Carbon Done Right Developments Inc. — Interim / Quarterly Report 2024

Nov 29, 2024

CARBON

DONE RIGHT

Carbon Done Right Developments Inc.

(formerly Klimat X Developments Inc.)

Condensed Consolidated Interim Financial Statements
For the three and nine months ended September 30, 2024 and
2023
(Unaudited)

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Carbon Done Right Developments Inc. (formerly Klimat X Developments Inc.)
CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
For the three and nine months ended September 30, 2024 and 2023

NOTICE OF NO REVIEW OF CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS

The accompanying unaudited condensed interim consolidated financial statements of Carbon Done Right Developments Inc. (formerly Klimat X Developments Inc) and its subsidiaries (“Carbon Done Right” or the “Company”) for the three and nine months ended September 30, 2024 and 2023 have been prepared by and are the responsibility of the Company’s management.

Under National Instrument 51-102, Continuous Disclosure Obligations, if an auditor has not performed a review of the interim financial statements, they must be accompanied by a notice indicating that the financial statements have not been reviewed by an auditor.

The Company’s independent auditor has not performed a review of these interim financial statements in accordance with standards established for a review of interim financial statements by an entity’s auditor.

2024 Q3 Condensed Interim Financial Statements Carbon Done Right Developments Inc. 2

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Carbon Done Right Developments Inc. (formerly Klimat X Developments Inc.)

CONDENSED INTERIM CONSOLIDATED STATEMENTS OF FINANCIAL POSITION

(Unaudited)

(Canadian $)	Note	September 30, 2024	December 31, 2023
ASSETS
Current assets
Cash and cash equivalents		112,415	156,549
Receivables		17,183	12,038
Prepaids and deposits		411	99,068
Biological assets		-	8,811
Total current assets		130,010	276,466
Right-of-use assets	4	519,538	5,146,054
Property, plant and equipment	5	142,352	524,769
Carbon credit streaming agreements	6	7,145,298	5,560,736
Total non-current assets		7,807,188	11,231,559
Total assets		7,937,198	11,508,025
Liabilities
Current liabilities
Accounts payable and accrued liabilities	15	2,971,150	2,031,500
Current portion of lease liabilities	9	78,839	221,852
Loan payable	8	889,653	-
Total current liabilities		3,939,642	2,253,352
Non-current liabilities
Convertible debenture	7	504,464	392,107
Deferred liability	6, 10	909,107	450,688
Derivative liability	6, 10	1,822,996	870,812
Lease liabilities	9	521,694	1,826,044
Total liabilities - non current		3,758,262	3,539,651
Total liabilities		7,697,903	5,793,003
Shareholders' equity (deficit)
Share capital	11	16,864,883	16,801,156
Reserves		1,996,807	1,995,479
Accumulated deficit		(19,176,313)	(13,529,555)
Total shareholders' equity attributable to Carbon Right Developments Inc. shareholders		(314,624)	5,267,080
Non-controlling interest		553,918	447,942
Total equity		239,294	5,715,022
Total liabilities and equity		7,937,198	11,508,025

Subsequent Events (Note 18)
Approved by the Board of Directors on November 29, 2024:

"James Tansey" Director

"Neil Passmore" Director

James Tansey

Neil Passmore

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

2024 Q3 Condensed Interim Financial Statements Carbon Done Right Developments Inc. 3

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Carbon Done Right Developments Inc. (formerly Klimat X Developments Inc.)

CONDENSED INTERIM CONSOLIDATED STATEMENTS OF NET LOSS AND COMPREHENSIVE LOSS (Unaudited)

(Canadian $)	Note	Three months ended September 30,		Nine months ended September 30,
		2024	2023	2024	2023
Revenue		18,312	43,737	67,737	128,683
Cost of goods sold		(27,712)	(121,938)	(93,935)	(344,624)
		(9,399)	(78,201)	(26,197)	(215,941)
Expenses
Consulting fees	15	(324,069)	(902,321)	(1,124,740)	(1,696,742)
Professional fees		(193,027)	(22,980)	(581,620)	(435,067)
Amortization expense	5	(57,466)	(34,966)	(117,619)	(100,782)
Marketing and investor relations		(109,498)	(168,012)	(298,963)	(467,493)
Listing and filing fees		(23,392)	(6,905)	(28,017)	(29,290)
Office and administrative		(36,870)	(88,752)	(105,183)	(340,813)
Share-based compensation	13	-	(15,937)	(2,657)	(61,271)
Travel and corporate development		(912)	(30,565)	(912)	(66,643)
Total expenses		(745,234)	(1,270,438)	(2,259,711)	(3,198,101)
Other income (expenses)
Finance costs		(127,927)	(43,613)	(369,504)	(145,823)
Foreign exchange loss		(30,682)	(23,418)	(161,811)	(64,389)
Gain in settlement of AP		-	-	16,586	-
Loss on asset disposal	5	(366,748)	-	(366,748)	-
Loss on lease termination	4,9	(2,816,167)	-	(2,816,167)	-
Other		27,360	-	240,029	-
Net loss		(4,068,798)	(1,415,670)	(5,743,524)	(3,624,254)
Other comprehensive (loss) income
Cumulative translation adjustment		268,005	(307,021)	202,741	(256,565)
Net loss and comprehensive loss		(3,800,793)	(1,772,691)	(5,540,783)	(3,880,819)
Net (loss) income attributable to:
Owners		(4,112,258)	(1,402,308)	(5,646,758)	(3,446,445)
Non-controlling interest ("NCI")		43,460	(13,362)	(96,766)	(177,809)
		(4,068,798)	(1,415,670)	(5,743,524)	(3,624,254)
Other comprehensive (loss) income attributable to:
Non-controlling interest ("NCI")		268,005	(307,021)	202,741	(256,565)
		268,005	(307,021)	202,741	(256,565)
Weighted average shares outstanding		94,699,957	87,558,486	94,628,385	86,669,573
Loss per share (basic and diluted)		(0.04)	(0.02)	(0.06)	(0.04)

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

2024 Q3 Condensed Interim Financial Statements Carbon Done Right Developments Inc. 4

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Carbon Done Right Developments Inc. (formerly Klimat X Developments Inc.)

CONDENSED INTERIM CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (DEFICIT)

(Canadian $, except Common Shares)	Note	Number of Common Shares	Share Capital	Share-based payments reserve	Warrants reserve	Accumulated deficit	Total	Non-controlling interest	Total equity
At December 31, 2022		86,222,661	15,793,367	1,789,860	-	(9,029,834)	8,553,393	710,171	9,263,564
Share issuances – private placement		6,036,567	754,571	-	150,914	-	905,485	-	905,485
Option exercised		675,000	103,424	(35,924)	-	-	67,500	-	67,500
Cumulative translation adjustment		-	-	-	-	-	-	(256,565)	(256,565)
Share-based payments	13	-	-	61,271	-	-	61,271	-	61,271
Net loss for the period		-	-	-	-	(3,446,445)	(3,446,445)	(177,809)	(3,624,254)
At September 30, 2023		92,934,228	16,651,362	1,815,207	150,914	(12,476,279)	6,141,204	275,797	6,417,001
At December 31, 2023		94,060,894	16,801,156	1,833,298	162,181	(13,529,555)	5,267,080	447,942	5,715,022
Share issuance - shares for debt		301,563	26,648	-	-	-	26,648	-	26,648
Options exercised		337,500	35,079	(1,329)	-	-	33,750	-	33,750
Cumulative translation adjustment		-	-	-	-	-	-	202,741	202,741
Share-based payments	13	-	-	2,657	-	-	2,657	-	2,657
Net loss for the period		-	-	-	-	(5,646,758)	(5,646,758)	(96,766)	(5,743,524)
At September 30, 2024		94,699,957	16,864,883	1,834,626	162,181	(19,176,313)	(314,623)	553,917	239,294

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

2024 Q3 Condensed Interim Financial Statements Carbon Done Right Developments Inc. 5

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Carbon Done Right Developments Inc. (formerly Klimat X Developments Inc.)

