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Copper Road Resources — Interim / Quarterly Report 2024
Nov 28, 2024
45353_rns_2024-11-28_5316064a-f706-4237-9e20-18bd03a7cc62.pdf
Interim / Quarterly Report
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COPPER ROAD RESOURCES INC.
CONDENSED INTERIM FINANCIAL STATEMENTS
THREE AND NINE MONTHS ENDED
SEPTEMBER 30, 2024
(EXPRESSED IN CANADIAN DOLLARS)
(UNAUDITED)
Notice to Reader
The accompanying unaudited condensed interim consolidated financial statements of Copper Road Resources Inc. (the "Company") have been prepared by and are the responsibility of management. The unaudited condensed interim consolidated financial statements as at and for the three and nine months ended September 30, 2024 have not been reviewed by the Company's auditors.
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Copper Road Resources Inc.
Condensed Interim Consolidated Statements of Financial Position
(Expressed in Canadian dollars)
(Unaudited)
| As at September 30, 2024 | As at December 31, 2023 | |
|---|---|---|
| ASSETS | ||
| Current assets | ||
| Cash | $ 268,929 | $ 11,659 |
| Amounts receivable and other assets (note 3) | 18,441 | 30,616 |
| Marketable securities (note 4) | 1,310,287 | - |
| Total assets | $ 1,597,657 | $ 42,275 |
| LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIENCY) | ||
| Current liabilities | ||
| Amounts payable and other liabilities (notes 5 and 12) | $ 127,868 | $ 163,086 |
| Total liabilities | 127,868 | 163,086 |
| Shareholders' equity (deficiency) | ||
| Share capital (note 6) | 27,633,626 | 27,304,551 |
| Reserves (notes 7 and 8) | 731,424 | 806,774 |
| Accumulated deficit | (26,895,261) | (28,232,136) |
| Total shareholders' equity (deficiency) | 1,469,789 | (120,811) |
| Total liabilities and shareholders' equity (deficiency) | $ 1,597,657 | $ 42,275 |
The accompanying notes to the unaudited condensed interim consolidated financial statements are an integral part of these statements.
Nature of operations and going concern (note 1)
Commitments and contingencies (note 14)
Copper Road Resources Inc.
Condensed Interim Consolidated Statements of (Loss) Income and Comprehensive (Loss) Income
(Expressed in Canadian dollars)
(Unaudited)
| | Three Months Ended
September 30, | | Nine Months Ended
September 30, | |
| --- | --- | --- | --- | --- |
| | 2024 | 2023 | 2024 | 2023 |
| Operating expenses | | | | |
| Exploration and evaluation expenditures (note 10) | $ - | $ 290,277 | $ 63,667 | $ 491,349 |
| General and administrative (note 11) | 28,094 | 134,608 | 426,088 | 390,677 |
| Share-based compensation (notes 8 and 12) | - | 4,241 | 1,171 | 18,627 |
| Operating loss before the following item | (28,094) | (429,126) | (490,926) | (900,653) |
| Sale of Copper Road Project (note 10(b)(ii)) | - | - | 6,945,260 | - |
| Loss on settlement of debt (note 6(b)(iii)) | - | - | (19,007) | - |
| Net (loss) income and comprehensive (loss) income for the period | $ (28,094) | $ (429,126) | $ 6,435,327 | $ (900,653) |
| Basic (loss) income per share (note 9) | $ (0.00) | $ (0.01) | $ 0.11 | $ (0.02) |
| Diluted (loss) income per share (note 9) | $ (0.00) | $ (0.01) | $ 0.11 | $ (0.02) |
| Weighted average number of common shares outstanding - basic and diluted (note 9) | 60,320,664 | 51,883,738 | 58,333,356 | 47,532,239 |
The accompanying notes to the unaudited condensed interim consolidated financial statements are an integral part of these statements.
Copper Road Resources Inc.
