibility of a project has been established; when we intend tocomplete the asset for use or sale and have the ability to do so; when the asset can generate probable future economic benefits; when the technical andfinancial resources are available to complete the development; and when we can reliably measure the expenditure attributable to the intangible asset duringits development. After initial recognition, internally generated intangible assets are recorded at cost less accumulated amortization and accumulatedimpairment losses. These costs are amortized on a straight-line basis over the estimated useful life. To date the Company did not have any development coststhat met the capitalization criteria.
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Derivative Liability The Company accounts for its warrants as either equity or liabilities based upon the characteristics and provisions of each instrument. Warrants classified asequity are recorded at fair value as of the date of issuance on the Company’s consolidated balance sheets and no further adjustments to their valuation aremade. Warrants classified as derivative liabilities that require separate accounting as liabilities are recorded on the Company’s consolidated balance sheets attheir fair value on the date of issuance and will be revalued on each subsequent balance sheet date until such instruments are exercised or expire, with anychanges in the fair value between reporting periods recorded as other income or expense. Management estimates the fair value of these liabilities usingoption pricing models and assumptions that are based on the individual characteristics of the warrants or instruments on the valuation date, as well asassumptions for future financings, expected volatility, expected life, yield and risk-free interest rate. Impairment of assets The carrying amount of the Company’s long-lived assets with finite useful lives (which include plant and equipment and intangible assets) is reviewed ateach reporting date to determine whether there is any indication of impairment. If such indication exists, the recoverable amount of the asset is estimated inorder to determine the extent of the impairment loss. An impairment loss is recognized whenever the carrying amount of an asset or its cash generating unitexceeds its recoverable amount. Impairment losses are recognized in the statement of comprehensive loss. The recoverable amount of assets is the greater of an asset’s fair value less cost to sell and value in use. In assessing value in use, the estimated future cashflows are discounted to their present value using a pre-tax discount rate that reflects the current market assessments of the time value of money and the risksspecific to the asset. For an asset that does not generate cash inflows largely independent of those from other assets, the recoverable amount is determined forthe cash-generating unit to which the asset belongs. An impairment loss is only reversed if there is an indication that the impairment loss may no longer exist and there has been a change in the estimates used todetermine the recoverable amount. Any reversal of impairment cannot increase the carrying value of the asset to an amount higher than the carrying amountthat would have been determined had no impairment loss been recognized in previous years. Goodwill and other intangible assets that have an indefinite useful life are not subject to amortization and are tested annually for impairment, or morefrequently if indicators of impairment exist. Income taxes Current income tax Current income tax assets and liabilities for the current period are measured at the amount expected to be recovered from or paid to the taxation authorities.The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted, at the reporting date, in the countries where theCompany operates and generates taxable income. Current income tax relating to items recognized directly in other comprehensive income or equity isrecognized in other comprehensive income or equity and not in profit or loss. Management periodically evaluates positions taken in the tax returns withrespect to situations in which applicable tax regulations are subject to interpretation and establishes provisions where appropriate.
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Tax Credits The Company earns SR&ED tax credits with respect to its research and development expenses. The benefit of these SR&ED tax credits is recorded as areduction of research and development expenses when their recoverability is reasonably expected. The SR&ED tax credits earned while the Company was aCanadian Controlled Private Corporation are refundable to the Company and are recorded as a receivable, while the tax credits earned now that the Companyis a reporting/public company (as defined under Canadian tax laws) can be used to reduce future Canadian income taxes payable. Deferred income tax: Deferred income tax is recognized, using the asset and liability method, on temporary differences at the reporting date arising between the tax bases of assetsand liabilities and their carrying amounts for financial reporting purposes. The carrying amount of deferred income tax assets is reviewed at the end of eachreporting period and recognized only to the extent that it is probable that sufficient taxable profit will be available to allow all or part of the deferred incometax asset to be utilized. Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to the year when the asset is realizedor the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period. Deferredincome tax assets and deferred income tax liabilities are offset, if deferred income taxes relate to the same taxable entity and the same taxation authority. Change in presentation currency Effective December 31, 2020, the Company changed its presentation currency from Canadian dollars to US dollars, as significant portions of the Company’srevenues, expenses and cash flows are dominated in US dollars. The change in presentation currency is to better reflect the Company’s business activities. Prior to December 31, 2020, the Company reported its annual and quarterly consolidated financial statements in Canadian dollars. In making this change inpresentation currency, the Company followed the recommendations set out in IAS 21, the Effects of Change in Foreign Exchange Rates (“IAS 21”). Inaccordance with IAS 21, comparable financial statements to those for the year ended December 31, 2020 for years ended 2019 and 2018 have been restatedretrospectively in the new presentation currency of US dollars using the current rate method. The procedure under the current rate method is outlined as below:
•	Income Statement and Statement of Cash Flows have been translated into US dollars using average foreign currency rates prevailing for the relevantreporting periods of years ended December 31, 2020, 2019 and 2018;

•	assets and liabilities in the Statement of Financial Position have been translated into US dollars at the closing foreign currency rates on the relevantreporting dates as of December 31, 2020 and 2019;

•	the equity section of the Statement of Financial Position, including foreign currency translation reserve, retained earnings, share capital and theother reserves, have been translated into US dollars using historical rates; and

•	earnings per share has also been restated to US dollars to reflect the change in presentation currency.
All resulting exchange differences arising from the translation are included as separate component of other comprehensive income.
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C. Research and Development, Patents and Licenses, etc. The following table specifies the amounts spent on research and development for the fiscal years ended December 31, 2020, 2019 and 2018:
		Year Ended		Year Ended	Year Ended
							December 31,		December 31,		December 31,
							2020		2019		2018
Labor	$					5,471,136 $	4,403,038 $	2,763,805
Materials	$					2,383,730 $	3,253,593 $	2,618,226
Government grants	$		- $				(476,985) $	(1,087,344)
Total	$					7,854,866 $	7,179,646 $	4,294,687
D. Trend Information Due to our short operating history, except as noted below, we are not aware of any trends that have or are reasonably likely to have a current or future effecton our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources thatis material to investors. Potential Impact of the COVID-19 Pandemic In December 2019, a strain of novel coronavirus (now commonly known as COVID-19) was reported to have surfaced in Wuhan, China. COVID-19 hassince spread rapidly throughout many countries, and, on March 12, 2020, the World Health Organization declared COVID-19 to be a pandemic. In an effortto contain and mitigate the spread of COVID-19, many countries, including the United States, Canada and China, have imposed unprecedented restrictionson travel, and there have been business closures and a substantial reduction in economic activity in countries that have had significant outbreaks of COVID-19. Our manufacturing partner, Zongshen, reports that its operations have not been materially affected at this point, and we anticipate that Zongshenremained on track and began production of the SOLOs on August 26, 2020. However, significant uncertainty remains as to the potential impact of theCOVID-19 pandemic on our and Zongshen’s operations, and on the global economy as a whole. It is currently not possible to predict how long the pandemicwill last or the time that it will take for economic activity to return to prior levels. We do not yet know the full extent of any impact on our business or ouroperations, however, we will continue to monitor the COVID-19 situation closely, and intend to follow health and safety guidelines as they evolve. E. Off-Balance Sheet Arrangements As of December 31, 2020, we did not have any off-balance sheet debt nor did we have any transactions, arrangements, obligations (including contingentobligations) or other relationships with any unconsolidated entities or other persons that may have material current or future effect on financial conditions,changes in the financial conditions, results of operations, liquidity, capital expenditures, capital resources or significant components of revenue or expenses. F. Tabular Disclosure of Contractual Obligations The Company adopted IFRS 16 on January 1, 2019, resulting in an increase of $1.60 million in total assets and total liabilities each for recognition of right-of-use assets and lease liabilities, respectively. The following table provides the contractual obligations:
	Within one		Between one				More than five
											year				and five years	years	Total
At December 31, 2020										576,232		373,889	125,652	1,075,773
At December 31, 2019										466,679		468,465	194,105	1,129,249
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G. Safe Harbor Not applicable. ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES A. Directors and Senior Management Name, Province/State and Country of Residence
	Age	Position		Director/Officer Since
Michael Paul Rivera, Arizona, U.S.			53	Chief Executive Officer and a director			August 12, 2019
Henry Reisner(1), British Columbia, Canada			57	President, Chief Operating Officer and a director			February 16, 2015
Bal Bhullar(2), British Columbia, Canada			51	Chief Financial Officer, Secretary and a director			November 19, 2018
Steven Sanders(3)(5), New York, U.S.			75	Chairman and a director			March 16, 2018
Jerry Kroll(4), British Columbia, Canada			61	Director			February 16, 2015
Luisa Ingargiola(5), Florida, U.S.			52	Director			March 16, 2018
Joanne Yan(5), British Columbia, Canada			62	Director			March 6, 2019
Peter Savagian(5), California, U.S.			60	Director			October 17, 2019
Isaac Moss, British Columbia, Canada			68	Chief Administrative Officer and Corporate Secretary			May 15, 2018
Notes:(1)
					Mr. Reisner was appointed as President and Chief Operating Officer of our Company on May 15, 2018.
(2)					Ms. Bhullar was appointed as Chief Financial Officer of our Company on November 19, 2018, and as a director of our Company on December 6,2019.
(3)					Mr. Sanders was appointed Chairman of our Company on October 20, 2018.
(4)					Mr. Kroll was appointed President, Chief Executive Officer and a director of our Company effective February 16, 2015. Mr. Kroll resigned from hisposition as President on May 15, 2018 and as Chairman on October 20, 2018. Mr. Kroll resigned as Chief Executive Officer on August 12, 2019.
(5)					Members of the Company’s Audit Committee, the Nominating and Corporate Governance Committee, the Corporate Disclosure and.or theCompensation Committee.
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Business Experience The following summarizes the occupation and business experience during the past five years or more for our directors and executive officers as of the date ofthis Annual Report: Michael Paul Rivera, Chief Executive Officer and a director Michael Paul Rivera joined ElectraMeccanica as Chief Executive Officer in August 2019. Before joining ElectraMeccanica, Mr. Rivera most recently servedas President of Ricardo, USA, a division of Ricardo, PLC (LON: RCDO), a 100-year-old global engineering, strategic and environmental consultancybusiness with a value chain that includes the design, engineering, testing and product launch, of vehicle systems, as well as the niche manufacture of highperformance products. Previous to that, as Executive VP of Hybrid & Electric Systems at Ricardo, Mr. Rivera led the company’s evolution towards an efficient and sustainable lowcarbon future. Ricardo’s engineering and design solutions have had a significant impact on technical developments throughout the auto sector, providinginnovative solutions across engines, drivelines and hybrid systems, as well as supporting the development of emerging technologies such as autonomous andconnected vehicles. Mr. Rivera brings more than two decades of experience in technical consulting, engineering services, general management and global business developmenttogether with a deep understanding of engineering in the automotive, transport and energy industries to ElectraMeccanica. Henry Reisner, President, Chief Operating Officer and a director Henry Reisner is the current President of InterMeccanica, a subsidiary of our Company, which is an automobile manufacturer, and has held this positionsince 2001. He is experienced in the automotive industry and has a background in manufacturing. Mr. Reisner holds a Bachelor of Arts degree in political science from the University of British Columbia from 1989. Bal Bhullar, Chief Financial Officer and a director Bal Bhullar brings over 25 years of diversified business, financial and risk management experience as an executive and/or as a board member in both publicand private companies, which includes such industries as technology, manufacturing, automotive, e-commerce, blockchain, resource, marine, energy,transport and health/wellness. Among some of the her areas of experience, Ms. Bhullar brings to our Company strong banking relationships, increasing market capitalization, raisingcapital, corporate governance, ESG, diversity as well as financial and strategic planning, initial public offerings, reverse take overs, operational and riskmanagement, regulatory compliance reporting, investor relations, marketing, business expansion, start-up operations, financial modeling, programdevelopment, product development, corporate financing, internal controls, SOX compliance and ERP. Previously, Ms. Bhullar has held various positions including President of BC Risk Management Association, and has held positions as a board member andChief Financial Officer of several private and public companies. Ms. Bhullar currently holds the following positions: Chief Financial Officer/board directorof ElectraMeccanica; Chief Executive Officer/Founder/board member of KISMET Nutrients/American e-Commerce Solutions LLC; Chief ExecutiveOfficer/Founder/board member of BKB Management Ltd.; and former Chief Financial Officer/board member and now an Advisory Board member ofEnertopia Corp. OTCQB:ENRT. Ms. Bhullar is a Chartered Professional Accountant, Certified General Accountant and a CRM designation from Simon Fraser University and has a diplomain Financial Management from the British Columbia Institute of Technology. Steven Sanders, Chairman and a director Since January 2017, Steven Sanders has been Of Counsel to the law firm of Ortoli Rosenstadt LLP. From July 2007 until January 2017, Mr. Sanders was aSenior Partner of Ortoli Rosenstadt LLP. From January 1, 2004 until June 30, 2007, he was Of Counsel to the law firm of Rubin, Bailin, Ortoli, LLP. FromJanuary 1, 2001 to December 31, 2003, Mr. Sanders was counsel to the law firm of Spitzer & Feldman PC. Mr. Sanders also serves as a director of HelijetInternational, Inc. Additionally, Mr. Sanders has been a director at the American Academy of Dramatic Arts since October 2013 and has been a director ofthe Bay Street Theater since February 2015. Mr. Sanders received his JD from Cornell University and his BBA from The City College of New York.
	55


Jerry Kroll, a director Jerry Kroll has an extensive background working in small businesses and start-ups. Mr. Kroll’s career began when he managed the production, strategicplanning and sales operations of Kroll Greenhouses, his family’s business. From there, Mr. Kroll served in other management roles in the floral and foodservices industries, overseeing the import/export of floral products, managing employees, managing food franchises and establishing supplier/distributorrelationships. In 1996 Mr. Kroll became involved in air racing as the owner of Vancouver International Air Races and Airshow, which featured large scale events attractingover 15,000 spectators and 31 corporate sponsors. From then on Mr. Kroll became increasingly involved in air racing and motor races. In 2007 Mr. Kroll founded KleenSpeed Technologies, a firm focused on stationary energy storage products. Mr. Kroll began researching and developing anEV for the everyday commuter. As an entrepreneur, Mr. Kroll also founded Ascend Sportmanagement Inc., a sports property and technology managementfirm. Mr. Kroll’s experience and skillset in innovative technology and start-ups, coupled with his passion for clean technology developments, allows Mr. Kroll tocoordinate, manage and execute strategies for our Company. Mr. Kroll is also actively involved in the Vancouver venture capital community and has been a member of the Vancouver Angel Technology Network, aninvesting and mentoring network for new technology start-ups, since 2003. From February 2013 to February 2015, Mr. Kroll was the President and CEO ofAscend Sportsmanagement Inc. Luisa Ingargiola, a director Luisa Ingargiola is our Director and Audit Chair. Ms Ingargiola has significant experience previously serving as Chief Financial Officer or Audit Chair forpublic companies. She currently serves as Director and Audit Chair for several public companies including AgEagle (NYSE:UAVS) and ProgressAcquisition Corporation (NASDAQ:PGRWU). She also currently serves as Director of Siyata Mobile (NASDAQ:SYTA) and serves as a Director of VisionMarine Technologies, Inc. (NASDAQ:VMAR). In addition, from 2017 to the present, she has served as Chief Financial Officer for Avalon GloboCare(NASDAQ:AVCO). From 2007 through 2016, Ms. Ingargiola served as the Chief Financial Officer and then Director at MagneGas Corporation(NASDAQ:MNGA). Prior to 2007, Ms. Ingargiola held various roles as Budget Director and Investment Analyst in several private companies. Ms.Ingargiola graduated in 1989 from Boston University with a Bachelor’s degree in Business Administration and a concentration in Finance. In 1996, shereceived her MBA in Health Administration from the University of South Florida. Ms. Ingargiola is qualified to serve as Audit Chair Officer because of herextensive knowledge in corporate governance, regulatory oversight, executive leadership and knowledge of, and experience in, financing and M&Atransactions. Joanne Yan, a director Joanne Yan has 25 years of experience in advising and managing both publicly traded and private companies and has been active in the cross-borderinvestment and mergers and acquisition space. Ms. Yan serves as the President of Joyco Consulting Services, which she founded in 1994 to provideconsulting services in the areas of corporate structuring, business development and strategic planning initiatives. Ms. Yan was a senior corporate executive and consultant to a number of public companies between 1997 and 2016. Ms. Yan has also been a director andchair of board committees with several publicly traded companies and private companies in Canada, including: (i) the Zongshen Group, our strategicmanufacturing partner, and three of its subsidiaries; (ii) the Toronto Stock Exchange-listed Hanwei Energy Services Corp.; (iii) Alphanco Venture Corp; and(iv) Evermount Venture Inc which are capital pool companies and in the process of completing their qualifying transactions.
	56


Peter Savagian, a director Peter Savagian is a pioneer in automotive electrification, with a broad spectrum of expertise in the technology, development, launch and production ofelectric vehicles. In 1990 Mr. Savagian began work on the General Motors EV1, the first modern electric vehicle, and was named Chief Engineer of ElectricPropulsion Systems in 1998. Later, as General Director of Electrified Propulsion, Mr. Savagian built and led multiple teams to innovate, engineer andexecute the full range of electrified vehicle propulsion systems. Mr. Savagian’s accomplishments at General Motors include 13 electrified autos brought toproduction. Notably, these include the first modern electric vehicle, the GM EV1, the first plug-in hybrid, the Chevy Volt, and the industry’s first long-rangevalue EV, the Chevy Bolt. Mr. Savagian is presently Chief Technology Officer of Canoo, a EV company focused on Mobility Productivity vehicles. Prior to that, he was Senior VP ofEngineering at Ampaire, an electric aircraft startup company focused on short-haul, fixed-wing electric aircraft, and Faraday Future, a luxury EV company.Mr. Savagian holds 45 patents and has authored 17 technical publications in the field of electrification. Mr. Savagian holds a BS in Mechanical Engineeringfrom the University of Wisconsin, an MS in Operations Research Engineering from the University of Southern California and an MBA from DukeUniversity. Isaac Moss, Chief Administrative Officer and Corporate Secretary Isaac Moss has 27 years of international multi-jurisdictional business, investment banking and corporate finance experience ranging across diverse industrysectors from media, forests products, hospitality, telecommunications, bio technology and green energy. Mr. Moss is experienced in scaling and managingbusinesses from start up through operations phase. He has held senior executive positions including President of a European specialty chemical company,Chief Financial Officer of a green energy company, Chief Operating Officer of a software company and Senior Vice-President of a mining company. He is agraduate of the University of Cape Town with a Bachelor of Social Science and Masters Degree in Public Administration. Mr. Moss also studied music, is anaccomplished pianist and serves as an ambassador for the University of British Columbia’s School of Music. Family Relationships There are no family relationships among any of our directors and executive officers. Term of Office Each director of our Company is to serve for a term of one year ending on the date of the subsequent annual meeting of stockholders following the annualmeeting at which such director was elected. Notwithstanding the foregoing, each director is to serve until his successor is elected and qualified or until hisdeath, resignation or removal. Our Board of Directors appoints our officers and each officer is to serve until his successor is appointed and qualified or untilhis or her death, resignation or removal. Involvement in Certain Legal Proceedings During the past ten years, none of our directors or executive officers have been the subject of the following events:
1. a petition under the Federal bankruptcy laws or any state insolvency law was filed by or against, or a receiver, fiscal agent or similar officer was
	appointed by a court for the business or property of such person, or any partnership in which he was a general partner at or within two years beforethe time of such filing, or any corporation or business association of which he was an executive officer at or within two years before the time ofsuch filing;
		57



2. convicted in a criminal proceeding or is a named subject of a pending criminal proceeding (excluding traffic violations and other minor offenses);

3. the subject of any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently
	or temporarily enjoining him from, or otherwise limiting, the following activities:

	(a) acting as a futures commission merchant, introducing broker, commodity trading advisor, commodity pool operator, floor broker, leverage
	transaction merchant, any other person regulated by the Commodity Futures Trading Commission, or an associated person of any of theforegoing, or as an investment adviser, underwriter, broker or dealer in securities, or as an affiliated person, director or employee of anyinvestment company, bank, savings and loan association or insurance company, or engaging in or continuing any conduct or practice inconnection with such activity;

	(b) engaging in any type of business practice; or

	(c) engaging in any activity in connection with the purchase or sale of any security or commodity or in connection with any violation of Federal or
	State securities laws or Federal commodities laws;

4. the subject of any order, judgment or decree, not subsequently reversed, suspended or vacated, of any Federal or State authority barring, suspending
	or otherwise limiting for more than 60 days the right of such person to engage in any activity described in paragraph 3.i in the preceding paragraphor to be associated with persons engaged in any such activity;

5. was found by a court of competent jurisdiction in a civil action or by the SEC to have violated any Federal or State securities law, and the judgment
	in such civil action or finding by the SEC has not been subsequently reversed, suspended, or vacated;

6. was found by a court of competent jurisdiction in a civil action or by the Commodity Futures Trading Commission to have violated any Federal
	commodities law, and the judgment in such civil action or finding by the Commodity Futures Trading Commission has not been subsequentlyreversed, suspended or vacated;

7. was the subject of, or a party to, any Federal or State judicial or administrative order, judgment, decree, or finding, not subsequently reversed,
	suspended or vacated, relating to an alleged violation of:

	(a) any Federal or State securities or commodities law or regulation;

	(b) any law or regulation respecting financial institutions or insurance companies including, but not limited to, a temporary or permanent
	injunction, order of disgorgement or restitution, civil money penalty or temporary or permanent cease-and-desist order, or removal orprohibition order, or

	(c) any law or regulation prohibiting mail or wire fraud or fraud in connection with any business entity; or

8. was the subject of, or a party to, any sanction or order, not subsequently reversed, suspended or vacated, of any self-regulatory organization (as
	defined in Section 3(a)(26) of the Exchange Act (15 U.S.C. 78c(a)(26))), any registered entity (as defined in Section 1(a)(29) of the CommodityExchange Act (7 U.S.C. 1(a)(29))), or any equivalent exchange, association, entity or organization that has disciplinary authority over its membersor persons associated with a member.
		58


Director Independence Our Board of Directors has determined that the following directors are “independent” as such directors do not have a direct or indirect material relationshipwith our Company. A material relationship is a relationship which could, in the view of our Board of Directors, be reasonably expected to interfere with theexercise of a director’s independent judgment.
•	Steven Sanders;

•	Luisa Ingargiola;

•	Joanne Yan; and

•	Peter Savagian.
Code of Business Conduct and Ethics On April 16, 2020, our Board of Directors adopted a new Code of Business Conduct and Ethics which complies with the definition of a “code of ethics” setout in Section 406(c) of the Sarbanes-Oxley Act of 2002, and any regulations promulgated thereunder by the SEC and also provides for an enforcementmechanism as required by Nasdaq Listing Rule 5610. The Code of Business Conduct and Ethics applies to the Company’s CEO and CFO and all otheremployees of the Company and the Board of Directors is responsible for monitoring compliance with the Code of Business Conduct and Ethics. A copy of the complete text of the Code of Business Conduct and Ethics was filed as Exhibit 99.4 to the Company’s Form 6-K filed with the SEC onEDGAR on April 27, 2020, which Form 6-K was also filed on SEDAR on the same date as a “material document”, and a copy can also be viewed on theCompany’s website at https://investors.electrameccanica.com/governance-docs. B. Compensation Compensation Discussion and Analysis This section sets out the objectives of our Company’s executive compensation arrangements, our Company’s executive compensation philosophy and theapplication of this philosophy to our Company’s executive compensation arrangements. It also provides an analysis of the compensation design, and thedecisions that the Board of Directors made in fiscal 2020 with respect to its Named Executive Officers (as herein defined). When determining thecompensation arrangements for the Named Executive Officers, our Compensation Committee considers the objectives of: (i) retaining an executive critical tothe success of the Company and the enhancement of shareholder value; (ii) providing fair and competitive compensation; (iii) balancing the interests ofmanagement and our Company’s shareholders; and (iv) rewarding performance, both on an individual basis and with respect to the business in general. Benchmarking Our Board of Directors established a Compensation Committee in March o2018. Prior to that, our Board of Directors acted as the Compensation Committee. The Compensation Committee will consider a variety of factors when designing and establishing, reviewing and making recommendations for executivecompensation arrangements for all our executive officers. The Compensation Committee does not intend to position executive pay to reflect a singlepercentile within the industry for each executive. Rather, in determining the compensation level for each executive, the Compensation Committee will lookat factors such as the relative complexity of the executive’s role within the organization, the executive’s performance and potential for future advancementand pay equity considerations.
		59


Elements of Compensation The compensation paid to Named Executive Officers in any year consists of two primary components:
	(a)	base salary; and

	(b)	long-term incentives in the form of stock options (the “Options”) granted under our 2020 Stock Incentive Plan and RSU awards s.
The key features of these two primary components of compensation are discussed below: Base Salary Base salary recognizes the value of an individual to our Company based on his or her role, skill, performance, contributions, leadership and potential. It iscritical in attracting and retaining executive talent in the markets in which the Company competes for talent. Base salaries for the Named Executive Officersare intended to be reviewed annually. Any change in base salary of a Named Executive Officer is generally determined by an assessment of such executive’sperformance, a consideration of competitive compensation levels in companies similar to the Company (in particular, companies in the EV industry) and areview of the performance of the Company as a whole and the role such executive officer played in such corporate performance. Stock Option and RSU Awards The Company provides long-term incentives to Named Executive Officers in the form of Options and RSUs as part of its overall executive compensationstrategy. Our Compensation Committee believes that Option grants and RSU awards serve the Company’s executive compensation philosophy in severalways: firstly, it helps attract, retain and motivate talent; secondly, it aligns the interests of the Named Executive Officers with those of the shareholders bylinking a specific portion of the officer’s total pay opportunity to the share price; and finally, it provides long-term accountability for Named ExecutiveOfficers. Risks Associated with Compensation Policies and Practices The oversight and administration of the Company’s executive compensation program requires the Compensation Committee to consider risks associated withthe Company’s compensation policies and practices. Potential risks associated with compensation policies and compensation awards are considered at annualreviews and also throughout the year whenever it is deemed necessary by the Compensation Committee. The Company’s executive compensation policies and practices are intended to align management incentives with the long-term interests of the Company andits shareholders. In each case, the Company seeks an appropriate balance of risk and reward. Practices that are designed to avoid inappropriate or excessiverisks include: (i) financial controls that provide limits and authorities in areas such as capital and operating expenditures to mitigate risk taking that couldaffect compensation; (ii) balancing base salary and variable compensation elements; and (iii) spreading compensation across short and long-term programs. Compensation Committee Our Compensation Committee consists of Steven Sanders, Luisa Ingargiola, Peter Savagian and Joanne Yan and is chaired by Peter Savagian. Each of theCompensation Committee members satisfies the “independence” requirements of Rule 5605(a)(2) of the Listing Rules of Nasdaq. Our CompensationCommittee will assist the Board of Directors in reviewing and approving the compensation structure, including all forms of compensation, relating to ourdirectors and executive officers. No officer may be present at any committee meeting during which such officer’s compensation is deliberated upon.
			60


The Compensation Committee’s responsibility is to formulate and make recommendations to our Board of Directors in respect of compensation issuesrelating to our directors and executive officers. Without limiting the generality of the foregoing, the Compensation Committee has the following duties:
(a) to review the compensation philosophy and remuneration policy for our executive officers and to recommend to our directors changes to improve
	our ability to recruit, retain and motivate executive officers;

(b) to review and recommend to the Board of Directors the retainer and fees, if any, to be paid to our directors;

(c) to review and approve corporate goals and objectives relevant to the compensation of the Chief Executive Officer (the “CEO”), evaluate the CEO’s
	performance in light of those corporate goals and objectives, and determine (or make recommendations to our directors with respect to) the CEO’scompensation level based on such evaluation;

(d) to recommend to our directors with respect to non-CEO officer and director compensation including reviewing management’s recommendations for
	proposed Options and other incentive-compensation plans and equity-based plans, if any, for non-CEO officer and director compensation, and makerecommendations in respect thereof to our directors;

(e) to administer the 2020 Stock Incentive Plan approved by our directors in accordance with its terms. including the recommendation to our directors
	of the grant of Options and RSU awards in accordance with the terms thereof; and

(f) to determine and recommend for the approval of our directors’ bonuses to be paid to our executive officers and employees and to establish targets or
	criteria for the payment of such bonuses, if appropriate. Pursuant to the mandate and terms of reference of the Compensation Committee, meetingsof the Compensation Committee are to take place at least once per year and at such other times as the Chair of the Compensation Committee maydetermine.
Appointment of GGA Since March of 2020, consistent with good governance practices, our Compensation Committee has now retained an independent compensation advisor toprovide advice on the structure and levels of compensation for our executive officers and directors and to undertake a comprehensive review of our incentiveplans. In Fiscal 2020, the Compensation Committee retained Global Governance Advisors (“GGA”) to provide independent compensation advice to theCompensation Committee and to the Board of Directors. GGA is an internationally recognized, independent advisory firm that provides counsel to boards ofdirectors on matters relating to executive compensation and governance. GGA is now retained to continually review the compensation levels for theCompany’s executive officers and directors and short and long-term incentive plans, and to evaluate and make recommendations on the Company’s overallexecutive and director compensation philosophy, objectives and approach. GGA’s services in Fiscal 2020 included:
•	compensation philosophy validation;

•	peer group review and development;

•	executive compensation review for our Chief Executive Officer, Chief Financial Officer, Chief Operating Officer and Chief Administrative Officer;
		61



•	short-term incentive plan design and performance metric criteria review;

•	long-term incentive plan review including:

•	performance based restricted stock unit design and long-term incentive plan mix evaluation; and

•	non-employee director compensation review; and

•	review of compensation discussion and analysis in the Company’s proxy statement.
Fees paid for GGA’s services for the last fiscal years were CAD$30,000. The Compensation Committee reviews all fees and the terms of consulting services provided by GGA. Overview of Executive Compensation Program In Fiscal 2020, with the recommendations put forth by GGA (the “GGA Recommendations”), the Compensation Committee maintained the followinggeneral principles in determining its executive and non-employee director total compensation plans. The Company recognizes that people are our primary asset and our principal source of competitive advantage. In order to recruit, motivate and retain themost qualified individuals as senior executive officers, the Company strives to maintain an executive compensation program that is competitive in theautomotive and electric car industry, which is a competitive, global labor market. The Compensation Committee’s compensation objective is designed to attract and retain the best available talent while efficiently utilizing availableresources. The Compensation Committee compensates executive management primarily through base compensation and variable at risk annual incentive andequity based compensation. The executive compensation plan is designed to be competitive with comparable companies, and to align management’scompensation with the long-term interests of stockholders. In determining executive management’s compensation, the Compensation Committee also takesinto consideration the financial condition of the Company and discussions with the executive in each instance. In order to accomplish our goals and to ensure that the Company’s executive compensation program is consistent with its direction and business strategy, thecompensation program for our senior executive officers is based on the following objectives:
•	to attract, motivate, retain and reward a knowledgeable and driven management team and to encourage them to attain and exceed performanceexpectations within a calculated risk framework; and

•	to reward each executive based on individual and corporate performance and to incentivize such executives to drive the organization’s currentgrowth and sustainability objectives.
The following key principles guide the Company’s overall compensation philosophy:
•	compensation is designed to align executives to the critical business issues facing the Company;

•	compensation should be fair and reasonable to stockholders and be set with reference to the local market and similar positions of comparablecompanies;

•	a substantial portion of total compensation is at-risk and linked to individual efforts, as well as divisional and corporate performance. This ensuresthe link between executive pay and business performance;
		62



•	an appropriate portion of total compensation should be equity-based, aligning the interests of executives with stockholders; and

•	compensation should be transparent to the Board of Directors, executives and stockholders.
Benchmarking Compensation and Primary Peer Group In Fiscal 2020 the Compensation Committee commissioned a peer group review from GGA as part of a more holistic executive and non-employee directorcompensation review, in order to address changes in the external market and to ensure that the Company continued to benchmark executive compensationwith appropriate market comparators. The Compensation Committee considered the complexity of the Company and the range of size of several of theappropriate comparable companies and, with the GGA Recommendations provided to them, established a revised peer group to better reflect the Company’scurrent business. The peer group was developed using a combination of criteria including company size, industry, business practices, geography and stockexchange to qualify each organization. More specifically the peer group met some or most of the following parameters:
•	companies of similar size to ElectraMeccanica (0.25x to 4x), primarily from a R&D expenditure perspective, but also taking into account otherfactors such as market capitalization, total assets and revenue;

•	companies who belong to similar industry segments as ElectraMeccanica (i.e. automobile, electronic components, health care equipment or othercomplex engineering-related segments which integrate both software and hardware);

•	companies with a similar business strategy and scope of operations to ElectraMeccanica; and

•	publicly traded companies on major U.S. or Canadian exchanges.
In Fiscal 2020, with the GGA Recommendations, the resulting companies created the peer group: AgJunction Inc., Airgain Inc.; Arcimoto Inc.; BaylinTechnologies Inc.; Bionano Genomics Inc.; Data I/O Corporation; electroCore Inc.; Frequency Electronics Inc.; MicroVision Inc.; PowerFleet Inc.; ReWalkRobotics Ltd.; Sensus Healthcare Inc.; Westell Technologies Inc.; Wireless Telecom Group Inc.; and Workhorse Group Inc. At the time of the peer groupselection, ElectraMeccanica’s market cap was positioned at the 53rd percentile of the peer group, and the R&D expenditure was also at the 53rd percentile. In Fiscal 2020, with the GGA Recommendations, our compensation philosophy aimed to align both our executive and Board of Director compensationaround the median of our peer group. Compensation Elements and Rationale There are three basic components to the Company’s executive compensation program: base compensation; short-term incentive awards; and long-termincentive equity compensation. Base Compensation Base compensation is the foundation of the compensation program and is intended to compensate competitively relative to comparable companies within ourindustry and the marketplace where we compete for talent. Base compensation is a fixed component of the compensation program and is used as the base todetermine elements of incentive compensation and benefits.
		63


Short-Term Incentive Awards Our short-term incentive plan (the “STIP”) is a variable component of compensation and has the objective of motivating the executive officers to achievepre-determined objectives over a one-year period and to provide a means to reward the achievement of corporate milestones and fulfillment of the annualbusiness plan. Historically, the amount of the short-term incentive awards paid to the Company’s executive officers was determined by the Company’s CompensationCommittee on a discretionary basis, given the Company’s stage of development and its transitional stage of growth, based on the expected benefits to theCompany for meeting its performance targets, the Company’s available resources and market conditions. As of our fiscal year ended December 31, 2020, with the GGA Recommendations, the Compensation Committee established guidelines for the amount ofannual short-term incentive awards payable to the executives as a percentage of an executive’s base compensation for specific performance targets and levelsachieve. GGA recommended that the Board of Directors adopt a balanced scorecard that supports a payout curve ranging from 50% of target for thresholdperformance, 100% of target and a 150% of target for maximum performance to eligible executives. In Fiscal 2020, the Compensation Committee approved the following guidelines for the opportunity of annual incentive awards to the executives, based on aselection of financial, operating:
•	in addition to the performance metrics used to evaluate the executive officer’s annual incentive, the payment of annual incentive awards shall besubject to a determination by the Board of Directors that the Company maintains sufficient cash on hand to meet the Company’s financialobligations as determined on the date of payment; and

•	annual incentive awards shall be subject to a provision for recovery or “clawback” if a payment is subsequently determined by the Board ofDirectors to have been based on materially inaccurate financial statements or materially inaccurate performance criteria.
The Compensation Committee determined that it would continue evaluating and evolving the short-term incentive program design against best marketpractices as the Company experiences further growth. In Fiscal 2020, short-term incentive awards were paid to the executive officers for performance meeting or exceeding target performance levels in the formof cash bonuses as more particularly described in the “Summary Compensation Table” below. Long-Term Incentive (Equity) The Company’s long-term incentive program provides for, among other awards, the granting of Options and RSUs to executive officers to both motivateexecutive performance and retention, as well as to align executive officer performance to shareholder value creation. In awarding long-term incentives, theCompany compares its long-term incentive program to that of comparable companies within our industry and evaluates such factors as the number of sharesavailable for awards under the Company’s 2020 Stock Incentive Plan, as ratified by the stockholders of the Company on July 9, 2020 (again, the “2020 StockIncentive Plan”), and the number of awards outstanding relative to the number of shares outstanding. Each long-term incentive grant is based on the level of the position held and overall market competitiveness. The Compensation Committee takes intoconsideration previous grants when it considers new grants of Options and RSUs. The Board of Directors administers the granting of equity awards inaccordance with the 2020 Stock Incentive Plan. In fiscal 2020 the Compensation Committee reviewed the market prevalence of long-term equity incentive plans within the Company’s primary peer group.The Compensation Committee determined that granting Options and RSUs were the most appropriate form of long-term equity incentive to award in fiscal2020 due to market practice. In fiscal 2020, the Compensation Committee considered the advice of GGA and the recommendations issued by leading independent proxy advisors anddetermined that it would implement a performance based long-term incentive award structure based on best market practice to more closely align pay withfuture performance.
		64

Summary Compensation Table The following table sets forth all annual and long-term compensation for services in all capacities to the Company during the fiscal periods indicated inrespect of the executive officers set out below (the “Named Executive Officers”) and includes amounts paid to affiliates of the Named Executive Officers forservices provided by the Named Executive Officers:

Long-

Share-

Equity

Annual

term

based

Incentive

Pension

All Other

Total

Named Executive Officerand Principal Position

Salary

Awards

Plan

Value

Compensation

Year

($)

($)(1)

($)

Michael Paul Rivera(2),

2020 331,597

Nil

719,999 277,500

Nil

11,400

Nil

1,340,496

Chief Executive Officer

2019 117,688

Nil 2,821,276

38,904

Nil

2,977,868

2018

n/a

Bal Bhullar(3),

2020 238,935

Nil

351,000 108,000

Nil

2,704

700,639

Chief Financial Officer

2019 148,350

Nil 1,726,814

27,156

Nil

2,716

1,905,036

2018

15,432

Nil

347

15,779

Isaac Moss(4),

2020 223,101

Nil

338,001 104,000

Nil

665,102

Chief Administrative Officerand Corporate Secretary

2019 176,011

Nil 1,049,567

18,858

Nil

1,244,436

2018

73,043

Nil

159,760

Nil

232,803

Henry Reisner(5),

2020 209,605

Nil

338,001 141,559

Nil

689,165

President and ChiefOperating Officer

2019 135,778

Nil

135,778

2018

97,762

Nil

30,424

Nil

128,186

Jerry Kroll(6),

2020 131,457

n/a

131,457

former President and ChiefExecutive Officer

2019 226,297

Nil

226,297

2018 108,024

Nil

95,467

Nil

203,491

Iain Ball(7),

2020

n/a

former Vice-President,Finance

2019

67,889

Nil

287,034

Nil

354,923

2018

54,012

Nil

23,099

Nil

77,111

Ed Theobald (8),

2020

n/a

former General ManagerSales and Dealerships

2019

24,138

Nil

24,138

2018

74,074

Nil

23,099

Nil

97,173

Lorenzo Caprilli(9),

2020

n/a

former Executive Vice-President Sales andMarketing

2019

66,054

Nil

66,054

2018

n/a

Notes:(1)

Option-based awards represent the fair value of Stock Options and RSUs granted and awarded in the year under our 2020 Stock Incentive Plan. Thefair value of Stock Options granted is calculated as of the grant date using the Black-Scholes option pricing model. The fair value of the RSUs iscalculated based on the market price of the Company’s common shares on the grant date. For discussion of the assumptions made in the valuation,refer to Note 13 to our financial statements.