CONDENSED INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

| (Canadian $) | Note | Nine months ended
September 30, | |
| --- | --- | --- | --- |
| | | 2024 | 2023 |
| CASH FLOWS USED IN OPERATING ACTIVITIES | | | |
| Net loss | | (5,743,524) | (3,624,254) |
| Adjusted for: | | | |
| Amortization | | 117,619 | 100,782 |
| Share-based payments | 13 | 2,657 | 61,271 |
| Accretion expense | | 324,812 | 176,184 |
| Gain on settlement on accounts payable | | 16,586 | - |
| Loss on lease termination | 4,9 | 2,816,167 | - |
| Loss on asset disposal | 5 | 366,748 | - |
| Foreign exchange | | 161,811 | 64,389 |
| Interest | 8 | 44,692 | - |
| Changes in non-cash working capital | | | |
| Prepaid expense | | 98,657 | 26,366 |
| Accounts payable | | 1,098,052 | 1,301,678 |
| Accounts receivable | | (5,145) | (94,830) |
| Inventory | | 8,811 | 7,518 |
| Net cash flow used in operating activities | | (692,057) | (1,980,896) |
| CASH FLOWS USED IN INVESTING ACTIVITIES | | | |
| Investment – Sierra Leone | 6 | (1,584,562) | (1,218,389) |
| Purchase of property, plant, and equipment | | - | (174,900) |
| Deferred revenue – Prepurchase Agreement | | - | 664,475 |
| Net cash flows used in investing activities | | (1,584,562) | (728,814) |
| CASH FLOWS FROM FINANCING ACTIVITIES | | | |
| Proceeds from private placement, net | 10 | 1,353,775 | 905,485 |
| Proceeds from exercise of options | | 33,750 | 67,500 |
| Proceeds from loan | 8 | 844,961 | - |
| Net cash flow from financing activities | | 2,232,486 | 972,985 |
| Decrease in cash and cash equivalents | | (44,134) | (1,736,725) |
| Cash and cash equivalents, beginning of period | | 156,549 | 2,318,750 |
| Cash and cash equivalents, end of period | | 112,415 | 582,025 |

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

2024 Q3 Condensed Interim Financial Statements Carbon Done Right Developments Inc. 6

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CARBON DONE RIGHT

Carbon Done Right Developments Inc. (formerly Klimat X Developments Inc.)

NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the nine months ended September 30, 2024 and 2023

1. REPORTING ENTITY

Carbon Done Right Developments Inc. (formerly Klimat X Developments Inc.) and its subsidiaries ("Carbon Done Right" or the "Company") is a carbon exploration and development company with global reach into jurisdictions with production potential from forestry and marine carbon sequestration projects.

Carbon Done Right was incorporated under the British Columbia Companies Act as a Specialty Limited Company on November 21, 1963. In July 1998, the Company continued to the Cayman Islands. In February 2018, the Company continued back to British Columbia. Prior to the COB (as defined below), the Company's principal business activities historically included acquiring options to explore and develop mineral properties, internationally. From a period beginning in 2003 and ending on closing date of the COB (as defined below), the Company was inactive with limited operations, and its common shares ("Common Shares") were listed on the NEX board of the TSXV ("NEX") under the symbol "ERL.H".

The head office and principal address of the Company is located at Suite 1012, 1030 West Georgia Street, Vancouver, British Columbia, V6E 2Y3, Canada.

During the year ended December 31, 2023, the Company changed its name from "Klimat X Developments Inc." to "Carbon Done Right Developments Inc.".

The Company has the following subsidiaries, incorporated and/or formed, and consolidated in these financial statements as of September 30, 2024:

Name of subsidiary	Jurisdiction of incorporation/formation	Ownership %
Pomeroon Trading (Holdings) Limited ("PTHL") (1)	Cayman Islands	74%
Pomeroon Trading Inc. ("PTI") (2)	Co-operative Republic of Guyana	100%
Pomeroon Suriname N.V. (3)	Suriname	70%

(1) Incorporated on January 19, 2018. On June 29, 2022, Carbon Done Right acquired a 74% interest.
(2) Incorporated on October 6, 2017 and a wholly-owned subsidiary of Pomeroon Trading (Holdings) Limited.
(3) Incorporated on September 13, 2022, and a 70% owned subsidiary of Pomeroon Trading (Holdings) Limited.

2024 Q3 Corporate Information Carbon Done Right Developments Inc.

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CARBON DONE RIGHT

Carbon Done Right Developments Inc. (formerly Klimat X Developments Inc.)

NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the nine months ended September 30, 2024 and 2023

2. BASIS OF PREPARATION AND GOING CONCERN

a) Basis of presentation and going concern

These unaudited condensed interim consolidated financial statements (the "Financial Statements") have been prepared in accordance with International Accounting Standard 34, Interim Financial Reporting, using accounting policies consistent with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB") and interpretations of the International Financial Reporting Interpretations Committee. These Financial Statements have been prepared following the same accounting policies and methods of computation as the annual financial statements for the year ended December 31, 2023. These Financial Statements are condensed as they do not include all of the information required by IFRS for annual financial statements and therefore should be read in conjunction with the Company's audited annual financial statements for the year ended December 31, 2023.

These condensed consolidated interim financial statements have been prepared in accordance with International Financial Reporting Standards ("IFRS") applicable to a going concern, which assumes that the Company will be able to realize its assets and discharge its liabilities in the normal course of operations. In assessing whether the going concern assumption is appropriate, management takes into account all available information about the future which is at least, but not limited to, twelve months from the end of the reporting period.

The Company has not yet generated income or cashflow from operations. As at September 30, 2024, the Company had cash and cash equivalents of $112,415 (December 31, 2023 - $156,549), a working capital deficit of $3,809,632 (December 31, 2023 - deficit of $1,976,886) and an accumulated deficit of $19,176,313 (December 31, 2023 - deficit $13,529,555). For the nine months ended September 30, 2024, the Company incurred a net loss of $5,743,524 (September 30, 2023 – net loss of $3,624,254) and negative cashflows from operations of $692,057 (September 30, 2023 – $1,980,896). The Company will require additional financing, through various means including but not limited to equity financing, to continue with its carbon streaming programs and to meet its future obligations and administrative expenses. There is no assurance that the Company will be successful in raising the additional required funds.

The above noted conditions indicate the existence of material uncertainties that cast significant doubt about the Company's ability to continue as a going concern. These consolidated financial statements do not reflect the adjustments to the carrying values of assets and liabilities, to the reported expenses and to the financial position classifications that would be necessary if the going concern assumption was inappropriate. These adjustments could be material.

These financial statements have been approved by the Board of Directors on November 27, 2024.

2024 Q3 Corporate Information Carbon Done Right Developments Inc.

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CARBON DONE RIGHT

Carbon Done Right Developments Inc. (formerly Klimat X Developments Inc.)

NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the nine months ended September 30, 2024 and 2023

2. BASIS OF PREPARATION AND GOING CONCERN (CONTINUED)

b) Basis of measurement, functional and presentation currency and operating segments

These Financial Statements have been prepared on a going concern basis, under the historical cost convention, except certain financial instruments which are recorded at fair value, and using the accrual basis of accounting, except for cash flow information.

These Financial Statements are presented in Canadian dollars, Carbon Done Right’s functional currency, unless otherwise indicated.

Name of subsidiary	Functional currency
Pomeroon Trading (Holdings) Limited	US Dollars
Pomeroon Trading Inc.	Guyanese dollar
Pomeroon Suriname N.V	US Dollars

c) Use of estimates, judgements and assumptions

The preparation of these Financial Statements requires management to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. These estimates and judgments are based on management’s best understanding of current events and actions that Carbon Done Right may undertake in the future. Actual results may differ from these estimates and judgments. Estimates and their underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the year in which estimates are revised and for any future years affected.

Significant estimates, judgements or assumptions used in these Financial Statements are outlined below:

Fair value of assets acquired and liabilities assumed in asset acquisition

The fair value of assets acquired and liabilities assumed through asset acquisition, including measuring the fair value of the consideration, is estimated based on information available at the date of the acquisition. Estimates are used to determine the fair value of the acquired assets and assumed liabilities and include quoted market prices and widely accepted valuation techniques.