Condensed Interim Consolidated Statements of Changes in Equity (Deficiency)
(Expressed in Canadian dollars)
(Unaudited)
| Share capital | Reserves | Accumulated deficit | Total | |
|---|---|---|---|---|
| Balance, December 31, 2023 | $ 27,304,551 | $ 806,774 | $ (28,232,136) | $ (120,811) |
| Shares issued for settlement of debt (note 6(b)(iv)) | 209,075 | - | - | 209,075 |
| Shares issued through private placement (note 6(b)(v) | 120,000 | - | - | 120,000 |
| Warrants expired | - | (70,593) | 70,593 | - |
| Stock options expired | - | (5,928) | 5,928 | - |
| Share-based compensation (note 8) | - | 1,171 | - | 1,171 |
| Dividend-in-kind (note 10(ii)) | - | - | (5,174,973) | (5,174,973) |
| Net income for the period | - | - | 6,435,327 | 6,435,327 |
| Balance, September 30, 2024 | $ 27,633,626 | $ 731,424 | $ (26,895,261) | $ 1,469,789 |
| Balance, December 31, 2022 | $ 26,732,842 | $ 843,497 | $ (27,505,942) | $ 70,397 |
| Shares issued through private placements (note 6(b)(ii)(iii)) | 800,000 | - | - | 800,000 |
| Warrants (note 6(b)(ii)(iii)) | (254,334) | 254,334 | - | - |
| Share issue costs (note 6(b)(iii)) | (99,665) | 27,220 | - | (72,445) |
| Share issued for acquisition of mining property (note 6(b)(i)) | 60,750 | - | - | 60,750 |
| Stock options expired | - | (42,488) | 42,488 | - |
| Share-based compensation (note 8) | - | 18,627 | - | 18,627 |
| Net loss for the period | - | - | (900,653) | (900,653) |
| Balance, September 30, 2023 | $ 27,239,593 | $ 1,101,190 | $ (28,364,107) | $ (23,324) |
The accompanying notes to the unaudited condensed interim consolidated financial statements are an integral part of these statements.
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Copper Road Resources Inc.
Condensed Interim Consolidated Statements of Cash Flows
(Expressed in Canadian dollars)
(Unaudited)
| | Nine Months Ended
September 30, | |
| --- | --- | --- |
| | 2024 | 2023 |
| Operating activities | | |
| Net income (loss) for the period | $ 6,435,327 | $ (900,653) |
| Adjustments for: | | |
| Loss on settlement of debt (note 6(b)(iv)) | 19,007 | - |
| Share-based compensation (note 8) | 1,171 | 18,627 |
| Shares issued for acquisition of mining property (note 6(b)(i)) | - | 60,750 |
| Shares received for the sale of Copper Road Project (note 10(ii)) | (6,485,260) | - |
| Changes in non-cash working capital items: | | |
| Amounts receivable and other assets | 12,175 | (26,245) |
| Amounts payable and other liabilities | 154,850 | 13,739 |
| Net cash provided by (used in) operating activities | 137,270 | (833,782) |
| Financing activities | | |
| Proceeds from private placement (note 6(b)(ii)(iii)(iv)) | 120,000 | 800,000 |
| Shares issue costs | - | (72,445) |
| Net cash provided by financing activities | 120,000 | 727,555 |
| Net change in cash | 257,270 | (106,227) |
| Cash, beginning of period | 11,659 | 136,924 |
| Cash, end of period | $ 268,929 | $ 30,697 |
| Supplemental information | | |
| Shares issued for settlement of debt (note 6(b)(iv)) | $ 209,075 | $ - |
The accompanying notes to the unaudited condensed interim consolidated financial statements are an integral part of these statements.
Copper Road Resources Inc.
Notes to Condensed Interim Consolidated Financial Statements
Three and Nine Months Ended September 30, 2024
(Expressed in Canadian dollars)
(Unaudited)
- Nature of operations and going concern
Copper Road Resources Inc. (the "Company" or "Copper Road") was incorporated by a Certificate of Incorporation issued pursuant to the provisions of the Ontario Business Corporations Act on December 13, 2002. The Company is engaged in the acquisition, exploration and evaluation of properties for the mining of precious and base metals. The primary office of the Company is located at 82 Richmond Street East, Toronto, Ontario, M5C 1P1.
On September 14, 2022, the Company changed its corporate name from Stone Gold Inc. to Copper Road Resources Inc. The Company's shares commenced trading on the TSX Venture Exchange ("TSXV") under the new name at the opening of trading on September 15, 2022 and under the new trading symbol "CRD".
On February 12, 2024, 100797918 Ontario Inc. (the "Subsidiary") was incorporated. The Subsidiary is a wholly-owned subsidiary of the Company. On May 10, 2024, the Company sold the Subsidiary. Refer to note 10(ii).