(2)

Mr. Rivera was appointed CEO and a director of our Company on August 12, 2019.

(3)

Ms. Bhullar was appointed Chief Financial Officer and Secretary of our Company on November 19, 2018 and as a director on December 6,2019. In July 2020, Ms. Bhullar stepped down as Secretary.

(4)

Mr. Moss was appointed Chief Administrative Officer of our Company on May 15, 2018, and in July 2020, Mr. Moss was appointed CorporateSecretary.

(5)

Mr. Reisner was appointed Chief Operating Officer of our Company on February 16, 2015, and on May 15, 2018 he was appointed as President ofour Company

(6)

Mr. Kroll was appointed the President and CEO of our Company on February 16, 2015 and served as the Secretary of our Company from June 11,2015 to August 8, 2016. On May 15, 2018, Mr. Kroll resigned from his position as President of our Company and on August 12, 2019 he resignedas CEO.

(7)

Mr. Ball was appointed Vice-President, Finance of our Company on June 27, 2016 and resigned effective on June 30, 2019.

(8)

Mr. Theobald was appointed General Manager of our Company on February 16, 2015 and resigned effective on June 30, 2019.

(9)

Lorenzo Caprilli was appointed Executive Vice-President Sales and Marketing of our Company on May 1, 2019 and resigned effective onNovember 30, 2019.


Executive Compensation Agreements Michael Paul Rivera On May 17, 2019, the Company entered into an employment agreement with Michael Paul Rivera (the “Rivera Agreement”), which is dated for referenceeffective August 12, 2019. Effective on January 1, 2020 (the “Effective Date” therein), with an execution date of February 26, 2020, Mr. Rivera and theCompany entered into an amending agreement to the Rivera Agreement (the “Amended Rivera Agreement”). In accordance with the Amended Rivera Agreement, the Rivera Agreement commenced on the Effective Date and continues until the third anniversary of theEffective Date, unless terminated earlier, provided that upon the third anniversary date the Rivera Agreement shall be deemed to be automatically extendedupon the same terms and conditions. Either party may provide 60 days prior written notice of its intention not to extend the term. Pursuant to the terms of theRivera Agreement, Mr. Rivera will be employed as the Chief Executive Officer and report to the Board of Directors of the Company (the “Board ofDirectors”), and shall have the duties, authority and responsibilities as shall be determined by the Board of Directors from time to time. Mr. Rivera willdevote substantially all of his business time and attention to the performance of his duties under the Rivera Agreement and will not engage in any business,profession or occupation for compensation or otherwise which would conflict or interfere with the performance of such services either directly or indirectlywithout consent of the majority of the Board of Directors. During the term of his employment Mr. Rivera will not engage in any Prohibited Activity (asdefined in the Rivera Agreement), provided, however, that Mr. Rivera shall be permitted to purchase and own less than 5% of the publicly traded securitiesof any corporation if such ownership represents a passive investment and Mr. Rivera is not a controlling person of, or a member of a group that controls,such corporation. Under the Rivera Agreement the Company will pay Mr. Rivera an annual base salary of $300,000.00 (the “Base Salary”) in periodic installments inaccordance with the Company’s customary payroll practices. Mr. Rivera’s Base Salary is subject to increase based on periodic reviews at the discretion of theBoard of Directors. Mr. Rivera shall be eligible to receive an annual bonus of not less than $150,000 for fiscal 2020, which will paid by at the sole andabsolute discretion of the Compensation Committee. Mr. Rivera will be entitled to participate in all benefit plans, practices and programs maintained by theCompany, as in effect from time to time, and including, but not limited to, the following: (a) reimbursements for payments to participate in one U.S. healthinsurance plan and one U.S. dental plan; and (b) no less than 25 paid vacation during each full fiscal year of Mr. Rivera’s employment (pro-rated for anypartial year of employment). The Rivera Agreement may be terminated upon either party’s failure to renew the Rivera Agreement, by the Company for Cause (as defined therein) or bythe Employee without Good Reason (as defined therein). Following any such termination, the Company will have no further obligations under the RiveraAgreement other than the Company’s obligations to, within two weeks following a termination date, provide Mr. Rivera with: (a) any accrued but unpaidBase Salary and accrued but unused vacation; (b) reimbursements for unreimbursed business expenses that are reimbursable in accordance with theCompany’s expense reimbursement policy; and (c) employee benefits, if any, to which Mr. Rivera may be entitled to under the Company’s employee benefitplans as of the date of termination. The Company also has the right to terminate the Rivera Agreement without Cause and Mr. Rivera has the right to terminate the Rivera Agreement for GoodReason. In the event of such termination, Mr. Rivera shall be entitled to receive: (a) all Accrued Amounts (as defined therein); (b) severance pay in equalinstallments, which are in the aggregate equal to the sum of Mr. Rivera’s Base Salary and Target Bonus (as defined therein) for two years from the date oftermination of the Rivera Agreement; (c) the Company shall reimburse Mr. Rivera for up to $1,800.00 of the monthly U.S. health insurance premium paid byMr. Rivera; and (d) the Company shall pay Mr. Rivera an amount equal to the greater of (i) the average STIP (as defined therein) paid to Mr. Rivera for theprevious two years and (ii) 80% of Mr. Rivera’s target annual STIP for the current fiscal year of the Company if Mr. Rivera has been employed by theCompany for less than two years at the date of termination.
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The Rivera Agreement will automatically terminate upon the death of Mr. Rivera and the Company may terminate the Rivera Agreement on account of Mr.Rivera’s Disability (as therein defined). In the event of such termination, Mr. Rivera (or his estate or beneficiaries, as the case may be) shall be entitled toreceive the Accrued Amounts. Notwithstanding any provision of the Rivera Agreement, all payments made in connection with Mr. Rivera’s Disability will beprovided in a manner consistent with state and federal law. Effective on January 1, 2020, Mr. Rivera and the Company agreed to amend the Rivera Agreement and entered into the Amended Rivera Agreement.Pursuant to the Amended Rivera Agreement, Mr. Rivera will be eligible to participate in any STIP or LTIP (each as defined therein) introduced by theCompany from time to time and the terms of such participation shall be determined by the Board of Directors. Mr. Rivera will also be entitled to five weeks’paid vacation per calendar year (pro-rated for partial years) in accordance with the Company’s vacation policies as in effect from time to time. The Amended Rivera Agreement also provides that Mr. Rivera may provide notice to the Company of any Change In Control of the Company (as definedtherein) by providing not less than 45 calendar days’ notice in writing to the Company after the Change In Control has been effected; provided, however, thatthe Company will be entitled to carefully review and object to any said Change In Control designation by the Executive within 15 calendar days of saidnotice; the final determination of which, upon dispute, if any, to be determined by arbitration under California law in Los Angeles, California. Unlessotherwise determined by mutual agreement of the parties or by arbitration as provided for therein, within 60 days of the completion of the Change In Controlthe Company shall be obligated to pay Mr. Rivera a one-time fee in cash in the amount of $3,000,000 whether the Rivera Agreement is otherwise terminatedor otherwise at the time of the completion of the Change In Control. In January 2020, Mr. Rivera received a $38,904 bonus payment for fiscal 2019. Based on certain recommendations provided to the Compensation Committeeby GGA, on July 20, 2020, the Rivera Agreement annual Base Salary was amended to $370,000 and Mr. Rivera was awarded 209,302 RSUs which vest as toon- third at the end of each year during the RSU vesting period. On November 26, 2020, the Compensation Committee approved a cash bonus to Mr. Riveraof $277,500 for fiscal 2020. Henry Reisner On January 15, 2019, our Board of Directors approved the entering into of an executive employment agreement with Henry Reisner, which is dated forreference effective on January 1, 2019, and which then superseded our Company’s prior agreement with Mr. Reisner, dated July 1, 2016, which had beenamended in August of 2018. On January 1, 2020 (the “Effective Date” therein), the Company entered into a new executive employment agreement withHenry Reisner (the “Reisner Agreement”) which superseded the January 15, 2019 executive employment agreement with Mr. Reisner. The Reisner Agreement commenced as of its Effective Date and will continue for a period of three years unless terminated in accordance with its terms. TheCompany may notify Mr. Reisner in writing at least 30 calendar days prior to the end of the term of its intent to renew the Reisner Agreement, any suchrenewal being on the same terms and conditions as provided in the Reisner Agreement. Pursuant to the terms of the Reisner Agreement, Mr. Reisner willcontinue to be employed as our Chief Operating Officer and President and will: (a) devote reasonable efforts and attentions to the business and affairs of theCompany; (b) perform the Services (as defined in the Reisner Agreement) in a competent and efficient manner and in manner consistent with his obligationsto the Company and in compliance with all the Company policies; and (c) promote the interests and goodwill of the Company. Mr. Reisner will not, directlyor indirectly, anywhere in Canada or the United States, either individually or in partnership, jointly or in conjunction with any person, firm, association,syndicate, company, whether as agent, shareholder, employee, consultant, or in any manner whatsoever, engage in any business the same or similar to or incompetition with that of the Company’s Business (as defined therein). However, Mr. Reisner may hold or become beneficially interest in up to 1% of anyclass of securities in any company provided that such class of securities are listed on a recognized stock exchange in Canada or the United States.
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The Company will pay Mr. Reisner a monthly base salary from the Effective Date of CAD$18,333.34 (the “Monthly Salary”). The Monthly Salary is subjectto increase based on periodic reviews at the discretion of the Company. The Board of Directors, in its sole discretion, may consider the payment of areasonable industry standard bonus to Mr. Reisner based upon the performance of the Company and upon the achievement by Mr. Reisner of reasonablemanagement objectives. Mr. Reisner will be eligible to receive a one-time lump sum payment of CAD$25,000.00 by delivering on the Company’s objectiveof having the Generation 3 SOLO begin production by May 15, 2020. Mr. Reisner will be eligible to participate in benefits, perquisites and allowances, assuch plans and policies may be amended from time to time, and including, but not limited to: (a) group insurance coverage for dental, health, and lifeinsurance; and (b) no less than five weeks paid vacation per calendar year (the “Vacation”), such Vacation to extend for such periods and to be taken at suchintervals as shall be appropriate and consistent with the proper performance of Mr. Reisner’s duties. The Company may grant Mr. Reisner stock options under its Stock Option Plan (as defined therein) from time to time in its absolute discretion. Any stockoptions granted will be in accordance with provisions, and including, but not limited to, the following: (a) the exercise of stock options shall be subject to, atall times, to such vesting and resale provisions as may then be contained in the Company’s Stock Option Plan as may be finally determined by the Board ofDirectors acting reasonably; (b) Mr. Reisner in no event make any disposition of all or any portion of stock options unless the requirements as provided in theReisner Agreement have been satisfied; and (c) the Company shall have an independent committee of the Board approve each grant of stock options and, ifrequired, by the applicable regulatory authorities and the shareholders of the Company. The Company has the right to and may terminate the Reisner Agreement at any time for Just Cause (as defined therein). Following any such termination, theCompany shall pay to Mr. Reisner an amount equal to the Monthly Salary and Vacation pay earned and payable to Mr. Reisner up to the date of termination,and Mr. Reisner shall have no entitlement to any further notice of termination, payment in lieu of notice of termination, severance, continuation of benefits orany damages whatsoever. The Company also has the right to terminate the Reisner Agreement without Just Cause and for any reason or no reason whatsoever by providing writtennotice to Mr. Reisner specifying the effective date of termination. Mr. Reisner may terminate the Reisner Agreement at any time in connection with a Changeof Control (as defined therein) of the Company by providing not less than 90 calendar days’ notice in writing of said date of termination to the Companyafter the Change of Control has been effected. In the event that the Reisner Agreement is terminated by the Company without Just Cause, or by Mr. Reisneras a result of a Change of Control, the Company will have the obligation to: (a) pay Mr. Reisner an amount equal to the Monthly Salary and Vacation payableto Mr. Reisner up to the date of termination, together with any Vacation pay required to comply with applicable employment standards legislation; (b) payMr. Reisner his annual performance Bonus entitlements (as defined therein) calculated pro rata for the period up to the date of termination based on theachievement of the objectives to such date; (c) pay severance equal to 12 months’ Monthly Salary plus an additional one month’s Monthly Salary for eachcompleted full year of employment with the Company; and (d) subject to the Company’s Stock Option Plan and policies of any regulatory authority andstock exchange having jurisdiction over the Company, allow for Mr. Reisner to exercise any unexercised and fully vested stock options at any time duringthree months from the date of termination. Mr. Reisner may terminate the Reisner Agreement at any time by providing written notice of resignation to the Board of Directors specifying the date oftermination (such date being not less than three months after the date of notice). In the event the Reisner Agreement is terminated by Mr. Reisner’sresignation, the Company shall pay to Mr. Reisner an amount equal to the Monthly Salary and Vacation pay earned and payable to Mr. Reisner up to the dateof termination, and Mr. Reisner shall have no entitlement to any further notice of termination, payment in lieu of notice of termination, severance,continuation of benefits or any damages whatsoever.
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The Reisner Agreement will automatically terminate upon the death of Mr. Reisner and, upon such termination, the Company’s obligations under the ReisnerAgreement will immediately terminate other than the Company’s obligations to: (a) pay Mr. Reisner’s estate an amount equal to the Monthly Salary andVacation payable to Mr. Reisner up to the date of termination; (b) pay Mr. Reisner’s estate his annual performance Bonus (entitlements) calculated pro ratafor the period up to the date of termination based on the achievement of the objectives to such date; and (c) subject to the Company’s Stock Option Plan andpolicies of any regulatory authority and stock exchange having jurisdiction over the Company, allow for Mr. Reisner’s estate to exercise any unexercised andfully vested stock options at any time during three months from the date of termination. The Company may terminate the Reisner Agreement at any time as a result of Total Disability (as defined therein) by providing 30 calendar days’ writtennotice. In the event of such termination, the Company’s obligations under the Reisner Agreement will immediately terminate other than the Company’sobligations to (a) pay Mr. Reisner’s an amount equal to the Monthly Salary and Vacation payable to Mr. Reisner up to the date of termination; (b) pay Mr.Reisner his annual performance Bonus entitlements calculated pro rata for the period up to the date of termination based on the achievement of the objectivesto such date; (c) subject to provisions of any Company plans and arrangements under which Benefits (as defined therein) are being provided to Mr. Reisner,continue each of Mr. Reisner’s Benefits in full force and effect for a period of six months from the date of termination; and (d) subject to the Company’sStock Option Plan and policies of any regulatory authority and stock exchange having jurisdiction over the Company, allow for Mr. Reisner to exercise anyunexercised and fully vested stock options at any time during three months from the date of termination. In the summer of 2020, Mr. Reisner received a CAD$50,000 bonus payment for fiscal 2019. Based on certain recommendations provided to theCompensation Committee from GGA, on July 20, 2020, the Reisner Agreement annual Monthly Salary was amended to $260,000 and Mr. Reisner wasawarded 98,256 RSUs which vest as to one-third at the end of each year during the RSU vesting period. On November 26, 2020, the CompensationCommittee approved a cash bonus to Mr. Reisner of $104,000 for fiscal 2020. Bal Bhullar On January 15, 2019, our Board of Directors approved the entering into of a consulting agreement with BKB Management Ltd., a company under the controland direction of Bal Bhullar, our Chief Executive Officer (the “Consulting Agreement”), which is dated for reference effective on January 1, 2019, andwhich superseded our Company’s prior offer letter with Ms. Bhullar, dated October 19, 2018. On December 19, 2019, the Company entered into a newexecutive employment agreement with Ms. Bhullar (the “Bhullar Agreement”) which is effective January 1, 2020 (the “Effective Date” therein), and whichsuperseded the Consulting Agreement. The Bhullar Agreement commenced as of its Effective Date and will continue for a period of three years unless terminated in accordance with its terms. TheBhullar Agreement shall renew automatically if not specifically terminated by the Company notifying Ms. Bhullar in writing at least 90 calendar days priorto the end of the term of its intent to not renew the Bhullar Agreement. Pursuant to the terms of the Bhullar Agreement, Ms. Bhullar will continue to be employed as our Chief Financial Officer and will: (a) devote reasonableefforts and attentions to the business and affairs of the Company; (b) perform the Services (as defined in the Bhullar Agreement) in a competent and efficientmanner and in manner consistent with her obligations to the Company and in compliance with all the Company policies; and (c) promote the interests andgoodwill of the Company. Ms. Bhullar will not, directly or indirectly, anywhere in North America, either individually or in partnership, jointly or inconjunction with any person, firm, association, syndicate, company, whether as agent, shareholder, employee, consultant, or in any manner whatsoever,engage in any business the same or similar to or in competition with that of the Company’s Business (as defined therein). However, Ms. Bhullar may hold orbecome beneficially interest in up to 1% of any class of securities in any company provided that such class of securities are listed on a recognized stockexchange in Canada or the United States.
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The Company will pay Ms. Bhullar a monthly base salary from the Effective Date of CAD$23,333.33 (the “Monthly Salary”). The Monthly Salary is subjectto increase based on periodic reviews at the discretion of the Company. The Board of Directors, in its sole discretion, may consider the payment of areasonable industry standard bonus to Ms. Bhullar based upon the performance of the Company and upon the achievement by Ms. Bhullar of reasonablemanagement objectives. Ms. Bhullar will be eligible to participate in benefits, perquisites and allowances, as such plans and policies may be amended fromtime to time, and including, but not limited to: (a) group insurance coverage for dental, health and life insurance; (b) an automobile expense allowance ofCAD$300.00 per month; (c) professional dues necessary to maintain Ms. Bhullar’s professional designation; and (d) no less than five weeks paid vacationper calendar year (the “Vacation”), such Vacation to extend for such periods and to be taken at such intervals as shall be appropriate and consistent with theproper performance of Ms. Bhullar’s duties. The Company may grant Ms. Bhullar stock options under its Stock Option Plan (as defined therein) from time to time in its absolute discretion. Any stockoptions granted will be in accordance with provisions, and including, but not limited to, the following: (a) the exercise of stock options shall be subject to, atall times, to such vesting and resale provisions as may then be contained in the Company’s Stock Option Plan as may be finally determined by the Board ofDirectors acting reasonably; (b) Ms. Bhullar in no event make any disposition of all or any portion of stock options unless the requirements as provided inthe Bhullar Agreement have been satisfied; and (c) the Company shall have an independent committee of the Board of Directors approve each grant of stockoptions and, if required, by the applicable regulatory authorities and the shareholders of the Company. The Company has the right to and may terminate the Bhullar Agreement at any time for Just Cause (as defined therein). Following any such termination, theCompany shall pay to Ms. Bhullar an amount equal to the Monthly Salary and Vacation pay earned and payable to Ms. Bhullar up to the date of termination,and Ms. Bhullar shall have no entitlement to any further notice of termination, payment in lieu of notice of termination, severance, continuation of benefits orany damages whatsoever. The Company also has the right to terminate the Bhullar Agreement without Just Cause and for any reason or no reason whatsoever by providing writtennotice to Ms. Bhullar specifying the effective date of termination. Ms. Bhullar may terminate the Bhullar Agreement at any time in connection with a Changeof Control (as defined therein) of the Company by providing not less than 90 calendar days’ notice in writing of said date of termination to the Companyafter the Change of Control has been effected. In the event that the Bhullar Agreement is terminated by the Company without Just Cause, or by Ms. Bhullaras a result of a Change of Control, the Company will have the obligation to: (a) pay Ms. Bhullar an amount equal to the Monthly Salary and Vacationpayable to Ms. Bhullar up to the date of termination, together with any Vacation pay required to comply with applicable employment standards legislation;(b) pay Ms. Bhullar her annual performance Bonus entitlements (as defined therein) calculated pro rata for the period up to the date of termination based onthe achievement of the objectives to such date; (c) severance equal to 24 months’ Monthly Salary for each completed year of employment with the Company;(d) subject to provisions of any Company plans and arrangements under which Benefits (as defined therein) are being provided to Ms. Bhullar, continue eachof Ms. Bhullar’s Benefits in full force and effect for a period of 12 months from the date of termination; (e) the Company shall pay Ms. Bhullar an amountequal to the greater of (i) the average STIP (as defined therein) paid to Ms. Bhullar for the previous two years and (ii) 80% of Ms. Bhullar’s target annualSTIP for the current fiscal year of the Company if Ms. Bhullar has been employed by the Company for less than two years at the date of termination; and (f)subject to the Company’s Stock Option Plan and policies of any regulatory authority and stock exchange having jurisdiction over the Company, allow forMs. Bhullar to exercise any unexercised and fully vested stock options at any time during the Termination Option Exercise Period (as defined therein). The Company may terminate the Bhullar Agreement by notifying Ms. Bhullar in writing at least 90 calendar days prior to the end of the term of its intent tonot renew the Bhullar Agreement. In the event of such termination, the Company will be obligated to provide Ms. Bhullar with (a) through (f) notedimmediately above, however, the Company will only pay Ms. Bhullar severance equal to four months of Monthly Salary for each completed full year ofemployment with the Company.
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Ms. Bhullar may terminate the Bhullar Agreement at any time by providing written notice of resignation to the Board of Directors specifying the date oftermination (such date being not less than three months after the date of notice). In the event the Bhullar Agreement is terminated by Ms. Bhullar’sresignation, the Company shall pay to Ms. Bhullar an amount equal to the Monthly Salary and Vacation pay earned and payable to Ms. Bhullar up to the dateof termination, and Ms. Bhullar shall have no entitlement to any further notice of termination, payment in lieu of notice of termination, severance,continuation of benefits or any damages whatsoever. The Bhullar Agreement will automatically terminate upon the death of Ms. Bhullar and, upon such termination, the Company’s obligations under the BhullarAgreement will immediately terminate other than the Company’s obligations to: (a) pay Ms. Bhullar’s estate an amount equal to the Monthly Salary andVacation payable to Ms. Bhullar up to the date of termination; (b) pay Ms. Bhullar’s estate her annual performance Bonus entitlements calculated pro rata forthe period up to the date of termination based on the achievement of the objectives to such date; and (c) subject to the Company’s Stock Option Plan andpolicies of any regulatory authority and stock exchange having jurisdiction over the Company, allow for Ms. Bhullar’s estate to exercise any unexercised andfully vested stock options at any time during the Termination Option Exercise Period from the date of termination. The Company may terminate the Bhullar Agreement at any time because of Total Disability (as defined therein) by providing 30 calendar days’ writtennotice. In the event of such termination, the Company’s obligations under the Bhullar Agreement will immediately terminate other than the Company’sobligations to (a) pay Ms. Bhullar an amount equal to the Monthly Salary and Vacation payable to Ms. Bhullar up to the date of termination; (b) pay Ms.Bhullar her annual performance Bonus entitlements calculated pro rata for the period up to the Date of Termination based on the achievement of theobjectives to such date; (c) subject to provisions of any Company plans and arrangements under which Benefits are being provided to Ms. Bhullar, continueeach of Ms. Bhullar’s Benefits in full force and effect for a period of 12 months from the date of termination; and (d) subject to the Company’s Stock OptionPlan and policies of any regulatory authority and stock exchange having jurisdiction over the Company, allow for Ms. Bhullar to exercise any unexercisedand fully vested stock options at any time during the Termination Option Exercise Period from the date of termination. Based on certain recommendations provided to the Compensation Committee by GGA, on July 20, 2020, the Bhullar Agreement annual Monthly Salary wasamended to $270,000 and Ms. Bhullar was awarded 102,035 RSUs which vest as to one-third at the end of each year during the RSU vesting period. OnNovember 26, 2020, the Compensation Committee approved a cash bonus of$108,000 to Ms. Bhullar for fiscal 2020. Jerry Kroll On January 15, 2019, our Board of Directors approved the entering into of an executive employment agreement with Jerry Kroll (the “Kroll Agreement”),which is dated for reference effective on January 1, 2019, and which superseded the Company’s prior agreement with Mr. Kroll, dated July 1, 2016, whichhad been amended in August of 2018. On August 16, 2019 the Company entered into a continuing relationship agreement with Jerry Kroll (the “ContinuingRelationship Agreement”), which superseded the Kroll Agreement. Pursuant to the terms of the Continuing Relationship Agreement, the Company has no further obligations under the Kroll Agreement other than to: (a) payMr. Kroll’s Executive Base Salary (as defined in the Kroll Agreement) accrued to August 16, 2019; (b) pay Mr. Kroll any accrued and unused vacation; (c)reimburse Mr. Kroll for expenses incurred up to August 16, 2019 that are reimbursable pursuant to the Kroll Agreement; and (d) pay Mr. Kroll an amountequal to the Base Salary (as defined in the Kroll Agreement) for a one year period payable in 12 installments. Pursuant to the terms of the Continuing Relationship Agreement, Mr. Kroll will continue to conceptualize new concepts for products and business with theconsent, and under the direction of, the Company’s Chief Executive Officer and/or the Company’s Board of Directors. Mr. Kroll will not have the authorityto bind the Company nor will Mr. Kroll make any agreements or representations on behalf of the Company without the Company’s prior written consent. Mr.Kroll may be engaged or employed in any other business, trade, profession, or activity, which does not (i) involve electric vehicles or their components,including their manufacturing, distribution, marketing, or sale, or (ii) place him in a conflict of interest with the Company. During the term of the ContinuingRelationship Agreement and for a period of 12 months following expiration or termination, Mr. Kroll will not make any solicitation to employ the personnelof the Company (including its subsidiaries) without prior written consent of the Company.
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Mr. Kroll will not be eligible to participate in any vacation, group medical or life insurance, disability, profit sharing, or retirement benefits, or any otherfringe benefits or benefit plans offered by the Company to its employees. Though Mr. Kroll will not be an employee of the Company, Mr. Kroll will agree toadhere to the Company’s policies governing media and social media activities and the Company’s Code of Ethics. Pursuant to the Continuing Relationship Agreement, the Company will grant Mr. Kroll 1,250,000 stock options to acquire common shares of the Companywhich shall (i) be exercisable at a price of $2.45 per option and (ii) vest in 12 equal installments. The 18,966 stock options previously granted to Mr. Krollthat had not vested as of August 16, 2019, will be deemed to be fully vested and remain exercisable by Mr. Kroll. The Continuing Relationship Agreement will terminate upon its one-year anniversary unless terminated earlier. The Continuing Relationship Agreement maybe extended with the mutual consent of the Company and Mr. Kroll. The Continuing Relationship Agreement may be terminated by the Company and Mr.Kroll, effective immediately upon 60 days’ written notice, if the other party breaches the Continuing Relationship Agreement. Upon expiration ortermination of the Continuing Relationship Agreement, Mr. Kroll will have five calendar days following expiration or termination to: (a) deliver to theCompany all hardware, software, tools, equipment, or other materials provided by the Company; (b) deliver to the Company all tangible documents andmaterials containing, reflecting, incorporating or based on Confidential Information (as defined in the Continuing Relationship Agreement); (c) permanentlyerase all Confidential Information (as defined therein) from his computer systems; and (d) certify to the Company that he has complied with the requirementsnoted above. After the expiration of the Continuation Relation Agreement on August 16, 2020, Mr. Kroll is being paid annual directors’ fees of $70,000 which are paidquarterly. Isaac Moss On January 15, 2019, our Board of Directors approved the entering into of an independent contractor agreement with Isaac (the “Prior Moss Agreement”),which is dated for reference effective on January 1, 2019, and which superseded our Company’s prior agreement with Mr. Moss, dated December 1, 2017(the “Commencement Date”), which had been amended in August of 2018. On July 1, 2020, our Board of Directors approved the entering into of a newexecutive employment agreement with Mr. Moss (the “Moss Agreement”) which is effective July 1, 2020 (the “Effective Date” therein), and whichsuperseded the Prior Moss Agreement. The Moss Agreement commenced as of its Effective Date and will continue for a period of two years unless terminated in accordance with its terms. TheMoss Agreement shall renew automatically if not specifically terminated by the Company notifying Mr. Moss in writing at least 90 calendar days prior to theend of the term of its intent to not renew the Moss Agreement. Pursuant to the terms of the Moss Agreement, Mr. Moss will continue to be employed as our Chief Administrative Officer and will: (a) devote reasonableefforts and attentions to the business and affairs of the Company; (b) perform the Services (as defined in the Moss Agreement) in a competent and efficientmanner and in manner consistent with his obligations to the Company and in compliance with all the Company policies; and (c) promote the interests andgoodwill of the Company. Mr. Moss will not, directly or indirectly, anywhere in North America, either individually or in partnership, jointly or inconjunction with any person, firm, association, syndicate, company, whether as agent, shareholder, employee, consultant, or in any manner whatsoever,engage in any business the same or similar to or in competition with that of the Company’s Business (as defined therein). However, Mr. Moss may hold orbecome beneficially interest in up to 1% of any class of securities in any company provided that such class of securities are listed on a recognized stockexchange in Canada or the United States.
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The Company will pay Mr. Moss a monthly base salary from the Effective Date of CAD$23,333.33 (the “Monthly Salary”). The Monthly Salary is subject toincrease based on periodic reviews at the discretion of the Company. The Board of Directors, in its sole discretion, may consider the payment of a reasonableindustry standard bonus to Mr. Moss based upon the performance of the Company and upon the achievement by Mr. Moss of reasonable managementobjectives. Mr. Moss will be eligible to participate in benefits, perquisites and allowances, as such plans and policies may be amended from time to time, andincluding, but not limited to: (a) group insurance coverage for dental, health and life insurance; (b) the use of a smartphone for Business purposes; and (c) noless than five weeks paid vacation per calendar year (the “Vacation”), such Vacation to extend for such periods and to be taken at such intervals as shall beappropriate and consistent with the proper performance of Mr. Moss’s duties. The Company may grant Mr. Moss stock options under its Option Plan (as defined therein) from time to time in its absolute discretion. Any stock optionsgranted will be in accordance with provisions, and including, but not limited to, the following: (a) the exercise of stock options shall be subject to, at alltimes, to such vesting and resale provisions as may then be contained in the Company’s Option Plan as may be finally determined by the Board of Directorsacting reasonably; (b) Mr. Moss in no event make any disposition of all or any portion of stock options unless the requirements as provided in the MossAgreement have been satisfied; and (c) the Company shall have an independent committee of the Board of Directors approve each grant of stock options and,if required, by the applicable regulatory authorities and the shareholders of the Company. The Company has the right to and may terminate the Moss Agreement at any time for Just Cause (as defined therein). Following any such termination, theCompany shall pay to Mr. Moss an amount equal to the Monthly Salary and Vacation pay earned and payable to Mr. Moss up to the date of termination, andMr. Moss shall have no entitlement to any further notice of termination, payment in lieu of notice of termination, severance, continuation of benefits or anydamages whatsoever. The Company also has the right to terminate the Moss Agreement without Just Cause and for any reason or no reason whatsoever by providing written noticeto Mr. Moss specifying the effective date of termination. Mr. Moss may terminate the Moss Agreement at any time in connection with a Change of Control(as defined therein) of the Company by providing not less than 90 calendar days’ notice in writing of said date of termination to the Company after theChange of Control has been effected. In the event that the Moss Agreement is terminated by the Company without Just Cause, or by Mr. Moss as a result of aChange of Control, the Company will have the obligation to: (a) pay Mr. Moss an amount equal to the Monthly Salary and Vacation payable to Mr. Moss upto the date of termination, together with any Vacation pay required to comply with applicable employment standards legislation; (b) pay Mr. Moss his annualperformance Bonus entitlements (as defined therein) calculated pro rata for the period up to the date of termination based on the achievement of theobjectives to such date; (c) severance equal to 24 months’ Monthly Salary for each completed year of employment with the Company from theCommencement Date; (d) subject to provisions of any Company plans and arrangements under which Benefits (as defined therein) are being provided to Mr.Moss, continue each of Mr. Moss’s Benefits in full force and effect for a period of 12 months from the date of termination; (e) the Company shall pay Mr.Moss an amount equal to the greater of (i) the average STIP (as defined therein) paid to Mr. Moss for the previous two years and (ii) 80% of Mr. Moss’starget annual STIP for the current fiscal year of the Company if Mr. Moss has been employed by the Company for less than two years at the date oftermination; and (f) subject to the Company’s Option Plan and policies of any regulatory authority and stock exchange having jurisdiction over the Company,allow for Mr. Moss to exercise any unexercised and fully vested stock options at any time during the Termination Option Exercise Period (as definedtherein). The Company may terminate the Moss Agreement by notifying Mr. Moss in writing at least 90 calendar days prior to the end of the term of its intent to notrenew the Moss Agreement. In the event of such termination, the Company will be obligated to provide Mr. Moss with (a) through (f) noted immediatelyabove, however, the Company will only pay Mr. Moss severance equal to four months of Monthly Salary for each completed full year of employment withthe Company commencing from the date of the Prior Moss Agreement.
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Mr. Moss may terminate the Moss Agreement at any time by providing written notice of resignation to the Board of Directors specifying the date oftermination (such date being not less than three months after the date of notice). In the event the Moss Agreement is terminated by Mr. Moss’s resignation,the Company shall pay to Mr. Moss an amount equal to the Monthly Salary and Vacation pay earned and payable to Mr. Moss up to the date of termination,and Mr. Moss shall have no entitlement to any further notice of termination, payment in lieu of notice of termination, severance, continuation of benefits orany damages whatsoever. The Moss Agreement will automatically terminate upon the death of Mr. Moss and, upon such termination, the Company’s obligations under the MossAgreement will immediately terminate other than the Company’s obligations to: (a) pay Mr. Moss’s estate an amount equal to the Monthly Salary andVacation payable to Mr. Moss up to the date of termination; (b) pay Mr. Moss’s estate his annual performance Bonus entitlements calculated pro rata for theperiod up to the date of termination based on the achievement of the objectives to such date; and (c) subject to the Company’s Option Plan and policies ofany regulatory authority and stock exchange having jurisdiction over the Company, allow for Mr. Moss’s estate to exercise any unexercised and fully vestedstock options at any time during the Termination Option Exercise Period from the date of termination. The Company may terminate the Moss Agreement at any time because of Total Disability (as defined therein) by providing 30 calendar days’ written notice.In the event of such termination, the Company’s obligations under the Moss Agreement will immediately terminate other than the Company’s obligations to(a) pay Mr. Moss an amount equal to the Monthly Salary and Vacation payable to Mr. Moss up to the date of termination; (b) pay Mr. Moss his annualperformance Bonus entitlements calculated pro rata for the period up to the Date of Termination based on the achievement of the objectives to such date; (c)subject to provisions of any Company plans and arrangements under which Benefits are being provided to Mr. Moss, continue each of Mr. Moss’s Benefits infull force and effect for a period of 12 months from the date of termination; and (d) subject to the Company’s Option Plan and policies of any regulatoryauthority and stock exchange having jurisdiction over the Company, allow for Mr. Moss to exercise any unexercised and fully vested stock options at anytime during the Termination Option Exercise Period from the date of termination. Based on the independent report produced by Global Governance Advisors, on July 20, 2020, the Moss Agreement annual Monthly Salary was amended to$260,000 and he was awarded 98,256 RSUs which vest, as to one-third, at the end of each year during the RSU vesting period. On November 26, 2020, theCompensation Committee approved a cash bonus to Mr. Moss of $104,000 for fiscal 2020. Stock Option Plans and Options The following table sets forth, as at December 31, 2020, the equity compensation plans pursuant to which equity securities of the Company may be issued:

Number of

securities

remaining

available for

future issuance

Number of

under equity

securities to be

compensation

issued upon

Weighted-

plans

exercise of

average

(excluding

outstanding

exercise price

securities

options

of outstanding

reflected in

Plan Category

(a)

options ($) (b)

column (a)) (c)

Equity compensation plans approved by securityholders

Equity compensation plans not approved by securityholders

12,908,315 $

2.03

17,091,685

Total

12,908,315 $

2.03

17,091,685


2020 Stock Incentive Plan On June 11, 2015, our Board of Directors adopted our 2015 Stock Option Plan (the “Stock Option Plan”) under which an aggregate of 30,000,000 commonshares may be issued, subject to adjustment as described in the Stock Option Plan. On May 29, 2020, with the prior recommendations from GGA, the Board of Directors passed a resolution to adopt our 2020 Stock Incentive Plan, subject to,and effective upon, the approval of shareholders. The 2020 Stock Incentive Plan provides flexibility to the Company to grant equity-based incentive awards(each, an “Award”) in the form of Options, RSUs, preferred shared units (“PSUs”) and deferred share units (“DSUs”), as described in further detail below.The 2020 Stock Incentive Plan was approved by Company shareholders on July 9, 2020 and, accordingly, all future grants of equity-based Awards will bemade pursuant to, or as otherwise permitted by, the 2020 Stock Incentive Plan, and no further equity-based awards will be made pursuant to the Company’sprior Stock Option Plan. The purpose of the 2020 Stock Incentive Plan is to, among other things, provide the Company with a share-related mechanism to attract, retain and motivatequalified directors, employees and consultants of the Company and its subsidiaries, to reward such of those directors, employees and consultants as may begranted awards under the 2020 Stock Incentive Plan by the Board of Directors from time to time for their contributions toward the long-term goals andsuccess of the Company, and to enable and encourage such directors, employees and consultants to acquire Common Shares as long-term investments andproprietary interests in the Company. A summary of the key terms of the 2020 Stock Incentive Plan is set out below, which is qualified in its entirety by the full text of the 2020 Stock IncentivePlan. Key Terms of the 2020 Stock Incentive Plan Shares Subject to the 2020 Stock Incentive Plan The 2020 Stock Incentive Plan is a fixed number share plan which provides that the aggregate maximum number of common shares (each, a “CommonShare”) that may be issued upon the exercise or settlement of Awards granted under it shall not exceed 30,000,000 Common Shares, subject to theadjustment provisions provided for therein (including those that apply in the event of a subdivision or consolidation of Common Shares). Such maximumnumber of Common Shares consists of (i) 12,850,917 Common Shares issuable pursuant to Awards previously granted and that remain outstanding under theCompany’s Stock Option Plan, which Awards will be covered by the 2020 Stock Incentive Plan upon its ratification by the shareholders, and (ii) 17,149,083additional Common Shares that may be issued pursuant to Awards to be granted under the 2020 Stock Incentive Plan. Administration of the 2020 Stock Incentive Plan The 2020 Stock Incentive Plan designates the Board of Directors as the initial Plan Administrator (as defined in the 2020 Stock Incentive Plan), subject tothe ability of the Board of Directors to delegate from time to time all or any of the powers conferred on the Plan Administrator to a committee of the Boardof Directors. The Board of Directors has resolved to delegate all powers of administration of the 2020 Stock Incentive Plan to the Compensation Committee. The Plan Administrator determines which directors, officers, consultants and employees are eligible to receive Awards under the 2020 Stock Incentive Plan,the time or times at which Awards may be granted, the conditions under which awards may be granted or forfeited to the Company, the number of CommonShares to be covered by any Award, the exercise price of any Award, whether restrictions or limitations are to be imposed on the Common Shares issuablepursuant to grants of any Award, and the nature of any such restrictions or limitations, any acceleration of exercisability or vesting, or waiver of terminationregarding any Award, based on such factors as the Plan Administrator may determine.
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In addition, the Plan Administrator interprets the 2020 Stock Incentive Plan and may adopt guidelines and other rules and regulations relating to the 2020Stock Incentive Plan, and make all other determinations and take all other actions necessary or advisable for the implementation and administration of the2020 Stock Incentive Plan. Eligibility All directors, employees and consultants are eligible to participate in the 2020 Stock Incentive Plan. The extent to which any such individual is entitled toreceive a grant of an Award pursuant to the 2020 Stock Incentive Plan will be determined in the sole and absolute discretion of the Plan Administrator. Types of Awards Awards of Options, RSUs, PSUs and DSUs may be made under the 2020 Stock Incentive Plan. All of the Awards described below are subject to theconditions, limitations, restrictions, exercise price, vesting, settlement and forfeiture provisions determined by the Plan Administrator, in its sole discretion,subject to such limitations provided in the 2020 Stock Incentive Plan, and will generally be evidenced by an Award agreement. In addition, subject to thelimitations provided in the 2020 Stock Incentive Plan and in accordance with applicable law, the Plan Administrator may accelerate or defer the vesting orpayment of Awards, cancel or modify outstanding Awards and waive any condition imposed with respect to Awards or Common Shares issued pursuant toAwards. Options An Option entitles a holder thereof to purchase a prescribed number of treasury Common Shares at an exercise price set at the time of the grant. The PlanAdministrator will establish the exercise price at the time each Option is granted, which exercise price must in all cases be not less than the volume weightedaverage closing price of the Common Shares on Nasdaq for the five trading days immediately preceding the date of grant (the “Market Price”) on the date ofgrant. Subject to any accelerated termination as set forth in the 2020 Stock Incentive Plan, each Option expires on its respective expiry date. The PlanAdministrator will have the authority to determine the vesting terms applicable to grants of Options. Once an Option becomes vested, it shall remain vestedand shall be exercisable until expiration or termination of the Option, unless otherwise specified by the Plan Administrator, or as otherwise set forth in anywritten employment agreement, Award agreement or other written agreement between the Company or a subsidiary of the Company and the participant. ThePlan Administrator has the right to accelerate the date upon which any Option becomes exercisable. The Plan Administrator may provide at the time ofgranting an Option that the exercise of that Option is subject to restrictions, in addition to those specified in the 2020 Stock Incentive Plan, such as vestingconditions relating to the attainment of specified performance goals. Unless otherwise specified by the Plan Administrator at the time of granting an Option and set forth in the particular Award agreement, an exercise noticemust be accompanied by payment of the exercise price. A participant may, in lieu of exercising an Option pursuant to an exercise notice, elect to surrendersuch Option to the Company (a “Cashless Exercise”) in consideration for an amount from the Company equal to (i) the Market Price of the Common Sharesissuable on the exercise of such Option (or portion thereof) as of the date such Option (or portion thereof) is exercised, less (ü) the aggregate exercise price ofthe Option (or portion thereof) surrendered relating to such Common Shares (the “In-the-Money Amount”) by written notice to the Company indicating thenumber of Options such participant wishes to exercise using the Cashless Exercise, and such other information that the Company may require. Subject to theprovisions of the 2020 Stock Incentive Plan, the Company will satisfy payment of the In-the-Money Amount by delivering to the participant such number ofCommon Shares having a fair market value equal to the In-the-Money Amount.
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Restricted Share Units A RSU is a unit equivalent in value to a Common Share credited by means of a bookkeeping entry in the books of the Company which entitles the holder toreceive one Common Share (or the value thereof) for each RSU after a specified vesting period. The Plan Administrator may, from time to time, subject tothe provisions of the 2020 Stock Incentive Plan and such other terms and conditions as the Plan Administrator may prescribe, grant RSUs to any participantin respect of a bonus or similar payment in respect of services rendered by the applicable participant in a taxation year. The number of RSUs (including fractional RSUs) granted at any particular time under the 2020 Stock Incentive Plan will be calculated by dividing: (a) theamount that is to be paid in RSUs, as determined by the Plan Administrator; by (b) the greater of (i) the Market Price of a Common Share on the date ofgrant and (ii) such amount as determined by the Plan Administrator in its sole discretion. The Plan Administrator shall have the authority to determine the settlement and any vesting terms applicable to the grant of RSUs, provided that the termsapplicable to RSUs granted to U.S. taxpayers comply with Section 409A of the United States Internal Revenue Code of 1986, as amended (the “Code”), tothe extent applicable. Upon settlement, holders will redeem each vested RSU for one fully paid and non-assessable Common Share in respect of each vested RSU. Performance Share Units A PSU is a unit equivalent in value to a Common Share credited by means of a bookkeeping entry in the books of the Company which entitles the holder toreceive one Common Share for each PSU after specific performance-based vesting criteria determined by the Plan Administrator, in its sole discretion, havebeen satisfied. The Plan Administrator may, from time to time, subject to the provisions of the 2020 Stock Incentive Plan and such other terms and conditionsas the Plan Administrator may prescribe, grant PSUs to any participant in respect of services rendered by the applicable participant in a taxation year. Theperformance goals to be achieved during any performance period, the length of any performance period, the amount of any PSUs granted, the effect oftermination of a participant’s service and the settlement terms pursuant to any PSU will be determined by the Plan Administrator and by the other terms andconditions of any PSU, all as set forth in the applicable Award agreement. The Plan Administrator shall have the authority to determine the settlement and any vesting terms applicable to the grant of PSUs, provided that the termsapplicable to PSUs granted to U.S. taxpayers comply with Section 409A of the Code, to the extent applicable. Upon settlement, holders will redeem eachvested PSU for one fully paid and non-assessable Common Share in respect of each vested PSU. Deferred Share Units A DSU is a unit equivalent in value to a Common Share credited by means of a bookkeeping entry in the books of the Company which entitles the holder toreceive one Common Share (or, at the election of the holder and subject to the approval of the Plan Administrator, the cash value thereof) for each DSU on afuture date. The Board of Directors may fix from time to time a portion of the total compensation (including annual retainer) paid by the Company to adirector in a calendar year for service on the Board of Directors (the “Director Fees”) that are to be payable in the form of DSUs. In addition, each director isgiven, subject to the provisions of the 2020 Stock Incentive Plan, the right to elect to receive a portion of the cash Director Fees owing to them in the form ofDSUs. Except as otherwise determined by the Plan Administrator or as set forth in the particular Award agreement, DSUs shall vest immediately upon grant. Thenumber of DSUs (including fractional DSUs) granted at any particular time will be calculated by dividing: (a) the amount of Director Fees that are to be paidin DSUs, as determined by the Plan Administrator; by (b) the Market Price of a Common Share on the date of grant. Upon settlement, holders will redeemeach vested DSU for: (a) one fully paid and non-assessable Common Share issued from treasury in respect of each vested DSU, or (b) at the election of theholder and subject to the approval of the Plan Administrator, a cash payment on the date of settlement. Any cash payments made under the 2020 StockIncentive Plan by the Company to a participant in respect of DSUs to be redeemed for cash shall be calculated by multiplying the number of DSUs to beredeemed for cash by the Market Price per Common Share as at the settlement date.
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Dividend Equivalents Except as otherwise determined by the Plan Administrator or as set forth in the particular Award agreement, RSUs, PSUs and DSUs shall be credited withdividend equivalents in the form of additional RSUs, PSUs and DSUs, as applicable, as of each dividend payment date in respect of which normal cashdividends are paid on Common Shares. Dividend equivalents shall vest in proportion to, and settle in the same manner as, the Awards to which they relate.Such dividend equivalents shall be computed by dividing: (a) the amount obtained by multiplying the amount of the dividend declared and paid per CommonShare by the number of RSUs, PSUs and DSUs, as applicable, held by the participant on the record date for the payment of such dividend; by (b) the MarketPrice at the close of the first business day immediately following the dividend record date, with fractions computed to three decimal places. Black-out Periods In the event an Award expires, at a time when a scheduled blackout is in place or an undisclosed material change or material fact in the affairs of theCompany exists, the expiry of such Award will be the date that is ten business days after which such scheduled blackout terminates or there is no longer suchundisclosed material change or material fact. Term While the 2020 Stock Incentive Plan does not stipulate a specific term for Awards granted thereunder, as discussed below, Awards may not expire beyond 10years from its date of grant, except where shareholder approval is received or where an expiry date would have fallen within a blackout period of theCompany. All Awards must vest and settle in accordance with the provisions of the 2020 Stock Incentive Plan and any applicable Award agreement, andwhich Award agreement may include an expiry date for a specific Award. Termination of Employment or Services The following describes the impact of certain events upon the participants under the 2020 Stock Incentive Plan, including termination for cause, resignation,termination without cause, disability, death or retirement, subject, in each case, to the terms of a participant’s applicable employment agreement, Awardagreement or other written agreement:
(a) Termination for Cause or upon Termination: Any Option or other Award held by the participant that has not been exercised, surrendered or settled as
	of the Termination Date (as defined in the 2020 Stock Incentive Plan) shall be immediately forfeited and cancelled as of the Termination Date.

(b) Termination without Cause: A portion of any unvested Options or other Awards shall immediately vest, such portion to be equal to the number of
	unvested Options or other Awards held by the participant as of the Termination Date multiplied by a fraction the numerator of which is the numberof days between the date of grant and the Termination Date and the denominator of which is the number of days between the date of grant and thedate any unvested Options or other Awards were originally scheduled to vest. Any vested Options may be exercised by the participant at any timeduring the period that terminates on the earlier of: (a) the expiry date of such Option; and (b) the date that is 90 days after the Termination Date. Ifan Option remains unexercised upon the earlier of (a) or (b), the Option shall be immediately forfeited and cancelled for no consideration upon thetermination of such period. In the case of a vested Award other than an Option, such Award will be settled within 90 days after the TerminationDate.

(c) Disability: A portion of any unvested Options or other Awards shall immediately vest, such portion to be equal to the number of unvested Options
	or other Awards held by the participant as of the Termination Date multiplied by a fraction the numerator of which is the number of days betweenthe date of grant and the Termination Date and the denominator of which is the number of days between the date of grant and the date any unvestedOptions or other Awards were originally scheduled to vest. Any vested Option may be exercised by the participant at any time until the Expiry Dateof such Option. Any vested Option may be exercised by the participant at any time until the expiry date of such Option. Any vested Award otherthan an Option will be settled within 90 days after the Termination Date.
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(d) Death: A portion of any unvested Options or other Awards shall immediately vest, such portion to be equal to the number of unvested Options or
	other Awards held by the participant as of the Termination Date multiplied by a fraction the numerator of which is the number of days between thedate of grant and the Termination Date and the denominator of which is the number of days between the date of grant and the date any unvestedOptions or other Awards were originally scheduled to vest. Any vested Option may be exercised by the participant’s beneficiary or legalrepresentative (as applicable) at any time during the period that terminates on the earlier of: (a) the expiry date of such Option; and (b) the firstanniversary of the date of the death of such participant. If an Option remains unexercised upon the earlier of (a) or (b), the Option shall beimmediately forfeited and cancelled for no consideration upon the termination of such period. In the case of a vested Award other than an Option,such Award will be settled with the participant’s beneficiary or legal representative (as applicable) within 90 days after the date of the Participant’sdeath.

(e) Retirement: A portion of any unvested Options or other Awards shall immediately vest, such portion to be equal to the number of unvested Options
	or other Awards held by the participant as of the Termination Date multiplied by a fraction the numerator of which is the number of days betweenthe date of grant and the Termination Date and the denominator of which is the number of days between the date of grant and the date any unvestedOptions or other Awards were originally scheduled to vest. Any vested Option may be exercised by the participant at any time during the period thatterminates on the earlier of: (a) the expiry date of such Option; and (b) the third anniversary of the participant’s date of retirement. If an Optionremains unexercised upon the earlier of (a) or (b), the Option shall be immediately forfeited and cancelled for no consideration upon the terminationof such period. In the case of a vested Award other than an Option, such Award will be settled within 90 days after the participant’s retirement.Notwithstanding the foregoing, if, following his or her retirement, the participant commences on the Commencement Date (as defined in the 2020Stock Incentive Plan) employment, consulting or acting as a director of the Company or any of its subsidiaries (or in an analogous capacity) orotherwise as a service provider to any person that carries on or proposes to carry on a business competitive with the Company or any of itssubsidiaries, any Option or other Award held by the participant that has not been exercised or settled as of the Commencement Date shall beimmediately forfeited and cancelled as of the Commencement Date.
Change in Control Under the 2020 Stock Incentive Plan, except as may be set forth in an employment agreement, Award agreement or other written agreement between theCompany or a subsidiary of the Company and a participant:
(a) the Plan Administrator may, without the consent of any participant, take such steps as it deems necessary or desirable, including to cause: (i) the
	conversion or exchange of any outstanding Awards into or for rights or other securities of substantially equivalent value, as determined by the PlanAdministrator in its discretion, in any entity participating in or resulting from a Change in Control (as defined below); (ii) outstanding Awards tovest and become exercisable, realizable or payable, or restrictions applicable to an Award to lapse, in whole or in part prior to or uponconsummation of a Change in Control, and, to the extent the Plan Administrator determines, terminate upon or immediately prior to theeffectiveness of such Change in Control; (iii) the termination of an Award in exchange for an amount of cash and/or property, if any, equal to theamount that would have been attained upon the exercise or settlement of such Award or realization of the participant’s rights as of the date of theoccurrence of the transaction; (iv) the replacement of such Award with other rights or property selected by the Board of Directors in its solediscretion where such replacement would not adversely affect the holder; or (v) any combination of the foregoing; provided that: (A) in taking anyof the foregoing actions), the Plan Administrator will not be required to treat all Awards similarly in the transaction; and (B) in the case of Options,RSUs and PSUs held by a Canadian taxpayer, the Plan Administrator may not cause the Canadian taxpayer to receive any property in connectionwith a Change in Control other than rights to acquire shares of a corporation or units of a “mutual fund trust” (as defined in the Income Tax Act(Canada)(the “Tax Act”) of the Company or a “qualifying person” (as defined in the Tax Act) that does not deal at arm’s length (for purposes of theTax Act) with the Company, as applicable, at the time such rights are issued or granted;
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(b) if within 12 months following the completion of a transaction resulting in a Change in Control (as defined below), a participant’s employment,
	consultancy or directorship is terminated by the Company or a subsidiary of the Company without Cause (as defined in the 2020 Stock IncentivePlan), without any action by the Plan Administrator:

	(i) any unvested Awards held by the participant at the Termination Date shall immediately vest; and

	(ii) any vested Awards may be exercised, surrendered to the Company, or settled by the participant at any time during the period that
		terminates on the earlier of: (i) the expiry date of such Award; and (ii) the date that is 90 days after the Termination Date. Any Award thathas not been exercised, surrendered or settled at the end of such period being immediately forfeited and cancelled; and

(c) unless otherwise determined by the Plan Administrator, if, as a result of a Change in Control, the Common Shares will cease trading on Nasdaq, the
	Company may terminate all of the Awards (other than an Option, RSU or PSU held by a participant that is a resident of Canada for the purposes ofthe Tax Act) at the time of and subject to the completion of the Change in Control transaction by paying to each holder at or within a reasonableperiod of time following completion of such Change in Control transaction an amount for each Award equal to the fair market value of the Awardheld by such participant as determined by the Plan Administrator, acting reasonably, provided that any vested Awards granted to U.S. taxpayers willbe settled within 90 days of the Change in Control.
Subject to certain exceptions, a “Change in Control” includes: (i) any transaction pursuant to which a person or group acquires more than 50% of theoutstanding Common Shares; (ii) the sale of all or substantially all of the Company’s assets; (iii) the dissolution or liquidation of the Company; (iv) theacquisition of the Company via consolidation, merger, exchange of securities, purchase of assets, amalgamation, statutory arrangement or otherwise; (v)individuals who comprise the Board of Directors at the last annual meeting of shareholders (the “Incumbent Board”) cease to constitute at least a majority ofthe Board of Directors, unless the election, or nomination for election by the shareholders, of any new director was approved by a vote of at least a majorityof the Incumbent Board, in which case such new director shall be considered as a member of the Incumbent Board; or (vi) any other event which the Boardof Directors determines to constitute a change in control of the Company. Non-Transferability of Awards Except as permitted by the Plan Administrator and to the extent that certain rights may pass to a beneficiary or legal representative upon death of aparticipant, by will or as required by law, no assignment or transfer of Awards, whether voluntary, involuntary, by operation of law or otherwise, vests anyinterest or right in such Awards whatsoever in any assignee or transferee and immediately upon any assignment or transfer, or any attempt to make the same,such Awards will terminate and be of no further force or effect. To the extent that certain rights to exercise any portion of an outstanding Award pass to abeneficiary or legal representative upon the death of a participant, the period in which such Award can be exercised by such beneficiary or legalrepresentative shall not exceed one year from the participant’s death. Amendments to the 2020 Stock Incentive Plan The Plan Administrator may also from time to time, without notice and without approval of the holders of voting Common Shares, amend, modify, change,suspend or terminate the 2020 Stock Incentive Plan or any Awards granted pursuant thereto as it, in its discretion, determines appropriate, provided that: (a)no such amendment, modification, change, suspension or termination of the 2020 Stock Incentive Plan or any Award granted pursuant thereto may materiallyimpair any rights of a participant or materially increase any obligations of a participant under the 2020 Stock Incentive Plan without the consent of suchparticipant, unless the Plan Administrator determines such adjustment is required or desirable in order to comply with any applicable securities laws or stockexchange requirements; and (b) any amendment that would cause an Award held by a U.S. Taxpayer to be subject to the income inclusion under Section409A of the Code shall be null and void ab initio.
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Notwithstanding the above, and subject to the Nasdaq Listing Rules, the approval of shareholders is required to effect any of the following amendments tothe 2020 Stock Incentive Plan:
(a) increasing the number of Common Shares reserved for issuance under the 2020 Stock Incentive Plan, except pursuant to the provisions in the 2020
	Stock Incentive Plan which permit the Plan Administrator to make equitable adjustments in the event of transactions affecting the Company or itscapital;

(b) reducing the exercise price of an option Award (for this purpose, a cancellation or termination of an Award of a participant prior to its expiry date
	for the purpose of reissuing an Award to the same participant with a lower exercise price shall be treated as an amendment to reduce the exerciseprice of an Award) except pursuant to the provisions in the 2020 Stock Incentive Plan which permit the Plan Administrator to make equitableadjustments in the event of transactions affecting the Company or its capital;

(c) extending the term of an Option Award beyond the original expiry date (except where an expiry date would have fallen within a blackout period
	applicable to the participant or within ten business days following the expiry of such a blackout period);

(d) permitting an Option Award to be exercisable beyond ten years from its date of grant (except where an expiry date would have fallen within a
	blackout period);

(e) increasing or removing the limits on the participation of directors;

(f) permitting Awards to be transferred to a person;

(g) changing the eligible participants; and

(h) deleting or reducing the range of amendments which require approval of the shareholders.
Except for the items listed above, amendments to the 2020 Stock Incentive Plan will not require shareholder approval. Such amendments include (but are notlimited to): (a) amending the general vesting provisions of an Award; (b) amending the provisions for early termination of Awards in connection with atermination of employment or service; (c) adding covenants of the Company for the protection of the participants; (d) amendments that are desirable as aresult of changes in law in any jurisdiction where a participant resides; and (e) curing or correcting any ambiguity or defect or inconsistent provision orclerical omission or mistake or manifest error. The foregoing summary of the 2020 Stock Incentive Plan is not complete and is qualified in its entirety by reference to the 2020 Stock Incentive Plan, whichwas filed as Exhibit 4.1 to to the Company’s Form S-8 filed with the SEC on October 5, 2020, and a copy can also be viewed on the Company’s website athttps://investors.electrameccanica.com/governance-docs.
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Incentive Plan Awards The following table sets out information on the incentive plan awards held by Named Executive Officers and/or directors as at December 31, 2020. Named Executive Officeror Director

Number of securities underlying

Exercise

Expiration

unexercised options & units (#)

price

date

Michael Paul Rivera, Chief Executive Officer and a director

Options

700,000 $

2.62 USD

25-Jun-22

Options

2,300,000 $

1.91 USD

6-Dec-26

RSUs

209,302 $

Nil

20-Jul-30

Bal Bhullar, Chief Financial Officer, and a director

Options

400,000 $

3.40 USD

19-Mar-26

Options

1,100,000 $

1.91 USD

6-Dec-26

RSUs

102,035 $

Nil

20-Jul-30

Isaac Moss, Chief Administrative Officer, Secretary

Options

250,000 $

3.40 USD

19-Mar-26

Options

750,000 $

1.91 USD

6-Dec-26

RSUs

98,256 $

Nil

20-Jul-30

Henry Reisner, Chief Operating Officer, President and a director

Options

56,818 $

0.30 CAD

13-Aug-22

Options

56,818 $

0.80 CAD

9-Dec-22

Options

5,000 $

2.00 CAD

17-Feb-24

Options

5,000 $

9.60 USD

5-Jan-25

RSUs

98,256 $

Nil

20-Jul-30

Steven Sanders, Chairman and a director

Options

120,000 $

3.40 USD

19-Mar-26

Options

225,000 $

1.91 USD

6-Dec-26

DSUs

12,952 $

Nil

22-Jul-30

Jerry Kroll, a director

Options

2,045,455 $

0.30 CAD

11-Jun-22

Options

227,273 $

0.80 CAD

9-Dec-22

Options

5,000 $

2.00 CAD

17-Feb-24

Options

5,000 $

9.60 USD

5-Jan-25

Options

1,250,000 $

2.45 USD

4-Aug-26

Luisa Ingargiola, a director

Options

120,000 $

3.40 USD

19-Mar-26

Options

225,000 $

1.91 USD

6-Dec-26

DSUs

8,797 $

Nil

22-Jul-30

Joanne Yan, a director

Options

2,500 $

2.00 CAD

17-Feb-24

Options

2,500 $

9.60 USD

5-Jan-25

Options

120,000 $

3.40 USD

19-Mar-26

Options

225,000 $

1.91 USD

6-Dec-26

DSUs

11,364 $

Nil

22-Jul-30

Peter Savagian, a director

Options

120,000 $

1.80 USD

17-Oct-26

Options

225,000 $

1.91 USD

6-Dec-26

DSUs

11,510 $

Nil

22-Jul-30

The following table provides information concerning the incentive award grants of the Company with respect to each Named Executive Officer during thefiscal year ended December 31, 2020. The only incentive award grants of the Company during such fiscal year was under the 2020 Stock Incentive Plan:

Equity Incentive Plan

Non-Equity Incentive Plan

Compensation

Named Executive Officer

Value Vested During the

and Director

Year ($)(*)

Year ($)

Michael Paul Rivera, Chief Executive Officer

1,163,682

Nil

Bal Bhullar, Chief Financial Officer

395,083

Nil

Isaac Moss, Chief Administrative Officer and Secretary

745,964

Nil

Henry Reisner, Chief Operating Officer and President

1,858

Nil

Steven Sanders, Chairman and a director

363,104

Nil

Jerry Kroll, a director

72,691

Nil

Joanne Yan, a director

358,618

Nil

Luisa Ingargiola, a director

348,935

Nil

Peter Savagian, a director

414,787

Nil

Note:(*)

The amount represents the aggregate dollar value that would have been realized if the Options had been exercised on the vesting date, based on thedifference between the closing price of our shares on the Nasdaq on vesting date, and the exercise price of the Options, multiplied by the number ofOptions that have vested.

Director Compensation for Fiscal 2020 The following table sets forth all compensation for services as a director to the Company during the fiscal year ended December 31, 2020 in respect of thedirectors set out below, which for those directors who are Named Executive Officers excludes compensation for services provided as a Named ExecutiveOfficer.

Share-based

Equity Incentive

All Other

Total

Awards

Compensation

Director

Year

Salary ($)

($)

($) (*)

($)

Michael Paul Rivera

2020

Nil

Jerry Kroll

2020

Nil

Bal Bhullar

2020

Nil

Henry Reisner

2020

Nil

Steven Sanders

2020

106,667

Nil

44,167

Nil

150,834

Jerry Kroll

2020

26,250

Nil

26,250

Joanne Yan

2020

41,356

Nil

38,750

Nil

80,106

Luisa Ingargiola

2020

70,002

Nil

29,997

Nil

99,999

Peter Savagian

2020

49,625

Nil

39,250

Nil

88,875

Jack Austin

2020

13,533

Nil

13,533

Note:(*)

Option-based awards represent the fair value of Options granted in the year under the 2020 Stock Incentive Plan. The fair value of Options grantedis calculated as of the grant date using the Black-Scholes option pricing model. For a discussion of the assumptions made in the valuation, refer toNote 11 to our financial statements for the fiscal year ended December 31, 2019.

We reimburse out-of-pocket costs that are incurred by the directors.