Fair value of equity-settled share-based payments

The Company uses a Black-Scholes option pricing model to determine the fair value of equity-settled share-based payments. Inputs to the model are subject to various estimates relating to volatility, interest rates, dividend yields and expected life of the units issued. Fair value inputs are subject to market factors as well as internal estimates. The Company considers historic trends together with any new information to determine the best estimate of fair value at the date of grant.

2024 Q3 Corporate Information Carbon Done Right Developments Inc.

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CARBON DONE RIGHT

Carbon Done Right Developments Inc. (formerly Klimat X Developments Inc.)

NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the nine months ended September 30, 2024 and 2023

2. BASIS OF PREPARATION AND GOING CONCERN (CONTINUED)

c) Use of estimates, judgements and assumptions (continued)

Accounting for and valuation of carbon credit streaming agreements

The Company from time to time will acquire carbon credit agreements. Each carbon credit agreement has its own unique terms and significant judgment is required to assess the appropriate accounting treatment. Various factors were used to conclude on its accounting treatment, such as - intangible rights, investments in an entity, significant influence, characteristics of loans and commodity prepurchase contracts and own use exemption. The Company also assumes it does not possess any timber rights from all of the carbon credit streaming agreements.

Significant estimates and assumptions in the fair value assessment are included in Note 6.

Fair value of carbon streaming agreements

As at September 30, 2024, management has assessed that the fair value of the carbon credit streaming agreements approximates the cash and equity payments disbursed to the projects. Apart from the write-off of IEG above, the Company has determined that there has been no change in the fair value from the acquisition dates made.

As the carbon credits development is still in early stage as at September 30, 2024, the fair value of the deferred liability and derivative liability resulted from the carbon streaming agreement was concluded to be the net present value of the repayment of agreement in cash in the event of a default.

Fair value of common shares

The Company completed three transactions on June 29, 2022. The measurement of the Company's shares was required to determine the amounts recorded in the transactions. As the Company was not trading on that date there is judgment in determining the fair value of the share price on that date. The Company has determined that the fair value of the net assets best represents the fair value of the Company's value at that date.

Income taxes

Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement amounts of existing assets and liabilities and their respective tax basis. Estimates of Carbon Done Right's future taxable income are considered in assessing the utilization of available tax losses. The calculation of income taxes involves many complex factors including the interpretation of relevant tax legislation and an analysis of the amount of future taxable income.

2024 Q3 Corporate Information Carbon Done Right Developments Inc. 10

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CARBON DONE RIGHT

Carbon Done Right Developments Inc. (formerly Klimat X Developments Inc.)

NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the nine months ended September 30, 2024 and 2023

2. BASIS OF PREPARATION AND GOING CONCERN (CONTINUED)

c) Use of estimates, judgements and assumptions (continued)

Income taxes

Deferred tax assets are recognized when it is considered probable that deductible temporary differences will be recovered in the foreseeable future. To the extent that future taxable income and the application of existing tax laws in each jurisdiction differ significantly from Carbon Done Right’s estimate, the ability of Carbon Done Right to realize the deferred tax assets could be impacted.

Deferred tax liabilities are recognized when there are taxable temporary differences that will reverse and result in a future outflow of funds to a taxation authority. Carbon Done Right records a provision for the amount that is expected to be settled, which requires judgment as to the ultimate outcome. Deferred tax liabilities could be impacted by changes in the Company’s judgment of the likelihood of a future outflow and estimates of the expected settlement amount, timing of reversals, and the tax laws in the jurisdictions in which Carbon Done Right operates.

Functional currency

The designation of the functional currency of the Company and each of its subsidiaries is a judgment based on the composition of revenue and costs in the locations in which Carbon Done Right operates.

3. MATERIAL ACCOUNTING POLICY INFORMATION

The accounting policies set out below have been applied consistently by Carbon Done Right for all periods presented in these Financial Statements.

a) Adoption of new/amended accounting standards

In May 2020, the IASB issued an amendment to International Accounting Standard 41, Agriculture, (“IAS 41”) as part of its Annual Improvements to IFRS Standards 2018–2020. The amendment removes the requirement for an entity to exclude taxation cash flows when calculating the fair value of its biological assets. An entity is permitted to use post-tax cash flows and a post-tax rate to discount those cash flows. The amendment was effective for annual periods beginning on or after January 1, 2022.

Carbon Done Right adopted the amendments to IAS 41 with the acquisition of PTHL as at December 31, 2022. The adoption of this standard did not have a significant impact on the Company.

b) Recent accounting pronouncements and/or future accounting standards

Certain accounting standards or amendments to existing accounting standards that have been issued but have future effective dates are either not applicable or are not expected to have a significant impact on these Financial Statements.

2024 Q3 Corporate Information Carbon Done Right Developments Inc. 11

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CARBON DONE RIGHT

Carbon Done Right Developments Inc. (formerly Klimat X Developments Inc.)

NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the nine months ended September 30, 2024 and 2023

1. RIGHT-OF-USE ASSETS

(Canadian $)	PTHL Leasehold estate	Suriname Leasehold estate	Total
Cost
At December 31, 2022	4,699,437	-	4,699,437
Additions	-	522,901	522,901
At December 31, 2023	4,699,437	522,901	5,222,338
Termination of PTHL lease	(4,699,437)	-	(4,699,437)
At September 30, 2024	-	522,901	522,901
Accumulated depreciation and impairment
At December 31, 2022	53,353	-	53,353
Depreciation expense	101,917	3,329	105,246
At December 31, 2023	155,270	3,329	158,599
Depreciation expense	86,716	10,069	96,785
Termination of PTHL lease	(241,986)	-	(241,986)
At September 30, 2024	-	13,398	13,398
Foreign exchange impact December 31, 2023	74,084	8,231	82,315
Foreign exchange impact September 30, 2024	-	10,035	10,035
Carrying amount
At December 31, 2023	4,618,251	527,803	5,146,054
At September 30, 2024	-	519,538	519,538

On January 29, 2018, Pomeroon Trading Inc. ("PTI") entered into a 50-year agreement for the lease of agricultural land known as the Stoll Estate ("PTHL Leasehold estate"), 700 acres set in the Pomeroon River, Guyana, in exchange for monthly lease payments of US$12,500. During the period ended September 30, 2024, PTI was not provided title documents as was expected in the lease agreement. Therefore, PTHL terminated the lease agreement on September 30, 2024, which resulted in a reduction of the related right of use assets to $Nil. The Company is actively seeking to recover costs incurred through litigation.

In September 2023, Pomeroon Suriname NV ("Suriname") entered into a 40-year agreement for the lease of agricultural land, 1,280 hectares, wherein Suriname intends to develop mixed agri-forestry and carbon offset projects in the Republic of Suriname ("Suriname Leasehold estate").

2024 Q3 Corporate Information Carbon Done Right Developments Inc. 12

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CARBON DONE RIGHT

Carbon Done Right Developments Inc. (formerly Klimat X Developments Inc.)

NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the nine months ended September 30, 2024 and 2023

5. PROPERTY, PLANT AND EQUIPMENT

(Canadian $)	Bearer plants	Rehabilitation asset	Building, machinery and equipment	Total
Cost
At December 31, 2022	116,113	138,195	103,223	357,531
Additions	11,538	-	174,900	186,438
At December 31, 2023	127,652	138,195	278,123	543,970
Disposals	(127,652)	(138,195)	(103,223)	(369,070)
At September 30, 2024	-	-	174,900	174,900
Accumulated depreciation
At December 31, 2022	260	1,390	5,911	7,561
Depreciation	564	2,690	29,827	33,081
At December 31, 2023	824	4,080	35,738	40,642
Depreciation	450	2,294	18,091	20,835
Disposals	(1,274)	(6,374)	(21,281)	(28,929)
At September 30, 2024	-	-	32,548	32,548
Foreign exchange impact December 31, 2023	5,032	5,447	10,963	21,442
Carrying amount
At December 31, 2023	131,860	139,562	253,348	524,770
At September 30, 2024	-	-	142,352	142,352

Carbon Done Right's property, plant and equipment consists of bearer plants, rehabilitation asset, and building, machinery and equipment:

• Bearer plants consist of the PTHL's water coconut trees used in the production of agricultural produce and related byproducts; and
• The rehabilitation assets include expenditures on additional land clearing, improved soil fertility, and increasing planting and productivity of tree plantations; and
• Building, machinery and equipment include bearer plants, nursery assets, farm and related equipment and vehicle, a building, office furniture and related equipment.