The Company has incurred an income of $6,435,327 for the nine months ended September 30, 2024 (nine months ended September 30, 2023 - loss of $900,653) and as at September 30, 2024, had an accumulated deficit of $26,895,261 (December 31, 2023 - $28,232,136). These conditions indicate the existence of a material uncertainty that casts significant doubt as to whether the Company can continue as a going concern.
These unaudited condensed interim consolidated financial statements have been prepared on the basis of accounting principles applicable to a going concern, which assume that the Company will continue in operation for the foreseeable future and will be able to realize its assets and discharge its liabilities in the normal course of operations as they come due. In assessing whether the going concern assumption is appropriate, management takes into account all available information about the future, which is at least, but is not limited to, twelve months from the end of the reporting period. These unaudited condensed interim consolidated financial statements do not reflect the adjustments to the carrying values of assets and liabilities and the reported expenses and classification of assets and liabilities that would be necessary if the Company were unable to realize its assets and settle its liabilities as a going concern in the normal course of operations for the foreseeable future. These adjustments could be material.
The business of acquisition, exploration and evaluation for minerals involves a high degree of risk and there can be no assurance that the current exploration programs will result in profitable operations.
The Company is in the process of exploring its mineral properties and has not yet determined whether these properties contain mineral reserves that are economically recoverable. The Company's continued existence is dependent upon the establishment of a sufficient quantity of economically recoverable reserves, the ability of the Company to obtain necessary financing to complete the development and upon future profitable production or proceeds from the disposition of these assets.
Although the Company has taken steps to verify title to the properties on which it is conducting its exploration activities, these procedures do not guarantee the Company's title. Property title may be subject to government licensing requirements or regulations, social licensing requirements, unregistered prior agreements, unregistered claims and non-compliance with regulatory and environmental requirements. The Company's assets may also be subject to increases in taxes and royalties, renegotiation of contracts, currency exchange fluctuations and restrictions, and political uncertainty.
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Copper Road Resources Inc.
Notes to Condensed Interim Consolidated Financial Statements
Three and Nine Months Ended September 30, 2024
(Expressed in Canadian dollars)
(Unaudited)
2. Significant accounting policies
Statement of compliance
The Company applies International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB"). These unaudited condensed interim consolidated financial statements have been prepared in accordance with International Accounting Standard 34 - Interim Financial Reporting. Accordingly, they do not include all of the information required for full annual financial statements required by IFRS as issued by the IASB.
The policies applied in these unaudited condensed interim consolidated financial statements are based on IFRSs issued and outstanding as of November 28, 2024, the date the Board of Directors approved the statements. The same accounting policies and methods of computation are followed in these unaudited condensed interim consolidated financial statements as compared with the most recent annual financial statements as at and for the year ended December 31, 2023, except as noted below. Any subsequent changes to IFRS that are given effect in the Company's annual consolidated financial statements for the year ending December 31, 2024 could result in restatement of these unaudited condensed interim consolidated financial statements.
Basis of consolidation
The unaudited condensed interim consolidated financial statements include the accounts of the Company, and its controlled subsidiary 100797918 Ontario Inc. All significant intercompany transactions and balances have been eliminated on consolidation. On May 10, 2024, the Company sold the Subsidiary. Refer to note 10(ii).
New accounting standards adopted
IAS 1 – Presentation of Financial Statements ("IAS 1") was amended in January 2020 to provide a more general approach to the classification of liabilities under IAS 1 based on the contractual arrangements in place at the reporting date. The amendments clarify that the classification of liabilities as current or non-current is based solely on a company's right to defer settlement at the reporting date. The right needs to be unconditional and must have substance. The amendments also clarify that the transfer of a company's own equity instruments is regarded as settlement of a liability, unless it results from the exercise of a conversion option meeting the definition of an equity instrument. The amendments are effective for annual periods beginning on January 1, 2024. At January 1, 2024, the Company adopted this standard and there was no material impact on the Company's unaudited condensed interim consolidated financial statements.
3. Amounts receivable and other assets
| As at September 30, 2024 | As at December 31, 2023 | |
|---|---|---|
| Sales tax receivable - Canada | $ 9,913 | $ 21,754 |
| Prepaid expenses | 8,528 | 8,862 |
| $ 18,441 | $ 30,616 |
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Copper Road Resources Inc.