Pension Benefits We do not have any defined benefit pension plans or any other plans providing for retirement payments or benefits. Termination of Employment and Change of Control Benefits Details with respect to termination of employment and change of control benefits for our directors and executive officers is reported above under the sectiontitled “Executive Compensation Agreements”. C. Board Practices Board of Directors Our Notice of Articles and Articles were filed as an exhibit to our registration statement on Form F-1 as filed with the SEC on October 12, 2016 andincorporated herein by reference. The Articles of the Company provide that the number of directors is set at:
(a) subject to paragraphs (b) and (c), the number of directors that is equal to the number of our first directors;

(b) if we are a public company, the greater of three and the number most recently elected by ordinary resolution (whether or not previous notice of the
	resolution was given); and

(c) if we are not a public company, the number most recently elected by ordinary resolution (whether or not previous notice of the resolution was
	given).
Our Board of Directors currently consists of eight directors. Our directors are elected annually at each annual meeting of our Company’s shareholders. TheBoard of Directors assesses potential Board candidates to fill perceived needs on the Board of Directors for required skills, expertise, independence and otherfactors. Management is delegated the responsibility for meeting defined corporate objectives, implementing approved strategic and operating plans, carrying on theCompany’s business in the ordinary course, managing cash flow, evaluating new business opportunities, recruiting staff and complying with applicableregulatory requirements. The Board of Directors facilitates its independent supervision over management by reviewing and approving long-term strategic,business and capital plans, material contracts and business transactions, and all debt and equity financing transactions. Through its Audit Committee, theBoard of Directors examines the effectiveness of the Company’s internal control processes and management information systems. The CompensationCommittee reviews executive compensation and recommends Option grants. Members of the Company’s Audit Committee are Luisa Ingargiola (Chair),Steven Sanders, Joanne Yan and Peter Savagian. The independent members of the Board of Directors are Ms. Ingargiola, Ms. Yan and Messrs. Sanders and Savagian. Ms. Bhullar and Messrs. Rivera andReisner are not independent as they are officers of the Company and Mr. Kroll is not independent as he is a significant security holder of the Company andwas the former Chief Executive Officer of the Company until August 12, 2019.
		84


Directors are considered to be independent if they have no direct or indirect material relationship with the Company. A “material relationship” is arelationship which could, in the Board of Directors’ opinion, be reasonably expected to interfere with the exercise of a director’s independent judgment. TheBoard of Directors facilitates its independent supervision over management of the Company through frequent meetings of the Board of Directors at whichmembers of management or non-independent directors are not in attendance and by retaining independent consultants where it deems necessary. On April 16, 2020, the Board of Directors adopted a new Board Mandate among other new corporate governance materials. Pursuant to the Board Mandate,the Board of Directors is specifically charged with responsibility for:
(a) to the extent feasible, satisfying itself as to the integrity of the Chief Executive Officer and other executive officers and that the Chief Executive
	Officer and other executive officers create a culture of integrity throughout the Company;

(b) adopting a strategic planning process and approving, on at least an annual basis, a strategic plan which takes into account, among other things, the
	opportunities and risks of the business;

(c) the identification of the principal risks of the Company’s business, and ensuring the implementation of appropriate systems to manage these risks;

(d) succession planning (including appointing, training and monitoring senior management);

(e) adopting a communication policy for the Company;

(f) the Company’s internal control and management information systems; and

(g) developing the Company’s approach to corporate governance, including developing a set of corporate governance principles and guidelines that are
	specifically applicable to the Company.
A copy of the complete text of the Board Mandate was filed as Exhibit 99.5 to the Company’s Form 6-K filed with the SEC on April 27, 2020, and a copycan also be viewed on the Company’s website at https://investors.electrameccanica.com/governance-docs. Our Board of Directors is responsible for appointing our Company’s officers. On April 16, 2020, our Board of Directors adopted written positiondescriptions for the Chair of the Board of Directors and the Chair of each committee of the Board of Directors. In addition, our Board of Directors and theCEO have adopted a written position description for the CEO. When new directors are appointed, they receive orientation, commensurate with their previous experience, on the Company’s assets, business, technologyand industry and on the responsibilities of directors. Board of Directors’ meetings may also include presentations by the Company’s management and employees to give the directors additional insight into theCompany’s business. Board of Director Committees Our Board of Directors currently has four committees, the Audit Committee, the Nominating and Corporate Governance Committee, the CompensationCommittee and the Corporate Disclosure Committee.
		85


Audit Committee Our Audit Committee consists of Luisa Ingargiola, Steven Sanders, Joanne Yan and Peter Savagian and is chaired by Luisa Ingargiola. Each member of theAudit Committee satisfies the “independence” requirements of Rule 5605(a)(2) of the Listing Rules of the Nasdaq and meets the independence standardsunder Rule 10A-3 under the Exchange Act. Our Audit Committee consists solely of independent directors that satisfy the Nasdaq and SEC requirements. OurBoard of Directors believes that Louisa Ingargiola qualifies as an audit committee financial expert pursuant to Items 16A(b) and (c) of Form 20-F. The AuditCommittee oversees our accounting and financial reporting processes and the audits of the financial statements of our Company. The Audit Committee isresponsible for, among other things:
•	selecting our independent registered public accounting firm and pre-approving all auditing and non-auditing services permitted to be performed byour independent registered public accounting firm;

•	reviewing with our independent registered public accounting firm any audit problems or difficulties and management’s response and approving allproposed related party transactions, as defined in Item 404 of Regulation S-K;

•	discussing the annual audited financial statements with management and our independent registered public accounting firm;

•	annually reviewing and reassessing the adequacy of our Audit Committee Charter;

•	meeting separately and periodically with the management and our internal auditor and our independent registered public accounting firm;

•	reporting regularly to the full Board of Directors;

•	reviewing the adequacy and effectiveness of our accounting and internal control policies and procedures and any steps taken to monitor and controlmajor financial risk exposure; and

•	such other matters that are specifically delegated to our Audit Committee by our Board of Directors from time to time.
Nominating and Corporate Governance Committee On April 16, 2020, our Board of Directors adopted a new Nominating and Corporate Governance Committee Charter that complies with the requirements ofNasdaq Listing Rule 5605(e)(2), and has established a nominating and corporate governance committee (the “N&CG Committee”) which operates under itsNominating and Corporate Governance Committee Charter. The N&CG Committee is currently comprised of Steven Sanders (Chair), Luisa Ingargiola,Joanne Yan and Peter Savagian. The N&CG Committee is responsible for corporate governance generally, reviewing the composition and size of the Boardof Directors, evaluating the Board of Directors as a whole, identifying, considering and recommending candidates to fill new positions or vacancies on theBoard of Directors, evaluating individual members of the Board of Directors, reviewing composition of each committee of the Board of Directors,recommending persons to be members of various committees and dealing with conflicts of interest. The N&CG Committee is responsible for: making recommendations to the Board of Directors regarding an appropriate organization and structure for theBoard of Directors; evaluating the size, composition, membership qualifications, scope of authority, responsibilities, reporting obligations and charters ofeach committee of the Board of Directors; periodically reviewing and assessing the adequacy of the Company’s corporate governance principles as containedin the Nominating and Corporate Governance Committee Charter and, should it deem it appropriate, it may develop and recommend to the Board ofDirectors for adoption of additional corporate governance principles; periodically reviewing the Company’s Articles and Bylaws in light of existingcorporate governance trends, and shall recommend any proposed changes for adoption by the Board of Directors or submission by the Board of Directors tothe Company’s shareholders; making recommendations on the structure and logistics of Board of Directors’ meetings and may recommend matters forconsideration by the Board of Directors; considering, adopting and overseeing all processes for evaluating the performance of the Board of Directors, eachcommittee and individual directors; and annually reviewing and assessing its own performance.
		86


Compensation Committee On April 16, 2020, our Board of Directors adopted a new Compensation Committee Charter which complies with the requirements of Nasdaq Listing Rule5605(d)(1) and the Board of Directors has established a Compensation Committee (the “Compensation Committee”). The Compensation Committee iscomprised of Luisa Ingargiola (Chair), Steven Sanders, Joanne Yan and Peter Savagian. The Compensation Committee determines compensation for the directors and officers of the Company, as well as the procedures for this determination, asare described under “Overview of Executive Compensation Program” herein. Our Compensation Committee also reviews any “red flags” or issues that may arise out of the Compensation Committee compensation and awardrecommendations and report them to the Board of Directors. The Compensation Committee and the N&CG Committee, at times, may be collaborative butwill not coordinate as the process is intended to be a “checks and balance” approach. It is set up as an internal control mechanism that would safeguardagainst fraud and errors due to omission. Each of the Compensation Committee members satisfies the “independence” requirements of Rule 5605(a)(2) of the Listing Rules of Nasdaq. OurCompensation Committee will assist the Board of Directors in reviewing and approving the compensation structure, including all forms of compensation,relating to our directors and executive officers. No officer may be present at any committee meeting during which such officer’s compensation is deliberatedupon. The Compensation Committee will be responsible for, among other things:
•	reviewing and recommending to the Board of Directors for approval with respect to the total compensation package for our most senior executiveofficers;

•	approving and overseeing the total compensation package for our executives other than the most senior executive officers;

•	reviewing and recommending to the Board of Directors with respect to the compensation of our directors;

•	reviewing periodically and approving any long-term incentive compensation or equity plans;

•	selecting compensation consultants, legal counsel or other advisors after taking into consideration all factors relevant to that person’s independencefrom management; and

•	programs or similar arrangements, annual bonuses, employee pension and welfare benefit plans.
Corporate Disclosure Committee Our Corporate Disclosure Committee consists of Steven Sanders, Luisa Ingargiola, Joanne Yan and Peter Savagian and is chaired by Steven Sanders. TheCorporate Disclosure Committee oversees the effectiveness of risk management policies, procedures and practices implemented by management of theCompany with respect to strategic, operational, environmental, health and safety, human resources, legal and compliance and other risks faced by theCompany. The Corporate Disclosure Committee:
•	reviews executive management’s assessment of our material risk exposures and our actions to identify, monitor and mitigate such exposures,
		87

•

reviews executive management’s implementation of systems and controls designed to promote compliance with applicable legal and regulatoryrequirements and

•

Reports to the Board of Directors on an annual basis with respect to the committee’s review of our material risks and measures in place to mitigatethem, and at least annually in respect of the committee’s other activities.

•

provides compliant Regulation FD strategic leadership for social media through the alignment of social media strategies and activities withenterprise strategic objectives and processes;

•

establishes and maintains corporate policies with respect to use of social media for both process-driven social engagements, as well as for use ofsocial media by employees for participating in social conversations (e.g., blogging and Tweeting by subject matter experts);

•

prioritizes social media initiatives and deliver final approvals and recommendations on proceeding with proposed social media projects, includingprocess, technology and organizational projects; and

•

ensures open communication between the social media department and our other functional units so as to promote collaborative strategies, planning,and implementation.

D. Employees As of March 17, 2021, we employed a total of 119 full-time and 18 part-time people. None of our employees are covered by a collective bargainingagreement. The breakdown of full-time employees by main category of activity is as follows:

Number of

Activity

Employees

Engineering/R&D

Sales & Marketing

General & Administration

Executives

E. Share Ownership Shares The shareholdings of our officers and directors are set out in Item 7 below. Options The Options, exercisable into common shares of the Company, held by our officers and directors are set out in Item 6 B above. Warrants Warrants, exercisable into common shares of the Company, held by our officers and directors are set forth below as of March 23, 2021.

Name

Position

Allotment date

Expiration date

Exercise price

Total

Joanne Yan

Director

Nov. 21, 2016

Nov. 21, 2021 $

4.00 CAD

50,000


ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS A. Major Shareholders Security Ownership of Certain Beneficial Owners and Management The following table sets forth certain information regarding the beneficial ownership of our common share as of March 23, 2021 by: (a) each stockholderwho is known to us to own beneficially 5% or more of our outstanding common share; (b) all directors; (c) our executive officers; and (d) all executiveofficers and directors as a group. Except as otherwise indicated, all persons listed below have (i) sole voting power and investment power with respect totheir common shares, except to the extent that authority is shared by spouses under applicable law, and (ii) record and beneficial ownership with respect totheir common shares.
	Common			Percentage of
			Shares of the				Common
			Company				Shares
			Beneficially				Beneficially
Name			Owned (1)				Owned (2)
Directors and Executive Officers:

Michael Paul Rivera(3), Chief Executive Officer and a director		1,670,171			1.5%

Henry Reisner(4), Chief Operating Officer, President and a director		2,497,904			2.2%

Bal Bhullar(5), Chief Financial Officer and a director		953,901			*

Steven Sanders(6), Chairman and a director		351,476			*

Jerry Kroll(7), a director		10,779,820			9.3%

Joanne Yan(8), a director		430,315			*

Luisa Ingargiola(9), a director		321,623			*

Peter Savagian(10), a director		350,755			*

Isaac Moss(11), Chief Administrative Officer and Corporate Secretary		1,000,000			*

Directors and Executive Officers as a Group (Eleven Persons)		18,355,965			15.99%

Other 5% or more Shareholders:

Megan Martin(12)		2,700,000			2.4%

Shang Wen Yang(13)		3,762,972			3.3%

Unison International Holdings Ltd.(14)		3,200,000			2.8%

Zongshen (Canada) Environtech Ltd.(15)		2,800,000			2.4%
						89


Notes: *
	Less than 1%.
(1)	Under Rule 13d-3, a beneficial owner of a security includes any person who, directly or indirectly, through any contract, arrangement, understanding,relationship, or otherwise has or common shares: (i) voting power, which includes the power to vote, or to direct the voting of common shares; and(ii) investment power, which includes the power to dispose or direct the disposition of common shares. Certain shares may be deemed to bebeneficially owned by more than one person (if, for example, persons share the power to vote or the power to dispose of the common shares). Inaddition, shares are deemed to be beneficially owned by a person if the person has the right to acquire the shares (for example, upon exercise of anoption) within 60 days of the date as of which the information is provided. In computing the percentage ownership of any person, the amount ofshares outstanding is deemed to include the amount of shares beneficially owned by such person (and only such person) by reason of theseacquisition rights. As a result, the percentage of outstanding shares of any person as shown in this table does not necessarily reflect the person’sactual ownership or voting power with respect to the number of common shares actually outstanding on March 23, 2021.
(2)	The percentage is calculated based on 112,908,266 common shares that were outstanding as of March 23, 2021.
(3)	Shares beneficially owned consists of (i) an Option to purchase 1,487,027 of our common shares which have vested and (ii) 183,144 shares of ourcommon stock which will vest within 60 days of March 23, 2021.
(4)	Shares beneficially owned consists of (i) 2,375,000 common shares registered directly to Henry Reisner, (ii)an Option to purchase 122,695 shares ofour common stock which have vested and (iii) an Option to purchase 209 shares of our common stock which will vest within 60 days of March 23,2021.
(5)	Shares beneficially owned consists of (i) 3,900 common shares registered directly to Bal Bhullar, (ii) an Option to purchase 888,890 shares of ourcommon stock which have vested and (iii) an Option to purchase 61,111 shares of our common stock which will vest within 60 days of March 23,2021.
(6)	Shares beneficially owned consists of an Option to purchase 345,000 shares of our common share which have vested and 6,476 vested DSUs
(7)	Shares beneficially owned consists of (i) 4,475,000 common shares held by Jerry Kroll, (ii) 3,572,092 common shares registered to AscendSportmanagement Inc. (over which Mr. Kroll has discretionary voting and investment authority), (iii) Options to purchase 2,732,728 shares of ourcommon stock which have vested.
(8)	Shares beneficially owned consists of (i) 25,000 common shares registered directly to Joanne Yan, (ii) 50,000 common shares issuable upon theexercise of warrants registered directly to Ms. Yan, (iii) an Option to purchase 349,529 shares of our common stock which have vested (iv) an Optionto purchase 104 shares of our common stock which will vest within 60 days of March 23, 2021 and (v) 5,682 vested DSUs.
(9)	Shares beneficially owned consists of (i) 92,224 common shares registered directly to Luisa Ingargiola, (ii) an Option to purchase 225,000 shares ofour common share which have vested and (iii) 4,399 vested DSUs.
(10)	Shares beneficially owned consists of (i) an Option to purchase 345,000 shares of our common stock which have vested and (ii) 5,755 vested DSUs.
(11)	Shares beneficially owned consists of an Option to purchase 1,000,000 shares of our common stock which have vested..
(12)	Shares beneficially owned consists of (i) 1,250,000 common shares held by to Megan Martin, (ii) 1,250,000 common shares held by Ms. Martin’shusband, Yuan Sheng Zhang, (iii) 200,000 common shares held by Ms. Martin’s son, Bo Hong Zhang,
(13)	Shares beneficially owned consists of (i) 1,029,688 common shares registered directly to Shang Wen Yang (ii) 500,017 common shares held by Mr.Yang’s mother, Cheng Quan Sang, (iii) 320,080 common shares held by Canada Jia-Qiao Group Investment Ltd. (over which Mr. Yang’s mother hasdiscretionary voting and investment authority), (iv) stock options held by Shang Wen Yang to purchase 57,090 shares of our common stock whichhave vested, (v) 1,000,000 common shares issuable upon the exercise of warrants registered directly to Shang Wen Yang, (vi) 500,017 commonshares issuable upon the exercise of warrants registered directly to Mr. Yang’s mother and (vii) 320,080 common shares issuable upon the exercise ofwarrants registered directly to Canada Jia-Qiao Group Investment Ltd.
(14)	Shares beneficially owned consists of (i) 1,710,000 common shares registered directly to Unison International Holdings Ltd. and (ii) 1,490,000common shares issuable upon the exercise of warrants registered directly to Unison International Holdings Ltd. (over which Mr. Ping Hui Lu hasdiscretionary voting and investment authority).
(15)	Shares beneficially owned consists of (i) 1,400,000 common shares registered directly to Zongshen (Canada) Environtech Ltd. and (ii) 1,400,000common shares issuable upon the exercise of warrants registered directly to Zongshen (Canada) Environtech Ltd. (over which Mr. Daxue Zhang hasdiscretionary voting and investment authority).
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The information as to shares beneficially owned, not being within our knowledge, has been furnished by the officers and directors. As at March 23, 2021, there were 37 holders of record of our common shares. Transfer Agent Our shares of common stock are recorded in registered form on the books of our transfer agent, VStock Transfer, LLC, located 18 Lafayette Place,Woodmere, New York 11598. B. Related Party Transactions Michael Paul Rivera On June 24, 2019, we granted an Option for 700,000 common shares to Mr. Rivera having an exercise price of US$2.62 per common share and beingexercisable until June 24, 2022. On December 6, 2019, we granted an Option for 2,300,000 common shares to Mr. Rivera having an exercise price ofUS$1.91 per common share and being exercisable until December 6, 2022. On May 17, 2019, the Company entered into the Rivera Agreement with Mr Rivera. Effective on January 1, 2020, Mr. Rivera and the Company entered intothe Amended Rivera Agreement to the Rivera Agreement. Mr. Rivera has a base salary annual salary of US$300,000 with a guaranteed bonus ofUS$150,000. In January 2020, Mr. Rivera received a US$38,904 bonus payment for fiscal 2019. Based on certain recommendations provided to the CompensationCommittee by GGA, on July 20, 2020, the Rivera Agreement annual Base Salary was amended to US$370,000 and Mr. Rivera was awarded 209,302 RSUswhich vest as to on- third at the end of each year during the RSU vesting period. On November 26, 2020, the Compensation Committee approved a cashbonus to Mr. Rivera of US$277,500 for fiscal 2020. Henry Reisner On October 18, 2017, we entered into a Share Purchase Agreement (the “SPA”) to acquire Intermeccanica with Mr. Reisner and two members of his family,which replaced a prior Joint Operating Agreement, dated July 15, 2015, as amended on September 19, 2016, which was comprised of three underlyingagreements. Under the SPA, we agreed to purchase all the shares of Intermeccanica for CAD$2,500,000; CAD$300,000 of which had been previously paidunder the Joint Operating Agreement. At closing we paid the sellers CAD$700,000 and issued a promissory note (the “Note”) for the balance ofCAD$1,500,000. On January 28, 2018, we paid off all of the principal and interest due on the Note for CAD$1,520,548. On February 16, 2015, Mr. Reisner acquired 2,375,000 common shares at a deemed price of CAD$0.0004 per common share pursuant to a private shareacquisition. Mr. Reisner’s wife and daughter acquired 525,000 common shares and 125,000 common shares, respectively, at a deemed price of CAD$0.0004per common share pursuant to a private share acquisition. On August 13, 2015, we granted an Option for 625,000 common shares to Mr. Reisner having an exercise price of CAD $0.30 per common share and beingexercisable until August 13, 2022. On July 20, 2018, Mr. Reisner agreed to forfeit an aggregate of 568,182 of that Option. As of the date hereof, Mr. Reisnerholds 56,818 of that Option. In addition, on December 9, 2015, we granted an Option for 625,000 common shares to Mr. Reisner having an exercise price ofCAD$0.80 per common share and being exercisable until December 9, 2022. On July 20, 2018, Mr. Reisner agreed to forfeit an aggregate of 568,182 of thatOption. As of the date hereof, Mr. Reisner holds 56,818 of that Option. On February 17, 2017, we granted an Option for 5,000 common shares to Mr. Reisnerhaving an exercise price of CAD$2.00 per common share and being exercisable until February 17, 2024. Furthermore, on January 5, 2018, we granted anOption for 5,000 common shares to Mr. Reisner having an exercise price of $9.60 per common share and being exercisable until January 5, 2025.
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On January 15, 2019, we entered into an executive employment agreement with Mr. Reisner pursuant to which he receives a base salary in the amount ofCAD$180,000 per year. On January 15, 2020, we replaced that agreement with the Reisner Agreement pursuant to which Mr. Reisner receives a base salaryin the amount of CAD$225,000 per year and subject to an additional CAD$25,000 bonus. In the summer of 2020, Mr. Reisner received a CAD$50,000 bonus payment for fiscal 2019. Based on certain recommendations provided to theCompensation Committee from GGA, on July 20, 2020, the Reisner Agreement annual Monthly Salary was amended to $260,000 and Mr. Reisner wasawarded 98,256 RSUs which vest as to one-third at the end of each year during the RSU vesting period. On November 26, 2020, the CompensationCommittee approved a cash bonus to Mr. Reisner of $104,000 for fiscal 2020. Bal Bhullar On February 19, 2019, Ms. Bhullar bought 3,800 common shares at price of $4.59 and 100 shares at a price of $4.57. On March 19, 2019, we granted anOption for 400,000 common shares to Ms. Bhullar having an exercise price of $3.40 per common share and being exercisable until March 19, 2026. OnDecember 6, 2019, we granted an Option for 1,100,000 common shares to Ms. Bhullar having an exercise price of $1.91 per common share and beingexercisable until December 6, 2026. On January 15, 2019, we entered into a Consulting Agreement with BKB Management Ltd., a company under the control and direction of Ms. Bhullar, andwhich superseded our Company’s prior offer letter with Ms. Bhullar, dated October 19, 2018. A bonus of CAD$36,000 was paid at the end of 2019. OnJanuary 1, 2020, we entered into the Bhullar Agreement with Ms. Bhullar, and which superseded the Consulting Agreement, and pursuant to which Ms.Bhullar receives CAD$280,000 per year. Based on certain recommendations provided to the Compensation Committee by GGA, on July 20, 2020, the Bhullar Agreement annual Monthly Salary wasamended to $270,000 and Ms. Bhullar was awarded 102,035 RSUs which vest as to one-third at the end of each year during the RSU vesting period. OnNovember 26, 2020, the Compensation Committee approved a cash bonus of $108,000 to Ms. Bhullar for fiscal 2020. Steven Sanders On May 5, 2018, we issued an Option to purchase 75,000 of our common shares at $9.00 to Steven Sanders in exchange for his services as a director of ourCompany. The Option vested in equal quarters every three months with the first quarter vesting on the date the Option was granted, and it has now beencancelled. On March 19, 2019, we granted an Option to purchase 120,000 common shares to Mr. Sanders having an exercise price of $3.40 per commonshare and being exercisable until March 19, 2026. On December 6, 2019, we granted an Option to purchase 225,000 common shares to Mr. Sanders havingan exercise price of $1.91per common share and being exercisable until December 6, 2026. Mr. Sanders now receives directors’ fees of $125,000 annually. Based on certain recommendations provided to the Compensation Committee by GGA, on July 22, 2020, Mr. Sanders’ annual directors’ fees were amendedto $132,500, whereby $88,333 will be paid in quarterly installments with the balance being payable in 12,952 DSUs.
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Jerry Kroll On October 16, 2017, Jerry Kroll, our then CEO, as Pledgor, entered into a Share Pledge to guarantee the payment by the Company for the cost of theprototype tooling and molds estimated to be CNY ¥9.5 million (CAD$1.4 million) to Zongshen through the pledge of 400,000 common shares of theCompany. The Company approved its obligations under the Share Pledge and had agreed to reimburse the Pledgor on a one for one basis for any pledgedshares realized by Zongshen. During third quarter of 2020, the Company has paid 100% of the cost of the prototype tooling and molds and, accordingly, theShare Pledge has been terminated. From February 16, 2015 to November 13, 2015, Mr. Kroll provided us with loans in the aggregate amount of CAD$185,000. These loans were unsecured,non-interest bearing and due on demand. No formal written agreements regarding these loans were signed, however, they are documented in our accountingrecords. On January 20, 2016, we repaid CAD$135,000 of these loans and CAD$50,000 was repaid through the issuance of 62,500 post-subdivision units ofour Company at a price of CAD$0.80 per unit. On February 16, 2015, Mr. Kroll acquired 3,500,000 common shares of our Company and Ascend Sportmanagement Inc., a corporation under the controland direction of Mr. Kroll, acquired 5,000,000 common shares at a price of CAD$0.0004 per common share pursuant to a private placement. In addition, onJune 15, 2015, Mr. Kroll acquired 25,000 units of our Company at a price of CAD $0.40 per unit pursuant to a private placement. Each unit consisted of onecommon share and one common share purchase warrant. Each warrant is exercisable for one additional common share at a price of CAD$0.80 per commonshare and is exercisable until June 15, 2020. Furthermore, on January 22, 2016, Mr. Kroll acquired 62,500 units of our Company at a price of CAD$0.80 perunit pursuant to a private placement. Each unit consisted of one common share and one common share purchase warrant. Each warrant is exercisable for oneadditional common share at a price of CAD$2.00 per common share and is exercisable until January 22, 2021. On June 11, 2015, we granted an Option to purchase 22,500,000 of our common shares to Mr. Kroll having an exercise price of CAD$0.30 per commonshare and being exercisable until June 11, 2022. On July 20, 2018, Mr. Kroll agreed to forfeit an aggregate of 20,454,545 of that Option. As of the datehereof, Mr. Kroll holds 2,045,455 of that Option. In addition, on December 9, 2015, we granted an Option to purchase 2,500,000 of our common shares toMr. Kroll having an exercise price of CAD $0.80 per common share and being exercisable until December 9, 2022. On July 20, 2018, Mr. Kroll agreed toforfeit an aggregate of 2,272,777 of that Option. As of the date hereof, Mr. Kroll holds 227,273 of that Option. On February 17, 2017, we granted an Optionto purchase 5,000 of our common shares to Mr. Kroll having an exercise price of CAD$2.00 per common share and being exercisable until February 17,2024. Furthermore, on January 5, 2018 we granted an Option to purchase 5,000 of our common shares to Mr. Kroll having an exercise price of $9.60 percommon share and being exercisable until January 5, 2025. On August 4, 2019, Mr. Kroll was granted an Option to purchase 1,250,000 of our commonshares an exercise price of $2.45 per common share and is exercisable until August 4, 2026. On January 15, 2019, we entered into the Kroll Agreement with Mr. Kroll, which superseded our Company’s prior agreement with Mr. Kroll, dated July 1,2016, which had been amended in August of 2018. On August 16, 2019, we entered into the Continuing Relationship Agreement with Mr. Kroll, whichsuperseded the Kroll Agreement, and pursuant to which Mr. Kroll received a fee of CAD$300,000 over a period of 12 months. As a result of the expirationof the Continuation Relationship Agreement on August 16, 2020, Mr. Kroll now receives annual directors’ fees of US$70,000 which are paid quarterly. Luisa Ingargiola On May 5, 2018, we issued an Option to purchase 75,000 of our common shares at $9.00 to Luisa Ingargiola in exchange for her services as a director of ourCompany. That Option vested in equal quarters every three months with the first quarter vesting on the date the Option was granted and it has now beencancelled. On March 19, 2019, we granted an Option to purchase 120,000 of our common shares to Ms. Ingargiola having an exercise price of $3.40 percommon share and being exercisable until March 19, 2026. On December 6, 2019, we granted an Option to purchase 225,000 of our common shares to Ms.Ingargiola having an exercise price of $1.91per common share and being exercisable until December 6, 2026. Ms. Ingargiola receives directors’ fees of$80,000 annually.
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Based on certain recommendations provided to the Compensation Committee by GGA, on July 22, 2020, Ms. Ingargiola’s annual directors’ fees wereamended to $90,000, whereby $60,003 will be paid in quarterly installments and the balance will be paid in 8,797 DSUs. Jack Austin On November 20, 2018 we appointed the Honorable Jack Austin to our Board of Directors. In conjunction with such appointment Mr. Austin was granted anOption to purchase 120,000 of our common shares, at an exercise price of $1.53 and being exercisable until November 20, 2023, and directors’ fees ofCAD$60,000 annually. On December 6, 2019, we granted an Option to purchase 225,000 of our common shares to Mr. Austin having an exercise price of$1.91per common share and being exercisable until December 6, 2026. Mr. Austin resigned as a director on April 20, 2020; such that his Options are now terminated. Joanne Yan On November 7, 2016, Joanne Yan acquired 50,000 units of our Company at a price of CAD$0.3634 per unit. Ms. Yan has only 25,000 of those commonshares left. Each unit consisted of one common share and one common share purchase warrant. Each warrant is exercisable for one additional common shareat a price of CAD$4.00 per common share and is exercisable until November 7, 2021. On February 17, 2017, we granted an Option to purchase 2,500 common shares to Ms. Yan having an exercise price of CAD$2.00 per common share andbeing exercisable until February 17, 2024. On January 5, 2018, we granted an Option to purchase 2,500 of our common shares to Ms. Yan having an exerciseprice of $9.60 per common share and being exercisable until January 5, 2025. On March 19, 2019, we granted an Option to purchase 120,000 of our commonshares to Ms. Yan having an exercise price of $3.40 per common share and being exercisable until March 19, 2026. On December 6, 2019, we granted anOption to purchase 225,000 of our common shares to Ms. Yan having an exercise price of $1.91per common share and being exercisable until December 6,2026. Ms. Yan receives directors’ fees of $60,000 annually. Based on certain recommendations provided to the Compensation Committee by GGA, on July 22, 2020, Ms. Yan’s annual directors’ fees were amended toUS$77,500, whereby USD$38,750 will be paid in quarterly installments and the balance will be paid in 11,364 DSUs. Peter Savagian On October 16, 2019 we appointed Peter Savagian to our Board of Directors. In conjunction with such appointment Mr. Savagian was granted an Option topurchase 120,000 of our common shares, with an exercise price of $1.80 per common share and being exercisable until October 16, 2026, and directors’ feesof $60,000 annually. On December 6, 2019, we granted an Option to purchase 225,000 of our common shares to Mr. Savagian having an exercise price of$1.91 per common share and being exercisable until December 6, 2026. Based on certain recommendations provided to the Compensation Committee by GGA, on July 22, 2020, Mr. Savagian’s annual directors’ fees wereamended to $78,500, whereby $39,250 will be paid in quarterly installments and the balance will be paid in 11,510 DSUs. Shaun Greffard On August 13, 2015, we granted an Option to purchase 25,000 of our common shares to Shaun Greffard having an exercise price of CAD$0.30 per commonshare and being exercisable until August 13, 2022. In addition, on December 9, 2015, we granted an Option to purchase12,500 of our common shares to Mr.Greffard having an exercise price of CAD$0.80 per common share and being exercisable until December 9, 2022. On February 17, 2017, we granted anOption to purchase 125,000 of our common shares to Mr. Greffard having an exercise price of CAD$2.00 per common share and being exercisable untilFebruary 17, 2024. Furthermore, on January 5, 2018, we granted an Option to purchase 5,000 of our common shares to Mr. Greffard having an exercise priceof $9.60 per common share and being exercisable until January 5, 2025. Mr. Greffard was paid directors’ fee of CAD$60,000 for fiscal 2019 and resigned onDecember 6, 2019.
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Isaac Moss On January 5, 2018 we granted an Option to purchase 125,000 of our common shares to Isaac Moss having an exercise price of $9.60 per common share andbeing exercisable until January 5, 2025, and that Option has now been cancelled. On March 19, 2019, we granted an Option to purchase 250,000 of ourcommon shares to Mr. Moss having an exercise price of $3.40 per common share and being exercisable until March 19, 2026. On December 6, 2019, wegranted an Option to purchase 750,000 of our common shares to Mr. Moss having an exercise price of $1.91 per common share and being exercisable untilDecember 6, 2026. On January 15, 2019, our Board of Directors approved the entering into of the Prior Moss Agreement which superseded our Company’s prior agreement withMr. Moss which had been amended in August of 2018. On July 1, 2020, our Board of Directors approved the entering into of the new Moss Agreementwhich superseded the Prior Moss Agreement. Based on certain recommendations provided to the Compensation Committee by GGA, on July 20, 2020, the Moss Agreement annual Monthly Salary wasamended to $260,000 and Mr. Moss was awarded 98,256 RSUs which vest as to one-third at the end of each year during the RSU vesting period. OnNovember 26, 2020, the Compensation Committee approved a cash bonus of $104,000 to Mr. Moss for fiscal 2020. Iain Ball On August 13, 2015, we granted an Option to purchase 250,000 of our common shares to Iain Ball having an exercise price of CAD$0.30 per common shareand being exercisable until August 13, 2022. On July 20, 2018, Mr. Ball agreed to forfeit an aggregate of 227,273 of that Option. As of the date hereof, Mr.Ball exercised all stock options granted. In addition, on December 9, 2015, we granted an Option to purchase 375,000 of our common shares to Mr. Ballhaving an exercise price of CAD$0.80 per common share and being exercisable until December 9, 2022. On July 20, 2018, Mr. Ball agreed to forfeit anaggregate of 340,909 of that Option. On February 17, 2017, we granted an Option to purchase 5,000 of our common shares to Mr. Ball having an exerciseprice of CAD$2.00 per common share and being exercisable until February 17, 2024. Furthermore, on January 5, 2018, we granted an Option to purchase5,000 of our common shares to Mr. Ball having an exercise price of $9.60 per common share and being exercisable until January 5, 2025. On March 19,2019, we granted an Option to purchase 183,182 of our common shares to Mr. Ball having an exercise price of $3.40 per common share and beingexercisable until March 19, 2026. Mr. Ball resigned as an executive officer of our Company on June 30, 2019. On August 19, 2015, Mr. Iain Ball acquired 31,250 units of our Company at a price of CAD$0.80 per unit. Each unit consisted of one common share and onecommon share purchase warrant, and each warrant is exercisable for one additional common share at a price of CAD$2.00 per common share and wasexercisable until August 19, 2020. Ed Theobald On February 16, 2015, Ed Theobald acquired 250,000 common shares of our Company at a price of CAD$0.0004 per common share pursuant to a privateplacement.
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On August 13, 2015, we granted an Option to purchase 250,000 of our common shares to Ed. Theobald having an exercise price of CAD$0.30 per commonshare and being exercisable until August 13, 2022. On July 20, 2018, Mr. Theobald agreed to forfeit an aggregate of 227,273 of that Option. In addition, onDecember 9, 2015, we granted an Option to purchase 375,000 of our common shares to Mr. Theobald having an exercise price of CAD$0.80 per commonshare until December 9, 2022. On July 20, 2018, Mr. Theobald agreed to forfeit an aggregate of 340,909 of that Option. On February 17, 2017, we granted anOption to purchase 5,000 of our common shares to Mr. Theobald having an exercise price of CAD$2.00 per common share and being exercisable untilFebruary 17, 2024. Furthermore, on January 5, 2018, we granted an Option to purchase 5,000 of our common shares to Mr. Theobald having an exerciseprice of $9.60 per common share and being exercisable until January 5, 2025. Mr. Theobald resigned as an executive officer of our Company on June 30,2019. Zongshen (Canada) Environtech Ltd. On October 2, 2017, we announced a Manufacturing Agreement with Zongshen to produce 75,000 SOLO all-electric vehicles, which we expect to occur inthe three full years from the commencement of production. Zongshen is an entity under common control with Zongshen (Canada) Environtech Ltd., which isthe beneficial owner of approximately 2.4% of our common shares. The production plan in the Manufacturing Agreement is 75,000 SOLOs over a period ofthree years once mass scale production has begun. We commenced production on August 26, 2020. Under the Manufacturing Agreement we agreed toreimburse Zongshen for the estimated cost of the prototype tooling and molds in amount of $1.4million and of the mass production tooling and molds inamount of $4.3 million, which shall be payable 50% when Zongshen commences manufacturing the tooling and molds. At December 31, 2020, Zongshencompleted prototype tooling and molds with actual cost of $1.7 million and the mass production tooling and molds with actual cost of $6.2 million. TheCompany inspected the completed prototype and mass production tooling and molds. The Company paid 100% of the prototype tooling and molds cost and80% of the mass production tolling and molds cost. The unpaid amount of mass production tooling and molds is included in accrued liabilities as atDecember 31, 2020. The prototype and mass production tooling and molds are estimated to be used for three years to produce the Generation 3 SOLO EVs. The existingproduction tooling and molds will be depreciated on a straight-line basis over a 3 year period as the assets were custom built for the production of the SOLOEVs and will be retired at the end of the production run. The Company estimates that the residual value of the assets will be minimal at the end of the 3 yearperiod. C. Interests of Experts and Counsel Not applicable.
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ITEM 8. FINANCIAL INFORMATION A. Consolidated Statements and Other Financial Information Financial Statements The financial statements of the Company for the years ended December 31, 2020, 2019 and 2018 have been prepared in accordance with IFRS, as issued bythe International Accounting Standards Board, or IASB, and are included under Item 18 of this Annual Report. The financial statements including relatednotes are accompanied by the report of the Company’s independent registered public accounting firm, KPMG LLP. Legal Proceedings As of the date of this Annual Report, in the opinion of our management, we are not currently a party to any litigation or legal proceedings which are material,either individually or in the aggregate, and, to our knowledge, no legal proceedings of a material nature involving us currently are contemplated by anyindividuals, entities or governmental authorities. Dividends We have not paid any dividends on our common shares since incorporation. Our management anticipates that we will retain all future earnings and other cashresources for the future operation and development of our business. We do not intend to declare or pay any cash dividends in the foreseeable future. Paymentof any future dividends will be at the Board of Directors’ discretion, subject to applicable law, after taking into account many factors including our operatingresults, financial condition and current and anticipated cash needs. B. Significant Changes We have not experienced any significant changes since the date of the financial statements included with this Annual Report except as disclosed in thisAnnual Report. ITEM 9. THE OFFER AND LISTING A. Offer and Listing Our common shares are traded on Nasdaq under the symbol “SOLO”. B. Plan of Distribution Not applicable. C. Markets Please see Item 9.A above. D. Selling Shareholders Not applicable.
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E. Dilution Not applicable. F. Expenses of the Issue Not applicable. ITEM 10. ADDITIONAL INFORMATION A. Share Capital Not applicable. B. Memorandum and Articles of Association The following is a summary of our Notice of Articles and Articles. You should read those documents for a complete understanding of the rights andlimitations set out therein. Our corporation number, as assigned by the British Columbia Registry Services, is BC1027632. Remuneration of Directors Our directors are entitled to the remuneration, if any, for acting as directors as the directors may from time to time determine. If the directors so decide, theremuneration of the directors will be determined by the shareholders. That remuneration may be in addition to any salary or other remuneration paid to adirector in such director’s capacity as an officer or employee of ours. Number of Directors According to Article 11.1 of our Articles, the number of directors, excluding additional directors appointed under Article 12.7 is set at:
(a) subject to paragraphs (b) and (c), the number of directors that is equal to the number of our first directors;