During the period ended September 30, 2024, the Company capitalized nursery asset depreciation of $8,718 (December 31, 2023 - $11,538) into bearer plants. Bearer plants, rehabilitation assets and equipment, with a total cost of $369,070, were disposed of during the period ended September 30, 2024, which resulted in a loss of $366,748.

2024 Q3 Corporate Information Carbon Done Right Developments Inc.

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CARBON DONE RIGHT

Carbon Done Right Developments Inc. (formerly Klimat X Developments Inc.)

NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the nine months ended September 30, 2024 and 2023

6. CARBON CREDIT STREAMING AGREEMENTS

(Canadian $)	IEG	Maforki (SL) FMPL Project - Rights 1		Total
Cost
At December 31, 2022	338,463	1,169,025	2,622,468	4,129,956
Investments	-	48,016	1,721,227	1,769,243
Write-off	(338,463)	-	-	(338,463)
At December 31, 2023	-	1,217,041	4,343,695	5,560,736
Advances	-	-	1,584,562	1,584,562
At September 30, 2024	-	1,217,041	5,928,257	7,145,298

1 Includes $3,375,000 share consideration and the Initial Advance of US$750,000 ($965,236).

Sierra Leone rights

RML assigned and transferred to Carbon Done Right fifty-one per cent (51%) of all:

• RML Carbon Credits that are produced from or in connection with the Maforki Project;
• Biological asset rights and revenues that are produced or generated from or in connection with the Maforki Project; and

All-in consideration for the Initial Advance and the issuance of Consideration Shares to RML and subject to and in accordance with the terms of a deed agreement and the Sierra Leone Prepayment Agreement.

During the year ended December 31, 2023, RML transferred the remaining 49% to the Company (the Company now currently owns 100%) for further funding commitments to advance the projects. The Company further advanced US$1,270,000 ($1,721,227) and had an additional commitment on advances up to US$2,200,000.

During the period ended September 30, 2024, the Company further advanced US$1,116,000 ($1,584,562) in funding towards the development of the projects.

Sierra Leone Pre-Purchase Agreement

On June 15, 2023, the Company signed a pre-purchase agreement with BP Carbon Trading Limited ("BP"). The terms are as follows:

• The pre-purchase agreement is intended for the development of the first 5,000 ha of native species planting.
• Under the pre-purchase financing structure, US$2.5m of investment is prepaid in exchange for 165,000 carbon credits. The financing will be provided upon certain milestones are achieved:

2024 Q3 Corporate Information Carbon Done Right Developments Inc. 14

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CARBON DONE RIGHT

Carbon Done Right Developments Inc. (formerly Klimat X Developments Inc.)

NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the nine months ended September 30, 2024 and 2023

6. CARBON CREDIT STREAMING AGREEMENTS (CONTINUED)

Milestone	Milestone details	Amount (US$)
1	• Carbon sequestration model
• Draft project design
• Account set with Verra
• Cash forecast draft	$500,000 (received in 2023)
2	• Completion of certain process with relevant community
• Carbon rights and land tenure of at least 5ha
• Preparation of at least 1000ha of land with certain target survival rate and blanking
• Revised cash forecast draft	$500,000 (received in 2023)
3	• Certain carbon credits certification documentations reviewed and approved by BP
• Certain mixed species planted on at least 1,000ha of land with certain target survival rate and blanking.
• Revised cash forecast draft
• Site visit by BP	$500,000 ($250,000 received in Q1 2024; $250,000 received in Q2 2024).
4	• Preparation of an additional 1000ha of land with certain target survival rate and blanking
• Revised cash forecast draft	$500,000 ($500,000 received in Q3 2024).
5	• Certain mixed species planted on at least 1,500ha of land with certain target survival rate and blanking.
• Complete certain reports with an expected generation of 3,000 carbon credits
• Verification site visit schedule for Q1 2025
• Revised cash forecast draft	$500,000
($250,000 subsequently
received in Q4 2024).

2024 Q3 Corporate Information Carbon Done Right Developments Inc. 15

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CARBON DONE RIGHT

Carbon Done Right Developments Inc. (formerly Klimat X Developments Inc.)

NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the nine months ended September 30, 2024 and 2023

6. CARBON CREDIT STREAMING AGREEMENTS (CONTINUED)

• Upon the delivery of 165,000 carbon credits, BP has the option to purchase the carbon credits from the first 5,000 ha of planting at 20% discount to a mutually agreed carbon index price that reflects the scale and volume of high-quality reforestation projects in the market. Upon completion of the delivery of 165,000 carbon credits, BP has first right to purchase any further carbon credits generated up to 1 million carbon credits.
• BP has a time limited Right of First Offer to pre-purchase credits from the remaining 20,000 ha within the project area.
• In the event of a non-delivery:
• If no carbon credits were transferred by December 31, 2028, BP may elect to terminate the agreement and require repayment of the payments advanced. This is to be repaid in cash by the Company within 5 business days of written notice by BP. The Penalty will be adjusted by applying an interest based on EFFR + 6% from the first prepayment date to default date.
• In the event that the Company failed to delivery 165,000 carbon credits by December 31, 2033, the Company can provide alternative units (e.g. carbon credits sourced from a 3rd party) by June 1, 2034. If BP rejects or if the Company fails to deliver alternative units by June 1, 2034, then BP will be compensated in the amount of US$30 per carbon credit shortfall.

During the current period ended September 30, 2024, the Company received payment of $1,353,775 (USD $1,000,000) from BP which has been presented as a derivative liability in these financial statements (December 31, 2023 - $1,350,022 (USD $1,000,000)). See Note 10 for more details.

Forest and Mangrove Protection Ltd. ("FMPL")

On August 15, 2022, the Company entered into a carbon credit streaming agreement with FMPL, a Company owned by the Company's Director of Operations, to acquire carbon credit development rights for approximately 32,000 hectares of land located in Sierra Leone. Pursuant to the acquisition, the Company will assume FMPL's cost of the land rights acquisition and all carbon credit development costs associated with implementing a large-scale rewilding project under the relevant Verra afforestation/reforestation protocol, in exchange for the carbon credit rights and other revenues generated through the sale of timber and other biological assets produced from, or in connection with the project. The cost of acquisition was $898,269 (US$655,912) into the FMPL project.

2024 Q3 Corporate Information Carbon Done Right Developments Inc. 16

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CARBON DONE RIGHT

Carbon Done Right Developments Inc. (formerly Klimat X Developments Inc.)

NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the nine months ended September 30, 2024 and 2023

6. CARBON CREDIT STREAMING AGREEMENTS (CONTINUED)

Infinitum Energy PTE. Ltd ("IEG")

On September 9, 2022, the Company entered into a carbon credit development agreement with Infinitum Energy PTE Ltd. IEG is in the process of developing a 1,000 t/day waste-to-energy facility in the greater Western Area of Sierra Leone. IEG and the Company believe that within operations of the Project, it may be possible to generate carbon credits from avoided methane emissions associated with the breakdown of biological materials in the waste stream, which may then allow the Project to become an originator of accredited voluntary carbon credits. The Company has agreed and provided IEG US$250,000 ($338,463) to fund the development activities of the Project by IEG and to determine whether the Company can generate Carbon Credits.

As at December 31, 2023, IEG has been unable to secure additional funding, and thus the project has been disabled. As a result, the deemed recoverability of the investment is considered to be unlikely. The Company therefore wrote off the IEG carbon credit streaming agreement to $Nil as at December 31, 2023.

Fair Value

As at September 30, 2024 and December 31, 2023, management has assessed that the fair value of the carbon credit streaming agreements approximates the cash and equity payments disbursed to the projects. The Company has determined that there has been no change in the fair value from the acquisition dates made. During the year ended December 31, 2023, $338,463 was written off.

7. CONVERTIBLE DEBENTURE

On April 6, 2022, the Company's subsidiary, PTHL, obtained a US$416,327 unsecured, non-interest bearing convertible debenture from Alma Pelly Limited, a UK Corporation, in the normal course of business. The terms of the loan are disclosed below. Upon acquisition of PTHL, the Company allocated the residual value of US$229,721 ($294,042) to PTHL's equity reserves based on a discount rate of 35%. The fair value of the liability portion of the convertible debenture was, therefore, US$186,606 ($240,461).