Notes to Condensed Interim Consolidated Financial Statements
Three and Nine Months Ended September 30, 2024
(Expressed in Canadian dollars)
(Unaudited)
- Marketable securities
| September 30, 2024 | Number of shares | Cost | Unrealized loss | Fair value |
|---|---|---|---|---|
| Sterling Metals Corp. ("Sterling") | 21,838,123 | $ 1,310,287 | $ - | $ 1,310,287 |
| December 31, 2023 | Number of shares | Cost | Unrealized loss | Fair value |
| Sterling | - | $ - | $ - | $ - |
During the three and nine months ended September 30, 2024, the Company recorded an unrealized gain on marketable securities of $nil (three and nine months ended September 30, 2023 - unrealized gain of $nil) in the unaudited condensed interim consolidated statement of (loss) income.
Refer to note 10(ii).
- Amounts payable and other liabilities
| As at September 30, 2024 | As at December 31, 2023 | |
|---|---|---|
| Trade payables | $ 82,576 | $ 61,102 |
| Accrued liabilities | 45,292 | 101,984 |
| $ 127,868 | $ 163,086 |
The following is an aged analysis of the amounts payable and other liabilities:
| As at September 30, 2024 | As at December 31, 2023 | |
|---|---|---|
| Less than 1 month | $ 77,586 | $ 145,086 |
| 1 to 3 months | 8,398 | - |
| Greater than 3 months | 41,884 | 18,000 |
| $ 127,868 | $ 163,086 |
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Copper Road Resources Inc.
Notes to Condensed Interim Consolidated Financial Statements
Three and Nine Months Ended September 30, 2024
(Expressed in Canadian dollars)
(Unaudited)
6. Share capital
a) Authorized share capital
The authorized share capital consisted of an unlimited number of common shares. The common shares do not have a par value. All issued shares are fully paid.
b) Common shares issued
As at September 30, 2024, the issued share capital amounted to $27,633,626. Changes in issued share capital for the periods presented are as follows:
| Number of common shares | Amount | |
|---|---|---|
| Balance, December 31, 2022 | 42,300,667 | $ 26,732,842 |
| Shares issued for acquisition of mineral property (i) | 450,000 | 60,750 |
| Shares issued through private placements (ii)(iii) | 10,642,858 | 800,000 |
| Warrants (ii)(iii) | - | (254,334) |
| Share issue costs (iii) | - | (99,665) |
| Balance, September 30, 2023 | 53,393,525 | $ 27,239,593 |
| Number of common shares | Amount | |
| Balance, December 31, 2023 | 55,214,951 | $ 27,304,551 |
| Shares issued for settlement of debt (iv) | 3,801,365 | 209,075 |
| Shares issued through private placements (v) | 6,000,000 | 120,000 |
| Balance, September 30, 2024 | 65,016,316 | $ 27,633,626 |
(i) Refer to note 10(i). The fair value was estimated based on the closing price of the Company's share on the date of issue.
(ii) On March 21, 2023, the Company closed a non-brokered private placement of 5,000,000 units of the Company at a price of $0.08 per unit for aggregate gross proceeds of $400,000. Each unit consists of one common share of the Company and one common share purchase warrant. Each warrant entitles the holder thereof to purchase one common share of the Company at a price of $0.15 for a period of 24 months following the closing date of the offering.
The fair value of the 5,000,000 warrants was estimated on the date of grant using the Black-Scholes option pricing model with the following assumptions: exercise price of $0.15; expected dividend yield of 0%; risk-free interest rate of 3.70%; expected volatility of 160% and an expected life of 2 years. The fair value assigned to these warrants was $148,874.
In connection with the offering, the Company agreed to pay a cash commission in the aggregate amount of $19,861 to eligible finder's in accordance with the policies of the TSXV.
Certain directors and management of the Company subscribed to the offering for an aggregate of 708,500 units.
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Copper Road Resources Inc.
Notes to Condensed Interim Consolidated Financial Statements
Three and Nine Months Ended September 30, 2024
(Expressed in Canadian dollars)
(Unaudited)
- Share capital (continued)
b) Common shares issued (continued)
(iii) On July 26, 2023, the Company completed a non-brokered private placement consisting of the sale of 71,426 units of the Company at a price of $0.07 per unit and 5,642,858 flow-through units of the Company each at a price of $0.07 per flow-through unit, for aggregate gross proceeds of $400,000. Each unit was comprised of one common share of the Company and one-half of one common share purchase warrant. Each flow-through unit was comprised of one common share of the Company issued as a "flow-through share" within the meaning of the Income Tax Act (Canada) (the "Tax Act") and one-half of one warrant. Each warrant entitles the holder thereof to purchase one common share of the Company at a price of $0.15 for a period of 36 months the closing date of the offering.
