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EDM Resources Inc. — Interim / Quarterly Report 2024
Nov 29, 2024
45546_rns_2024-11-28_b2d7fac0-114d-4f09-b488-c66599fb41cf.pdf
Interim / Quarterly Report
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EDM RESOURCES INC.
CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE AND NINE MONTHS ENDED
SEPTEMBER 30, 2024 AND 2023
(EXPRESSED IN CANADIAN DOLLARS)
(UNAUDITED)
NOTICE TO READER
The Company's independent auditor has not performed a review of these condensed interim consolidated financial statements.
EDM Resources Inc.
CONDENSED INTERIM CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
(PRESENTED IN CANADIAN DOLLARS)
(UNAUDITED)
| As at | September 30, 2024 | December 31, 2023 |
|---|---|---|
| ASSETS | ||
| Current | ||
| Cash | 3,581 | 8,665 |
| Amounts receivable and prepaid expenses (Note 5) | 189,477 | 212,239 |
| 193,058 | 220,904 | |
| Non-current | ||
| Cash held for reclamation (Note 3) | 3,232,852 | 3,205,489 |
| Property, plant and equipment (Note 4) | 8,119,230 | 8,116,063 |
| Exploration and evaluation assets (Note 6) | 14,152,037 | 13,437,342 |
| 25,504,118 | 24,758,893 | |
| 25,697,177 | 24,979,797 | |
| LIABILITIES | ||
| Current | ||
| Accounts payable and accrued liabilities (Note 7) | 926,299 | 349,410 |
| Amounts payable to related parties (Note 12) | 77,858 | 178,485 |
| Loan payable (Note 13) | - | 60,000 |
| 1,004,157 | 587,895 | |
| Non-current | ||
| Decommissioning liability (Note 8) | 14,498,556 | 14,161,857 |
| 15,502,713 | 14,749,752 | |
| SHAREHOLDERS' EQUITY | ||
| Share capital (Note 9) | 90,018,684 | 89,092,181 |
| Warrants (Note 10(b)) | 1,157,545 | 648,589 |
| Contributed surplus (Notes 10(a), 10(c)) | 1,953,204 | 1,989,620 |
| Deficit | (82,934,970) | (81,500,345) |
| 10,194,464 | 10,230,045 | |
| 25,697,177 | 24,979,797 |
Nature of Operations and Going Concern (Note 1)
Subsequent Event (Note 14)
The accompanying notes are an integral part of these condensed interim consolidated financial statements.
EDM Resources Inc.
CONDENSED INTERIM CONSOLIDATED STATEMENTS OF LOSS AND COMPREHENSIVE LOSS
(PRESENTED IN CANADIAN DOLLARS)
(UNAUDITED)
| For the period | 3 months ended | 9 months ended | ||
|---|---|---|---|---|
| September, 30 | September, 30 | |||
| 2024 | 2023 | 2024 | 2023 | |
| EXPENSES | ||||
| Salaries and benefits (Note 12) | 140,621 | 167,899 | 428,344 | 524,200 |
| Office and general | 26,736 | 44,460 | 139,953 | 160,314 |
| Legal and accounting fees | 16,239 | 3,450 | 81,511 | 92,739 |
| Investor relations | 44,333 | 14,274 | 91,594 | 24,857 |
| Amortization (Note 4) | 3,220 | (10,948) | 10,333 | 3,089 |
| Consulting | 142,137 | 134,656 | 341,812 | 289,656 |
| Stock-based payments (Note 10(a) and (c)) | 6,292 | 39,972 | 28,584 | 121,313 |
| Regulatory fees | 5,087 | 5,021 | 24,223 | 22,005 |
| (384,665) | (398,782) | (1,146,355) | (1,238,173) | |
| Interest income | 9,121 | 9,018 | 48,428 | 27,054 |
| Financing costs | - | (195,831) | - | (582,051) |
| Accretion of decommissioning liability (Note 8) | (112,234) | (105,454) | (336,699) | (316,363) |
| LOSS AND COMPREHENSIVE LOSS FOR THE PERIOD | (487,778) | (691,049) | (1,434,625) | (2,109,533) |
| Basic and diluted loss per share (Note 11) | (0.01) | (0.03) | (0.04) | (0.09) |
| Weighted average number of common shares outstanding - basic and diluted | 36,971,077 | 24,048,943 | 35,497,283 | 22,259,656 |
The accompanying notes are an integral part of these condensed interim consolidated financial statements.