(Canadian $)

At December 31, 2022	296,969
Accretion expense	103,551
Foreign exchange impact	(8,413)
At December 31, 2023	392,107
Accretion expense	105,704
Foreign exchange impact	6,653
At September 30, 2024	504,464

2024 Q3 Corporate Information Carbon Done Right Developments Inc. 17

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CARBON DONE RIGHT

Carbon Done Right Developments Inc. (formerly Klimat X Developments Inc.)

NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the nine months ended September 30, 2024 and 2023

7. CONVERTIBLE DEBENTURE (CONTINUED)

Terms	Details
Maturity Date	March 1, 2025
Conversion right	The Company can elect the conversion of the debt at any time after June 30, 2023, at US$4.00/PTHL share. This must be agreed upon with the lender. Convertible at any time at the option of the holder at US$4.00/PTHL share.
If lender rejects the conversion offered by the Company, the lender has the right to request 65% of the loan outstanding to be paid in cash (“Cash Payment”), and the remaining 35% to be converted at US$1.00/PTHL share, or cash, or mix of both.
Interest rate	Non-interest bearing
However, if the Company fails to pay the loan by the maturity date, the outstanding loan shall accrue simple interest at a rate of 10% per annum.
In the event the Company fails to pay the Cash Payment, the remaining loan would accrue a quarterly compounded interest of 20% per annum.

8. LOAN PAYABLE

Below is the summary of the Company's loan payable balance as at September 30, 2024:

	(a) Shard Capital	(b) Pershing Nominees	(c) Riverfort Global	(d) Related Party	Total
At December 31, 2023	-	-	-	-	-
Borrowing	127,124	134,981	67,856	515,000	844,961
Interest	15,217	15,871	13,604	-	44,692
At September 30, 2024	142,341	150,852	81,460	515,000	889,653

a) Shard Capital Partners LLP – The promissory note principal balance is US$100,000, with a maturity date of 12 months from the issuance date (March 8, 2025). The note bears interest at the rate of 20% per annum.
b) Pershing Nominees Limited – The promissory note principal balance is US$100,000, with a maturity date of 12 months from the issuance date (March 11, 2025). The note bears interest at the rate of 20% per annum.
c) Riverfort Global Opportunities – The promissory note principal balance is US$50,000, with a maturity date of 6 months from the issuance date (September 30, 2024). The note bears a fixed coupon rate of 20%.
d) Related party – The promissory note principal balance is $515,000, due on demand, and is non-interest bearing.

2024 Q3 Corporate Information Carbon Done Right Developments Inc. 18

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CARBON DONE RIGHT

Carbon Done Right Developments Inc. (formerly Klimat X Developments Inc.)

NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the nine months ended September 30, 2024 and 2023

9. LEASE LIABILITIES

(Canadian $)	PTHL Leasehold estate		Suriname Leasehold estate		Total
	September 30, 2024	December 31, 2023	September 30, 2024	December 31, 2023	September 30, 2024	December 31, 2023
At beginning of year	1,523,907	1,558,737	523,989	-	2,047,896	1,558,737
Acquisition	-	-	-	522,901	-	522,901
Unpaid lease payment - reclassified to AP	(455,591)	(198,701)	-	(15,000)	(455,591)	(213,701)
Accretion expense	152,504	201,763	65,941	27,238	218,445	229,001
Disposals	(1,220,820)	-	-	-	(1,220,820)	-
Foreign exchange impact	-	(37,892)	10,603	(11,150)	10,603	(49,042)
Ending lease liability	-	1,523,907	600,533	523,989	600,533	2,047,896
Current portion of lease liabilities	-	(152,704)	(78,839)	(69,148)	(78,839)	(221,852)
Non-current portion of lease liabilities	-	1,371,203	521,694	454,841	521,694	1,826,044

Lease liabilities consist of PTHL's agricultural land lease acquired as part of the acquisition of PTHL as well as Suriname's land sub-lease acquired during the period ended September 30, 2024.

PTHL Leasehold Estate

On January 29, 2018, PTI entered into a 50-year agreement for the lease of agricultural land known as the Stoll Estate, 700 acres set in the Pomeroon River, Guyana, in exchange for monthly lease payments of US$12,500.

Pursuant to the lease, 50% of the monthly lease payments due by December 31, 2022 (US$6,250 per month), are subject to an equity conversion right, whereby such outstanding lease payments may be converted into common shares of PTI. If this equity right is exercised, the carrying amount of such payables will be converted to shares of PTI at the prevailing fair value of such shares at the conversion date. Starting July 1, 2022, no lease payments will be allowed to be paid in common shares of PTI; any further lease payments will be settled in cash. As at September 30, 2024, total lease payments subjected to be paid in common shares was US$337,500 ($455,591), currently recorded in accounts payable. No payment in common shares has ever been exercised since the inception of the lease.

For the leased estate, the Company has recognized lease liabilities in relation to all lease arrangements measured at the present value of the remaining lease payments at an implied borrowing rate of 13% per annum appropriate for the location, type of property and length of term.

During the period ended September 30, 2024, PTI was not provided title documents as was expected in the lease agreement. Therefore, PTI terminated the lease agreement on September 30, 2024. As a result, a loss of $2,816,167 was recorded in the period ended September 30, 2024. The Company is actively seeking to recover costs incurred through litigation.

2024 Q3 Corporate Information Carbon Done Right Developments Inc. 19

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CARBON DONE RIGHT

Carbon Done Right Developments Inc. (formerly Klimat X Developments Inc.)

NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the nine months ended September 30, 2024 and 2023

9. LEASE LIABILITIES (CONTINUED)

Suriname Leasehold Estate

In September 2023, Pomeroon Suriname NV ("Suriname") entered into a 40-year agreement for the lease of agricultural land, 1,280 hectares, wherein Suriname intends to develop mixed agri-forestry and carbon offset projects in the Republic of Suriname.

Pursuant to the lease, the rental rate is US$15,000 per annum from the effective date to the fifth anniversary of the effective date. For the following five years, the rental rate shall be US$100,000 per annum, and for the remainder of the contractual term, the rental rate shall be US$150,000 per annum.

For the leased estate, the Company has recognized lease liabilities in relation to all lease agreements measured at the present value of the remaining lease payments at an implied borrowing rate of 16.5% per annum appropriate for the location, type of property and length of term.

The Company has the following future commitments associated with its lease liabilities:

(Canadian $)	September 30, 2024	December 31, 2023
Less than 1 year	20,249	218,571
2 to 3 years	40,497	437,141
4 to 5 years	155,239	437,141
More than 5 years	6,614,510	14,372,670
Total lease payments	6,830,495	15,465,523
Amounts representing interest over the term of the lease	(6,229,962)	(13,417,626)
Present value of lease liabilities	600,533	2,047,897

10. DERIVATIVE LIABILITY

On July 18, 2023, the Company entered into a carbon credit offtake transactions agreement with BP Carbon Trading Limited ("BP") wherein BP will pre-purchase carbon credits from the Company's Sierra Leone Rewilding Project. See Note 6 for details of the contract.

During the period ended September 30, 2024, the Company received payment of $1,353,775 (USD $1,000,000) from BP which has been presented as a derivative liability and deferred liability in these financial statements.

During the year ended December 31, 2023, the Company received payment of $1,350,022 (US$1,000,000) from BP which has been presented as a derivative liability and deferred liability in these financial statements.

As at September 30, 2024, the cumulative total amount collected was $2,703,797 (US$2,000,000).

2024 Q3 Corporate Information Carbon Done Right Developments Inc. 20

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CARBON DONE RIGHT

Carbon Done Right Developments Inc. (formerly Klimat X Developments Inc.)

NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the nine months ended September 30, 2024 and 2023

10. DERIVATIVE LIABILITY (CONTINUED)

(Canadian $)	Derivative liability	Deferred liability
At December 31, 2022	-	-
Cash received	1,350,022	-
Reclassification – deferred	(450,688)	450,688
Foreign exchange impact	(28,522)	-
At December 31, 2023	870,812	450,688
Cash received	1,353,775	-
Reclassification – deferred	(458,419)	458,419
Foreign exchange impact	56,828	-
At September 30, 2024	1,822,996	909,107

The BP agreement was considered as a contract to buy or sell non-financial items that can be settled net in cash or another financial instruments; as a result, it was recorded as a derivative liability. There was inadequate evidence to support the own use exception.