(b) if we are a public company, the greater of three and the number most recently elected by ordinary resolution (whether or not previous notice of the
	resolution was given); and

(c) if we are not a public company, the number most recently elected by ordinary resolution (whether or not previous notice of the resolution was
	given).
Directors Our directors are elected annually at each annual meeting of our Company’s shareholders. Our Articles provide that the Board of Directors may, betweenannual meetings, appoint one or more additional directors to serve until the next annual meeting, but the number of additional directors must not at any timeexceed:
(a) one-third of the number of first directors, if, at the time of the appointments, one or more of the first directors have not yet completed their first term
	of office; or

(b) in any other case, one-third of the number of the current directors who were elected or appointed as directors at the expiration of the last annual
	meeting of our Company’s shareholders.
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Our Articles provide that our directors may from time to time, on behalf of our Company, without shareholder approval:
•	create one or more classes or series of shares or, if none of the shares of a class or series of shares are allotted or issued, eliminate that class or seriesof shares;

•	increase, reduce or eliminate the maximum number of shares that we are authorized to issue out of any class or series of shares or establish amaximum number of shares that we are authorized to issue out of any class or series of shares for which no maximum is established;

•	if we are authorized to issue shares of a class of shares with par value;

•	decrease the par value of those shares;

•	if none of the shares of that class of shares are allotted or issued, increase the par value of those shares;

•	subdivide all or any of its unissued or fully paid issued shares with par value into shares of smaller par value;

•	consolidate all or any of its unissued or fully paid issued shares with par value into share of larger par value;

•	subdivide all or any of its unissued or fully paid issued shares without par value;

•	change all or any of its unissued or fully paid issued shares with par value into shares without par value or all or any of its unissued shares withoutpar value into shares with par value;

•	alter the identifying name of any of its shares;

•	consolidate all or any of its unissued or fully paid issued shares without par value;

•	otherwise alter it shares or authorized share structure when required or permitted to do so by the Business Corporations Act;

•	borrow money in the manner and amount, on the security, from the sources and on the terms and conditions that they consider appropriate;

•	issue bonds, debentures and other debt obligations either outright or as security for any liability or obligation of the Company or any other person,and at any discount or premium and on such terms as they consider appropriate;

•	guarantee the repayment of money by any other person or the performance of any obligation of any other person; and

•	mortgage or charge, whether by way of specific or floating charge, or give other security on the whole or any part of the present and future assetsand undertaking of the Company.
Our Articles also provide that we may by resolution of the directors authorize an alteration to our Notice of Articles to change our name or adopt or changeany translation of that name.
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Our Articles provide that the directors may meet together for the conduct of business, adjourn and otherwise regulate their meetings as they think fit, andmeetings of the Board of Directors held at regular intervals may be held at the place and at the time that the Board of Directors may by resolution from timeto time determine. Questions arising at any meeting of directors are to be decided by a majority of votes and, in the case of an equality of votes, the chair ofthe meeting does not have a second or casting vote. A director may participate in a meeting of the directors or of any committee of the directors in person, orby telephone or other communications medium, if all directors participating in the meeting are able to communicate with each other. A director mayparticipate in a meeting of the directors or of any committee of the directors by a communication medium other than telephone if all directors participating inthe meeting, whether in person or by telephone or other communications medium, are able to communicate with each other and if all directors who wish toparticipate in the meeting agree to such participation. A director who participates in a meeting in a manner contemplated by such provisions of our Articles isdeemed for all purposes of the Business Corporations Act and our Articles to be present at the meeting and to have agreed to participate in that manner. Our Articles provide that the quorum necessary for the transaction of the business of the directors may be set by the directors and, if not so set, is a majorityof the directors. Our Articles do not restrict: (i) a director’s power to vote on a proposal, arrangement or contract in which the director is materially interested (although theBusiness Corporations Act generally requires a director who is materially interested in a material contract or material transaction to disclose his or herinterest to the Board of Directors and to abstain from voting on any resolution to approve the contract or transaction, failing which the British ColumbiaSupreme Court may, on application of our Company or any of our shareholders, set aside the material contract or material transaction on any terms that itthinks fit, or require the director to account to us for any profit or gain realized on it, or both); or (ii) our directors’ power, in the absence of an independentquorum, to vote compensation to themselves or any members of their body. Our Articles do not set out a mandatory retirement age for our directors. Our directors are not required to own securities of our Company to serve asdirectors. Authorized Capital Our Notice of Articles provide that our authorized capital consists of an unlimited number of common shares, without par value, and an unlimited number ofpreferred shares, without par value, which have special rights or restrictions. Rights, Preferences and Restrictions Attaching to Our Shares The Business Corporations Act provides the following rights, privileges, restrictions and conditions attaching to our common shares:
•	to vote at meetings of shareholders, except meetings at which only holders of a specified class of shares are entitled to vote;

•	subject to the rights, privileges, restrictions and conditions attaching to any other class of shares of our company, to share equally in the remainingproperty of our company on liquidation, dissolution or winding-up of our company; and

•	subject to the rights of the preferred shares, the common shares are entitled to receive dividends if, as and when declared by the Board of Directors.
Our preferred shares may include one or more series and, subject to the Business Corporations Act, the directors may, by resolution, if none of the shares ofthat particular series are issued, alter our Articles and authorize the alteration of our Notice of Articles, as the case may be, to do one or more of thefollowing:
(a) determine the maximum number of shares of that series that we are authorized to issue and determine that there is no such maximum number or
	alter any such determination;

(b) create an identifying name for the shares of that series, or alter any such identifying name; and

(c) attach special rights or restrictions to the shares of that series, or alter any such special rights or restrictions.
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The provisions in our Articles attaching to our common shares and our preferred shares may be altered, amended, repealed, suspended or changed by theaffirmative vote of the holders of not less than two-thirds of the outstanding common shares and two-thirds of the preferred shares, as applicable. With the exception of special resolutions (i.e., resolutions in respect of fundamental changes to our Company, including the sale of all or substantially all ofour assets, a merger or other arrangement or an alteration to our authorized capital that is not allowed by resolution of the directors) that require the approvalof holders of two-thirds of the outstanding common shares entitled to vote at a meeting, either in person or by proxy, resolutions to approve matters broughtbefore a meeting of our shareholders require approval by a simple majority of the votes cast by shareholders entitled to vote at a meeting, either in person orby proxy. Shareholder Meetings The Business Corporations Act provides that: (i) a general meetings of shareholders must be held in British Columbia, or may be held at a location outsideBritish Columbia since our Articles do not restrict our Company from approving a location outside of British Columbia for the holding of the generalmeeting and the location for the meeting is approved by ordinary resolution, or the location for the meeting is approving in writing by the British ColumbiaRegistrar of Companies before the meeting is held; (ii) directors must call an annual meeting of shareholders not later than 15 months after the last precedingannual meeting; (iii) for the purpose of determining shareholders entitled to receive notice of or vote at meetings of shareholders, the directors may fix inadvance a date as the record date for that determination, provided that such date shall not precede by more than two months or by less than 21 days the dateon which the meeting is to be held; (iv) the holders of not less than 5% of the issued shares entitled to vote at a meeting may requisition the directors to call ameeting of shareholders for the purposes stated in the requisition; (v) only shareholders entitled to vote at the meeting, our directors and our auditor areentitled to be present at a meeting of shareholders; and (vi) upon the application of a director or shareholder entitled to vote at the meeting, the BritishColumbia Supreme Court may order a meeting to be called, held and conducted in a manner that the Court directs. Pursuant to Article 8.20 of our Articles, a shareholder or proxy holder who is entitled to participate in a meeting of shareholders may do so in person, or bytelephone or other communications medium, if all shareholders and proxy holders participating in the meeting are able to communicate with each other;provided, however, that nothing in Article 8.20 of our Articles shall obligate us to take any action or provide any facility to permit or facilitate the use of anycommunications medium at a meeting of shareholders. If one or more shareholders or proxy holders participate in a meeting of shareholders in a mattercontemplated by Article 8.20 of our Articles:
(a) each such shareholder or proxy holder shall be deemed to be present at the meeting; and

(b) the meeting shall be deemed to be help at the location specified in the notice of the meeting.
Pursuant to our Articles, the quorum for the transaction of business at a meeting of our shareholders is one or more persons, present in person or by proxy. Limitations on Rights of Non-Canadians Our Company is incorporated pursuant to the laws of the Province of British Columbia, Canada. There is no law or governmental decree or regulation inCanada that restricts the export or import of capital, or affects the remittance of dividends, interest or other payments to a non-resident holder of commonshares, other than withholding tax requirements. Any such remittances to United States residents are generally subject to withholding tax, however, no suchremittances are likely in the foreseeable future. See “Canadian Federal Income Tax Considerations For United States Residents” below.
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There is no limitation imposed by Canadian law or by our Articles or other constituent documents of our Company on the right of a non-resident to hold orvote common shares of our Company. However, the Investment Canada Act (Canada) (the “Investment Act”) has rules regarding certain acquisitions ofshares by non-Canadians, along with other requirements under that legislation. The following discussion summarizes the principal features of the Investment Act for a “non-Canadian” (as defined under the Investment Act) who proposesto acquire common shares of our Company. The discussion is general only; it is not a substitute for independent legal advice from an investor’s own advisor;and it does not anticipate statutory or regulatory amendments. The Investment Act is a federal statute of broad application regulating the establishment and acquisition of Canadian businesses by non-Canadians, includingindividuals, governments or agencies thereof, corporations, partnerships, trusts or joint ventures (each an “entity”). Investments by non-Canadians to acquirecontrol over existing Canadian businesses or to establish new ones are either reviewable or notifiable under the Investment Act. If an investment by a non-Canadian to acquire control over an existing Canadian business is reviewable under the Investment Act, the Investment Act generally prohibitsimplementation of the investment unless, after review, the Minister of Innovation, Science and Economic Development Canada (the “Minister”) is satisfiedthat the investment is likely to be of net benefit to Canada. A non-Canadian would acquire control of our Company for the purposes of the Investment Act through the acquisition of common shares if the non-Canadian acquired a majority of the common shares of our Company. Further, the acquisition of less than a majority but one-third or more of the common shares of our Company by a non-Canadian would be presumed to be anacquisition of control of our Company unless it could be established that, on the acquisition, our Company was not controlled in fact by the acquirer throughthe ownership of common shares. For a direct acquisition that would result in an acquisition of control of our Company, subject to the exception for “WTO-investors” that are controlled bypersons who are nationals or permanent residents of World Trade Organization (“WTO”) member nations, a proposed investment generally would bereviewable where the value of the acquired assets is $5 million or more. For a proposed indirect acquisition by an investor other than a so-called WTO investor that would result in an acquisition of control of our Company throughthe acquisition of a non-Canadian parent entity, the investment generally would be reviewable where the value of the assets of the entity carrying on theCanadian business, and of all other entities in Canada, the control of which is acquired, directly or indirectly, is $50 million or more. In the case of a direct acquisition by a WTO investor, the threshold is significantly higher. An investment in common shares of our Company by a WTOinvestor that is not a state-owned enterprise would be reviewable only if it was an investment to acquire control of the Company and the enterprise value ofthe assets of the Company was equal to or greater than a specified amount, which is published by the Minister after its determination for any particular year.For 2021, this amount is $1.043 billion (unless the investor is controlled by persons who are nationals or permanent residents of countries that are party toone of a list of certain free trade agreements, in which case the amount is $1.565 billion for 2021); each January 1 both thresholds are adjusted by a GDP(Gross Domestic Product) based index. The higher WTO threshold for direct investments and the exemption for indirect investments do not apply where the relevant Canadian business is carryingon a “cultural business”. The acquisition of a Canadian business that is a cultural business is subject to lower review thresholds under the Investment Actbecause of the perceived sensitivity of the cultural sector. In 2009, amendments were enacted to the Investment Act concerning investments that may be considered injurious to national security. If the Minister ofIndustry has reasonable grounds to believe that an investment by a non-Canadian “could be injurious to national security”, the Minister may send the non-Canadian a notice indicating that an order for review of the investment may be made. The review of an investment on the grounds of national security mayoccur whether or not an investment is otherwise subject to review on the basis of net benefit to Canada or otherwise subject to notification under theInvestment Act.
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Certain transactions, except those to which the national security provisions of the Investment Act may apply, relating to common shares of our Company areexempt from the Investment Act, including:
(a) the acquisition of our common shares by a person in the ordinary course of that person’s business as a trader or dealer in securities;

(b) the acquisition of control of our Company in connection with the realization of security granted for a loan or other financial assistance and not for a
	purpose related to the provisions on the Investment Act, if the acquisition is subject to approval under the Bank Act, the Cooperative CreditAssociation Act, the Insurance Companies Act or the Trust and Loan Companies Act;; and

(c) the acquisition of control of our Company by reason of an amalgamation, merger, consolidation or corporate reorganization following which the
	ultimate direct or indirect control in fact of our Company, through the ownership of common shares, remained unchanged.
C. Material Contracts The following summary of our material agreements, all of which have been previously filed with the SEC, does not purport to be complete and is subject to,and is qualified in its entirety by reference to, all the provisions of those agreements. There are no material contracts, other than those contracts entered intoin the ordinary course of business, currently in place or to which we or any member of our group is a party, from the two years immediately preceding thepublication of this Annual Report, except as follows: SOLO Manufacturing Agreement On October 2, 2017, we announced a Manufacturing Agreement with Zongshen to produce 75,000 SOLO all-electric vehicles. The production commencedon August 26, 2020, but deliveries to customers will be in 2021. The 75,000 SOLOs under the Manufacturing Agreement will be completed in the threeyears from the commencement of production. Under the Manufacturing Agreement we agreed to reimburse Zongshen for: (i) the cost of the prototypetooling and molds estimated to be $1.4 million, which was due on or before March 18, 2018 and which had been postponed to complete until the secondquarter of 2019 due to Zongshen not then completing the prototype of the tooling and molds; and (ii) the mass production tooling and molds estimated to be$4.3 million, which shall be payable 50% when Zongshen commences manufacturing the tooling and molds, 40% when Zongshen completes manufacturingthe tooling and molds and 10% upon delivery to the Company of the first production vehicle. At December 31, 2020, the Company had completed theprototype tooling and molds with an actual cost of $1.7 million, as inspected and assessed by the Company, most of the prototype tooling and molds will beused for the mass production and the Company has completed the mass production tooling and molds with an actual cost of $6.2 million. The Company hadpaid 100% of prototype tooling and molds and 80% of the mass production tooling and molds. Share Pledge Agreement In connection with the Manufacturing Agreement with Zongshen, on October 16, 2017, Jerry Kroll, our then CEO, entered into a Share Pledge Agreement toguarantee the payment by us for the cost of the prototype tooling and molds estimated to be $1.4 million to Zongshen through the pledge of 400,000 of ourcommon shares at a deemed price of USD$4.00 per share. We had agreed to reimburse Mr. Kroll on a one-for-one basis for any pledged shares realized byZongshen under the Share Pledge Agreement. The Share Pledge Agreement has now been terminated.
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D. Exchange Controls We are incorporated pursuant to the laws of the Province of British Columbia, Canada. There is no law or governmental decree or regulation in Canada thatrestricts the export or import of capital, or affects the remittance of dividends, interest or other payments to a non-resident holder of common shares, otherthan withholding tax requirements. Any such remittances to United States residents are generally subject to withholding tax, however no such remittances arelikely in the foreseeable future. See “Certain Canadian Federal Income Tax Information For United States Residents” below. There is no limitation imposed by Canadian law or by the charter or other constituent documents of our Company on the right of a non-resident to hold orvote common shares of our Company. However, the Investment Act has rules regarding certain acquisitions of shares by non-residents, along with otherrequirements under that legislation. The following discussion summarizes the principal features of the Investment Act for a nonresident who proposes to acquire common shares of ourCompany. The discussion is general only; it is not a substitute for independent legal advice from an investor’s own advisor; and it does not anticipatestatutory or regulatory amendments. The Investment Act is a federal statute of broad application regulating the establishment and acquisition of Canadian businesses by non-Canadians, includingindividuals, governments or agencies thereof, corporations, partnerships, trusts or joint ventures (each an “entity”). Investments by non-Canadians to acquirecontrol over existing Canadian businesses or to establish new ones are either reviewable or notifiable under the Investment Act. If an investment by a non-Canadian to acquire control over an existing Canadian business is reviewable under the Investment Act, the Investment Act generally prohibitsimplementation of the investment unless, after review, the Minister of Industry, is satisfied that the investment is likely to be of net benefit to Canada. A non-Canadian would acquire control of our Company for the purposes of the Investment Act through the acquisition of common shares if the non-Canadian acquired a majority of the common shares of our Company. Further, the acquisition of less than a majority but one-third or more of the common shares of our Company would be presumed to be an acquisition ofcontrol of our Company unless it could be established that, on the acquisition, our Company was not controlled in fact by the acquirer through the ownershipof common shares. For a direct acquisition that would result in an acquisition of control of our Company, subject to the exception for “WTO-investors” that are controlled bypersons who are resident in World Trade Organization (“WTO”) member nations, a proposed investment would be reviewable where the value of theacquired assets is $5 million or more, or if an order for review was made by the federal cabinet on the grounds that the investment related to Canada’scultural heritage or national identity, where the value of the acquired assets is less than $5 million. For a proposed indirect acquisition that is not a so-called WTO transaction and that would result in an acquisition of control of our Company through theacquisition of a non-Canadian parent entity, the investment would be reviewable where (a) the value of the Canadian assets acquired in the transaction is $50million or more, or (b) the value of the Canadian assets is greater than 50% of the value of all of the assets acquired in the transaction and the value of theCanadian assets is $5 million or more. In the case of a direct acquisition by or from a “WTO investor”, the threshold is significantly higher. The 2016 threshold is $600 million, which thresholdwill be increased to $800 million in April 2017 for a two-year period. Other than the exception noted below, an indirect acquisition involving a WTOinvestor is not reviewable under the Investment Act. The higher WTO threshold for direct investments and the exemption for indirect investments do not apply where the relevant Canadian business is carryingon a “cultural business”. The acquisition of a Canadian business that is a “cultural business” is subject to lower review thresholds under the Investment Actbecause of the perceived sensitivity of the cultural sector.
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In 2009, amendments were enacted to the Investment Act concerning investments that may be considered injurious to national security. If the IndustryMinister has reasonable grounds to believe that an investment by a non-Canadian “could be injurious to national security,” the Industry Minister may sendthe non-Canadian a notice indicating that an order for review of the investment may be made. The review of an investment on the grounds of nationalsecurity may occur whether or not an investment is otherwise subject to review on the basis of net benefit to Canada or otherwise subject to notificationunder the Investment Canada Act. To date, there is neither legislation nor guidelines published, or anticipated to be published, on the meaning of “injuriousto national security.” Discussions with government officials suggest that very few investment proposals will cause a review under these new sections. Certain transactions, except those to which the national security provisions of the Investment Act may apply, relating to common shares of our Company areexempt from the Investment Act, including:
(a) acquisition of common shares of the Company by a person in the ordinary course of that person’s business as a trader or dealer in securities,

(b) acquisition of control of our Company in connection with the realization of security granted for a loan or other financial assistance and not for a
	purpose related to the provisions on the Investment Act, and

(c) acquisition of control of our Company by reason of an amalgamation, merger, consolidation or corporate reorganization following which the
	ultimate direct or indirect control in fact of our Company, through the ownership of common shares, remained unchanged.
E. Taxation Certain Canadian Federal Income Tax Considerations for United States Residents The following is a summary of certain Canadian federal income tax considerations generally applicable to the holding and disposition of our common sharesacquired by a holder who, at all relevant times, (a) for the purposes of the Income Tax Act (Canada) (the “Tax Act”) (i) is not resident, or deemed to beresident, in Canada, (ii) deals at arm’s length with us and the Agents, and is not affiliated with us or the Agents, (iii) holds our common shares as capitalproperty, (iv) does not use or hold the common shares in the course of carrying on a business in Canada, or otherwise in connection with a business carriedon or deemed to be carried on in Canada, and (v) is not a “registered non-resident insurer”, an “authorized foreign bank” (each as defined in the Tax Act), orother holder of special status or in special circumstances, and (b) for the purposes of the Canada-U.S. Tax Convention (the “Tax Treaty”), is a resident of theUnited States, has never been a resident of Canada, does not have and has not had, at any time, a permanent establishment or fixed base in Canada, and whoqualifies in all respects for the full benefits of the Tax Treaty. Holders who meet all of the criteria in clauses (a) and (b) above are referred to herein as “U.S.Holders”, and this summary only addresses such U.S. Holders. This summary does not deal with special situations, such as the particular circumstances of traders or dealers, tax exempt entities, partnerships, insurers orfinancial institutions, or other holders of special status or in special circumstances. Such holders, and all other holders who do not meet the criteria in clauses(a) and (b) above, should consult their own tax advisors. This summary is based on the current provisions of the Tax Act, the regulations thereunder in force at the date hereof (“Regulations”), the current provisionsof the Tax Treaty, and our understanding of the administrative and assessing practices of the Canada Revenue Agency published in writing prior to the datehereof. This summary takes into account all specific proposals to amend the Tax Act and Regulations publicly announced by or on behalf of the Minister ofFinance (Canada) prior to the date hereof (the “Proposed Amendments”) and assumes that such Proposed Amendments will be enacted in the form proposed.However, such Proposed Amendments might not be enacted in the form proposed, or at all, and no assurance in this regard can be given. This summary doesnot otherwise take into account or anticipate any changes in law or administrative or assessing practices, whether by legislative, governmental or judicialdecision or action, nor does it take into account tax laws of any province or territory of Canada or of any other jurisdiction outside Canada, any or all ofwhich may differ significantly from those discussed in this summary.
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For the purposes of the Tax Act, all amounts relating to the acquisition, holding or disposition of our common shares must be expressed in Canadian dollars.Amounts denominated in United States currency generally must be converted into Canadian dollars using the rate of exchange that is acceptable to theCanada Revenue Agency. This summary is of a general nature only and is not intended to be, nor should it be construed to be, legal or tax advice to any particular U.S. Holder, and norepresentation with respect to the Canadian federal income tax consequences to any particular U.S. Holder or prospective U.S. Holder is made. Thissummary is not exhaustive of all Canadian federal income tax considerations. Accordingly, all prospective purchasers (including U.S. Holders as definedabove) should consult with their own tax advisors for advice with respect to their own particular circumstances. Withholding Tax on Dividends Amounts paid or credited or deemed to be paid or credited as, on account or in lieu of payment of, or in satisfaction of, dividends on our common shares to aU.S. Holder will be subject to Canadian withholding tax. Under the Tax Treaty, the rate of Canadian withholding tax on dividends paid or credited by us to aU.S. Holder that beneficially owns such dividends and substantiates eligibility for the benefits of the Tax Treaty is generally 15% (unless the beneficialowner is a company that owns at least 10% of our voting stock at that time, in which case the rate of Canadian withholding tax is generally reduced to 5%). Disposition of Common Shares A U.S. Holder will not be subject to tax under the Tax Act on a capital gain realized on a disposition or deemed disposition of our common shares, unless thecommon shares are “taxable Canadian property” to the U.S. Holder for purposes of the Tax Act and the U.S. Holder is not entitled to relief under the TaxTreaty. Provided the common shares are listed on a “designated stock exchange” as defined in the Tax Act (which currently includes Nasdaq) at the time ofdisposition, the common shares generally will not constitute “taxable Canadian property” of a U.S. Holder at that time unless, at any time during the 60month period immediately preceding the disposition, the following two conditions are met: (i) the U.S. Holder, persons with whom the U.S. Holder did notdeal at arm’s length, partnerships in which the U.S. Holder or such non-arm’s length person holds a membership interest (either directly or indirectly throughone or more partnerships), or the U.S. Holder together with all such persons, owned 25% or more of the issued shares of any class or series of shares of ourcompany; and (ii) more than 50% of the fair market value of the shares of the company was derived directly or indirectly from one or any combination ofreal or immovable property situated in Canada, Canadian resource properties (as defined in the Tax Act), timber resource properties (as defined in the TaxAct) or options in respect of, or interests in, or for civil law rights in, property described in any of the foregoing (whether or not the property exists).Notwithstanding the foregoing, in certain other circumstances set out in the Tax Act, common shares could also be deemed to be “taxable Canadianproperty”. U.S. Holders who may hold common shares as “taxable Canadian property” should consult their own tax advisors with respect to the application of Canadiancapital gains taxation, any potential relief under the Tax Treaty, and compliance procedures under the Tax Act, none of which is described in this summary. F. Dividends and Paying Agents Not applicable. G. Statements by Experts Not applicable.
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H. Documents on Display The documents concerning us which are referred to in this Annual Report may be inspected at our offices located at 102 East 1st Avenue, Vancouver, BritishColumbia, Canada, V5T 1A4. In addition, we have filed with the SEC a registration statement on Form F-1 under the Securities Act and the documents referred to in this Annual Reporthave been filed as exhibits to such Form F-1 with the SEC and may be inspected and copied at the public reference facility maintained by the SEC at 100F.Street NW, Washington, D.C. 20549. In addition, the SEC maintains a website at www.sec.gov that contains copies of documents that we have filed with theSEC using its EDGAR system. I. Subsidiary Information We have four subsidiaries: InterMeccanica, a British Columbia, Canada, corporation; EMV Automotive USA Inc., a Nevada corporation; SOLO EV LLC, aMichigan corporation; and EMV Automotive (Chongqing) Technology Inc., a PRC corporation. We own 100% of the voting and dispositive control over allsubsidiaries.
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ITEM 11. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK We are exposed in varying degrees to a variety of financial instrument related risks. The Board of Directors approves and monitors the risk managementprocesses, inclusive of controlling and reporting structures. The type of risk exposure and the way in which such exposure is managed is provided as follows: Credit Risk Credit risk is the risk that one party to a financial instrument will fail to discharge an obligation and cause the other party to incur a financial loss. Ourprimary exposure to credit risk is on our cash held in bank accounts. The majority of cash is deposited in bank accounts held with major banks in Canada. Asmost of our cash is held by one bank there is a concentration of credit risk. This risk is managed by using major banks that are high credit quality financialinstitutions as determined by rating agencies. Our secondary exposure to risk is on its other receivables. This risk is minimal as receivables consist primarilyof refundable government value added taxes and interest receivable from the major financial institution with high credit rating. Liquidity Risk Liquidity risk is the risk that we will not be able to meet our financial obligations as they fall due. We have a planning and budgeting process in place to helpdetermine the funds required to support our normal operating requirements on an ongoing basis. We ensure that there are sufficient funds to meet our short-term business requirements, taking into account our anticipated cash flows from operations and our holdings of cash and cash equivalents. Historically, our source of funding has been shareholder loans and the issuance of equity securities for cash, primarily through private placements andregistered offerings. Our access to financing is always uncertain. There can be no assurance of continued access to significant equity funding The following is an analysis of the contractual maturities of our non-derivative financial liabilities as at December 31, 2020, 2019 and 2018 (amountspayable to related parties is included with trade payables in the tables below). We have excluded derivative liabilities from the table because they are settledby shares.
		Between one	More than five
At December 31, 2020		Within one year	and five years	years
Trade payables	$				1,001,773	-	-
Accrued liabilities					2,179,134	-
Due to related parties					280,432	-	-
Lease liabilities					576,232	373,889	125,652
	$				4,037,571 $	373,889 $	125,652

		Between one	More than five

At December 31, 2019	Within one year						and five years		years
Trade payables	$				535,048	-	-
Accrued liabilities					894,350	-
Due to related parties					212,562	-	-
Shareholder loans					1,602	-	-
Lease liabilities					466,679	468,465	194,105
	$				2,110,241 $	468,465 $	194,105
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			Between one		More than five

At December 31, 2018	Within one year		and five years		years
Trade payables	$						468,548	-		-
Accrued liabilities							400,940	-
Due to related parties							61,427	-		-
Shareholder loans		4,592		-		-
	$						935,507 $	- $		-
Foreign Exchange Risk Foreign currency risk is the risk that the fair values of future cash flows of a financial instrument will fluctuate because they are denominated in currenciesthat differ from the respective functional currency. We are exposed to currency risk as we incur expenditures that are denominated in US dollars while ourfunctional currency is the Canadian dollar. We do not hedge our exposure to fluctuations in foreign exchange rates. The following is an analysis of financial assets and liabilities that are denominated in US dollars:
								December 31,	December 31,		December 31,

							2020		2019			2018
Cash and cash equivalents	$						127,126,440 $		8,143,357 $	13,304,246
Restricted cash	$						63,250 $	63,250 $		40,250
Receivables	$						162,315 $	148,901 $		37,715
Lease liabilities	$						(646,616) $	(557,713) $		-
Trade payables and accrued liabilities	$						(1,921,536) $	(81,700) $					(281,655)
	$						124,783,853 $		7,716,095 $	13,100,556
Interest Rate Risk Interest rate risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market interest rates. We areexposed to interest rate risk on our cash equivalents as these instruments have original maturities of three months or less and are therefore exposed to interestrate fluctuations on renewal. A 1% change in market interest rates would have an impact on the Company’s net loss of $121,504 for the year endedDecember 31, 2018. A 1% change in market interest rates would have an impact on the Company’s net loss of $65,000 for the year ended December 31,2019. A 1% change in market interest rates would have an impact on the Company’s net loss of $710,000 for the year ended December 31, 2020. Classification of Financial Instruments Financial assets included in the statement of financial position are as follows:
								December 31,	December 31,		December 31,

							2020		2019			2018
Cash and receivables:
Cash and cash equivalents	$						129,450,676 $		8,560,624 $	13,951,951
Restricted cash	$						143,800 $	142,201 $		81,608
Receivables	$						159,664 $	111,400 $		175,077
	$						129,754,140 $		8,814,225 $	14,208,636
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Financial liabilities included in the statement of financial position are as follows:
		December 31,		December 31,		December 31,

				2020				2019				2018
Non-derivative financial liabilities:
Trade payable and accrued liabilities	$							3,461,339 $	1,641,960 $	930,915
Shareholder loan	$		$		1,602 $		4,592
Lease liabilities								1,075,773	1,129,249	-
Derivative liability	$							17,899,855 $	5,456,265 $	3,503,572
	$							22,436,967 $	8,299,076 $	4,439,079
Fair Value The fair value of the Company’s financial assets and liabilities, other than the derivative liability which is measured at fair value, approximates the carryingamount. Financial instruments measured at fair value are classified into one of three levels in the fair value hierarchy according to the relative reliability of the inputsused to estimate the fair values. The three levels of the fair value hierarchy are:
											•	Level 1 – Unadjusted quoted prices in active markets for identical assets or liabilities;

											•	Level 2 – Inputs other than quoted prices that are observable for the asset or liability either directly or indirectly; and

											•	Level 3 – Inputs that are not based on observable market data.
Financial liabilities measured at fair value at December 31, 2020 consisted of the derivative liability, which includes transferrable warrants and non-transferrable warrants. Transferrable warrants are measured using level 1 inputs and non-transferrable warrants are measured using level 2 inputs. There havebeen no reclassifications between the Levels in the periods presented. The fair value of the derivative liability relating to the transferrable warrants was calculated using the quoted market price on the NASDAQ exchange. The fair value of the derivative liability relating to the non-transferrable warrants was calculated using the Black-Scholes Option Pricing Model usinghistorical volatility of comparable companies as an estimate of future volatility The following is an analysis of derivative liabilities as at December 31, 2020, 2019 and 2018:
		December 31,		December 31,		December 31,

				2020				2019				2018
Level 1	$							14,308,914 $	1,217,221 $	Nil
Level 2	$							3,590,941 $	4,239,044 $	3,503,572
Level 3	$		Nil $		Nil $		Nil
ITEM 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES Not applicable.
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	PART II

ITEM 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES There have not been any defaults with respect to dividends, arrearages or delinquencies since incorporation on February 16, 2015. ITEM 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS There have been no material modifications to the rights of our security holders since incorporation on February 16, 2015. Use of Proceeds From March 30, 2020 to September 24, 2020, we completed an offering of 28,978,936 common shares. These common shares were offered and sold by anymethod permitted by law deemed to be an “at the market” offering as defined in Rule 415 promulgated under the Securities Act (the “ATM Offering”). Wereceived approximately $58 million in net proceeds from the ATM Offering. We have not yet fully used the net proceeds from this ATM Offering. Theproceeds from the ATM Offering that we have used were used to advance the development and mass production of the SOLO and for general corporate andworking capital purposes. We anticipate that the remainder of the net proceeds from the ATM Offering will be used for sales and marketing expenditures,capital expenditures, further product development, operational expenditures and for general corporate and working capital purposes. On June 12, 2020, we completed a registered direct public offering of 10,000,000 common shares with institutional investors (the “Registered Offering”). Wereceived approximately $19 million in net proceeds from the Registered Offering. We have not yet used the net proceeds from this Registered Offering. Weanticipate that the net proceeds from the Registered Offering will be used for sales and marketing expenditures, capital expenditures, further productdevelopment, operational expenditures and for general corporate and working capital purposes. From December 22 to December 30, 2020, we completed a further ATM Offering of 7,520,000 common shares. We received approximately $52 million innet proceeds from this ATM Offering. We have not yet used the net proceeds from this ATM offering. We anticipate that the net proceeds from this ATMOffering will be used for sales and marketing expenditures, capital expenditures, further product development, operational expenditures and for generalcorporate and working capital purposes. From January 1 to March 23, 2021, we completed ATM offerings of 20,365,495 common shares. We received approximately $143 million in net proceesfrom ATM offerings. We have not yet used the net proceeds from this ATM offering. We anticipate that the net proceeds from this ATM Offering will be usedfor sales and marketing expenditures, capital expenditures, further product development, operational expenditures and for general corporate and workingcapital purposes.
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ITEM 15. CONTROLS AND PROCEDURES Disclosure controls and procedures are defined in Rule 13a-15(e) and 15d-15(e) under the Exchange Act to mean controls and other procedures of an issuerthat are designed to ensure that information required to be disclosed by the Company in the reports that we file or submit under the Exchange Act isrecorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms and includes, without limitation, controls andprocedures designed to ensure that such information is accumulated and communicated to the issuer’s management, including its principal executive andprincipal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. As required by Rule 13a-15 or 15d-15 under the Exchange Act, we have carried out an evaluation of the effectiveness of our Company’s disclosure controlsand procedures as of the end of the period covered by this Annual Report, that being as at December 31, 2020. This evaluation was carried out by our ChiefExecutive Officer and Chief Financial Officer. Based upon that evaluation, our CEO and CFO concluded that our disclosure controls and procedures wereeffective as of December 31, 2020. Management’s Annual Report on Internal Control Over Financial Reporting Our management is responsible for establishing and maintaining adequate internal control over financial reporting. Exchange Act Rules 13a-15(f ) and 15d-15(f ) define this as a process designed by, or under the supervision of, the Company’s principal executive and principal financial officers and effected by theBoard of Directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation offinancial statements for external purposes in accordance with generally accepted accounting principles and includes those policies and procedures that:
•	pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of theCompany;