The fair value of the 2,857,142 warrants was estimated on the date of grant using the Black-Scholes option pricing model with the following assumptions: exercise price of $0.15; expected dividend yield of 0%; risk-free interest rate of 4.38%; expected volatility of 153% and an expected life of 3 years. The fair value assigned to these warrants was $105,460.
In connection with the offering, the Company paid a commission in the aggregate amount of $24,153 and issued 345,038 finder warrants to eligible finders. Each finder's warrant entitles the holder to acquire one common share in the capital of the Company at a price of $0.15 for a period of 36 months following the closing of the offering. The fair value of the 345,038 finder's warrants was estimated on the date of grant using the Black-Scholes option pricing model with the following assumptions: exercise price of $0.15; expected dividend yield of 0%; risk-free interest rate of 4.38%; expected volatility of 153% and an expected life of 3 years. The fair value assigned to these warrants was $27,220.
(iv) On March 21, 2024, the Company issued 3,801,365 common shares of the Company to settle $190,068 of accounts payable for professional services. The fair value of the shares issued was $209,075, resulting in a loss on settlement of debt of $19,007.
(v) On September 10, 2024, the Company completed a non-brokered private placement consisting of the sale of 6,000,000 common shares of the Company at a price of $0.02 per unit, for aggregate gross proceeds of $120,000.
The common shares issued pursuant to the offering are subject to a statutory hold period of four months and one day.
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Copper Road Resources Inc.
Notes to Condensed Interim Consolidated Financial Statements
Three and Nine Months Ended September 30, 2024
(Expressed in Canadian dollars)
(Unaudited)
7. Warrants
The following table reflects the continuity of warrants for the periods ended September 30, 2024 and September 30, 2023:
| Number of warrants | Weighted average exercise price ($) | |
|---|---|---|
| Balance, December 31, 2022 | 10,134,163 | 0.175 |
| Issued (note 6(b)(ii)(iii)) | 8,202,180 | 0.150 |
| Balance, September 30, 2023 | 18,336,343 | 0.164 |
| Balance, December 31, 2023 | 10,862,180 | 0.161 |
| Expired | (787,500) | 0.30 |
| Balance, September 30, 2024 | 10,074,680 | 0.149 |
The following table reflects the actual warrants issued and outstanding as of September 30, 2024:
| Number of warrants outstanding | Grant date fair value($) | Exercise price ($) | Expiry date |
|---|---|---|---|
| 5,000,000 | 148,874 | 0.150 | March 21, 2025 |
| 1,750,000 | 66,319 | 0.150 | October 20, 2025 |
| 122,500 | 5,120 | 0.100 | October 20, 2025 |
| 2,857,142 | 105,460 | 0.150 | July 26, 2026 |
| 345,038 | 12,736 | 0.150 | July 26, 2026 |
| 10,074,680 | 338,509 | 0.149 |
8. Stock options
The following table reflects the continuity of stock options:
| Number of stock options | Weighted average exercise price ($) | |
|---|---|---|
| Balance, December 31, 2022 | 4,145,000 | 0.15 |
| Expired | (375,000) | 0.15 |
| Balance, September 30, 2023 | 3,770,000 | 0.15 |
| Balance, December 31, 2023 | 3,770,000 | 0.15 |
| Expired | (120,000) | 0.05 |
| Balance, September 30, 2024 | 3,650,000 | 0.15 |
(i) The portion of the estimated fair value of options granted in the current and prior periods and vested during the three and nine months ended September 30, 2024, amounted to $nil and $1,171, respectively (three and nine months ended September 30, 2023 - $4,241 and $18,627, respectively).
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Copper Road Resources Inc.