As the carbon credits development is still in early stage as at September 30, 2024 and December 31, 2023, the fair value was concluded to be the net present value of the repayment of agreement in cash in the event of a default. As a result, the proceeds were considered as an interest free loan. For initial measurement, the Company discounted the repayment amount based on prevailing market rates of similar instruments with a similar credit rating.

For the period ended September 30, 2024, upon the conclusion of such analysis, the discounted face value of $2,714,625 was $1,822,996, based on a discount rate of 30%, annual default interest penalty rate of 11.33% and repayment date of December 1, 2028. The Company was unable to find level 1 inputs to calculate the fair value (e.g. active market for an identical liability); as a result, level 3 inputs were used. Consequently, the difference of $458,419 between the face value and fair value was reclassified to deferred liability. An increase or decrease in 1% of the discount rate from 30% would decrease or increase the derivative liability by approximately $45,174. The remaining $56,828 was recorded as gain in foreign exchange impact.

For the year ended December 31, 2023, upon the conclusion of such analysis, the discounted face value of $1,350,022 was $870,812, based on a discount rate of 30%, annual default interest penalty rate of 11.33% and repayment date of December 1, 2028. The Company was unable to find level 1 inputs to calculate the fair value (e.g. active market for an identical liability); as a result, level 3 inputs were used. Consequently, the difference of $450,688 between the face value and fair value was reclassified to deferred liability. An increase or decrease in 1% of the discount rate from 30% would decrease or increase the derivative liability by approximately $22,000. The remaining $28,522 was recorded as a gain in foreign exchange impact.

2024 Q3 Corporate Information Carbon Done Right Developments Inc.

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CARBON DONE RIGHT

Carbon Done Right Developments Inc. (formerly Klimat X Developments Inc.)

NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the nine months ended September 30, 2024 and 2023

11. SHARE CAPITAL

a) Authorized share capital

The Company is authorized to issue:

An unlimited number of Common Shares without par value

b) Share issuances

Period ended September 30, 2024

Share issuance – shares for debt

On January 2, 2024, the Company settled an aggregate of $45,234 of indebtedness to a certain arm's length creditor through the issuance of 301,563 common shares at a deemed issuance price of $0.15 per share. The indebtedness relates to professional services rendered to the Company. A gain on settlement of debt of $16,586 was recorded in other income on the statement of loss and comprehensive loss, and the remaining $28,648 was allocated to share capital.

On February 23, 2024, the Company issued 337,500 shares to Outside the Box Capital Inc. in relation to an option exercise at an exercise price of $0.10 for total proceeds of $33,750.

Year ended December 31, 2023

Share issuance – private placement

On September 14, 2023, the Company announced the first tranche of a non-brokered private placement offering with the placement of 6,036,567 units at a price of $0.15 per unit for gross proceeds of $905,485. Each unit consists of one common share and one share purchase warrant with each warrant entitling the holder to purchase one share of the Company at a price of $0.25 per share with an expiry date of September 14, 2025. The Company has allocated $754,571 of the proceeds from the private placement to the shares, and $150,914 to the warrants on a residual method basis.

On October 6, 2023, the Company closed the final tranche of the non-brokered private placement offering, with the placement of 1,126,666 units at a price of $0.15 per unit for gross proceeds of $169,000. Each unit consists of one common share and one share purchase warrant with each warrant entitling the holder to purchase one share of the company at a price of $0.25 per share with an expiry date of October 6, 2025.

Share issuances – COB

Common Share issuances as a result of the Guyana Transaction, Sierra Leone Transaction and the Yucatan Transaction.

2024 Q3 Corporate Information Carbon Done Right Developments Inc. 22

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CARBON DONE RIGHT

Carbon Done Right Developments Inc. (formerly Klimat X Developments Inc.)

NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the nine months ended September 30, 2024 and 2023

11. SHARE CAPITAL (CONTINUED)

c) Warrants

A summary of the status of the Company's warrants at September 30, 2024 is as follows:

	Number of Warrants	Exercise Price
As at December 31, 2023	7,163,233	$0.25
As at September 30, 2024	7,163,233	$0.25

On September 14, 2023, the Company issued 6,036,567 share purchase warrants associated with the first tranche of the non-brokered private placement on September 14, 2023 (Note 11). Each warrant is exercisable at a price of $0.25 into one common share with an expiry date of September 14, 2025.

On October 6, 2023, the Company issued 1,126,666 share purchase warrants associated with the first tranche of the non-brokered private placement on October 6, 2023 (Note 11). Each warrant is exercisable at a price of $0.25 into one common share with an expiry date of October 6, 2025.

d) Escrowed Common Shares

As at September 30, 2024, 21,662,609 (December 31, 2023 – 21,662,609) Common Shares are subject to escrow.

12. CAPITAL MANAGEMENT

The Company's strategy is to carry a capital base to maintain investor, creditor and market confidence and to sustain future development of the business. The Company's objectives when managing capital are to safeguard the Company's ability to continue as a going concern in order to pursue the development of any identified business opportunities and to maintain a flexible capital structure for the benefit of its stakeholders.

Carbon Done Right considers its capital structure to include working capital, debt, lease liabilities and shareholders' equity (deficit).

The Company manages the capital structure and makes adjustments to it in light of changes in the economic conditions and the risk characteristics of the underlying assets. To maintain or adjust the capital structure, the Company may issue new shares, enter into joint venture arrangements, acquire or dispose of assets and adjust capital and operating expenditures to manage its current and projected available capital.

2024 Q3 Corporate Information Carbon Done Right Developments Inc. 23

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CARBON DONE RIGHT

Carbon Done Right Developments Inc. (formerly Klimat X Developments Inc.)

NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the nine months ended September 30, 2024 and 2023

12. CAPITAL MANAGEMENT (CONTINUED)

The Company's capital structure consists of the following:

(Canadian $)	September 30, 2024	December 31, 2023
Current assets	130,010	276,466
Current liabilities	(3,939,642)	(2,253,352)
Working capital (deficit) or net current assets (liabilities)	(3,809,632)	(1,976,886)
Lease liabilities - non-current	(521,694)	(1,826,044)
Shareholders' deficit	(19,176,313)	(13,529,555)

The Board of Directors does not establish quantitative return on capital criteria for management, but rather promotes year over year sustainable growth. The Company is not subject to externally imposed capital requirements. There has been no change with respect to the overall capital risk management strategy during the period ended September 30, 2024.

13. SHARE-BASED PAYMENTS

a) Share-based incentive programs and payment plans

The Company has the following share-based compensation and payment plans:

Stock option plan (equity-settled)

The Company has established a stock option plan (the "2010 Rolling Option Plan"), approved by the shareholders on November 10, 2010, whereby the Company may grant stock options from time to time, subject to regulatory terms and approval, to employees, officers, directors and service providers of the Company to recognize the contributions made by individuals to the Company's growth and furnish an incentive to the future success and prosperity of the Company.

The 2010 Rolling Option Plan is based on the maximum number of eligible shares equaling a rolling percentage of up to 10% of the Company's outstanding Common Shares, calculated from time to time. Pursuant to the 2010 Rolling Option Plan, if outstanding stock options are exercised, or expired, and/or the number of issued and outstanding Common Shares of the Company increases, then the options available to grant under the plan increase proportionately. The exercise price of each option is set by the Board of Directors at the time of grant but cannot be less than the discounted market price, as calculated pursuant to the policies of the TSXV, or such other minimum price as may be required by the TSXV.

Stock options can have a maximum term of ten (10) years and typically terminate 90 days following the termination of the holder's employment or engagement, except in the case of retirement or death. Vesting of options is at the discretion of the Board of Directors and determined at the time the options are granted.

2024 Q3 Corporate Information Carbon Done Right Developments Inc. 24

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CARBON DONE RIGHT

Carbon Done Right Developments Inc. (formerly Klimat X Developments Inc.)

NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the nine months ended September 30, 2024 and 2023

13. SHARE-BASED PAYMENTS (CONTINUED)

a) Share-based incentive programs and payment plans

Common shares issued in exchange for goods received/services rendered (equity-settled)

The Company may issue Carbon Done Right Common Shares from time to time to service providers, vendors or consultants in exchange for services rendered to the Company, as determined by the Board of Directors.

b) Stock options

On February 27, 2023, the Company granted a total of 1,350,000 incentive stock options to a marketing consultant in consideration of the Optionee’s ongoing services and contributions to the Company pursuant to the Company’s equity incentive plan. Each option is exercisable to purchase one common share of the Company at a price of $0.10 per common share, with an expiry date of February 27, 2025. The options vest as follows:

a. One-quarter will be released on the date that is three months from February 27, 2023;
b. One-quarter will be released on the date that is six months from February 27, 2023;
c. One-quarter will be released on the date that is nine months from February 27, 2023; and
d. One-quarter will be released on the date that is twelve months from February 27, 2023.

On April 20, 2023, the Company granted a total of 100,000 stock options to a consultant of the Company pursuant to the Company’s equity incentive plan. Each option is exercisable to purchase one common share of the Company at a price of $0.20 per common share, with an expiry date of April 20, 2028. The options vest immediately.

On February 23, 2024, the Company issued 337,500 shares to Outside the Box Capital Inc. in relation to an option exercise at an exercise price of $0.10.

2024 Q3 Corporate Information Carbon Done Right Developments Inc. 25

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CARBON DONE RIGHT

Carbon Done Right Developments Inc. (formerly Klimat X Developments Inc.)

NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the nine months ended September 30, 2024 and 2023

13. SHARE-BASED PAYMENTS (CONTINUED)

b) Stock options

The following table provides a summary of the Company's stock options:

(Canadian $, except number of stock options)	Number of stock options	September 30 2024 Weighted average exercise price	Number of stock options	December 31 2023 Weighted average exercise price
Stock options
Outstanding at beginning of year	3,500,000	0.306	5,374,040	0.334
Cancelled	-	-	(2,649,040)	0.332
Granted	-	-	1,450,000	0.110
Exercised	(337,500)	0.100	(675,000)	0.100
Outstanding at end of period	3,162,500	0.306	3,500,000	0.286
Weighted average remaining life		2.59 years		3.51 years
Vested and exercisable at end of period	3,162,500	0.306	3,162,500	0.306

The estimated fair value of the stock options granted during the period was calculated using the Black-Scholes model and the following assumptions:

	Period ended September 30 2024	Year ended December 31 2023
Share price on grant date	-	$0.10
Exercise price	-	$0.11
Expected life (years)	-	2.21
Expected volatility	-	95%
Risk-free interest rate	-	3.62%
Expected forfeiture rate	-	-
Expected dividend yield	-	-
Weighted average fair value per stock option	-	$0.06

Estimated forfeiture rates are adjusted to the actual forfeiture rate at time of forfeiture. Expected volatility is based on the historical volatility of publicly traded peer companies. The risk-free interest rate is based on Government of Canada bonds of a similar duration.

For the period ended September 30, 2024, $2,657 (2023 - $Nil) of share-based payment expense related to stock options was recognized in net loss.

2024 Q3 Corporate Information Carbon Done Right Developments Inc.

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CARBON DONE RIGHT

Carbon Done Right Developments Inc. (formerly Klimat X Developments Inc.)

NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the nine months ended September 30, 2024 and 2023

13. SHARE-BASED PAYMENTS (CONTINUED)

c) Share-based compensation expenses

Carbon Done Right recorded the following equity-settled share-based payments as share-based compensation in net income (loss):

(Canadian $)	Three months ended September 30,		Nine months ended September 30,
	2024	2023	2024	2023
Stock options	-	15,937	2,657	61,271
Total share-based compensation expense	-	15,937	2,657	61,271

14. FINANCIAL INSTRUMENTS AND RISK MANAGEMENT

Financial instruments

Carbon Done Right's financial assets consist of cash and cash equivalents and accounts receivable and carbon credit streaming agreements.

Carbon Done Right's financial liabilities consist of accounts payable and accrued liabilities and derivative liability and convertible debenture (Note 7).

The fair values of cash and cash equivalents, accounts receivable and accounts payable and accrued liabilities approximate their carrying values due to the short-term maturities of those instruments.

The Company's convertible debenture is recorded at amortized cost using the effective interest method.

Financial risk management

Carbon Done Right's activities expose it to certain financial risks, including market risk, credit risk and liquidity risk. The following table summarizes the Company's financial instruments as of September 30, 2024 and December 31, 2023:

(Canadian $)	September 30, 2024	December 31, 2023
Financial Assets
Amortized cost:
Cash	112,415	156,549
Accounts receivable	17,183	12,038
Fair value through profit or Carbon credit streaming agreements	7,145,298	5,560,736
Financial Liabilities
Amortized cost:
Accounts payable and accrued liabilities	2,971,150	2,031,500
Convertible debenture	504,464	392,107
Deferred liability	909,107	450,688
Fair value through profit or Derivative liability	1,822,996	870,812

2024 Q3 Corporate Information Carbon Done Right Developments Inc.

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CARBON DONE RIGHT

Carbon Done Right Developments Inc. (formerly Klimat X Developments Inc.)

NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the nine months ended September 30, 2024 and 2023

14. FINANCIAL INSTRUMENTS AND RISK MANAGEMENT (CONTINUED)

Market risk

Market risk is the risk that changes in market conditions, such as interest rates and foreign exchange rates will affect Carbon Done Right’s net loss or value of financial instruments.

Interest rate risk

Interest rate risk is the risk that future cash flows will fluctuate as a result of changes in market interest rates.

The Company may manage its interest expense using a mix of fixed and variable interest rates on its debt. Changes in interest rates could result in an increase or decrease in the amount the Company pays to service variable interest rate debt.

The interest rates on PTHL’s debt loans payable are fixed and not subject to interest rate risk.

Foreign exchange risk

Foreign exchange risk is the risk that future cash flows or the fair value of a financial instrument will fluctuate as a result of changes in foreign exchange rates.

The Company is primarily exposed to fluctuations in the U.S. dollar and Guyanese dollar in relation to its foreign operations.

A 1% change in the value of the U.S. dollar and Guyanese dollar would have had no material impact on the net loss and comprehensive loss of the Company at September 30, 2024.

Commodity price risk

The Company may be exposed to commodity price risk through the sale of its agricultural produce and biological assets and inventories held.

At September 30, 2024 and December 31, 2023, the Company does not hold significant biological assets or inventories nor has it recognized significant revenue related to the sale of its agricultural produce.

Carbon market risk

Carbon market risk is the risk that the fair value of a financial instrument will fluctuate from changes in market forces including, but not limited to, interest rates, voluntary carbon credit prices, foreign exchange, and timing and number of anticipated carbon credit deliveries and sales. There has been no change in fair value in the year for the carbon credit assets acquired.

2024 Q3 Corporate Information Carbon Done Right Developments Inc. 28

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CARBON DONE RIGHT

Carbon Done Right Developments Inc. (formerly Klimat X Developments Inc.)

NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the nine months ended September 30, 2024 and 2023

14. FINANCIAL INSTRUMENTS AND RISK MANAGEMENT (CONTINUED)

Credit risk

Credit risk is the risk that a customer or counterparty to a financial asset will default, resulting in the Company incurring a financial loss.

The Company's accounts receivables are predominantly for PTHL customers and other partners who are subject to normal industry credit risks in Guyana. The Company assesses the creditworthiness of its customers on an ongoing basis as well as monitoring the amount and age of balances outstanding. Accordingly, the Company views the credit risks on these amounts as normal for the industry. The carrying amount of accounts receivable represents the maximum credit exposure on this balance.

An impairment analysis is performed at each reporting date using a provision matrix to measure ECL. The calculation reflects the probability-weighted outcome, the time value of money and reasonable supportable information that is available at the reporting date about past events, current conditions and forecasts of future economic conditions.

The Company's accounts receivable payment terms with customers vary by contract; however, standard payment terms are 30 days from the invoice date. Any credit risk related to the accounts receivable will have an immaterial impact to the Company.