•	provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generallyaccepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations ofmanagement and directors of the Company; and

•	provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the company’s assets thatmay have a material effect on the financial statements.
Under the supervision and with the participation of our CEO and CFO, our management assessed the effectiveness of our internal control over financialreporting as at December 31, 2020. In making this assessment, our management used the criteria, established in Internal Control-Integrated Frameworkissued by the Committee of Sponsoring Organizations of the Treadway Commission. Based upon this assessment, our management concluded that ourinternal control over financial reporting was effective as at December 31, 2020. Attestation Report of the Registered Public Accounting Firm This Annual Report does not include an attestation report of the Company’s registered public accounting firm regarding internal control over financialreporting. Management’s report is not subject to attestation by the Company’s registered public accounting firm pursuant to rules of the SEC that permit theCompany to provide only management’s report in this Annual Report. Changes In Internal Control Over Financial Reporting Except as noted above, during the period ended December 31, 2020, there were no changes in our internal control over financial reporting (as defined inRules 13a-15(f) and 15d-15(f) of the Exchange Act) that have materially affected, or are reasonably likely to materially affect, our internal control overfinancial reporting.
		112


ITEM 16. ITEM 16A. AUDIT COMMITTEE FINANCIAL EXPERT As disclosed above, as of the date hereof, our Audit Committee is comprised of Luisa Ingargiola, Steven Sanders, Joanne Yan and Jack Austin, each of whomis independent under the listing standards regarding “independence” within the meaning of the Listing Rules of Nasdaq. Our Board of Directors has determined that Louisa Ingargiola qualifies as an audit committee financial expert pursuant to Items 16A(b) and (c) of Form 20-F.In addition, we believe that each member of the Audit Committee satisfies the “independence” requirements of Rule 5605(a)(2) of the Listing Rules ofNasdaq, meets the independence standards under Rule 10A-3 under the Exchange Act and is financially literate under applicable Canadian laws. ITEM 16B. CODE OF ETHICS We have adopted a Code of Business Conduct and Ethics (the “Code of Ethics”) that applies to all of our employee and officers, including our principalexecutive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions. The Code of Ethics meets therequirements for a “code of ethics” within the meaning of that term in Item 16B of Form 20-F. A copy of our Code of Ethics will be provided to any personwithout charge, upon request. All requests for a copy of our Code of Ethics should be directed in writing to the attention of Bal Bhullar, CFO, at 102 East 1stAvenue, Vancouver, British Columbia, Canada, V5T 1A4, or by email at bal@electrameccanica.com. ITEM 16C. PRINCIPAL ACCOUNTANT FEES AND SERVICES The following table sets forth information regarding the amount billed and accrued to us by KPMG for the fiscal year ended December 31, 2020 and 2019:
		Year Ended December 31
				2020		2019
Audit Fees:	$	159,265 $		115,349
Audit Related Fees:	$		- $	-
Tax Fees:	$	61,163 $		28,000
Total:	$	220,428 $		143,349
Audit Fees This category includes the aggregate fees billed by our independent auditor for the audit of our annual financial statements, reviews of interim financialstatements that are provided in connection with statutory and regulatory filings or engagements.
					113


Audit Related Fees This category includes the aggregate fees billed in each of the last two fiscal years for assurance and related services by our independent auditor that arereasonably related to the performance of the audits or reviews of the financial statements and are not reported above under “Audit Fees”, and generallyconsist of fees for other engagements under professional auditing standards, accounting and reporting consultations. Tax Fees This category includes the aggregate fees billed in each of the last two fiscal years for professional services rendered by our independent auditor for taxcompliance, tax planning and tax advice. Policy on Pre-Approval by Audit Committee of Services Performed by Independent Auditors The policy of our Audit Committee is to pre-approve all audit and permissible non-audit services to be performed by our independent auditors during thefiscal year. ITEM 16D. EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES Not applicable. ITEM 16E. PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS Not applicable. ITEM 16F. CHANGE IN REGISTRANT’S CERTIFYING ACCOUNTANT Not applicable. ITEM 16G. CORPORATE GOVERNANCE The Company is a foreign private issuer and our common shares are listed on Nasdaq. Nasdaq Marketplace Rule 5615(a)(3) permits a foreign private issuerto follow its home country practices in lieu of most of the requirements of the 5600 Series of the Nasdaq Marketplace Rules. In order to claim such anexemption, the Company must disclose the significant differences between its corporate governance practices and those required to be followed by U.S.domestic issuers under Nasdaq’s corporate governance requirements. Set forth below is a brief summary of such differences. Shareholder Approval Requirements Nasdaq Marketplace Rule 5635 requires each issuer to obtain shareholder approval prior to certain dilutive events, including a transaction other than a publicoffering involving the sale of 20% or more of the issuer’s common shares outstanding prior to the transaction for less than the greater of book or marketvalue of the stock. The Company does not follow this Nasdaq Marketplace Rule. Instead, and in accordance with the Nasdaq exemption, the Companycomplies with British Columbia corporate and securities laws, which do not require shareholder approval for dilutive events unless the Company were todispose of all or substantially all of its undertaking. In addition, Nasdaq Marketplace Rule 5635 requires shareholder approval of most equity compensation plans and material revisions to such plans, as well aswith respect to the sale of our securities at a discount to their market value to an officer, director, employee or consultant. We do not follow this NasdaqMarketplace Rule. Instead, and in accordance with the Nasdaq exemption, we comply with British Columbia corporate and securities laws, which do notrequire shareholder approval of equity compensation plans or most discount to market offerings of securities unless otherwise indicated in the Articles of theCompany. Quorum Requirement NASDAQ Marketplace Rule 5620(c) requires that each company that is not a limited partnership shall provide for a quorum as specified in its by-laws forany meeting of holders of common stock; provided, however, that in no case shall such quorum be less than 33 1/3% of the outstanding shares of thecompany’s common voting stock. The Company does not presently follow this NASDAQ Marketplace Rule. Instead, and in accordance with the NASDAQexemption, the Company complies with British Columbia corporate and securities laws and its Articles which do not require a quorum of no less than 331/3% of the outstanding shares of the Company’s common voting stock and provides that the quorum for the transaction of business at a meeting ofshareholders is the quorum established by the Company’s Articles, which is one or more persons, present in person or by proxy. Executive Sessions NASDAQ Marketplace Rule 5605(b)(2) requires that the independent board members of a company have Executive Sessions which are regularly scheduledand at which only independent directors are present. Although we have previously followed this NASDAQ Marketplace Rule we may not do so in the futureor on a consistent or regularly scheduled basis. Instead, and in accordance with the NASDAQ exemption, we may determine to comply with BritishColumbia corporate and securities laws which do not require Executive Sessions of independent board members unless otherwise indicated in the Articles ofthe company which is not the case for the Company. ITEM 16H. MINE SAFETY DISCLOSURE Not applicable.
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	PART III

ITEM 17. FINANCIAL STATEMENTS Not applicable. ITEM 18. FINANCIAL STATEMENTS Our financial statements were prepared in accordance with IFRS, as issued by the IASB, and are presented in US dollars. Financial statements are filed as part of this Annual Report:
		[To be included upon finalization of financial statements]
	115



	ElectraMeccanica Vehicles Corp.
	Consolidated Financial Statements
	Year Ended December 31, 2020 and 2019

	Expressed in United States Dollars
		116



KPMG LLPPO Box 10426 777 Dunsmuir StreetVancouver BC V7Y 1K3CanadaTelephone (604) 691-3000Fax (604) 691-3031

		Report of Independent Registered Public Accounting Firm

To the Shareholders and Board of Directors
			Electrameccanica Vehicles Corp.: Opinion on the Consolidated Financial Statements We have audited the accompanying consolidated statements of financial position of Electrameccanica Vehicles Corp. and subsidiaries (the Company) as ofDecember 31, 2020 and 2019, the related consolidated statements of comprehensive loss, changes in equity, and cash flows for each of the years in the three-year period ended December 31, 2020, and the related notes (collectively, the consolidated financial statements). In our opinion, the consolidated financialstatements present fairly, in all material respects, the financial position of the Company as of December 31, 2020 and 2019, and its financial performance andits cash flows for each of the years in the three-year period ended December 31, 2020, in conformity with International Financial Reporting Standards asissued by the International Accounting Standards Board. Change in presentation currency As discussed in Note 3 to the consolidated financial statements, the Company has changed its presentation currency from Canadian dollars to US Dollars asof December 31, 2020, and has applied this change retrospectively for all periods presented. Change in accounting principle As discussed in Note 2 to the consolidated financial statements, the Company has changed its accounting policies for leases as of January 1, 2019 due to theadoption of IFRS 16 – Leases. Basis for Opinion These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on theseconsolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board(United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and theapplicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonableassurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not requiredto have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain anunderstanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internalcontrol over financial reporting. Accordingly, we express no such opinion. Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error orfraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts anddisclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made bymanagement, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis forour opinion. /s/ KPMG LLP Chartered Professional Accountants We have served as the Company’s auditor since 2018. Vancouver, CanadaMarch 22, 2021

	117



ElectraMeccanica Vehicles Corp. Consolidated Statements of Financial Position (Expressed in United States dollars)
		December 31,		December 31,
		2020		2019 Restated
ASSETS
Current assets
Cash and cash equivalents	4	129,450,676 $			8,560,624
Receivables	5	213,346			340,185
Prepaid expenses		5,039,150			5,077,328
Inventory		609,094			578,753
		135,312,266			14,556,890
Non-current assets
Restricted cash		143,800			142,201
Plant and equipment	6	9,290,308			7,707,863
Net investment in sublease		38,541		-
Goodwill and other intangible assets	8	969,467			956,009
TOTAL ASSETS		145,754,382 $			23,362,963
LIABILITIES
Current liabilities
Trade payables and accrued liabilities	9	3,461,339			1,641,960
Customer deposits		329,221			317,463
Construction contract liability		189,651			153,890
Shareholder loan			-	1,602
Deferred income tax	11		-		33,063
Current portion of lease liabilities	10	576,232			466,679
		4,556,443			2,614,657
Non-current liabilities
Derivative liability1	12	17,899,855			5,456,265
Lease liabilities	10	499,541			662,570
Deferred revenue		119,253		-
TOTAL LIABILITIES		23,075,092			8,733,492
EQUITY
Share capital	13	212,058,836			50,616,051
Deficit		(110,327,159)			(47,280,254)
Reserves		20,947,613			11,293,674
TOTAL EQUITY		122,679,290			14,629,471
TOTAL LIABILITIES AND EQUITY		145,754,382 $			23,362,963
Nature and continuance of operations (Note 1) Lease commitments (Note 23) On behalf of the Board of Directors /s/ Michael Paul Rivera
						/s/ Bal Bhullar
Director						Director
1 Footnote: The warrant derivative liability is valued at fair value in accordance with International Financial Reporting Standards (“IFRS”). There are nocircumstances in which the Company would be required to pay cash upon exercise or expiry of the warrants. See Note 12. The accompanying notes are an integral part of these consolidated financial statements
						118


ElectraMeccanica Vehicles Corp. Consolidated Statements of Comprehensive Loss (Expressed in United States dollars)
				Year ended
			December 31,	December 31,			December 31,
					2020					2019 Restated		2018 Restated
Revenue			$			568,521 $		585,584 $	599,757
Cost of revenue						699,455		487,543	443,796
Gross profit / (loss)						(130,934)	98,041		155,961
Operating expenses
Amortization		6				1,603,654		804,206	214,981
General and administrative expenses		15				8,825,317	6,101,360				4,236,742
Research and development expenses		16				7,854,866	7,179,646				4,294,687
Sales and marketing expenses		17				2,534,731	1,314,689				1,070,116
Stock-based compensation expense		13				6,260,985	5,147,573				2,491,078
Share-based payment expense					-			159,833	856,101
						27,079,553	20,707,307				13,163,705
Operating loss						(27,210,487)	(20,609,266)				(13,007,744)
Other items
Interest expense/(income)						(169,707)		(75,753)	-
Changes in fair value of warrant derivative		12				31,923,727	2,228,256				(5,946,668)
Lease modification loss		7			62,935		-	-
Issue costs allocated to derivative liability					-		-		1,152,408
Other Income		18				(395,372)		(67,410)	-
Foreign exchange (gain)/loss						4,447,387		597,464	(466,885)

Loss before taxes						(63,079,457)	(23,291,823)				(7,746,599)
Current income tax expense/(recovery)					(404)		1,600		(1,286)
Income tax recovery						(32,148)		(80,725)	-

Net loss						(63,046,905)	(23,212,698)				(7,745,313)

Other comprehensive income/(loss)						4,213,906		898,473	(763,708)

Comprehensive Loss			$			(58,832,999) $	(22,314,225) $				(8,509,021)
Loss per share – basic and fully diluted			$		(1.08) $		(0.64) $	(0.29)
Weighted average number of shares outstanding – basic and fully diluted						58,352,766	35,998,152				26,582,664
The accompanying notes are an integral part of these consolidated financial statements
	119


ElectraMeccanica Vehicles Corp. Consolidated Statements of Changes in Equity (Expressed in United States dollars)
		Share capital				Foreign
												Amount net	Share-based	Currency
											Number									of share	Share	payment				Translation
																					of shares						issue cost		subscription	reserve	Reserve	Deficit	Total
Balance at December 31, 2017 Restated			23,794,106 $										17,371,609 $	595,678 $	2,690,660 $	152,542 $ (16,322,243) $									4,488,246
Shares issued for cash			8,322,753										17,464,331	-									719,470	-	-			18,183,801
Shares issued for finder’s fee			2,286	19,160	-	-		-	-	19,160
Shares issued pursuant to exercise of options			6,198	24,800	-	(14,947)		-	-	9,853
Shares issued for services			207,000										797,812	-	-		-	-							797,812
Stock-based compensation			-	-	-										2,491,078	-	-							2,491,078
Share subscription			-	-										(595,678)	-		-	-							(595,678)
Net loss for the year			-	-	-	-		-								(7,745,313)	(7,745,313)
Foreign currency translation reserve			-	-	-	-	(763,708)		-								(763,708)
Balance at December 31, 2018 Restated			32,332,343										35,677,712	-									5,886,261	(611,166)	(24,067,556)				16,885,251
Shares issued for cash			3,333,334										10,965,269	-	-		-	-							10,965,269
Shares issued pursuant to exercise of
warrants			1,116,323										3,634,734	-	-		-	-							3,634,734
Shares issued pursuant to exercise of options			137,304	83,382	-	(27,467)		-	-	55,915
Shares issued for services			140,070										292,661	-	-		-	-							292,661
Shares cancelled			(10,000)										(37,707)	-	-		-	-	(37,707)
Stock-based compensation			-	-	-										5,147,573	-	-							5,147,573
Net loss for the year			-	-	-	-		-	(23,212,698)									(23,212,698)
Foreign currency translation reserve			-	-	-	-	898,473		-								898,473
Balance at December 31, 2019 Restated			37,049,374										50,616,051	-									11,006,367	287,307	(47,280,254)				14,629,471
Shares issued for cash			46,498,936										132,941,001	-	-		-	- 132,941,001
Shares issued pursuant to exercise of
warrants			5,242,389										32,597,096	-									(272,600)	-	-			32,324,496
Shares issued pursuant to exercise of options			518,864										950,971	-									(548,352)					402,619
Shares issued cost			-										(5,046,283)	-	-		-	-							(5,046,283)
Stock-based compensation	13		-	-	-										6,260,985	-	-							6,260,985
Net loss for the year			-	-	-	-		-	(63,046,905)									(63,046,905)
Foreign currency translation reserve			-	-	-	-	4,213,906		-								4,213,906
Balance at December 31, 2020			89,309,563 $ 212,058,836 $		- $										16,446,400 $	4,501,213 $ (110,327,159) $ 122,679,290
The accompanying notes are an integral part of these consolidated financial statements
			120


ElectraMeccanica Vehicles Corp.Consolidated Cash Flow Statements (Expressed in United States dollars) For the years ended December 31, 2020, 2019, and 2018
		Year ended
	December 31,	December 31,			December 31,
								2020			2019 Restated	2018 Restated
Operating activities
Loss for the year	$			(63,046,905) $	(23,212,698) $					(7,745,313)
Adjustments for:
Amortization				1,603,654			804,206	214,981
Stock-based compensation expense				6,260,985	5,147,573					2,491,078
Share-based payment expense			-				159,833	856,101
Interest expense/(income)				(169,707)			(75,753)	-
Lease modification loss			62,935		-	-
Changes in fair value of warrant derivative				31,923,727	2,228,256					(5,946,668)
Deferred income tax recovery				(32,148)			(80,725)	-
Changes in non-cash working capital items:
Receivables				183,863			660,621	(730,348)
Prepaid expenses				292,146	(3,228,192)					(1,036,818)
Inventory			6,875	(245,301)					(141,543)
Trade payables and accrued liabilities				392,539			755,098	48,591
Customer deposits and construction contract liability			35,406				157,259	(34,172)
Net cash flows used in operating activities				(22,486,630)	(16,929,823)					(12,024,111)
Investing activities
Investments in restricted cash			964				(55,775)	(85,420)
Expenditures on plant and equipment				(1,400,032)	(2,747,495)					(3,219,605)
Acquisition of intangible assets			-		(3,833)	(6,205)
Net cash flows used in investing activities				(1,399,068)	(2,807,103)					(3,311,230)
Financing activities
Interest received				178,925	92,550	-
Interest from net investment in sublease			11,420		-	-
Interest paid			(300)		(364)	-
Interest on lease payments				(79,655)	(103,946)	-
Repayment of bank loans			-		-	(95,397)
Repayment of promissory note			-		-	(1,157,382)
Repayment of shareholder loans			(1,521)		(3,131)	(3,204)
Repayment of leases				(486,136)			(469,113)	-
Payment received for net investment in sublease			73,586		-	-
Proceeds on issuance of common shares – net of issue costs				126,392,128	11,058,573					24,571,559
Proceeds from issuance of common shares for options exercised				405,305	55,791	-
Proceeds from issuance of common shares for warrants exercised				12,433,257	3,155,574	-
Net cash flows from financing activities	138,927,009.00	13,785,934				23,315,576
Increase/(decrease) in cash and cash equivalents				115,041,311	(5,950,992)					7,980,235
Effect of exchange rate changes on cash				5,848,741			559,665	(867,456)
Cash and cash equivalents, beginning				8,560,624	13,951,951					6,839,172
Cash and cash equivalents, ending	$			129,450,676 $	8,560,624 $					13,951,951
The accompanying notes are an integral part of these consolidated financial statements
								121


ElectraMeccanica Vehicles Corp. Notes to Consolidated Financial Statements (Expressed in United States dollars) For the years ended December 31, 2020, 2019, and 2018 1.
	Nature and continuance of operations
ElectraMeccanica Vehicles Corp (the “Company”) was incorporated on February 16, 2015, under the laws of the province of British Columbia, Canada, andits principal activity is the development and manufacturing of electric vehicles (“EV”s). The Company acquired Intermeccanica International Inc.(“Intermeccanica”) on October 18, 2017, and whose principal activity is the development and manufacturing of high-end custom-built vehicles. On January22, 2018, the Company incorporated a wholly-owned subsidiary, EMV Automotive USA Inc., in Nevada, USA. On October 15, 2019, the Companyincorporated a wholly-owned subsidiary, EMV Automotive Technology (Chongqing) Inc., in Chongqing, China. On November 22, 2019, the Companyincorporated SOLO EV, LLC, a wholly-owned subsidiary of EMV Automotive USA Inc., in Michigan, USA. The head office and principal address of the Company are located at 102 East 1st Avenue, Vancouver, British Columbia, Canada, V5T 1A4. These consolidated financial statements have been prepared on the assumption that the Company will continue in operation for the foreseeable future andwill be able to realize assets and discharge liabilities in the ordinary course of operations. The Company’s principal activity is the development andmanufacture of EVs. As at December 31, 2020, the Company has commenced commercial production of the SOLO single seat EV and is not able to financeday-to-day activities through operations. The Company’s continuation is dependent upon the successful results from its electric vehicle manufacturingactivities and its ability to attain profitable operations and generate funds there from and/or raise equity capital or borrowings sufficient to meet current andfuture obligations. The Company has begun production but has not had commercial delivery of its first electric vehicle. As at December 31, 2020, there have been no revenuesfrom the sale of electric vehicles as any amounts received from the sale of pre-production electric vehicles were netted off against research and developmentcosts as cost recovery. It is anticipated that significant additional funding will be required. Management primarily intends to finance its operations over the next 12 months throughsales of the SOLO, private placements and/or public offerings of equity capital. 2.
	Significant accounting policies and basis of preparation
The consolidated financial statements were authorized for issue on March 22, 2021 by the directors of the Company. Statement of compliance with International Financial Reporting Standards These consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (“IFRS”), as issued by theInternational Accounting Standards Board (“IASB”), and including interpretations of the International Financial Reporting Interpretations Committee(“IFRIC”) as applicable to the preparation of annual financial statements. These consolidated financial statements were prepared using the same accounting policies and methods as those used in the Company’s consolidatedfinancial statements for the year ended December 31, 2019, with the exception of a change in presentation currency from Canadian dollars (“CAD”) toUnited States dollars (“USD”) as discussed in Note 3. Basis of preparation The consolidated financial statements of the Company have been prepared on an accrual basis and are based on historical costs except for derivativeliabilities which are measured at fair value. As at December 31, 2020, the Company’s functional currency is CAD and its presentation currency is USD. Thechange in presentation currency is discussed in Note 3. Consolidation The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, EMV Automotive USA Inc., from the date ofincorporation of January 22, 2018, Intermeccanica, from the date of its acquisition on October 18, 2017, EMV Automotive Technology (Chongqing) Inc.,from the date of its incorporation on October 15, 2019, and SOLO EV, LLC, from the date of its incorporation on November 22, 2019. Inter-companybalances and transactions, including unrealized income and expenses arising from inter-company transactions, are eliminated on consolidation.
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ElectraMeccanica Vehicles Corp. Notes to Consolidated Financial Statements (Expressed in United States dollars) For the years ended December 31, 2020, 2019, and 2018 Significant estimates and assumptions The preparation of financial statements in accordance with IFRS requires the Company to make estimates and assumptions concerning the future. TheCompany’s management reviews these estimates and underlying assumptions on an ongoing basis, based on experience and other factors, includingexpectations of future events that are believed to be reasonable under the circumstances. Revisions to estimates are adjusted for prospectively in the period inwhich the estimates are revised. Estimates and assumptions where there is significant risk of material adjustments to assets and liabilities in future accounting periods include the estimatedrecoverable amount of goodwill, intangible assets and other long-lived assets, the useful lives of plant and equipment, fair value measurements for financialinstruments and share-based payments, and the recoverability and measurement of deferred tax assets. The Covid-19 outbreak brings significant uncertainty as to the potential impact on our operations, supply chains for parts and sales channels for our products,and on the global economy as a whole. It is currently not possible to predict how long the pandemic will last or the time that it will take for economic activityto return to prior levels. Therefore, the Company has not changed any estimates and assumptions in the preparation of the financial statements. Significant judgments The preparation of financial statements in accordance with IFRS requires the Company to make judgments, apart from those involving estimates, in applyingaccounting policies. The most significant areas that require judgment from the Company in completing its consolidated financial statements include: -
the assessment of the Company’s ability to continueoperations and whether there are events or conditions that may give rise to significant uncertainty;
-	the classification of financial instruments; and
-	the calculation of income taxes require judgement in interpreting tax rules and regulations.
Foreign currency translation The Company’s functional currency is CAD. The functional currency of Intermeccanica is CAD, the functional currency of EMV Automotive USA Inc. isUSD, and the functional currency of EMV Automotive Technology (Chongqing) Inc. is the Chinese RMB. The Company changed its presentation currencyfrom CAD to USD as at December 31, 2020, and the change in presentation currency is discussed in Note 3. Transactions in foreign currency Each entity within the consolidated group records transactions using its functional currency, being the currency of the primary economic environment inwhich it operates. Foreign currency transactions are translated into the respective functional currency of each entity using the foreign currency ratesprevailing at the date of the transaction. Period-end balances of monetary assets and liabilities in foreign currency are translated to the respective functionalcurrencies using period-end foreign currency rates. Foreign currency gains and losses arising from the settlement of foreign currency transactions arerecognized in profit or loss. Foreign operations translation The assets and liabilities of foreign operations are translated into CAD at period-end foreign currency rates. Revenues and expenses of foreign operations aretranslated into CAD at average rates for the period. Foreign currency translation gains and losses are recognized in other comprehensive loss. Presentation currency translation Income Statement and Statement of Cash Flows have been translated into USD using average foreign currency rates prevailing for the relevant reportingperiods of years ended December 31, 2020, 2019 and 2018. Assets and liabilities in the Statement of Financial Position have been translated into USD at theclosing foreign currency rates on the relevant reporting dates as of December 31, 2020 and 2019. The equity section of the Statement of Financial Position,including foreign currency translation reserve, retained earnings, share capital and the other reserves, have been translated into USD using historical rates;and earnings per share has also been restated to USD to reflect the change in presentation currency. Segment reporting The Company’s operations currently consist of two operating segments, which are its reportable segments.
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ElectraMeccanica Vehicles Corp. Notes to Consolidated Financial Statements (Expressed in United States dollars) For the years ended December 31, 2020, 2019, and 2018 Financial Instruments The Company classifies its financial instruments in the following categories: at fair value through profit or loss (“FVTPL”); or at amortized cost. TheCompany determines the classification of financial assets at initial recognition. The classification of financial assets is driven by the Company’s businessmodel for managing the financial assets and their contractual cash flow characteristics. Equity instruments that are held for trading are classified as FVTPL.For other equity instruments, on the day of acquisition the Company can make an irrevocable election (on an instrument-by-instrument basis) to designatethem as at fair value through other comprehensive income (loss) (“ FVTOCI”). Financial liabilities are measured at amortized cost, unless they are requiredto be measured at FVTPL (such as instruments held for trading or derivatives) or if the Company has opted to measure them at FVTPL. The following table shows the classification of the Company’s financial assets and liabilities Financial assets/liabilities

Cash and cash equivalents	Amortized cost
Restricted cash	Amortized cost
Receivables	Amortized cost
Trade payables and accrued liabilities	Amortized cost
Shareholder loan	Amortized cost
Derivative liability	FVTPL
Financial assets and liabilities at amortized cost are initially recognized at fair value plus or minus transaction costs, respectively, and subsequently carried atamortized cost less any impairment. Financial assets and liabilities carried at FVTPL are initially recorded at fair value and transaction costs are expensed in the consolidated statements ofcomprehensive loss. Realized and unrealized gains and losses arising from changes in the fair value of the financial assets and liabilities held at FVTPL areincluded in the consolidated statements of comprehensive loss in the period in which they arise. The Company recognizes a loss allowance for expected credit losses on financial assets that are measured at amortized cost. At each reporting date, theCompany measures the loss allowance for the financial asset at an amount equal to the lifetime expected credit losses if the financial risk on the financialasset has increased significantly since initial recognition. If, at the reporting date, the financial asset has not increased significantly since initial recognition,the Company measures the loss allowance for the financial asset at an amount equal to the 12 month expected credit losses. The Company will recognize inthe consolidated statements of comprehensive loss, as an impairment gain or loss, the amount of expected credit losses (or reversal) that is required to adjustthe loss allowance at the reporting date to the amount that is required to be recognized. The Company derecognizes financial assets only when the contractual rights to cash flows from the financial assets expire, or when it transfers the financialassets and substantially all of the associated risks and rewards of ownership to another entity. Gains and losses on derecognition are generally recognized inthe consolidated statements of comprehensive loss. Revenue from contracts with customers Revenue is recognized to the extent that the amount of revenue can be measured reliably and collection is probable. Part sales Sales of parts are recognized when the Company has transferred control to the customer which generally occurs upon shipment. Services, repairs and support services Services, repairs and support services are recognized in the accounting period when the services are rendered. Sales of custom build vehicles The Company manufactures and sells custom built vehicles typically on fixed fee arrangements with its customers. Revenue is recognized when theCompany has transferred control to the customer which generally occurs upon shipment.
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ElectraMeccanica Vehicles Corp. Notes to Consolidated Financial Statements (Expressed in United States dollars) For the years ended December 31, 2020, 2019, and 2018 Sales of electric vehicles The Company will be manufacturing and selling electric powered one-seater vehicles (the SOLO), which has not yet been commercialized. At this timeproceeds of these sales are considered to be incidental revenue and are not being made with the expectation of profit. These are sold to ‘beta’ customers whoprovide real-world testing and feedback on the vehicles. The revenue generated from sales are recorded against research and development expenses.Whenthe Company start delivering production vehicles to customers, revenue will be recognized when the Company has transferred title of the vehicle to thecustomer. Government grants A government grant is recognized if there is reasonable assurance that it will be received and that the Company will comply with the conditions associatedwith the grant. If the conditions are met, the Company recognizes the grant in profit or loss on a systematic basis in line with its recognition of the expensesthat the grant is intended to compensate. For grants related to income, a company can elect to either offset the grant against the related expenditure or includeit in other income. Government assistance received by the Company during the period have been accounted for as government grants related to income andhave been included in other income. Cash and cash equivalents Cash and cash equivalents include cash and short-term investments with original maturities of less than 180 days and are presented at cost, whichapproximates market value. Customer deposits Customer deposits consist primarily of advance payments from customers who order the SOLO vehicles. The deposit will be recognized as revenue when theCompany starts commercial production and transfers control to the customer which generally occurs upon delivery. Construction contract liabilities Construction contract liabilities consist primarily of advance payments from customers who order custom-built vehicles. The deposit is recognized asrevenue when the Company has transferred control to the customer which generally occurs upon shipment. Deferred revenue Deferred revenue consists primarily of advance payments that may be made to the Company by its manufacturing partner in China, Chongqing ZongshenAutomobile Co., Ltd. (“Zongshen”), for royalties to be derived from the sales of SOLOs by Zongshen in China when any such sales are made in accordancewith the terms of our manufacturing agreement (the “Manufacturing Agreement”). The deferred revenue from any such royalties will be recognized in profitor loss on a periodic basis as and when the Zongshen builds and sells the permitted number of SOLOs in China under the Manufacturing Agreement. Inventory Inventory consists of parts and cars held for resale or for use in fixed fee contracts and is valued at the lower of cost and net realizable value. Cost isdetermined on the first-in, first-out basis. Trademarks and patents The Company expenses legal fees and filing costs associated with the development of its trademarks and patents. Plant and equipment Plant and equipment are stated at historical cost less accumulated depreciation and accumulated impairment losses. Subsequent costs are included in the asset’s carrying amount or recognized as a separate asset, as appropriate, only when it is probable that future economicbenefits associated with the item will flow to the Company and the cost of the item can be measured reliably. The carrying amount of the replaced asset isderecognized. All other repairs and maintenance are charged to the consolidated statements of comprehensive loss during the financial period in which theyare incurred. Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognized in the consolidated statements ofcomprehensive loss.
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ElectraMeccanica Vehicles Corp. Notes to Consolidated Financial Statements (Expressed in United States dollars) For the years ended December 31, 2020, 2019, and 2018 Amortization is calculated on a straight-line method to write off the cost of the assets to their residual values over their estimated useful lives. Theamortization rates applicable to each category of plant and equipment are as follows:
	Class of plant and equipment	Amortization rate
	Furniture and equipment		20%
	Computer hardware		33%
	Computer software		50%
	Vehicles		33%
	Production molds		33%
	Leasehold improvements	over term of lease
	Right of use assets	over term of lease
Share-based payments Share-based compensation expenses are measured at the fair value of the instruments issued and amortized over the vesting periods. Share-based paymentexpenses to non-employees are measured at the fair value of goods or services received or the fair value of the equity instruments issued, if it is determinedthe fair value of the goods or services cannot be reliably measured, and are recorded at the date the goods or services are received. The correspondingamounts are recorded to the share-based payment reserve. The fair value of options is determined using a Black–Scholes pricing model. The number ofoptions expected to vest is reviewed and adjusted at the end of each reporting period such that the amount recognized for services received as considerationfor the equity instruments granted shall be based on the number of equity instruments that eventually vest. Restricted Stock Units Restricted Stock Units (“RSU”s) are stock-based awards that may be granted by the Company to certain eligible participants pursuant to its current 2020Stock Incentive Plan (the “Plan”) which was ratified by Company shareholders on July 9, 2020. RSUs are accounted for as equity-settled share basedpayment transactions as the obligations under an RSU will be settled through the issuance of common shares. The Company measures the cost of equity-settled share-based transactions by reference to the fair value of the equity instruments at the date at which they are granted and is recorded in the statementof comprehensive loss over the vesting period. Deferred Stock Units Deferred Stock Units (“DSU”s) are stock-based awards that may be granted by the Company to certain eligible participants pursuant to its Plan. DSUs areaccounted for as equity-settled share based payment transactions as the terms of a DSU provide the Company with the choice of whether to settle in cash orby issuing equity instruments. The Company measures the cost of equity-settled share-based transactions by reference to the fair value of the equityinstruments at the date at which they are granted and is recorded in the statement of comprehensive loss in the period they are granted (immediate vesting) Loss per share Basic loss per share is calculated by dividing the loss attributable to common shareholders by the weighted average number of common shares outstanding inthe period. For all periods presented, the loss attributable to common shareholders equals the reported loss attributable to owners of the Company. Fullydiluted loss per share is calculated by the treasury stock method. Under the treasury stock method, the weighted average number of common sharesoutstanding for the calculation of fully diluted loss per share assumes that the proceeds to be received on the exercise of dilutive share options and warrantsare used to repurchase common shares at the average market price during the period. Research and development expenses Research costs are expensed when incurred and are stated net of government grants. Development costs including direct material, direct labour and contractservice costs are capitalized as intangible assets when: the Company can demonstrate that the technical feasibility of the project has been established; theCompany intends to complete the asset for use or sale and has the ability to do so; the asset can generate probable future economic benefits; the technical andfinancial resources are available to complete the development; and the Company can reliably measure the expenditure attributable to the intangible assetduring its development. After initial recognition, internally generated intangible assets are recorded at cost less accumulated amortization and accumulatedimpairment losses. These capitalized costs are amortized on a straight-line basis over the estimated useful life. To date, the Company did not have anydevelopment costs that met the capitalization criteria.
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ElectraMeccanica Vehicles Corp. Notes to Consolidated Financial Statements (Expressed in United States dollars) For the years ended December 31, 2020, 2019, and 2018 Derivative Liability The Company accounts for its warrants as either equity or liabilities based upon the characteristics and provisions of each instrument. Warrants classified asequity are recorded at fair value as of the date of issuance on the Company’s consolidated statements of financial position and no further adjustments to theirvaluation are made. Warrants classified as derivative liabilities that require separate accounting as liabilities are recorded on the Company’s consolidatedstatement of financial position at their fair value on the date of issuance and will be revalued on each subsequent statement of financial position date untilsuch instruments are exercised or expire, with any changes in the fair value between reporting periods recorded as other income or expense. Managementestimates the fair value of these liabilities using option pricing models and assumptions that are based on the individual characteristics of the warrants orinstruments on the valuation date, as well as assumptions for future financings, expected volatility, expected life, yield and risk-free interest rate. Leases In January 2016, the IASB issued IFRS 16 Leases (“IFRS 16”), which replaced IAS 17 Leases (“IAS 17”) and related interpretations. IFRS 16 introduces asingle lessee accounting model eliminating the previous distinction between finance and operating leases. IFRS 16 requires the recognition of lease-relatedassets and liabilities on the statements of financial position, except for short-term leases and leases of low value underlying assets. Lessor accountingremained substantially unchanged. The Company adopted IFRS 16 on January 1, 2019. The Company transitioned to IFRS 16 in accordance with the modified retrospective approach. Thecomparative information has not been restated and continues to be reported under IAS 17 and IFRIC 4 Determining whether an Arrangement contains aLease. In calculating the lease liability at this date, the Company has chosen to apply practical expedients in IFRS 16, which include:
(i)	recognition exemption of short-term leases;
(ii)	recognition exemption of low-value leases;
(iii)	application of a single discount rate to a portfolio of leases with similar characteristics on transition;
(iv)	exclusion of initial direct costs from the measurement of the right-of-use assets upon transition;
(v)	application of hindsight in determining the applicable lease term at the date of transition; and
(vi)	election to not separate non-lease components from lease components, and instead account for each lease component and any associated non-lease components as a single lease component.
The adoption of IFRS 16 resulted in an increase of $1.6 million in total assets and total liabilities each for recognition of right-of-use assets and leaseliabilities, respectively, and had no impact to opening retained earnings as at January 1, 2019. The majority of our property leases, which were previouslytreated as operating leases, were impacted by IFRS 16. The adoption of IFRS 16 has resulted in:
(i)	higher non-current assets related to the initial recognition of the present value of our unavoidable future lease payments as right-of-use assetsunder property, plant and equipment, adjusted by the amount of any prepaid or accrued lease payments relating to the lease recognized in thebalance sheet as at January 1, 2019;
(ii)	higher current and non-current liabilities related to the concurrent recognition of lease liabilities, which are measured at the present value of theremaining fixed lease payments, discounted by our weighted average incremental borrowing rate of 5% to 10% as of January 1, 2019;
(iii)	replacement of rent expense previously recorded in operating expenses with depreciation expense of these right-of-use assets and higherfinance costs related to the accretion and interest expense of the corresponding lease liabilities; and
(iv)	variable lease payments and non-lease components are expensed as incurred.
The new standard does not change the amount of cash transferred between the lessor and lessee but impacts the presentation of the operating and financingcash flows presented on the Company’s consolidated statement of cash flows by decreasing operating cash flows and increasing financing cash flows. When measuring lease liabilities, the Company discounted lease payments using its incremental borrowing rate at January 1, 2019 of 5% to 10%. Operating lease commitment at December 31, 2018 as disclosed in the Company’s financial statement
		$	1,575,738
Discounting effect using the incremental borrowing rate at January 1, 2019			278,192
			1,297,546
Extension options reasonably certain to be exercised			255,978
Lease liabilities recognized at January 1, 2019		$	1,553,524