EDM Resources Inc.
CONDENSED INTERIM CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
(PRESENTED IN CANADIAN DOLLARS, EXCEPT SHARE AMOUNTS)
(UNAUDITED)
| Period ended September 30 | Number of Shares | Share Capital | Warrants | Contributed Surplus | Deficit | Total |
|---|---|---|---|---|---|---|
| Balance, December 31, 2022 | 20,026,743 | $87,825,047 | - | $1,517,575 | $(79,149,308) | $10,193,314 |
| Issued on private placement, net of costs | 4,022,200 | 1,940,723 | - | - | - | 1,940,723 |
| Stock-based compensation | - | - | - | 121,313 | - | 121,313 |
| Loss for the period | - | - | - | - | (2,109,533) | (2,109,533) |
| Balance, September 30, 2023 | 24,048,943 | 89,765,770 | - | 1,638,888 | (81,258,841) | 10,145,818 |
| Balance, December 31, 2023 | 24,048,943 | 89,092,181 | 648,589 | 1,989,620 | (81,500,345) | 10,230,045 |
| Issued on private placement, net of costs | 12,727,272 | 861,503 | 508,956 | - | - | 1,370,459 |
| Stock-based compensation | - | - | - | 28,584 | - | 28,584 |
| Issued on exercise of restricted share units | 194,862 | 65,000 | - | (65,000) | - | - |
| Loss for the period | - | - | - | - | (1,434,625) | (1,428,333) |
| Balance, September 30, 2024 | 36,971,077 | 90,018,684 | 1,157,545 | 1,953,204 | (82,934,970) | 10,194,464 |
The accompanying notes are an integral part of these condensed interim consolidated financial statements.
EDM Resources Inc.
CONDENSED INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS
(PRESENTED IN CANADIAN DOLLARS)
(UNAUDITED)
| For nine months ended September 30, | 2024 | 2023 |
|---|---|---|
| CASH (USED IN) PROVIDED BY: | ||
| OPERATING ACTIVITIES | ||
| Loss for the period: | (1,434,625) | (2,109,533) |
| Amortization | 10,333 | 3,089 |
| Share-based payments | 28,584 | 121,313 |
| Accrued interest income | (47,363) | (27,054) |
| Financing costs | - | 582,051 |
| Accretion of decommissioning liability | 336,699 | 316,363 |
| (1,106,372) | (1,113,771) | |
| Net change in non-cash working capital: | ||
| Amounts receivable and prepaid expenses | 22,762 | 14,912 |
| Accounts payable and accrued liabilities | 576,889 | (102,758) |
| Amounts payable to related parties | (100,627) | (9,792) |
| (607,348) | (1,211,409) | |
| INVESTING ACTIVITIES | ||
| Exploration and evaluation assets | (714,695) | (435,373) |
| Acquisition of property, plant and equipment | (13,500) | (172,494) |
| (728,195) | (607,867) | |
| FINANCING ACTIVITIES | ||
| Share capital issued for cash | 1,370,459 | 1,940,723 |
| Repayment of loan | (40,000) | - |
| 1,330,459 | 1,940,723 | |
| CHANGE IN CASH | (5,083) | 121,447 |
| CASH, BEGINNING OF PERIOD | 8,665 | 332,935 |
| CASH, END OF PERIOD | 3,581 | 454,382 |
The accompanying notes are an integral part of these condensed interim consolidated financial statements.
EDM Resources Inc.
NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2024
(EXPRESSED IN CANADIAN DOLLARS)
(UNAUDITED)
1. NATURE OF OPERATIONS AND GOING CONCERN
EDM Resources Inc. (the "Company" or "EDM"), and its wholly owned subsidiary Scotia Mine Limited (collectively, the "Group") is engaged in base metals mining and related activities, including the exploration and evaluation of mineral property interests that are considered to have the potential for economic mineralization and development. The Company is a public company, which is listed on the TSX Venture Exchange and the Frankfurt Stock Exchange, incorporated on March 9, 2004, and domiciled in Canada. The address of its registered office is Purdy's Wharf, 1959 Upper Water Street, Suite 1301, Nova Scotia, B3J 3N2.
On January 12, 2022, the Company changed its name to EDM Resources Inc. On March 25, 2022, the Company changed the name of its wholly owned subsidiary to Scotia Mine Limited.
The condensed interim consolidated financial statements have been prepared on a going concern basis, which assumes the Company will continue in operation through the fiscal year and into the foreseeable future and will be able to realize assets and discharge its liabilities and commitments in the normal course of operations at the amounts stated in the condensed interim consolidated financial statements.
The Company has not generated revenue from operations. The Company has incurred a loss of $1,434,625 for the nine months ended September 30, 2024 (nine months ended September 30, 2023 – $2,109,533), and as of that date has an accumulated deficit of $82,934,970 (December 31, 2023 – $81,500,345). As at September 30, 2024, cash amounted to $3,581 (December 31, 2023 – $8,665), and the Company had a working capital deficit of $811,099 (December 31, 2023 – deficit of $366,991). The ability of the Company to carry out its planned business objectives is dependent on its ability to raise adequate financing from lenders, shareholders, and other investors and/or generate operating profitability and positive cash flow. There can be no assurances that the Company will continue to obtain the additional financial resources necessary and/or achieve profitability or positive cash flows. If the Company is unable to obtain adequate financing, the Company will be required to curtail operations, and development activities and there would be significant uncertainty whether the Company would continue as a going concern and realize its assets and settle its liabilities and commitments in the normal course of business.
At September 30, 2024, Management has forecasted that the Company does not have sufficient cash on hand to meet all planned environmental, exploration, development, general expenses, and property payments for the next twelve months, however, the Company plans to raise additional capital to further develop and explore its project, however the Company may increase or decrease expenditures as necessary to adjust to a changing capital market environment.
The above factors indicate the existence of material uncertainties that may cast significant doubt on the ability of the Company to continue as a going concern.
The condensed interim consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. If management is unsuccessful in securing capital, the Company's assets may not be realized, or its liabilities discharged at their carrying amounts and these differences could be material.
EDM Resources Inc.
NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2024
(EXPRESSED IN CANADIAN DOLLARS)
(UNAUDITED)
2. ACCOUNTING POLICIES
Statement of Compliance
These condensed interim 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 IASB and interpretations issued by IFRIC. These condensed interim consolidated financial statements should be read in conjunction with the Company's audited consolidated financial statements for the year ended December 31, 2023.
These condensed interim consolidated financial statements were authorized for issuance by the Board of Directors of the Company on November 28, 2024.
Basis of Presentation
These unaudited condensed interim consolidated financial statements have been prepared on a historical cost basis, except for financial instruments which are measured at fair value. In addition, these consolidated financial statements have been prepared using the accrual basis of accounting except for cash flow information.
In the preparation of these unaudited condensed interim consolidated financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of expenses during the period. Actual results could differ from these estimates.
Basis of Consolidation
These condensed interim consolidated financial statements include the accounts of the Company, and its active subsidiary, Scotia Mine Ltd. All significant intercompany transactions are eliminated on consolidation.
3. CASH HELD FOR RECLAMATION
The Company is required to make reclamation deposits in respect of its expected rehabilitation obligations as set out below.
The Company has agreed with the Province of Nova Scotia (Department of Natural Resources) to remediate the Scotia Mine facility to an agreed status at the end of the mining operations at the site; as a result the Company is required to make reclamation deposits in respect of this obligation. As at September 30, 2024, a $3,033,326 (December 31, 2023 – $3,007,611) cash bond, including accrued interest, is posted with the Province of Nova Scotia.