The Company held cash and cash equivalents of $112,415 at September 30, 2024 which represents its maximum credit exposure on these assets (December 31, 2023 - $156,549). The cash is held with major, high credit-quality financial institution counterparties and management believes credit risk is minimal.

Liquidity risk

Liquidity risk is the risk that the Company will be unable to fulfill its obligations associated with financial liabilities on a timely basis or at a reasonable cost. The Company's objective in managing liquidity risk is to maintain sufficient available resources to meet its liquidity requirements at any point.

The Company is exposed to this risk mainly in respect of its accounts payable and accrued liabilities, lease obligations and long-term debt.

The Company mitigates this risk through efforts to maintain the support of its lenders and through the issuance of additional capital, if required.

The Company has the following payments (gross amount, undiscounted) due within the period noted below:

	Within 1 year	1-3 years	3-5 years	More than 5 years	Total
Accounts payables	2,971,150	-	-	-	2,971,150
Convertible debenture	-	504,464	-	-	504,464
Derivative liability	-	1,822,996	-	-	1,822,996
Lease liability	20,249	40,497	155,239	6,614,510	6,830,495
	2,991,399	2,367,957	155,239	6,614,510	12,129,105

2024 Q3 Corporate Information Carbon Done Right Developments Inc. 29

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CARBON DONE RIGHT

Carbon Done Right Developments Inc. (formerly Klimat X Developments Inc.)

NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the nine months ended September 30, 2024 and 2023

14. FINANCIAL INSTRUMENTS AND RISK MANAGEMENT (CONTINUED)

Carbon market risk

Carbon market risk is the risk that the fair value of a financial instrument will fluctuate from changes in market forces including, but not limited to, interest rates, voluntary carbon credit prices, foreign exchange, and timing and number of anticipated carbon credit deliveries and sales. There has been no change in fair value in the year for the carbon credit assets acquired.

15. RELATED PARTY BALANCES AND TRANSACTIONS

Related party transactions

Except as disclosed elsewhere, the Company incurred the following with directors and companies controlled by Directors of the Company for the period ended September 30:

	Three months ended September 30		Nine months ended September 30
(Canadian $)	2024	2023	2024	2023
Consulting fees	18,000	38,404	174,000	114,654
Management fees	134,350	195,900	451,150	495,200
Total	152,350	234,304	625,150	609,854

Included in related party consulting fees for the period ended September 30, 2024, a minority shareholder of Pomeroon Suriname N.V (a subsidiary of the Company) charged $108,265 (December 31, 2023 - $105,300) to the Company.

On June 29, 2022, the Company entered into a carbon streaming agreement with RML, a Company owned by the Company's Director of Operations. See Note 6 for details. During the period ended September 30, 2024, the Company advanced $1,584,562 (December 31, 2023 - $1,721,226) to develop the carbon credits project.

On August 15, 2022, the Company entered into a carbon credit streaming agreement with FMPL, a Company owned by the Company's Director of Operations. See Note 6 for details.

During July 2022, the Company paid back a US $65,000 ($83,759) loan balance from 662 Ventures Limited (wholly owned by Director of Corporate Development of the Company).

The Company is the lessee to the Suriname leasehold agreement, with the lessor being an organization whose chairwoman is a related party to the Company. As such, the Suriname lease is considered a related party transaction.

2024 Q3 Corporate Information Carbon Done Right Developments Inc. 30

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CARBON DONE RIGHT

Carbon Done Right Developments Inc. (formerly Klimat X Developments Inc.)

NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the nine months ended September 30, 2024 and 2023

15. RELATED PARTY BALANCES AND TRANSACTIONS (CONTINUED)

Due to related parties

As at September 30, 2024, the Company owes $1,630,830 (December 31, 2023 - $552,142) to directors or officers of the Company. This balance includes a $515,000 loan due to a related party (Note 8) (December 31, 2023 - $Nil). The amount owed was recorded in accounts payable and accrued liabilities in the statement of financial position.

16. SUPPLEMENTARY CASH FLOW INFORMATION

The following table reconciles the net changes in non-cash working capital, excluding the non-cash working capital acquired on acquisitions, from the statement of financial position to the statements of cash flows and details interest received:

(Canadian $)	Nine months ended September 30,
	2024	2023
Net changes in non-cash working capital:
Prepaid expenses and deposits	98,657	26,366
Inventory	8,811	7,518
Accounts receivable	(5,145)	(94,830)
Accounts payable and accrued liabilities	1,098,052	1,301,678
Total	1,200,375	1,240,732

2024 Q3 Corporate Information Carbon Done Right Developments Inc.

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CARBON
DONE RIGHT

Carbon Done Right Developments Inc. (formerly Klimat X Developments Inc.)

NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

For the nine months ended September 30, 2024 and 2023

17. SEGMENTED REPORTING

The net loss by segment for the period ended September 30, 2024 and 2023 are as follows:

(Canadian $)	Three months ended September 30, 2024				Three months ended September 30, 2023
	Guyana	Suriname	Corporate	Total	Guyana	Suriname	Corporate	Total
Revenue	18,312	-	-	18,312	43,737	-	-	43,737
Cost of good sold	(27,712)	-	-	(27,712)	(121,938)	-	-	(121,938)
Expenses
General and administrative	(109,218)	(75,746)	(560,269)	(745,234)	(84,965)	(71,104)	(1,098,432)	(1,254,501)
Share-based payments	-	-	-	-	-	-	(15,937)	(15,937)
Total expenses	(109,218)	(75,746)	(560,269)	(745,234)	(84,965)	(71,104)	(1,114,369)	(1,270,438)
Other	(3,245,014)	(23,487)	(45,663)	(3,314,164)	33,220	(3,983)	(96,268)	(67,031)
Net loss	(3,363,632)	(99,233)	(605,932)	(4,068,798)	(129,946)	(75,087)	(1,210,637)	(1,415,670)
(Canadian $)	Nine months ended September 30, 2024				Nine months ended September 30, 2023
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	Guyana	Suriname	Corporate	Total	Guyana	Suriname	Corporate	Total
Revenue	67,737	-	-	67,737	128,683	-	-	128,683
Cost of good sold	(93,935)	-	-	(93,935)	(344,624)	-	-	(344,624)
Expenses
General and administrative	(193,422)	(221,847)	(1,841,784)	(2,257,054)	(223,356)	(199,330)	(2,714,144)	(3,136,830)
Share-based payments	-	-	(2,657)	(2,657)	-	-	(61,271)	(61,271)
Total expenses	(193,422)	(221,847)	(1,844,441)	(2,259,711)	(223,356)	(199,330)	(2,775,415)	(3,198,101)
Other	(3,379,271)	(66,415)	(11,929)	(3,457,615)	(87,144)	(5,281)	(117,787)	(210,212)
Net loss	(3,598,891)	(288,262)	(1,856,370)	(5,743,524)	(526,441)	(204,611)	(2,893,202)	(3,624,254)

The segment assets and liabilities as at September 30, 2024 and December 31, 2023 are as follows:

(Canadian $)	September 30, 2024				December 31, 2023
	Guyana	Suriname	Unallocated	Total	Guyana	Suriname	Unallocated	Total
Segment assets	(36,553)	(2,118,384)	10,092,135	7,937,198	2,344,528	520,688	8,642,809	11,508,025
Segment liabilities	(832,729)	(278,593)	(6,586,582)	(7,697,903)	(2,889,642)	(571,680)	(2,331,681)	(5,793,003)

18. SUBSEQUENT EVENTS

Subsequent to period end, the Company announced Celia Francis has resigned as a director of the Company.

On October 31, 2024, the Company completed all milestones required for the seventh disbursement under the pre-purchase agreement with BP Carbon Trading Limited. The Company received USD $250,000 in accordance with the payment schedule set out on the pre-purchase agreement.

On November 14, 2024, the Company announced that it is changing its financial year-end to March 31 from its current year-end of December 31. As a result, the Company will file an additional interim report as of December 31, 2023, and will report audited financial results for a 15-month transition year from January 1, 2024, to March 31, 2025 (with a comparative of the 12 months ended December 31, 2023).

2024 Q3 Corporate Information Carbon Done Right Developments Inc.