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ElectraMeccanica Vehicles Corp. Notes to Consolidated Financial Statements (Expressed in United States dollars) For the years ended December 31, 2020, 2019, and 2018 As a lessee The Company assesses whether a contract is or contains a lease at the inception of the contract. Leases are recognized as a right-of-use asset andcorresponding lease liability at the lease commencement date. The lease liability is measured at the present value of the future fixed payments and variablelease payments that depend on an index or rate over the lease term, less any lease incentives receivable, discounted using the lessee’s incremental borrowingrate, unless the implicit interest rate in the lease can be easily determined. Lease liabilities are subsequently measured at amortized cost using the effective interest rate method. Lease terms applied are the contractual non-cancellableperiods of the lease, plus periods covered by renewal or termination options, if the Company is reasonably certain to exercise those options. Lease liabilitiesare remeasured (with a corresponding adjustment to the right-of-use asset) when there is a change in the lease term, a change in the future lease paymentsresulting from a change in an index or rate used to determine those payments or when the lease contract is modified and the lease modification is notaccounted for as a separate lease. The right-of-use assets include the initial measurement of the corresponding lease liabilities, lease payments at or before the commencement date and anyinitial direct costs, less any lease incentives received before the commencement date. The right-of-use assets are subsequently measured at cost and aredepreciated on a straight-line basis from the date the underlying asset is available for use over the lease term. The Company recognizes the lease payments associated with these leases as an expense on a straight line basis over the lease term. As a lessor When the Company acts as an intermediate lessor, it determines at lease inception whether each lease is a finance lease or an operating lease and accounts forits interest in the head lease and the sublease separately. It assesses the lease classification of a sublease with reference to the right-of-use asset arising fromthe head lease, not with reference to the underlying asset. If a head lease is a short-term lease to which the Company applies the exemption described above,then it classifies the sublease as an operating lease. Impairment of assets The carrying amount of the Company’s long-lived assets with finite useful lives (which include plant and equipment and intangible assets) is reviewed ateach reporting date to determine whether there is any indication of impairment. If such indication exists, the recoverable amount of the asset is estimated inorder to determine the extent of the impairment loss. An impairment loss is recognized whenever the carrying amount of an asset or its cash generating unit(CGU) assets exceeds its recoverable amount. The Company has identified two CGUs including electric vehicles, which develop and manufacture electricvehicles for mass markets, and custom-built vehicles which develop and manufacture high-end custom-built vehicles. Impairment losses are recognized inthe consolidated statements of comprehensive loss. The recoverable amount of assets is the greater of an asset’s fair value less cost to sell and value in use. In assessing value in use, the estimated future cashflows are discounted to their present value using a pre-tax discount rate that reflects the current market assessments of the time value of money and the risksspecific to the asset. For an asset that does not generate cash inflows largely independent of those from other assets, the recoverable amount is determined forthe cash-generating unit to which the asset belongs. An impairment loss is only reversed if there is an indication that the impairment loss may no longer exist and there has been a change in the estimates used todetermine the recoverable amount. Any reversal of impairment cannot increase the carrying value of the asset to an amount higher than the carrying amountthat would have been determined had no impairment loss been recognized in previous years. Goodwill and other intangible assets that have an indefinite useful life are not subject to amortization and are tested annually for impairment at both CGUassets level and total assets level, or more frequently if indicators of impairment exist.
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ElectraMeccanica Vehicles Corp. Notes to Consolidated Financial Statements (Expressed in United States dollars) For the years ended December 31, 2020, 2019, and 2018 Income taxes Current income tax Current income tax assets and liabilities for the current period are measured at the amount expected to be recovered from or paid to the taxation authorities.The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted, at the reporting date, in the countries where theCompany operates and generates taxable income. Current income tax relating to items recognized directly in other comprehensive income or equity isrecognized in other comprehensive income or equity and not in profit or loss. Management periodically evaluates positions taken in the tax returns withrespect to situations in which applicable tax regulations are subject to interpretation and establishes provisions where appropriate. Tax Credits The Company earns scientific research and experimental development activity (“SR&ED”) tax credits with respect to its research and development expenses.The benefit of these SR&ED tax credits is recorded as a reduction of research and development expenses when their recoverability is reasonably expected.The SR&ED tax credits earned while the Company was Canadian Controller Private Corporation (as defined by Canadian income tax legislation) arerefundable to the Company and are recorded as a receivable, while the tax credits earned now that the Company is a public company (as defined underCanadian tax laws) can be used to reduce future Canadian income taxes payable. Deferred income tax Deferred income tax is recognized, using the liability method, on temporary differences at the reporting date arising between the tax bases of assets andliabilities and their carrying amounts for financial reporting purposes. The carrying amount of deferred income tax assets is reviewed at the end of eachreporting period and recognized only to the extent that it is probable that sufficient taxable profit will be available to allow all or part of the deferred incometax asset to be utilized. Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to the year when the asset is realizedor the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period. Deferredincome tax assets and deferred income tax liabilities are offset if a deferred income taxes relate to the same taxable entity and the same taxation authority. 3.
	Change in presentation currency
Effective December 31, 2020, the Company changed its presentation currency from CAD to USD to be more relevant to users. Prior to December 31, 2020, the Company reported its annual and quarterly consolidated financial statements in CAD. In making this change in presentationcurrency, the Company follows the recommendations set out in IAS 21, the Effects of Change in Foreign Exchange Rates. In accordance with IAS 21,comparable financial statements to those for the year ended December 31, 2020 for years ended 2019 and 2018 have been restated retrospectively in the newpresentation currency of USD using the current rate method. The consolidated financial statements as of December 31, 2020 of the Company have been prepared in CAD and translated into the new presentationcurrency of USD using the current rate method. The procedure under the current rate method is outlined as below:
•	Income Statement and Statement of Cash Flows have been translated into USD using average foreign currency rates prevailing for the relevantreporting periods of years ended December 31, 2020, 2019 and 2018;
•	assets and liabilities in the Statement of Financial Position have been translated into USD at the closing foreign currency rates on the relevantreporting dates as of December 31, 2020 and 2019;
•	the equity section of the Statement of Financial Position, including foreign currency translation reserve, retained earnings, share capital and theother reserves, have been translated into USD using historical rates; and
•	earnings per share has also been restated to USD to reflect the change in presentation currency.
All resulting exchange differences arising from the translation are included as separate component of other comprehensive income. 4.
	Cash and cash equivalents
For the purposes of the cash flow statement, cash and cash equivalents comprise the following balances with original term to maturity of 180 days or less:
		December 31,		December 31,
			2020		2019
Cash		$	58,450,680 $		2,060,624
Cash equivalent			70,999,996		6,500,000
		$	129,450,676 $		8,560,624
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ElectraMeccanica Vehicles Corp. Notes to Consolidated Financial Statements (Expressed in United States dollars) For the years ended December 31, 2020, 2019, and 2018 5.
	Receivables

		December 31,		December 31,
			2020		2019
Trade receivable		$		- $	11,562
GST receivable			49,385		36,592
Scientific research and experimental development tax credits receivable				-	192,193
Interest receivable			162,316		99,573
Other receivables			1,645			265
		$	213,346 $		340,185
6.
	Plant and equipment

								Computer	Production
							Furniture and	hardware and			Leasehold	Right-of-use		tooling
													equipment									software	Vehicles	Improvements	assets			and molds	Total
Cost:
December 31, 2018								364,510							98,338	286,050	283,316		-	3,353,985						4,386,199
Additions								56,854						107,907			-	99,778		-	2,554,467						2,819,006
Adoption of IFRS 16								-							-		-	-	1,590,456			-					1,590,456
Disposals								-							(1,659)		-	-		-		-					(1,659)
Foreign exchange translation difference								16,994							4,584	13,336	13,209		-	156,374						204,497
December 31, 2019								438,358						209,170		299,386	396,303	1,590,456		6,064,826						8,998,499
Additions								32,937						208,294		1,090,673	64,495		465,312	1,738,462						3,600,173
Disposals/write off								-							-	(10,907)	(28,366)		-	(299,606)						(338,879)
Lease termination and derecognition1,2								-							-		-	-		(425,932)		-					(425,932)
Foreign exchange translation difference								6,528							3,734		5,445	2,944		30,262	110,287						159,200
December 31, 2020								477,823						421,198		1,384,597	435,376	1,660,098		7,613,969						11,993,061
Amortization:
December 31, 2018								170,132							48,423	158,672	84,569		-		-					461,796
Additions								60,159							50,611	90,519	94,087		512,902		-					808,278
Disposals								-							(967)		-	-		-		-					(967)
Foreign exchange translation difference								7,932							2,257		7,397	3,943		-		-					21,529
December 31, 2019								238,223						100,324		256,588	182,599		512,902		-					1,290,636
Additions								67,030							96,191	41,005	112,591		414,102	903,756						1,634,675
Disposals/write off								-							-	(7,588)	(23,119)		-	(9,847)						(40,554)
Lease termination and derecognition1,2								-							-		-	-		(204,590)		-					(204,590)
Foreign exchange translation difference								4,068							1,816		4,667	1,685		10,350		-					22,586
December 31, 2020								309,321						198,331		294,672	273,756		732,764	893,909						2,702,753
Net book value:
December 31, 2019								200,135						108,846		42,798	213,704	1,077,554		6,064,826						7,707,863
December 31, 2020								168,502						222,867		1,089,925	161,620		927,334	6,720,060						9,290,308
1 The Company entered into a sublease agreement for its office space in Los Angeles, USA, with effect from February 1, 2020. As a result of the sublease,the Company derecognized the right-of-use asset relating to the head lease with a cost of $298,708 and accumulated amortization of $120,131 (see Note 7 forfurther information on the net investment in sublease). 2 The Company terminated one of its warehouse leases on January 31, 2020. As a result of the termination, the Company derecognized the right-of-use assetof the warehouse with a cost of $127,224 and accumulated amortization of $84,459 (see Note 10 for further information on the termination of the lease)
										130


ElectraMeccanica Vehicles Corp. Notes to Consolidated Financial Statements (Expressed in United States dollars) For the years ended December 31, 2020, 2019, and 2018 On September 18, 2017, the Company entered into a Manufacturing Agreement with Zongshen. Under the Manufacturing Agreement, the Company agreesto reimburse Zongshen for the cost of prototype tooling and molds estimated to be CNY ¥9.5 million ($1.4 million), which was payable on or before March18, 2018, subject to a 10% holdback, and mass production tooling and molds estimated to be CNY ¥29 million ($4.3 million), which shall be payable as to50% when Zongshen commences manufacturing the tooling and molds, 40% when Zongshen completes manufacturing the tooling and molds and 10% upondelivery to the Company of the first production vehicle. As at December 31, 2020, the Company has commenced commercial production and delivered the first production vehicle. Therefore, the Company has paid100% of the prototype tooling and molds with an actual cost of CNY ¥10.1 million ($1.7 million) and 80% of the mass production tooling and molds with anactual cost of CNY ¥40 million ($6.2 million). The unpaid amount of mass production tooling and molds is included in accrued liabilities as at December 31,2020. As assessed by the Company, the prototype and mass production tooling and molds with a net book value of $289,759 were written off in the year endedDecember 31, 2020 due to technical changes; as the molds cannot be adapted for use to produce the current version of the SOLO. The remaining prototypeand mass production tooling and molds are estimated to be used for three years to produce the SOLO. These production tooling and molds will bedepreciated on a straight-line basis over a three year period as the assets were custom built for the production of the current SOLO and will be retired at theend of the production run. The Company estimates that the residual value of the assets will be minimal at the end of the three year period. During the yearended December 31, 2020, $903,756 (2019 and 2018 - $Nil) was charged to amortization expenses. No amounts were allocated to inventory or charged tocost of goods sold during the period as the SOLOs completed as at December 31, 2020 are intended to be used as marketing vehicles for customers to testdrive. The Company does not intend to sell these marketing vehicles to customers in future periods. On October 16, 2017, the then CEO of the Company (the “Pledgor”) entered into a Share Pledge Agreement (“Share Pledge”) to guarantee the payment bythe Company for the cost of the prototype tooling and molds estimated to be CNY ¥9.5 million ($1.4 million) to Zongshen through the pledge of 400,000common shares of the Company. The Company approved its obligations under the Share Pledge and had agreed to reimburse the Pledgor on a one for onebasis for any pledged shares realized by Zongshen. As at December 31, 2020, the Company has paid 100% of the cost of the prototype tooling and moldsand, accordingly, the Share Pledge has been terminated. 7.
	Net investment in sublease
The Company entered into an agreement to sublease its office space in Los Angeles, USA, with effect from February 1, 2020. The Company has classifiedthe sublease as a finance lease as the term of the sublease is for major part of the economic life of the right-of-use asset arising from the head lease. At thecommencement date of the sublease, the Company derecognized the right-of-use asset relating to the head lease that it transferred to the sub-lessee andrecognized the net investment in the sub-lease. The term of the sublease expires on August 21, 2021. During the year ended December 31, 2020, the Company provided rent relief to a sub-lessee from August to the expiry date on August 21, 2021.Accordingly, the Company has recognized $62,935 of lease modification loss in relation to the net investment in sublease. As at December 31, 2021, the contractual undiscounted cash flows related to subleases were as follows:
					Present value of
		Future minimum					minimum lease
				lease payments					payments
				receivable		Interest income	receivable
Less than one year		$					40,000 $	1,459 $	38,541
Between one and five years			-		-	-
Net investment in sublease		$					40,000 $	1,459 $	38,541
									131


ElectraMeccanica Vehicles Corp. Notes to Consolidated Financial Statements (Expressed in United States dollars) For the years ended December 31, 2020, 2019, and 2018 8.
	Goodwill and Intangible Assets

		December 31, 2020 December 31, 2019
Identifiable intangibles on acquisition of Intermeccanica		$	407,751 $	404,326
Goodwill on acquisition of Intermeccanica			549,760	539,941
Other intangibles			11,956	11,742
		$	969,467 $	956,009
9.
	Trade payables and accrued liabilities

		December 31, 2020 December 31, 2019
Trade payables		$	1,001,773 $	535,048
Due to related parties (Note 19)			280,432	212,562
Accrued liabilities			2,179,134	894,350
		$	3,461,339 $	1,641,960
10.
	Lease liabilities
Lease obligations relate to the Company’s rent of warehouse spaces and kiosk locations to promote vehicle sales. The term of leases related to warehousespaces expire on August 31, 2021 and August 1, 2022, respectively, with the Company holding an option to renew one of the warehouse leases for a furtherfive years which has been included in the lease term. The Company entered into 4 long term lease agreements in 2020 for the lease of kiosk locations in USAwhich expire between November 30, 2021 to September 30, 2023. The Company terminated one of its warehouse leases on January 31, 2020 without penalty for termination and derecognized the lease liability and net right-of-use asset of $33,442 and $42,765, respectively, on the effective date of termination. The Company incurred $247,262 of lease expenses for year ended December 31, 2020 (2019 - $27,765), for short-term leases and low-value leases which arenot included in the measurement of lease liabilities. The following tables reconciles the change in the lease liabilities and discloses a maturity analysis of the lease liabilities for year ended December 31, 2020and 2019: Balance as at January 1, 2019
					$	1,553,524
Accretion of lease liability						91,112
Repayment of principal and interest

Repayment of principal and interest						(515,387)
Balance as at December 31, 2019					$	1,129,249
Lease addition						465,312
Lease termination						(33,442)
Accretion of lease liability						79,205
Repayment of principal and interest						(564,551)
Balance as at December 31, 2020					$	1,075,773
							132


ElectraMeccanica Vehicles Corp.Notes to Consolidated Financial Statements(Expressed in United States dollars)For the years ended December 31, 2020, 2019, and 2018
				Present value of
	Future minimum					minimum lease
At December 31, 2020			lease payments		Interest			payments
Less than one year	$						641,448 $	65,216 $	576,232
Between one and five years							458,146	84,257	373,889
More than five years							133,118	7,466	125,652
	$						1,232,712 $	156,939	1,075,773
Current portion of lease liabilities									576,232
Non-current portion of lease liabilities				$					499,541
11.
										Income tax recovery and deferred tax assets and liabilities
A reconciliation of the expected income tax recovery to the actual income tax recovery is as follows:
		31-Dec-20		31-Dec-19			31-Dec-18
Loss before tax	$						(63,079,457) $	(23,291,823) $			(7,746,599)
Statutory tax rate		27%		27%	27%
Expected income tax recovery at the statutory tax rate							(17,031,453)	(6,288,792)			(2,091,582)
Lower rate on foreign subsidiaries							48,161	13,932	-
Change in estimates							(115,603)	141,562		-
Non-deductible items							10,299,823	1,920,654			(933,010)
Share issue costs and other							(1,372,262)	(281,953)			(748,188)
Temporary differences not recognized							8,138,782	4,415,472			3,771,494
Income tax recovery							(32,552)	(79,125)						(1,286)
The Company has the following deductible (taxable) temporary differences:
											31-Dec-20		31-Dec-19		31-Dec-18
Non-capital loss carry-forwards	$						63,213,473 $	35,846,498 $			18,638,208
Property, plant and equipment							1,845,332	339,632	243,969
Share issue costs							6,774,934	3,757,068			3,662,916
SR&ED expenditures							2,941,082	2,430,941			1,718,657
ROU Assets							(927,331)	(1,077,556)		-
Lease libiltiy							1,075,773	1,129,249		-
Net Investment Assets							(38,541)	-	-
Other							(374,454)	(270,395)						(303,327)
							74,510,268	42,155,437			23,960,423
Deferred tax assets not recognized							(74,510,268)	(42,277,892)			(24,369,388)
Deferred tax liability		-	(122,455)						(408,965)
Deferred tax liability (tax effected at 27%)	$	- $						(33,063) $	(110,420)
												133


ElectraMeccanica Vehicles Corp.Notes to Consolidated Financial Statements(Expressed in United States dollars)For the years ended December 31, 2020, 2019, and 2018 12.
	Derivative liability
The exercise price of certain of our warrants is denominated in USD; however, the functional currency of the Company is CAD. Consequently, the value ofthe proceeds on exercise is not fixed and will vary based on foreign exchange rate movements. The warrants when issued other than as compensation forgoods and services are therefore a derivative for accounting purposes and are required to be recognized as a derivative liability and measured at fair value ateach reporting period. Any changes in fair value from period to period are recorded as non-cash gain or loss in the consolidated statements of comprehensiveloss. Upon exercise, the holders will pay the Company the respective exercise price for each warrant exercised in exchange for one common share of theCompany and the fair value at the date of exercise and the associated non-cash liability will be reclassified to share capital. The non-cash liability associatedwith any warrants that expire unexercised will be recorded as a gain in the consolidated statements of comprehensive loss. There are no circumstances inwhich the Company would be required to pay any cash upon exercise or expiry of the warrants (see Note 12 for further information on warrants issued andoutstanding). A reconciliation of the changes in fair values of the derivative liability for year ended December 31, 2020 and December 31, 2019 is below:
		December 31, 2020 December 31, 2019
Balance, beginning		$	5,456,265 $	3,503,572
Warrants exercised			(20,491,542)	(468,413)
Changes in fair value of derivative liabilities			32,935,132	2,421,106
Balance, ending		$	17,899,855 $	5,456,265
The fair value of the transferrable warrants was calculated using the warrant price of $0.50 at issuance and $3.77 at December 31, 2020 as quoted on Nasdaq. 13.
	Share capital
Authorized share capital Unlimited number of common shares without par value. At December 31, 2020, the Company had 89,309,563 issued and outstanding common shares (December 31, 2019 – 37,049,374). On March 27, 2020, the Company contracted with Stifel, Nicolaus & Company, Incorporated and Roth Capital Partners, LLC (each, an “Agent”, andcollectively, the “Agents”) to sell common shares of the Company (the “Shares”) having an aggregate offering price of up to $30,000,000 through the Agents(the “Sales Agreement March”). On July 13, 2020, the Company and the Agents amended the Sales Agreement March to increase the aggregate offeringprice up to US$59,500,000. On December 21, 2020, the Company contracted with the Agents to sell Shares having an aggregate offering price of up to $100,000,000 through the Agents(the “Sales Agreement December”). In accordance with the terms of the Sales Agreement March and Sales Agreement December, the Company may offer and sell Shares from time to timethrough the Agent selected by the Company (the “Designated Agent”), acting as sales agent or, with consent of the Company, as principal. The shares may beoffered and sold by any method permitted by law deemed to be an “at the market” (“ATM”) offering as defined in Rule 415 promulgated under the SecuritiesAct, including sales made directly on or through Nasdaq or on any other existing trading market for the Shares, and, if expressly authorized by the Company,in negotiated transactions. From March 30, 2020 to September 24, 2020, the Company issued 28,978,936 common shares for the ATM offering under the Sales Agreement March forgross proceeds of $59,499,993. Share issue costs related to the ATM offering were $1,786,315. From December 22 to December 30, 2020, the Company issued 7,520,000 common shares for the ATM offering under the Sales Agreement December forgross proceeds of $53,441,008. Share issue costs related to the ATM offering were $1,444,088.
					134


ElectraMeccanica Vehicles Corp.Notes to Consolidated Financial Statements(Expressed in United States dollars)For the years ended December 31, 2020, 2019, and 2018 On June 10, 2020, the Company entered into definitive agreements with institutional investors to sell an aggregate of 10,000,000 common shares of theCompany at a price of $2.00 per share for gross proceeds of $20,000,000 (the “Offering”). The Offering was priced “at market” under the rules of Nasdaq.The Offering was closed on June 12, 2020. The Company received gross proceeds of $20,000,000 with share issue costs of $1,350,000. During the year ended December 31, 2020, the Company issued 5,242,389 shares for warrants exercised by investors for proceeds of $32,597,096 (2019 –1,116, 323 shares for proceeds of $3,634,734) During the year ended December 31, 2020, the Company issued 518,864 shares for options exercised by investors for proceeds of $950,971 (2019 – 137,304shares for proceeds of $83,382) Basic and fully diluted loss per share The calculation of basic and fully diluted loss per share for year ended December 31, 2020 was based on the net loss attributable to common shareholders of$63,046,905 (2019 – $23,212,698; 2018 - $7,745,313) and the weighted average number of common shares outstanding of 58,352,766 (2019 – 35,998,152;2018 – 26,582,664). Fully diluted loss per share did not include the effect of 13,008,364 stock options (2019 – 12,908,315; 2018 – 4,756,174), 15,070,883warrants (2019 – 20,603,396; 2018 – 22,369,718), 44,623 DSUs (2019 – Nil; 2018 – Nil) and 507,829 RSUs (2019 – Nil; 2018 – Nil) as the effect would beanti-dilutive. Stock options The Company adopted its Plan on July 9, 2020, which provides that the Board of Directors of the Company may from time to time, in its discretion, grant todirectors, officers, employees and consultants of the Company non-transferable stock options to purchase common shares, provided that the number ofcommon shares reserved for issuance will not exceed 30,000,000. Such stock options will be exercisable for a period of up to 10 years from the date of grant.Stock options may be exercised no later than 90 days following cessation of the optionee’s position with the Company unless any exercise extension hasbeen approved in advance by the Plan Administrator. Stock options granted vest based on terms and conditions set out in the stock option agreements themselves. On exercise, each stock option allows the holderto purchase one common share of the Company or to exchange common share of the Company cashless base on formula set in the option agreement. The changes in stock options during the years ended December 31, 2020 and 2019 are as follows:
		December 31, 2020		December 31, 2019
						Weighted		Weighted
	Number of					average	Number of			average
			options						exercise price		options	exercise price
Options outstanding, beginning		12,908,315 $	2.03	4,756,174 $	2.12
Options granted		1,790,000	3.47	8,755,000	2.26
Options exercised		(632,822)	1.83	(137,304)	0.41
Options forfeited		(952,129)	2.85	(190,555)	5.96
Options expired/cancelled		(105,000)	6.34	(275,000)	9.27
Options outstanding, ending		13,008,364 $	2.14	12,908,315 $	2.03
		135


ElectraMeccanica Vehicles Corp.Notes to Consolidated Financial Statements(Expressed in United States dollars)For the years ended December 31, 2020, 2019, and 2018 Details of stock options outstanding as at December 31, 2020 were as follows:
		Weighted			Number of			Number of
				average					options					options
	Exercise price			contractual life					outstanding					exercisable
$0.30 CAD				1.45		2,152,273			2,152,273
$0.80 CAD				1.95		387,211			387,211
$2.00 CAD				3.14		122,604			114,104
$1.80				5.80		120,000			120,000
$1.91				5.93		5,050,000			2,953,285
$2.45				5.59		1,250,000			1,250,000
$2.53				3.30		131,818			131,818
$2.62				1.48		700,000			328,125
$3.40				5.22		1,045,000			1,045,000
$3.41				6.56		1,400,727			535,314
$3.77				7.37		295,000			66,355
$5.00				2.92		193,629			193,629
$6.18				4.61		25,000			15,107
$9.60				3.87		135,102			104,379
						13,008,364			9,396,600
The weighted average grant date fair value of stock options granted during the year ended December 31, 2020 was $1.58 (2019 - $1.17). The fair value wascalculated using the Black-Scholes option pricing model using the following weighted average assumptions:
							Year ended		Year ended
							December 31, 2020		December 31, 2019
Expected life of options							3-5 years		3-5 years
Annualized volatility											62.29%	62.29%
Risk-free interest rate							0.29% - 0.42%		1.25% - 1.58%
Dividend rate								0%		0%
During the year ended December 31, 2020, the Company recognized stock-based compensation expense of $5,559,181 (2019 - $5,147,573; 2018 -$2,491,078) for stock options granted. Warrants On exercise, each warrant allows the holder to purchase one common share of the Company or to exchange common share of the Company cashless base onformula set in the warrant agreement. The changes in warrants during the year ended December 31, 2020 and 2019 are as follows:
				December 31, 2020							December 31, 2019
					Weighted				Weighted
			Number of				average		Number of				average
					warrants										exercise price	warrants	exercise price
Warrants outstanding, beginning				20,603,396 $		3.57	22,369,718 $			3.81
Warrants exercised				(5,387,200)		2.49	(1,116,322)			2.85
Warrants expired				(145,313)		1.49					(650,000)	15.35
Warrants outstanding, ending				15,070,883 $		4.01	20,603,396 $			3.57
				136


ElectraMeccanica Vehicles Corp.Notes to Consolidated Financial Statements(Expressed in United States dollars)For the years ended December 31, 2020, 2019, and 2018 At December 31, 2020, all warrants outstanding were exercisable. Details of warrants outstanding as at December 31, 2020 were as follows:
		Number
Exercise Price	Weighted average	of warrants
		contractual life		outstanding
Non-Transferable Warrants
$0.80 CAD - $16.00 CAD				0.90 years	9,231,196
$2.00 USD - $24.00 USD				2.67 years	1,338,319
Transferable Warrants
$4.25 USD				2.60 years	4,501,368
Warrants outstanding, ending				1.56 years	15,070,883
DSUs DSUs are stock-based awards that may be granted by the Company to certain eligible participants pursuant to its Plan. DSUs are accounted for as equity-settled share based payment transactions as the terms of a DSU provide the Company with the choice of whether to settle in cash or by issuing equityinstruments. The Company measures the cost of equity-settled share-based transactions by reference to the fair value of the equity instruments at the date atwhich they are granted and is recorded in the statement of comprehensive loss in the period they are granted (immediate vesting) The changes in DSUs during the year ended December 31, 2020 were as follows:
				December 31, 2020
		Weighted average
	Number of options		exercise price
DSUs outstanding, beginning			- $	-
DSUs granted				44,623	3.41
DSUs exercised			-	-
DSUs outstanding, ending				44,623 $	3.41
					137


ElectraMeccanica Vehicles Corp.Notes to Consolidated Financial Statements(Expressed in United States dollars)For the years ended December 31, 2020, 2019, and 2018 Details of DSUs outstanding as at December 31, 2020 are as follows:
		Weighted average		Number of		Number of DSUs
	Deemed value			contractual life				DSUs outstanding			exercisable
	$	3.41	9.56		44,623			44,623
During the year ended December 31, 2020, the Company recognized stock-based compensation expense of $153,266 (2019 and 2018 - $Nil) for DSUsgranted during the period. RSUs RSUs are stock-based awards that may be granted by the Company to certain eligible participants pursuant to its current Plan which was ratified byCompany shareholders on July 9, 2020. RSUs are accounted for as equity-settled share based payment transactions as the obligations under an RSU will besettled through the issuance of common shares. The Company measures the cost of equity-settled share-based transactions by reference to the fair value ofthe equity instruments at the date at which they are granted and is recorded in the statement of comprehensive loss over the vesting period. The changes in RSUs during the year ended December 31, 2020 were as follows:
										December 31, 2020
											Weighted average
									Number of options		exercise price
RSUs outstanding, beginning											- $	-
RSUs granted										507,849			3.44
RSUs exercised											-	-
RSUs outstanding, ending										507,849 $			3.44
Details of RSUs outstanding as at December 31, 2020 were as follows:
												Weighted	Number of		Number of
												average		RSUs		RSUs
	Deemed value			contractual life				outstanding					exercisable
	$	3.44	9.56		507,849		-
During the year ended December 31, 2020, the Company recognized stock-based compensation expense of $548,538 (2019 and 2018 - $Nil) for RSUsgranted during the period. 14.
													Share Based Reserves
The share-based payment reserve records items that are recognized as stock-based compensation expense and other share-based payments until such timethat the stock options are exercised, at which time the corresponding amount will be transferred to share capital. If the stock options expire unexercised, theamount remains in the share-based payment reserve account. 15.
													General and administrative expenses

				December 31, 2020 December 31, 2019 December 31, 2018
Rent				$	616,968 $		320,927 $							376,746
Office expenses					1,331,356		1,192,785							728,974
Legal and professional					2,073,022		1,393,004							1,151,069
Consulting fees					1,323,803		1,512,126							919,418
Investor relations					316,145		249,322							474,375
Salaries					3,164,023		1,433,196							586,160
				$	8,825,317 $		6,101,360 $							4,236,742
			138


ElectraMeccanica Vehicles Corp.Notes to Consolidated Financial Statements(Expressed in United States dollars)For the years ended December 31, 2020, 2019, and 2018 16.
	Research and development expenses

		December 31, 2020 December 31, 2019 December 31, 2018
Labor		$	5,471,136 $	4,403,038 $	2,763,805
Materials			2,383,730	3,253,593	2,618,226
Government grants						-	(476,985)	(1,087,344)
		$	7,854,866 $	7,179,646 $	4,294,687
17.
	Sales and marketing expenses

		December 31, 2020 December 31, 2019 December 31, 2018
Consulting		$	402,146 $	331,135 $	410,338
Marketing			900,976	403,002	356,266
Salaries			1,231,609	580,552	303,512
		$	2,534,731 $	1,314,689 $	1,070,116
18. Other Income
		December 31, 2020 December 31, 2019 December 31, 2018
Paycheck Protraction Program Loan1		$	133,750 $				- $	-
Industrial Research Assistance Program Funding			176,088				-	-
Canada Emergency Wage Subsidy			77,994				-	-
Miscellaneous income			7,540	67,410				-
		$	395,372 $	67,410 $				-
1 On May 21, 2020, the Company entered into a promissory note evidencing an unsecured loan in the amount of $133,750 made to the Company under thePaycheck Protection Program (the “Loan”). The Paycheck Protection Program (or “PPP”) was established under the Coronavirus Aid, Relief, and EconomicSecurity Act (the “CARES Act”) and is administered by the U.S. Small Business Administration. The Loan to the Company was made through BMO HarrisBank National Association (the “Lender”). The Loan bears interest rate of 1% per year and matures in 24 months from the date of the Loan. Beginning sevenmonths from the date of the Loan, the Company is required to make 18 monthly payments of principal and interest. Under the terms of the CARES Act, PPPloan recipients can apply for and be granted forgiveness for all or a portion of loan granted under the PPP. Such forgiveness will be determined, subject tolimitations, based on the use of loan proceeds for payment of payroll costs and any covered payments of mortgage interest, rent and utilities. As at December31, 2020, the Company has used all proceeds from the PPP Loan to maintain payroll and make lease and utility payments. The Company has filed a PPP loanforgiveness application with U.S. Small Business Administration. The Company meets the PPP loan forgiveness conditions listed in the PPP loan forgivenessapplication form in accordance with the established guidelines issued by U.S. Small Business Administration. Accordingly, the Company has accounted forthe PPP Loan as a government grant in accordance with IAS 20 – Accounting for Government Grants and Disclosure of Government Assistance. During the year ended December 31, 2020, the Company received $176,088 (2019 and 2018 – $Nil) from the Industrial Research Assistance ProgramFunding and $77,994 (2019 and 2018 – $Nil) in Canada Emergency Wage Subsidy relief related to COVID-19. These governmental assistances received arenon-repayable and were accounted for as government grants related to income in accordance with IAS 20. 19.
	Segmented information
The Company operates in two reportable business segments in Canada. The two reportable business segments offer different products, require different production processes, and are based on how the financial information isproduced internally for the purposes of making operating decisions. The following summary describes the operations of each of the Company’s reportablebusiness segments:
•	Electric Vehicles – development and manufacture of electric vehicles for mass markets, and
•	Custom built vehicles – development and manufacture of high-end custom-built vehicles.
		139