In addition, the Company has a reclamation bond with the Nova Scotia Department of Environment for $199,525 (December 31, 2023 – $197,878), including accrued interest, which is required to address the potential replacement of domestic water supplies that could potentially be downgraded by mining operations.
Nova Scotia Business Inc. ("NSBI") holds a reclamation bond in the amount of $100,000 (2023 – $100,000), in relation to the land which the Company leases from the organization in Sheet Harbour. The Company terminated its lease during the year ended December 31, 2020. NSBI has withheld the bond, pending determination of additional remediation costs which may be assessed to the Company, if any. The Company has disputed withholding the bond and the parties have commenced formal litigation procedures to resolve the matter. It is the Company's position that it has met if not exceeded its obligation, and accordingly no associated provision has been recognized in the company's financial statements for the period ended September 30, 2024 or December 31, 2023.
EDM Resources Inc.
NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2024
(EXPRESSED IN CANADIAN DOLLARS)
(UNAUDITED)
- PROPERTY PLANT AND EQUIPMENT
| Land & Buildings | Plant & Equipment | Motor Vehicles | Office equipment | Assets under construction | Total | |
|---|---|---|---|---|---|---|
| Cost | ||||||
| Balance, December 31, 2022 | $1,578,840 | $4,490,826 | $161,120 | $154,975 | $3,801,215 | $10,186,976 |
| Disposal | - | - | 15,430 | - | - | 15,430 |
| Additions | - | - | - | 98 | 187,827 | 187,925 |
| Balance, December 31, 2023 | 1,578,840 | 4,490,826 | 145,690 | 155,073 | 3,989,042 | 10,359,471 |
| Disposal | - | - | - | - | - | - |
| Additions | - | - | - | - | 13,500 | 13,500 |
| Balance, September 2024 | 1,578,840 | 4,490,826 | 145,690 | 155,073 | 4,002,542 | 10,372,971 |
| Accumulated Amortisation | ||||||
| Balance, December 31, 2022 | 1,014,308 | 965,524 | 109,156 | 147,346 | - | 2,236,334 |
| Disposal | - | - | 15,430 | - | - | 15,430 |
| Amortisation | - | - | 15,686 | 6,784 | - | 22,470 |
| Balance, December 31, 2023 | 1,014,308 | 965,524 | 109,412 | 154,130 | - | 2,243,374 |
| Disposal/ Adjustment | - | - | (34) | - | - | (34) |
| Amortisation | - | - | 9,390 | 943 | - | 10,333 |
| Balance, September 2024 | 1,014,308 | 965,524 | 118,836 | 155,073 | - | 2,253,741 |
| Net Book Value, December 31, 2023 | 564,532 | 3,525,302 | 36,278 | 943 | 3,989,042 | 8,116,097 |
| Net Book Value, September 30, 2024 | 564,532 | 3,525,302 | 26,854 | - | 4,002,542 | 8,119,230 |
EDM Resources Inc.
NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2024
(EXPRESSED IN CANADIAN DOLLARS)
(UNAUDITED)
- ACCOUNTS RECEIVABLE AND PREPAID EXPENSES
| September 30, 2024 | December 31, 2023 | |
|---|---|---|
| Refundable GST/HST | $ 55,949 | $ 47,890 |
| Prepaid expenses | 133,528 | 164,349 |
| $ 189,477 | $ 212,239 |
- EXPLORATION AND EVALUATION ASSETS
Scotia Mine Project, Nova Scotia
As part of the business acquisition of ScoZinc Limited on May 31, 2011, the Company acquired 100% of the Scotia Mine and several other mineral resource prospects in Nova Scotia. The properties are comprised of exploration licences and a mineral property lease that provides for zinc and lead exploration and development.
