Edesa Biotech, Inc. 10-K

Item 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES. Market Information Our common shares trade on The Nasdaq Capital Market in the United States under the symbol “EDSA”. Holders As of December 14, 2022, we had 19,353,351 common shares outstanding, with 44 shareholders of record. The number of record shareholders was determined from the records of our stock transfer agent and does not reflect persons or entities that hold their shares in nominee or “street” name through various brokerage firms. Securities Authorized for Issuance Under Equity Compensation Plans See Part III, Item 12 “ Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters ” of this report. Dividends We have not declared any dividends on our common shares since our incorporation and do not anticipate that we will do so in the foreseeable future. Our present policy is to retain future earnings, if any, for use in our operations and the expansion of our business. Recent Sales of Unregistered Securities; Use of Proceeds from Registered Securities None. Purchase of Equity Securities by the Issuer and Affiliated Purchasers None. Canadian Federal Income Tax Consequences Applicable to Holders in the United States The following summary of the material Canadian federal income tax consequences is stated in general terms and is not intended to be legal or tax advice to any particular shareholder. Management urges holders to consult their own tax advisor with respect to the income tax consequences applicable to them based on their own particular circumstances. This summary is applicable only to holders who are resident in the United States for income tax purposes, have never been resident in Canada for income tax purposes, deal at arm’s length with the company, hold their Common Shares as capital property and who will not use or hold the Common Shares in carrying on business in Canada. This summary does not discuss any non-Canadian income or other tax consequences of acquiring, holding or disposing of Common Shares. This summary is based upon the provisions of the Income Tax Act (Canada) and the regulations thereunder (collectively, the Tax Act or ITA) and the Canada-United States Tax Convention (1980) as amended (the Tax Convention) at the date of this Annual Report on Form 10-K and the current administrative practices of the Canada Revenue Agency. This summary does not take into account provincial income tax consequences. The comments in this summary that are based on the Tax Convention are applicable to U.S. Holders only if they qualify for benefits under the Tax Convention. 35 Table of Contents Dividends A Holder will be subject to Canadian withholding tax (Part XIII Tax) equal to 25%, or such lower rates as may be available under an applicable tax treaty, of the gross amount of any dividend paid or credited or deemed to be paid or credited to the Holder on the Common Shares. For example, under the Tax Convention, where dividends on the Common Shares are considered to be paid to a Holder that is the beneficial owner of the dividends and is a resident of the United States for the purposes of, and is entitled to all the benefits of, the Tax Convention, the applicable rate of Canadian withholding tax is generally reduced to 15%. The company will be required to withhold the applicable amount of Part XIII Tax from each dividend so paid and remit the withheld amount directly to the Receiver General for Canada for the account of the Holder. We have not declared any dividends on our common shares since our incorporation and do not anticipate that we will do so in the foreseeable future. Disposition of Common Shares A Holder who is a resident of the United States and realizes a capital gain on a disposition of Common Shares will generally be exempt from Canadian income tax on that capital gain, unless the shares are taxable Canadian property. Provided the Common Shares are listed on a “designated stock exchange” (as defined in the Tax Act) (which currently includes the Nasdaq Capital Market) at the time of disposition, the Common Shares will generally not constitute taxable Canadian property of a Holder at that time, unless any of the following conditions are met: (a) at the time of disposition more than 50% of the fair market value of the Common Shares is derived directly or indirectly from real property situated in Canada, which generally includes certain Canadian natural resource properties; (b) the Common Shares formed part of the business property of a permanent establishment that the Holder has or had in Canada within the 12 months preceding disposition; or (c) the Holder is an individual who (i) was a resident of Canada at any time within the ten years immediately preceding the disposition, and for a total of 120 months during any period of 20 consecutive years, preceding the disposition, (ii) owned the Common Shares when the individual ceased to be resident in Canada, and (iii) the Common Shares were not subject to a deemed disposition on the Holder’s departure from Canada. Notwithstanding the foregoing, a Common Share may otherwise be deemed to be taxable Canadian property to a Holder for purposes of the Tax Act in particular circumstances. Inclusion in Taxable Income A Holder who is subject to Canadian income tax in respect of a capital gain realized on a disposition of Common Shares must include one half of the capital gain (“taxable capital gain”) in computing the Holder’s taxable income earned in Canada. The Holder may, subject to certain limitations, deduct one half of any capital loss (“allowable capital loss”) arising on a disposition of taxable Canadian property from taxable capital gains realized in the year of disposition in respect of taxable Canadian property and, to the extent not so deductible, from such taxable capital gains of any of the three preceding years or any subsequent year. Subject to certain exceptions, a non-resident person who disposes of taxable Canadian property must notify the Canada Revenue Agency either before or after the disposition (within ten days of the disposition). Item 6. RESERVED.