ElectraMeccanica Vehicles Corp.Notes to Consolidated Financial Statements(Expressed in United States dollars)For the years ended December 31, 2020, 2019, and 2018 Sales between segments are accounted for at prices that approximate fair value. No business segments have been aggregated to form the above reportablebusiness segments.
		Year ended December 31, 2020	Year ended December 31, 2019		Year ended December 31, 2018
	Electric				Custom Built	Electric		Custom Built	Electric		Custom Built
					Vehicles									Vehicles								Vehicles				Vehicles				Vehicles	Vehicles
Revenue	$			- $								568,521 $	- $						585,584 $	- $			599,757
Gross profit				-								(130,934)	-						98,041	-			155,961
Operating expenses															(26,837,127)	(242,426)	(20,341,597)						(365,710)	(12,811,978)		(351,727)
Other items															(36,062,460)	193,490	(2,666,853)						(15,704)	5,278,597		(17,452)
Current income tax recovery				(725)								1,129	(1,600)	-								-			1,286
Deferred income tax recovery				-								32,148	-						80,725	-	-
Net loss/(income)															(62,900,312)	(146,593)	(23,010,050)						(202,648)	(7,533,381)		(211,932)
FX translation				4,213,906	-					898,473	-							(763,708)	-
Comprehensive loss/(income)	$														(58,686,406) $	(146,593) $	(22,111,577) $						(202,648) $	(8,297,089) $		(211,932)

												December 31, 2020		December 31, 2019
					Electric	Custom Built	Electric								Custom Built
																									Vehicles			Vehicles	Vehicles			Vehicles
Inventory				$								305,443 $	303,651 $	237,029 $											341,724
Plant and equipment												9,014,777	275,531	7,391,375											316,488
20.
																	Related party transactions
Related party balances The following amounts are due to related parties:
													December 31, 2020 December 31, 2019
Shareholder loan													$	- $				1,602
Due to related parties														280,432					212,562
													$	280,432 $					214,164
These amounts are unsecured, non-interest bearing and have no fixed terms of repayment. Key management personnel compensation
							December 31,	December 31,									December 31,
																	2020						2019				2018
Consulting fees						$		93,901 $	440,980 $					258,574
Salary								1,685,957	608,692					354,505
Director fees								307,432	305,717					127,574
Stock-based compensation								4,689,996	4,303,871		1,155,765
						$		6,777,286 $	5,659,260 $		1,896,418
		140


ElectraMeccanica Vehicles Corp.Notes to Consolidated Financial Statements(Expressed in United States dollars)For the years ended December 31, 2020, 2019, and 2018 21.
	Financial instruments and financial risk management
The Company is exposed in varying degrees to a variety of financial instrument related risks. The Board of Directors approves and monitors the riskmanagement processes, inclusive of controlling and reporting structures. The type of risk exposure and the way in which such exposure is managed isprovided as follows. Credit riskCredit risk is the risk that one party to a financial instrument will fail to discharge an obligation and cause the other party to incur a financial loss. TheCompany’s primary exposure to credit risk is on its cash and cash equivalents held in bank accounts. The majority of cash is deposited in bank accounts heldwith major financial institutions in Canada. As most of the Company’s cash is held by one financial institution there is a concentration of credit risk. Thisrisk is managed by using major financial institutions that are high credit quality financial institutions as determined by rating agencies. The Company’ssecondary exposure to risk is on its receivables. This risk is minimal as receivables consist primarily of refundable government goods and services taxes andinterest receivable from major financial institutions with high credit rating. Liquidity riskLiquidity risk is the risk that the Company will not be able to meet its financial obligations as they fall due. The Company has a planning and budgetingprocess in place to help determine the funds required to support the Company’s normal operating requirements on an ongoing basis. The Company ensuresthat there are sufficient funds to meet its short-term business requirements, taking into account its anticipated cash flows from operations and its holdings ofcash and cash equivalents. Historically, the Company’s source of funding has been shareholder loans and the issuance of equity securities for cash, primarily through private placementsand public offerings. The Company’s access to financing is always uncertain. There can be no assurance of continued access to significant equity funding. The following is an analysis of the contractual maturities of the Company’s non-derivative financial liabilities as at December 31, 2020 and 2019. We haveexcluded derivative liabilities from the table because they are settled by shares.
			Between one		More than
At December 31, 2020			Within one year			and five years		five years
Trade payables		$					1,001,773	-		-
Accrued liabilities							2,179,134	-		-
Due to related parties							280,432	-		-
Lease liabilities							576,232	373,889			125,652
		$					4,037,571 $	373,889 $			125,652

			Between one		More than
At December 31, 2019			Within one year			and five years		five years
Trade payables		$					535,048	-		-
Accrued liabilities							894,350	-		-
Due to related parties							212,562	-		-
Shareholder loan							1,602	-		-
Lease liabilities							466,679	468,465			194,105
		$					2,110,241 $	468,465 $			194,105
Foreign exchange riskForeign currency risk is the risk that the fair values of future cash flows of a financial instrument will fluctuate because they are denominated in currenciesthat differ from the respective functional currency. The Company is exposed to currency risk as it incurs expenditures that are denominated in US dollarswhile its functional currency is the Canadian dollar. The Company does not hedge its exposure to fluctuations in foreign exchange rates. The following is an analysis of financial assets and liabilities that are denominated in US dollars:
										December 31, 2020 December 31, 2019
Cash and cash equivalents			$	127,126,440 $		8,143,357
Restricted cash				63,250				63,250
Receivables				162,315				148,901
Lease liabilities				(646,616)				(557,713)
Trade payables and accrued liabilities				(1,921,536)					(81,700)
			$	124,783,853 $		7,716,095
										141


ElectraMeccanica Vehicles Corp.Notes to Consolidated Financial Statements(Expressed in United States dollars)For the years ended December 31, 2020, 2019, and 2018 Based on the above net exposures, as at December 31, 2020, a 10% change in the US dollar to Canadian dollar exchange rate would impact the Company’snet loss by $12,534,286 (2019 - $815,105). Interest rate riskInterest rate risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market interest rates. TheCompany is exposed to interest rate risk on its cash equivalents as these instruments have original maturities of 12 months or less and are therefore exposedto interest rate fluctuations on renewal. A 1% change in market interest rates would have an impact on the Company’s net loss of $710,000 for the year endedDecember 31, 2020 (2019 - $65,000). Classification of financial instrumentsFinancial assets included in the consolidated statements of financial position are as follows:
	December 31, 2020 December 31, 2019
Amortized cost:
Cash and cash equivalents	$	129,450,676 $	8,560,624
Restricted cash		143,800	142,201
Receivables		159,664	111,400
	$	129,754,140 $	8,814,225
Financial liabilities included in the consolidated statements of financial position are as follows:
					December 31, 2020		December 31, 2019
Non-derivative financial liabilities:
Trade payable and accrued liabilities				$	3,461,339 $			1,641,960
Shareholder loan					-	1,602
Lease liabilities					1,075,773			1,129,249
Derivative financial liabilities:
Derivative liability					17,899,855			5,456,265
				$	22,436,967 $			8,229,076
Fair valueThe fair value of the Company’s financial assets and liabilities, other than the derivative liability which is measured at fair value, approximates the carryingamount. Financial instruments measured at fair value are classified into one of three levels in the fair value hierarchy according to the relative reliability of the inputsused to estimate the fair values. The three levels of the fair value hierarchy are:
•					Level 1 – Unadjusted quoted prices in active markets for identical assets or liabilities;
•					Level 2 – Inputs other than quoted prices that are observable for the asset or liability either directly or indirectly; and
•					Level 3 – Inputs that are not based on observable market data.
Financial liabilities measured at fair value at December 31, 2020 consisted of the derivative liability, which includes transferrable warrants and non-transferrable warrants. The fair value of the transferrable warrants is classified as level 1, and the fair value of the non-transferrable warrants is classified aslevel 2 in the fair value hierarchy. The fair value of the derivative liability relating to the transferrable warrants was measured using the quoted market price on the Nasdaq. The fair value of the derivative liability relating to the non-transferrable warrants was calculated using the Black-Scholes Option Pricing Model usinghistorical volatility of comparable companies as an estimate of future volatility. At December 31, 2020, if the volatility used was increased by 10% theimpact would be an increase to the derivative liability of $162,585 (2019 - $416,854) with a corresponding increase in loss and comprehensive loss.
						142


ElectraMeccanica Vehicles Corp.Notes to Consolidated Financial Statements(Expressed in United States dollars)For the years ended December 31, 2020, 2019, and 2018 22.
	Capital management
The Company’s policy is to maintain a strong capital base to safeguard the Company’s business and sustain future development of the business. The capitalstructure of the Company consists of equity. There were no changes in the Company’s approach to capital management during the year ended December 31,2020. The Company is not subject to any externally imposed capital requirements. 23.
	Lease commitments
The Company is committed to future minimum lease payments for short-term leases and a long-term lease with a lease commencement date of March 1,2021, for which no lease liability has been recognized as at December 31, 2020 (Note 10). The leases are related to rental of office premises and kiosklocations. The details of lease commitments as at December 31, 2020 are as follows:
		Fiscal year	Amount
2021			$	746,126
2022				220,636
2023				146,877
2024				152,351
2025 and after				178,807
Total			$	1,444,797
24.
	Subsequent events
From January 1, 2021 to the reporting date, the Company has issued 20,365,495 common shares for the ATM Offerings for gross proceeds of $146,558,984.Share issue costs related to the ATM Offering are $3,960,332. From January 1, 2021 to the reporting date, the Company issued 2,174,484 common shares at various prices per share for gross proceeds of $4,800,714pursuant to the exercise of certain warrants by certain investors. From January 1, 2021 to the reporting date, the Company issued 1,058,724 common shares at various prices per share for gross proceeds of $475,240pursuant to the exercise of certain stock options by certain Plan participants. On March 16, 2021, the Company announced that it has selected Mesa, AZ, in the greater Phoenix area, for its U.S. based assembly facility and engineeringtechnical center. The proposed facility in Mesa will support the Company’s strategic plan to meet anticipated demand for its flagship SOLO EV. When fullyoperational, the facility is expected to create up to 500 new jobs and will be capable of producing up to 20,000 SOLOs per year. Altogether it will featureboth a light vehicle assembly plant along with a state-of-the-art engineering technical center, including multiple labs to support comprehensive researchfacilities as well as vehicle chassis, battery pack and power electronics testing workshops.
				143


ITEM 19. EXHIBITS The following exhibits are filed as part of this Annual Report on Form 20-F: 1.1
	Notice of Articles(1)

1.2	Articles(1)

2.1	Share Certificate – Common Shares(1)

2.2	Description of Registrant’s Securities*

4.1	Manufacturing Agreement between Chongqing Zongshen Automobile Co., Ltd. and the Company, dated September 29, 2017(2)+

4.2	Employment Agreement, dated May 17, 2019, by and between EMV Automotive USA Inc. and Michael Paul Rivera (3)

4.3	Amendment Agreement between the Company and Michael Paul Rivera, dated for reference effective on January 1, 2020(4)

4.4	Executive Employment Agreement between the Company and Henry Reisner, dated for reference effective on January 1, 2020 (4)

4.5	Executive Employment Agreement between the Company and Bal Bhullar, dated for reference effective on January 1, 2020 (4)

4.6	Continuing Relationship Agreement between the Company and Jerry Kroll, dated for reference effective on August 16, 2019(4)

4.7	Executive Employment Agreement between the Company and Isaac Moss, dated for reference effective on July 1, 2020(7)

4.8	Further Employment Agreement Amendment between the Company and Michael Paul Rivera, dated August 12, 2020(8)

8.1	List of Subsidiaries*

11.1	Code of Business Conduct and Ethics(6)

12.1	Section 302(a) Certification of CEO*

12.2	Section 302(a) Certification of CFO*

13.1	Section 906 Certifications of CEO and CFO*

15.1	Consent of KPMG LLP, Chartered Professional Accountants*

15.2	Audit Committee Charter(6)

15.3	Compensation Committee Charter(6)

15.4	Nominating and Corporate Governance Committee Charter(6)

15.5	Board Mandate(6)

101.INS XBRL Instance*

101.SCH XBRL Taxonomy Extension Schema*

101.CAL XBRL Taxonomy Extension Calculation*

101.DEF XBRL Taxonomy Extension Definition*

101.LAB XBRL Taxonomy Extension Labels*

101.PRE XBRL Taxonomy Extension Presentation*
		144


Notes: *
Filed herewith.
+
Portions of this exhibit have been omitted pursuant to a request for confidential treatment. Confidential information has been omitted from the exhibit inplaces marked “****”and has been filed separately with the SEC.
(1) Filed as an exhibit to our registration statement on Form F-1 as filed with the SEC on October 12, 2016 and incorporated herein by reference. (2) Filed as an exhibit to our annual report on Form 20-F as filed with the SEC on April 19, 2018 and incorporated herein by reference. (3) Filed as an exhibit to our Report of Foreign Private Issuer on Form 6-K as filed with the SEC on August 8, 2019 and incorporated herein by reference. (4) Filed as an exhibit to our Report of Foreign Private Issuer on Form 6-K as filed with the SEC on February 28, 2020 and incorporated herein by
reference.
(5) Filed as an exhibit to our registration statement on Form F-3 as filed with the SEC on February 2, 2019 and incorporated herein by reference. (6) Filed as an exhibit to our Report of Foreign Private Issuer on Form 6-K as filed with the SEC on April 27, 2020 and incorporated herein by reference. (7) Filed as an exhibit to our Report of Foreign Private Issuer on Form 6-K as filed with the SEC on July 13, 2020 and incorporated herein by reference. (8) Filed as an exhibit to our Report of Foreign Private Issuer on Form 6-K as filed with the SEC on August 24, 2020 and incorporated herein by reference.
	145



	SIGNATURES

The registrant certifies that it meets all of the requirements for filing on Form 20-F and that it has duly caused and authorized the undersigned to sign thisannual report on its behalf. Electrameccanica Vehicles Corp. Date: March 23, 2021. By: /s/ Bal Bhullar

	Bal Bhullar
	Chief Financial Officer
		146

EXHIBIT 2.2
	DESCRIPTION OF REGISTRANT’S SECURITIES

The following securities of our Company are registered under section 12(b) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”):
•			our Company’s common shares are listed on the Nasdaq Capital Market (“Nasdaq”), under the symbol “SOLO”; and

•			our Company’s common share purchase warrants (each, a “Warrant”) are listed on Nasdaq, under the symbol “SOLOW”.
Jurisdiction of Incorporation Our Company was incorporated under the Business Corporations Act (British Columbia) on February 16, 2015. Authorized and Issued Share Capital Our Notice of Articles provide that our authorized capital consists of an unlimited number of common shares, without par value, and an unlimited number ofpreferred shares, without par value, which have special rights or restrictions. As of December 31, 2020, we had 89,309,563 common shares and no preferred shares issued and outstanding. As of March 23, 2021, we had 112,908,266 common shares and no preferred shares issued and outstanding. Rights, Preferences and Restrictions Attaching to Our Shares The Business Corporations Act provides the following rights, privileges, restrictions and conditions attaching to our common shares:
(a) to vote at meetings of shareholders, except meetings at which only holders of a specified class of shares are entitled to vote;

(b) subject to the rights, privileges, restrictions and conditions attaching to any other class of shares of our Company, to share equally in the remaining
			property of our Company on liquidation, dissolution or winding-up of our Company; and

(c) subject to the rights of the preferred shares, the common shares are entitled to receive dividends if, as, and when declared by our Board of Directors.
Our preferred shares may include one or more series and, subject to the Business Corporations Act, the directors may, by resolution, if none of the shares ofthat particular series are issued, alter the Articles of the Company and authorize the alteration of the Notice of Articles of the Company, as the case may be,to do one or more of the following:
(a) determine the maximum number of shares of that series that the Company is authorized to issue, determine that there is no such maximum number,
			or alter any such determination;

(b) create an identifying name for the shares of that series, or alter any such identifying name; and

(c) attach special rights or restrictions to the shares of that series, or alter any such special rights or restrictions.
		1



The provisions in our Articles attaching to our common shares and our preferred shares may be altered, amended, repealed, suspended or changed by theaffirmative vote of the holders of not less than two-thirds of the outstanding common shares and two-thirds of the preferred shares, as applicable. With the exception of special resolutions (i.e., resolutions in respect of fundamental changes to our Company, including: the sale of all or substantially all ofour assets, a merger or other arrangement or an alteration to our authorized capital that is not allowed by resolution of the directors) that require the approvalof holders of two-thirds of the outstanding common shares entitled to vote at a meeting, either in person or by proxy, resolutions to approve matters broughtbefore a meeting of our shareholders require approval by a simple majority of the votes cast by shareholders entitled to vote at a meeting, either in person orby proxy. Shareholder Meetings The Business Corporations Act provides that: (i) a general meetings of shareholders must be held in British Columbia, or may be held at a location outsideBritish Columbia since our Articles do not restrict our Company from approving a location outside of British Columbia for the holding of the generalmeeting and the location for the meeting is approved by ordinary resolution, or the location for the meeting is approving in writing by the British ColumbiaRegistrar of Companies before the meeting is held; (ii) directors must call an annual meeting of shareholders not later than 15 months after the last precedingannual meeting; (iii) for the purpose of determining shareholders entitled to receive notice of or vote at meetings of shareholders, the directors may fix inadvance a date as the record date for that determination, provided that such date shall not precede by more than two months or by less than 21 days the dateon which the meeting is to be held; (iv) the holders of not less than 5% of the issued shares entitled to vote at a meeting may requisition the directors to call ameeting of shareholders for the purposes stated in the requisition; (v) only shareholders entitled to vote at the meeting, our directors and our auditor areentitled to be present at a meeting of shareholders; and (vi) upon the application of a director or shareholder entitled to vote at the meeting, the BritishColumbia Supreme Court may order a meeting to be called, held and conducted in a manner that the Court directs. Pursuant to Article 8.20 of our Articles, a shareholder or proxy holder who is entitled to participate in a meeting of shareholders may do so in person, or bytelephone or other communications medium, if all shareholders and proxy holders participating in the meeting are able to communicate with each other;provided, however, that nothing in Article 8.20 of our Articles shall obligate the Company to take any action or provide any facility to permit or facilitate theuse of any communications medium at a meeting of shareholders. If one or more shareholders or proxy holders participate in a meeting of shareholders in amatter contemplated by Article 8.20 of our Articles:
(a) each such shareholder or proxy holder shall be deemed to be present at the meeting; and

(b) the meeting shall be deemed to be help at the location specified in the notice of the meeting.
Pursuant to our Articles, the quorum for the transaction of business at a meeting of our shareholders is one or more persons, present in person or by proxy. Limitations on Rights of Non-Canadians Our Company is incorporated pursuant to the laws of the Province of British Columbia, Canada. There is no law or governmental decree or regulation inCanada that restricts the export or import of capital, or affects the remittance of dividends, interest or other payments to a non-resident holder of commonshares, other than withholding tax requirements. Any such remittances to United States residents are generally subject to withholding tax, however, no suchremittances are likely in the foreseeable future. For additional information, see “Item 10. Additional Information - E. Taxation - Canadian Federal IncomeTax Considerations for United States Residents” in our Annual Report on Form 20-F. There is no limitation imposed by Canadian law or by our Articles or other constituent documents of our Company on the right of a non-resident to hold orvote common shares of our Company. However, the Investment Canada Act (Canada) has rules regarding certain acquisitions of shares by non-residents,along with other requirements under that legislation. For additional information, see “Item 10. Additional Information - B. Memorandum and Articles ofAssociation – Limitations on Rights of Non-Canadians” in our Annual Report on Form 20-F.
	2



Warrants As of December 31, 2020, we had 15,070,883 Warrants issued and outstanding. As of March 23, 2021, we had 12,539,558 Warrants issued and outstanding. Each Warrant entitles the holder to purchase one common share in the capital of the Company (each, a “Warrant Share”) at an exercise price of US$4.25 perWarrant Share (the “Exercise Price”). The Warrants were immediately exercisable upon issuance, and will expire at 5:00 pm (New York time) on August 13,2023 (the “Expiration Date”). The Warrants have been issued pursuant to a warrant agent agreement dated as of August 9, 2018 (the “Warrant Agreement”) between our Company andVStock Transfer, LLC, as warrant agent (in such capacity, the “Warrant Agent”). Unless terminated earlier by the parties, the Warrant Agreement shallterminate 90 days after the earlier of the Expiration Date and the date on which no Warrants remain outstanding (the “Termination Date”). Any Warrants thatremain unexercised on the Termination Date shall be automatically exercised by way of a cashless exercise on that date, as described below. Our Company has filed with the Securities and Exchange Commission (the “SEC”) a Registration Statement, No. 333-222814, on Form F-1 (as amendedfrom time to time, the “Registration Statement”), for the registration under the Securities Act of 1933, as amended (the “Securities Act”), of certainsecurities, including the Warrants and the underlying Warrant Shares. The Registration Statement was declared effective by the SEC on August 3, 2018. The Warrants are in registered form and are evidenced by a global Warrant certificate (“Global Certificate”) in the form attached as Annex A to the WarrantAgreement. The Global Certificate has been deposited on behalf of our Company with a custodian for The Depository Trust Company (“DTC”) andregistered in the name of Cede & Co., a nominee of DTC. In the event that the Warrants cease to be eligible for registration in the name of Cede & Co., asDTC’s nominee, or in circumstances where it is no longer necessary to have the Warrants so registered, our Company may instruct the Warrant Agent tocause DTC to deliver the Global Certificate to the Warrant Agent for cancellation, and the Company will instruct the Warrant Agent to deliver to each holderof Warrants (each, a “Holder”) separate certificates evidencing Warrants, in the form attached as Annex C to the Warrant Agreement. Our Company has agreed to cause the Warrant Shares purchased upon exercise of Warrants to be transmitted by the Company’s transfer agent (the “TransferAgent”) to the Holder by:
(a) crediting the account of the Holder’s or its designee’s balance account with The Depository Trust Company through its Deposit or Withdrawal at
	Custodian system (“DWAC”) if our Company is then a participant in such system, and either (i) there is an effective registration statementpermitting the issuance of the Warrant Shares to or resale of the Warrant Shares by Holder, or (ii) the Warrant is being exercised by way of cashlessexercise; and

(b) otherwise by physical delivery of a certificate registered in our Company’s share register in the name of the Holder or its designee.
Such transmittal of Warrant Shares by the Transfer Agent to the Holder is to occur after the delivery to our Company of the Holder’s notice of exercise ofWarrants (the “Notice of Exercise”) on that date (the “Warrant Share Delivery Date”) that is the earlier of:
(a) two trading days thereafter; and

(b) the number of trading days comprising the Standard Settlement Period.
		3



Upon delivery of the Notice of Exercise, the Holder shall be deemed for all corporate purposes to have become the holder of record of the Warrant Shareswith respect to which the Warrants have been exercised, irrespective of the date of delivery of the Warrant Shares, provided that payment of the aggregateExercise Price (other than in the case of a cashless exercise) is received no later than the Warrant Share Delivery Date. Under the Warrant Agreement, our Company cannot effect any exercise of a Warrant, and a Holder will not have any right to exercise any portion of aWarrant, if after giving effect to the issuance of Warrant Shares after exercise as set forth on the applicable Notice of Exercise, the Holder (together with theHolder’s affiliates, and any other persons acting as a group together with the Holder or any of the Holder’s affiliates would beneficially own in excess of theBeneficial Ownership Limitation. Except otherwise expressly provided for in the Warrant Agreement, beneficial ownership is to be calculated in accordancewith Section 13(d) of the Exchange Act, and the rules and regulations promulgated thereunder. The “Beneficial Ownership Limitation” shall be 4.99% (or,upon election by a Holder prior to the issuance of any Warrants, 9.99%) of the number of common shares outstanding immediately after giving effect to theissuance of the common shares issuable upon exercise of the Warrant. The Holder, upon notice to our Company, may increase or decrease the BeneficialOwnership Limitation, provided that the Beneficial Ownership Limitation in no event exceeds 9.99% of the number of common shares outstandingimmediately after giving effect to the issuance of common shares upon exercise of the Warrant held by the Holder. Any increase in the Beneficial OwnershipLimitation will not be effective until the 61st day after such notice is delivered to the Company. If, upon exercise of the Warrants, a holder would be entitled to receive a fractional interest in a share, the Company will, at its election, upon exercise, eitherpay a cash adjustment in respect of such fraction (in an amount equal to such fraction multiplied by the exercise price) or round the number of shares to bereceived by the holder up to the next whole number. If our Company fails for any reason to deliver to the Holder the Warrant Shares subject to a Notice of Exercise by the Warrant Share Delivery Date, ourCompany must pay to the Holder, in cash, as liquidated damages and not as a penalty, for each $1,000 of Warrant Shares subject to such exercise (based onthe VWAP of the common shares on the date of the applicable Notice of Exercise), $10 per trading day (increasing to $20 per trading day on the fifth tradingday after such liquidated damages begin to accrue) for each trading day after such Warrant Share Delivery Date, until such Warrant Shares are delivered orHolder rescinds such exercise. We have agreed to maintain a transfer agent that is a participant in the FAST program so long as this Warrant remainsoutstanding and exercisable. Under the Warrant Agreement:
•	“Standard Settlement Period” is defined to mean the standard settlement period, expressed in a number of trading days, on our Company’s primaryTrading Market with respect to our common shares as in effect on the date of delivery of the Notice of Exercise;

•	“Trading Market” is defined to mean any of the following markets or exchanges on which our common share are listed or quoted for trading on thedate in question: the NYSE American, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market, or the New YorkStock Exchange; and

•	“VWAP” is defined to mean, for any date, the price determined by the first of the following clauses that applies: (a) if our common shares are thenlisted or quoted on a Trading Market, the daily volume weighted average price of the common shares for such date (or the nearest preceding date)on the Trading Market on which the common share are then listed or quoted as reported by Bloomberg L.P. (based on a trading day from 9:30 a.m.(New York City time) to 4:02 p.m. (New York City time)), (b) if OTCQB or OTCQX is not a Trading Market, the volume weighted average price ofthe common share for such date (or the nearest preceding date) on OTCQB or OTCQX as applicable, (c) if the common shares are not then listed orquoted for trading on OTCQB or OTCQX and if prices for the common shares are then reported in the “Pink Sheets” published by OTC MarketsGroup, Inc. (or a similar organization or agency succeeding to its functions of reporting prices), the most recent bid price per common share soreported, or (d) in all other cases, the fair market value of a common share as determined by an independent appraiser selected in good faith by theholders of a majority in interest of the Warrants then outstanding and reasonably acceptable to our Company, the fees and expenses of which shallbe paid by our Company.
		4



Under the Warrant Agreement, we must use reasonable best efforts to maintain the effectiveness of the Registration Statement and the current status of theprospectus included therein, or to file and maintain the effectiveness of another registration statement and another current prospectus covering the Warrantsand the Warrant Shares, at any time that the Warrants are exercisable. We must provide to the Warrant Agent and each Holder prompt written notice of anytime that we are unable to deliver the Warrant Shares via DTC transfer or otherwise without restrictive legend because:
(a) the SEC has issued a stop order with respect to the Registration Statement,

(b) the SEC otherwise has suspended or withdrawn the effectiveness of the Registration Statement, either temporarily or permanently,

(c) our Company has suspended or withdrawn the effectiveness of the Registration Statement, either temporarily or permanently,

(d) the prospectus contained in the Registration Statement is not available for the issuance of the Warrant Shares to the Holder, or

(e) otherwise;
(each a “Restrictive Legend Event”). If the Warrants cannot be exercised as a result of a Restrictive Legend Event, or if a Restrictive Legend Event occurs after a Holder has exercised Warrantsbut prior to the delivery of the Warrant Shares, we must, at the election of the Holder, either (i) rescind the previously submitted notice of Warrant exercise,in which case we must return all consideration paid for such Warrant Shares, or (ii) treat the attempted exercise as a cashless exercise, as described below,and refund the cash portion of the exercise price to the Holder. The Holder must make this election within five days of receipt of our notice of the RestrictiveLegend Event. If, following a Restrictive Legend Event, the Holder elects to proceed by way of a cashless exercise of the Warrants, the Holder will be entitled to receive thenumber of Warrant Shares equal to the quotient obtained by dividing (A-B) (X) by (A), where:
	(A) = the last VWAP immediately preceding the date of exercise giving rise to the applicable “cashless exercise”, as set forth in the applicableNotice of Exercise; (B) = the Exercise Price of the Warrant; and (X) = the number of Warrant Shares that would be issuable upon exercise of the Warrant in accordance with the terms of the Warrant if suchexercise were by means of a cash exercise rather than a cashless exercise.
The Warrant Agreement also provides that any Warrants that remain unexercised on the Termination Date shall be automatically exercised by way of acashless exercise on that date. If the Warrant Shares are issued in such a cashless exercise, then, in accordance with Section 3(a)(9) of the Securities Act, the Warrant Shares shall take onthe registered characteristics of the Warrants being exercised, and we will not take any position contrary thereto. The Warrants are also subject to customary adjustment provisions, such as for stock dividends, subdivisions and the like, and certain fundamentaltransactions such as those in which we directly or indirectly, in one or more related transactions effect any merger or consolidation of our Company with orinto another entity, or we effect any sale, lease, license, assignment, transfer, conveyance or other disposition of all or substantially all of our assets in one ora series of related transactions.
		5

EXHIBIT 8.1
	LIST OF SUBSIDIARIES

Subsidiaries
1. Intermeccanica International Inc., a British Columbia, Canada, corporation;

2. EMV Automotive USA Inc., a Nevada corporation;

3. SOLO EV LLC, a Michigan corporation; and

4. EMV Automotive Technology (Chongqing) Inc., a PRC corporation.

EXHIBIT 12.1
	CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER
		PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Michael Paul Rivera, certify that: 1.
			I have reviewed this Annual Report on Form 20-F of Electrameccanica Vehicles Corp.;
2.
			Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make thestatements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by thisreport;
3.
			Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects thefinancial condition, results of operations and cash flows of the company as of, and for, the periods presented in this report;
4.
			The company’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined inExchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the company and have:

			(a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision,to ensure that material information relating to the company, including its consolidated subsidiaries, is made known to us by others withinthose entities, particularly during the period in which this report is being prepared;

			(b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under oursupervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements forexternal purposes in accordance with generally accepted accounting principles;

			(c)	Evaluated the effectiveness of the company’s disclosure controls and procedures and presented in this report our conclusions about theeffectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

			(d)	Disclosed in this report any change in the company’s internal control over financial reporting that occurred during the period covered bythe annual report that has materially affected, or is reasonably likely to materially affect, the company’s internal control over financialreporting; and
5.
			The company’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, tothe company’s auditors and the audit committee of company’s board of directors (or persons performing the equivalent functions):

			(a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which arereasonably likely to adversely affect the company’s ability to record, process, summarize and report financial information; and

			(b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the company’s internalcontrol over financial reporting.
Date: March 23, 2021


			/s/ Michael Paul Rivera
Name: Michael Paul Rivera
Title: Chief Executive Officer
			(Principal Executive Officer)

EXHIBIT 12.2
	CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER
		PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Bal Bhullar, certify that: 1.
			I have reviewed this Annual Report on Form 20-F of Electrameccanica Vehicles Corp.;
2.
			Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make thestatements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by thisreport;
3.
			Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects thefinancial condition, results of operations and cash flows of the company as of, and for, the periods presented in this report;
4.
			The company’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined inExchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the company and have:

			(a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision,to ensure that material information relating to the company, including its consolidated subsidiaries, is made known to us by others withinthose entities, particularly during the period in which this report is being prepared;

			(b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under oursupervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements forexternal purposes in accordance with generally accepted accounting principles;

			(c)	Evaluated the effectiveness of the company’s disclosure controls and procedures and presented in this report our conclusions about theeffectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

			(d)	Disclosed in this report any change in the company’s internal control over financial reporting that occurred during the period covered bythe annual report that has materially affected, or is reasonably likely to materially affect, the company’s internal control over financialreporting; and
5.
			The company’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, tothe company’s auditors and the audit committee of company’s board of directors (or persons performing the equivalent functions):

			(a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which arereasonably likely to adversely affect the company’s ability to record, process, summarize and report financial information; and


			(b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the company’s internalcontrol over financial reporting.

Date: March 23, 2021


			/s/ Bal Bhullar
Name: Bal Bhullar
Title: Chief Financial Officer
			(Principal Financial Officer and Principal Accounting Officer)

EXHIBIT 13.1
	CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,
		AS ADOPTED PURSUANT TO
	SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of Electrameccanica Vehicles Corp. on Form 20-F for the fiscal year ended December 31, 2020 filed with theSecurities and Exchange Commission on the date hereof (the “Report”), the undersigned hereby certify that to the best of our knowledge:
1.			The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2.			The information contained in the Report fairly presents, in all material respects, the financial conditions and results of operations ofElectrameccanica Vehicles Corp.
Date: March 23, 2021
				/s/ Michael Paul Rivera
				Name: Michael Paul Rivera
				Title: Chief Executive Officer
				(Principal Executive Officer)

Date: March 23, 2021				/s/ Bal Bhullar
				Name: Bal Bhullar
				Title: Chief Financial Officer
				(Principal Financial Officer and PrincipalAccounting Officer)
This written statement accompanies the Annual Report on Form 20-F in which it appears as an Exhibit pursuant to Section 906 of the U.S. Sarbanes-OxleyAct of 2002 and shall not, except to the extent required by the U.S. Sarbanes-Oxley Act of 2002 or other applicable law, be deemed filed by ElectrameccanicaVehicles Corp. for purposes of Section 18 of the U.S. Securities Exchange Act of 1934, as amended.

EXHIBIT 15.1 KPMG LLPPO Box 10426 777 Dunsmuir StreetVancouver BC V7Y 1K3CanadaTelephone (604) 691-3000Fax (604) 691-3031

	CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors
		Electrameccanica Vehicles Corp. We consent to the incorporation by reference in the Registration Statements (no. 333-227883, no. 333-229562 and no. 333-250863) on Form F-3 and (no.333-249321) on Form S-8, of Electrameccanica Vehicles Corp. (the Company) of our report dated March 22, 2021, with respect to the consolidatedstatements of financial position of the Company as of December 31, 2020 and 2019, and the related consolidated statements of comprehensive loss, changesin equity and cash flows for each of the years in the three year period ended December 31, 2020, and the related notes (collectively, the “consolidatedfinancial statements”), which report appears in the December 31, 2020 annual report on Form 20-F of the Company. Our report on the consolidated financial statements refers to a change in the presentation currency from Canadian dollars to US dollars as of December 31,2020, applied retrospectively to all periods presented, and a change in the accounting policy for leases as of January 1, 2019 due to the adoption of IFRS 16 –Leases. /s/ KPMG LLP Chartered Professional Accountants Vancouver, CanadaMarch 23, 2021