The following is a continuity of the Company's Projects:
| Balance, December 31, 2022 | $11,877,939 |
|---|---|
| Additions | 718,992 |
| Change in decommissioning liability estimate | 840,411 |
| Balance, December 31, 2023 | 13,437,342 |
| Additions | 377,997 |
| Change in decommissioning liability estimate | 336,698 |
| Balance, September 30, 2024 | 14,152,037 |
- ACCOUNTS PAYABLE AND ACCRUED LIABILITIES
| September 30, 2024 | December 31, 2023 | |
|---|---|---|
| Trade payables | $ 696,098 | $ 106,197 |
| Accrued expenses | 308,059 | 243,213 |
| $ 1,004,157 | $ 349,410 |
- DECOMMISSIONING LIABILITY
The Company has estimated that the present value of future rehabilitation costs required to remediate the Scotia Mine facility based on its current state.
Although the ultimate amount of the rehabilitation liability is uncertain, the best estimate of these obligations is based on information currently available. Current significant closure and rehabilitation activities include dismantling and removing facilities, equipment removal and remediation of the mine site.
The total amount of estimated undiscounted cash flow required to settle the Company's estimated obligation as at September 30, 2024 was $14,806,219 (December 31, 2023 – $14,806,219). The calculation of present value of estimated future cash flows assumed a discount rate of 3.17% (2023 – 3.17%) and an inflation rate of 2.9% (2023 – 2.9%). Rehabilitation costs are estimated to be settled at various dates between 2029 and 2032.
EDM Resources Inc.
NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2024
(EXPRESSED IN CANADIAN DOLLARS)
(UNAUDITED)
8. DECOMMISSIONING LIABILITY (Continued)
A continuity of the Company's decommissioning liability is as follows:
| Balance, December 31, 2022 | $12,899,628 |
|---|---|
| Accretion | 421,818 |
| Change in estimate | 840,411 |
| Balance, December 31, 2023 | $14,161,857 |
| Accretion | 336,698 |
| Balance, September 30, 2024 | $14,498,555 |
9. SHARE CAPITAL
(a) AUTHORIZED
Unlimited number of common shares without par value
Unlimited number of Class A preferred shares with no par value
Unlimited number of Class B preferred shares with a par value of $10 per share
(b) ISSUED - COMMON SHARES
| Shares | Amount | |
|---|---|---|
| Balance, December 31, 2022 | 20,026,743 | $ 87,825,047 |
| Issued on exercise of warrants | 4,022,200 | 1,940,723 |
| Balance, September 30, 2023 | 24,048,943 | $ 89,765,770 |
| Balance, December 31, 2023 | 24,048,943 | $ 89,092,181 |
| Issued on private placement | 12,727,272 | 1,350,459 |
| Share subscription received in advance | - | 20,000 |
| Transfer of premium for warrants | - | (508,956) |
| Issued on exercise of restricted share units | 194,862 | 65,000 |
| Balance, September 30, 2024 | 36,971,077 | $ 90,018,684 |
10. SHARE BASED PAYMENTS
a) Stock Option Plan
A stock option plan ("Plan") was established to provide incentive to qualified parties to increase their proprietary interest in the Company and thereby encourage their continuing association with the Company. Each year, shareholders of the Company approve the Plan at the Annual General Meeting. The Plan provides that the Board of Directors of the Company may from time to time, in its discretion, grant to directors, officers, employees and consultants of the Company, or any subsidiary of the Company, the option to purchase common shares. The Plan provides for a floating maximum limit of 10% of the outstanding common shares of the common shares as permitted by the policies of the TSX-V. Options under the Plan have terms and vesting as determined by the Board. The expiry date shall not be more than 10 years from the date of grant.
EDM Resources Inc.
NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2024
(EXPRESSED IN CANADIAN DOLLARS)
(UNAUDITED)
10. SHARE BASED PAYMENTS (Continued)
a) Stock Option Plan (Continued)
Share option activity for the nine months ended September 30, 2024 and 2023 are as follows:
| Number of Stock Options Outstanding | Weighted Average Exercise Price ($) | |
|---|---|---|
| Balance - December 31, 2022 | 1,085,000 | 0.54 |
| Stock options issued | 1,230,000 | 0.50 |
| Stock options cancelled | (175,000) | 0.56 |
| Balance - September 30, 2023 | 2,140,000 | 0.52 |
| Balance - December 31, 2023 | 1,605,000 | 0.53 |
| Stock options issued | - | - |
| Stock options expired | (325,000) | 0.52 |
| Balance - September 30, 2024 | 1,280,000 | 0.53 |
The following table summarizes information about stock options outstanding as at September 30, 2024:
| Number of Options Outstanding | Expiry Date | Exercise Price ($) | Weighted Average Remaining Contractual Life (years) | Number of Options Vested (Exercisable) |
|---|---|---|---|---|
| 770,000 | 9-May-28 | 0.50 | 3.61 | 770,000 |
| 110,000 | 18-Jun-30 | 0.45 | 5.72 | 110,000 |
| 380,000 | 29-Oct-31 | 0.60 | 7.08 | 380,000 |
| 20,000 | 20-Feb-33 | 0.60 | 8.40 | 16,110 |
| 1,280,000 | 0.53 | 4.90 | 1,276,110 |
On February 20, 2023, 20,000 stock options were granted to an employee of the Company at a strike price of C$0.60 and expiring on February 20, 2023, subject to the Company's Stock Option Plan and the policies of the TSX Venture Exchange.
On May 9th, 2023, a total of 1,210,000 stock options were granted to certain directors, employees and consultants of the Company at a strike price of C$0.50 and expiring on May 9, 2028, subject to the Company's Stock Option Plan and the policies of the TSX Venture Exchange ("TSX.V").
During the nine months ended September 30, 2024, the Company recognized $22,292 (nine months ended September 30, 2023 - $86,938) related to vesting of stock options.
EDM Resources Inc.
NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2024
(EXPRESSED IN CANADIAN DOLLARS)
(UNAUDITED)
10. SHARE BASED PAYMENTS (Continued)
b) Warrants
The following table reflects the continuity of warrants for the nine months ended September 30, 2024 and 2023:
| Number of Warrants Outstanding | Weighted Average Exercise Price | |
|---|---|---|
| Balance - December 31, 2022 and September, 2023 | - | $ - |
| Balance - December 31, 2023 | 4,041,974 | $ 0.75 |
| Issued | 12,917,672 | $ 0.14 |
| Balance - September 30, 2024 | 16,959,646 | $ 0.29 |
c) Restricted Share Units
The number of shares reserved for stock options and all other forms of equity-based incentive compensation under the Plan cannot exceed 10% of the Company's issued and outstanding common shares.
On August 15, 2022, the Company issued a total of 87,719 RSUs to an officer of the Company, with a fair value of $50,000. These RSU's vest on August 15, 2023.
On August 29, 2022, 87,719 RSUs with a fair value of $50,000 were exercised and converted to common shares of the Company by an officer of the Company.
On November 5, 2022, 36,765 RSUs with a fair value of $25,000 were exercised and converted to common shares of the Company by an officer of the Company.
On November 7, 2022, the Company issued a total of 51,020 RSUs to an officer of the Company, with a fair value of $25,000. These RSU's vest on November 7, 2023.
During the year ended December 31, 2023, the Company recognized $45,833 (2022 – $88,649) in stock-based compensation expense on the vesting of RSUs.
On February 16, 2023, the Company issued a total of 26,786 RSUs to an officer of the Company, with a fair value of $15,000. These RSU's vest on February 16, 2024.
On April 5, 2024, 114,505 RSUs with a fair value of $53,750 were exercised and converted to common shares of the Company by an officer of the Company.
On May 16, 2024, 80,357 RSUs with a fair value of $11,250 were exercised and converted to common shares of the Company by an officer of the Company.
As at September 30, 2024, there are no (December 31, 2023 – 114,505) RSUs issued and outstanding.
EDM Resources Inc.
NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2024
(EXPRESSED IN CANADIAN DOLLARS)
(UNAUDITED)
11. BASIC AND DILUTED LOSS PER SHARE
Basic loss per share is computed using the weighted average number of common shares outstanding during the period. Diluted loss per share, which reflects the maximum possible dilution from the potential exercise of warrants and stock options, is the same as basic loss per share for the period ended. The effect of potential issuances of shares under options and warrants would be anti-dilutive for the three months ended September 30, 2024 and 2023 as they would decrease the loss per share, consequently the weighted average number of common shares outstanding for basic and diluted are the same.
12. RELATED PARTY TRANSACTIONS
Key Management Personnel Compensation
Key management personnel include those persons having the authority and responsibility for planning, directing, and controlling the activities of the Company as a whole. The Company has determined that key management personnel consist of executive and non-executive members of the Company's board of directors and corporate officers and/or companies controlled by those individuals.
Remuneration attributed to key management personnel during the three and nine months ended September 30, 2024 and 2023 is as follows:
| Three months ended September 30 | Nine months ended September 30 | |||
|---|---|---|---|---|
| 2024 | 2023 | 2024 | 2023 | |
| Remuneration | 59,000 | 174,211 | 224,250 | 400,768 |
| Share-based compensation | - | 33,581 | 24,015 | 78,776 |
| 59,000 | 207,792 | 248,265 | 479,544 |
During the nine months ended September 30, 2024, the Company incurred $51,750, in services from Mr. Kevin Farrell, to act as Chief Financial Officer ("CFO") of the Company.
As at September 30, 2024, amounts due to related parties totaled $94,808 (December 31, 2023 – $178,486) pertaining to amounts payable for key management remuneration, director's fees, and reimbursement of expenses paid on behalf of the Company.
13. LOAN PAYABLE
In May 2020, the Company benefitted from a $40,000 Government of Canada Covid-19 "Canada Emergency Business Account" loan, administered by the Royal Bank of Canada. In January 2021, this loan was increased by $20,000, or $60,000 in aggregate. The proceeds of the loan are interest free until January 18, 2024 with a 33.33% balance forgiveness if repaid by that date. After January 18, 2024, the outstanding balance will accrue interest at 5% per annum and convert to a three-year term loan. The Company repaid the loan on January 17, 2024.
EDM Resources Inc.
NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2024
(EXPRESSED IN CANADIAN DOLLARS)
(UNAUDITED)
14 SUBSEQUENT EVENTS
Subsequent to September 30, 2024, the Company announced on November 12, 2024 that, further to its news releases dated September 30, 2024 and October 11, 2024, and due to additional investor demand, it increased its previously announced non-brokered private placement (the "Offering") to comprise of up to 16,363,636 units of the Company ("Units") at a price per unit of C$0.11, for total gross proceeds of up to C$1,800,000.
On October 29, 2024, the Company closed the first tranche of a non-brokered private placement of 7,070,046 Units for aggregate gross proceeds of C$777,705.
On November 28, 2024, the Company closed the second tranche of a non-brokered private placement of 8,304,001 Units for aggregate gross proceeds of C$913,440.
Each Unit consisted of one common share of the Company (each, a "Common Share") and one common share purchase warrant (each whole warrant, a "Warrant"). Each whole Warrant will entitle the holder thereof to purchase one Common Share at a price of C$0.14 for a period of 36 months following the issue date of the Unit. Pursuant to applicable Canadian securities laws, the Common Shares and Warrants comprising of the Units are subject to a four month plus one day hold period from the closing date. If during the exercise period of the Warrants, the Common Shares trade at or above a volume-weighted average trading price of $0.20 per Common Share for 10 consecutive trading days, the Company may accelerate the expiry time of the Warrants to 30 days from the date on which the Company provides written notice to the holders of the Warrants.
15. COMPARATIVE FIGURES
Certain balances have been reclassified to conform to current period presentation. Such reclassifications had no impact on previously reported net loss or deficit.
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