Notes to Condensed Interim Consolidated Financial Statements
Three and Nine Months Ended September 30, 2024
(Expressed in Canadian dollars)
(Unaudited)
- Stock options (continued)
The following table reflects the actual stock options issued and outstanding as of September 30, 2024:
| Expiry date | Exercise price ($) | Weighted average remaining contractual life (years) | Number of options outstanding | Number of options vested (exercisable) |
|---|---|---|---|---|
| November 2, 2025 | 0.15 | 1.09 | 950,000 | 950,000 |
| December 9, 2025 | 0.17 | 1.19 | 50,000 | 50,000 |
| July 12, 2026 | 0.17 | 1.78 | 100,000 | 100,000 |
| February 10, 2027 | 0.15 | 2.36 | 1,550,000 | 1,550,000 |
| November 2, 2027 | 0.15 | 3.09 | 1,000,000 | 1,000,000 |
| 2.13 | 3,650,000 | 3,650,000 |
- Net (loss) income per common share
The calculation of basic and diluted (loss) income per share for the three and nine months ended September 30, 2024 was based on the (loss) income attributable to common shareholders of $(28,094)$ and $6,435,327$, respectively (three and nine months ended September 30, 2023 - loss of $(429,126)$ and $(900,653)$, respectively) and the weighted average number of common shares outstanding of 60,320,664 and 58,333,356, respectively (three and nine months ended September 30, 2023 - 51,883,738 and 47,532,239, respectively). Diluted (loss) income per share did not include the effect of 3,650,000 stock options (September 30, 2023 - 3,770,000 stock options) and 10,074,680 warrants September 30, 2023 - 18,336,343 warrants) as they are anti-dilutive.
- Exploration and evaluation expenditures
| Three Months Ended September 30, | Nine Months Ended September 30, | |||
|---|---|---|---|---|
| 2024 | 2023 | 2024 | 2023 | |
| Copper Road Project | ||||
| Consulting fees | $ - | $ - | $ - | $ 6,000 |
| Drilling | - | 215,880 | 206 | 221,480 |
| Environmental | - | - | - | 29,946 |
| General and geology | - | 34,201 | - | 61,312 |
| Laboratory analysis | - | - | - | 4,884 |
| Legal fees | - | 27,158 | 180 | 32,532 |
| Permits | - | 7,500 | - | 7,500 |
| Property acquisition costs (i) | - | - | 55,000 | 110,750 |
| Property maintenance | - | - | 4,027 | 3,400 |
| Travel, hotel and meals | - | 4,789 | - | 10,805 |
| Other | - | 749 | 3,592 | 2,740 |
| $ - | $ 290,277 | $ 63,005 | $ 491,349 | |
| Mount Jamie North Property | ||||
| Property maintenance | $ - | $ - | $ 662 | $ - |
| $ - | $ - | $ 662 | $ - | |
| Total | $ - | $ 290,277 | $ 63,667 | $ 491,349 |
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Copper Road Resources Inc.
Notes to Condensed Interim Consolidated Financial Statements
Three and Nine Months Ended September 30, 2024
(Expressed in Canadian dollars)
(Unaudited)
10. Exploration and evaluation expenditures (continued)
(i) On March 14, 2023, the Company paid $35,000 and issued 200,000 common shares of the Company valued at $27,000 according to the East Breccia Option Agreement and paid $15,000 and issued 250,000 common shares of the Company valued at $33,750 according to the Tribag Option Agreement.
On March 4, 2024, the Company paid $40,000 according to the East Breccia Option Agreement and paid $15,000 according to the Tribag Option Agreement.
(ii) On May 10, 2024, the Company completed the sale of its 100% interest in the 24,000-hectare Copper Road Project located in Batchewana Bay, Ontario ("Copper Road Project") from the Company (the "Transaction") to Sterling.
Pursuant to the terms of the share purchase agreement dated February 13, 2024, Sterling acquired the Subsidiary which holds the Copper Road Project, in consideration for: (i) the payment of $460,000 in cash; and (ii) the issuance of an aggregate of 108,087,669 common shares of Sterling (the "Consideration Shares") (fair value of $6,485,260), of which Copper Road retained 21,838,123 Consideration Shares (fair value of $1,310,287), representing approximately 9.9% of the issued and outstanding common shares of Sterling. The registrar and transfer agent for Sterling, distributed the remaining 86,249,546 Consideration Shares (fair value of $5,174,973) to shareholders of Copper Road on pro rata basis.
