Company: WKSP
Filing Date: 2025-05-15
Form Type: 10-Q
Source: 0001641172-25-010837
Chunk: 92

Company: Worksport Ltd
Filing Date: 2025-05-15
Form: 10-Q
Item: Part I, Item 2
Chunk 92
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4, we had $5,080,372 and $4,883,099, respectively in cash and cash equivalents. As of March
31, 2025, we had $2,858,700 of remaining available capacity on our revolving line of credit compared with $811,400 of remaining
available capacity as of December 31, 2024. The increase in cash and cash equivalents and increase in the remaining available
capacity on our revolving line of credit was primarily a result of our warrant inducement transaction on February 27, 2025. We
have historically generated only limited gross profit and have relied primarily upon capital generated from public and private
offerings of our securities to fund continuing operations. Since the Company’s acquisition of Worksport in 2014, it has never
generated a profit. During the three months ended March 31, 2025, we had net losses of $4,460,464 (three months ended March 31, 2024
- $3,714,657). As of March 31, 2025, the Company had working capital of $7,936,250 (As of December 31, 2024 - $7,304,110) and had an
accumulated deficit of $68,937,430 (As of December 31, 2024 - $64,476,966).

In
their fiscal 2024 audit report, our independent auditors expressed that there is substantial doubt as to our ability to continue as
a going concern. Our ability to continue as a going concern is dependent upon our ability to generate cash flows from operations and
obtain equity and/or debt financing. We intend to continue funding operations through equity and debt financing arrangements, which
may be insufficient to fund our capital expenditures, working capital and other cash requirements in the long term. There can be no
assurance that the steps our management is taking will be successful.

To
date, our principal sources of liquidity consist of net proceeds from public and private securities offerings and cash exercises of outstanding
warrants. During the three months ended March 31, 2025, the Company received net proceeds of $6,570,415 from offerings. Management is focused
on transitioning towards gross profit as our principal source of liquidity by growing our existing product offerings and customer base
and realizing manufacturing efficiency improvements. We cannot give assurance that we can increase our cash balances or limit our cash
consumption and thus maintain sufficient cash balances for our planned operations