11. General and administrative
| Three Months Ended September 30, | Nine Months Ended September 30, | |||
|---|---|---|---|---|
| 2024 | 2023 | 2024 | 2023 | |
| Professional fees (note 12) | $ 79,396 | $ 46,017 | $ 338,443 | $ 142,727 |
| Management compensation (note 12) | - | 30,000 | 60,000 | 78,000 |
| Office and general | 6,269 | 11,131 | 20,832 | 45,235 |
| Director fees (note 12) | (69,000) | 15,000 | (42,000) | 51,000 |
| Reporting issuer costs | 9,984 | 11,265 | 38,230 | 22,701 |
| Shareholder and investors relations | 1,134 | 9,960 | 8,370 | 25,990 |
| Business development | - | 10,807 | 1,500 | 23,939 |
| Bank charges | 311 | 428 | 713 | 1,085 |
| $ 28,094 | $ 134,608 | $ 426,088 | $ 390,677 |
12. Related party disclosures
Related parties include the Board of Directors and officers, close family members and enterprises that are controlled by these individuals as well as certain persons performing similar functions.
Refer to note 6(b)(ii).
Remuneration of directors and key management personnel including Chief Executive Officer, Chief Financial Officer ("CFO") and directors of the Company was as follows:
| Three Months Ended September 30, | Nine Months Ended September 30, | |||
|---|---|---|---|---|
| 2024 | 2023 | 2024 | 2023 | |
| Management compensation and salaries and benefits (1) | $ (55,365) | $ 43,635 | $ 40,905 | $ 136,905 |
| Share-based compensation | $ - | $ 566 | $ 156 | $ 2,484 |
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Copper Road Resources Inc.
Notes to Condensed Interim Consolidated Financial Statements
Three and Nine Months Ended September 30, 2024
(Expressed in Canadian dollars)
(Unaudited)
12. Related party disclosures (continued)
(1) Salaries and benefits include director fees. The Board of Directors and select officers do not have employment or service contracts with the Company. Directors are entitled to director fees and stock options for their services and officers are entitled to fees and stock options for their services. During the nine months ended September 30, 2024, the directors waived all director fees. During the three and nine months ended September 30, 2024, $(69,000) and $(42,000), respectively (three and nine months ended September 30, 2023 - $15,000 and $51,000, respectively) was adjusted. As at September 30, 2024, officers and directors (excluding the CFO) were owed $nil (December 31, 2023 - $46,342) and this amount was included in amounts payable and other liabilities.
The Company entered into the following transactions with related parties:
| Notes | Three Months Ended September 30, | Nine Months Ended September 30, | |||
|---|---|---|---|---|---|
| 2024 | 2023 | 2024 | 2023 | ||
| Marrelli Group | (i) | $ 4,408 | $ 6,175 | $ 23,451 | $ 19,886 |
| Dixcart Trust Corporation Limited ("Dixcart") | (ii) | $ 6,024 | $ 6,003 | $ 14,092 | $ 18,091 |
(i) During the three and nine months ended September 30, 2024, the Company paid professional fees of $4,408 and $23,451, respectively (three and nine months ended September 30, 2023 - $6,175 and $19,886, respectively) to Marrelli Support Services Inc., and certain of its affiliates, together know as the "Marrelli Group", for: (i) Carmelo Marrelli, beneficial owner of the Marrelli Group, to act as the CFO of the Company, (ii) bookkeeping and office support, (iii) regulatory filing services, and (iv) press release services. The Marrelli Group was owed $5,190 (December 31, 2023 - $7,195) and these amounts were included in amounts payable and other liabilities.
(ii) Shaun Drake, who is the Corporate Secretary Officer of the Company, is an employee of Dixcart. During the three and nine months ended September 30, 2024, the Company paid professional fees of $6,024 and $14,092, respectively (three and nine months ended September 30, 2023 - $6,003 and $18,091, respectively) to Dixcart. The amounts charged by Dixcart are recorded at their exchange value. As at September 30, 2024, Dixcart was owed $nil (December 31, 2023 - $8,208).
All amounts due to related parties are unsecured, non-interest bearing and due on demand.
13. Segmented information
The Company's operations comprise a single reporting operating segment engaged in mineral exploration in Canada. As the operations comprise a single reporting segment, amounts disclosed in the unaudited condensed interim consolidated financial statements also represent segment amounts. In order to determine reportable operating segments, the chief operating decision maker reviews various factors including geographical location, quantitative thresholds and managerial structure.
14. Commitments and contingencies
Flow-through shares
Pursuant to the terms of a flow-through share agreement, the Company is in the process of complying with flow-through contractual obligations to subscribers with respect to the Income Tax Act (Canada) requirements for flow-through shares. As of September 30, 2024, the Company is committed to incurring approximately $264,000 in Canadian Exploration Expenditures (as such term is defined in the Income Tax Act (Canada)) by December 31, 2024 arising from the flow-through offerings.
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