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ESGold Corp. — Management Reports 2025
May 27, 2025
45686_rns_2025-05-27_d8dec126-2dd4-4a0b-ab8f-6d3a9e96a2fd.pdf
Management Reports
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MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
This Management's Discussion and Analysis ("MD&A") of RESAAS Services Inc. (the "Company", "we", "our", "us" or "RESAAS") is dated May 27, 2025. You should read this MD&A in conjunction with our audited consolidated financial statements and the related notes thereto for the fiscal year ended December 31, 2024. We present our audited consolidated financial statements in Canadian dollars and in accordance with IFRS Accounting Standards ("IFRS"), as issued by the International Accounting Standards Board ("IASB"). All references to dollar amounts are in Canadian dollars unless otherwise noted.
This MD&A contains forward-looking statements that involve risks and uncertainties. Such information, although considered to be reasonable by the Company's management at the time of preparation, may prove to be inaccurate and actual results may differ materially from those anticipated in any forward-looking statements. Additional information on the Company, including our voluntarily-filed AIF, is available on SEDAR at www.sedar.com.
RESAAS has developed a cloud-based technology platform for the real estate industry servicing Multiple Listing Services (MLSs), franchises, real estate brokerage and real estate agents on a B2B basis (together, known as "Agents" whether operating on their own or belonging to a MLS, franchise or real estate brokerage).
We have created a suite of tools which integrate with the platform, including a global referral network, lead generation engine, listing management, client engagement modules, customer relationship management (CRM) tools, analytics, file sharing, an advertising engine and payment system. Our Platform enables Agents to communicate with other Agents globally, find leads, send and receive referrals to generate business opportunities, create pre-market property listings before it is made available to the MLS, create off-market property listings that is intended for a closed group and create on-market property listings. There is currently no other provider that can do what we do, and the real estate sector as a whole has been slow in digitalizing its business.
Our mission is to enable Agents to communicate effectively, connect instantly, engage meaningfully and create business opportunities with one another through a platform built for their benefit. Our platform allows for instant discussion and networking opportunities, both on local and global scale, for facilitating easier and richer communication within the real estate industry. We commenced operations in February 2013 and began revenue generating activities for the RESAAS platform in January 2015 after some of the components of the Company's platform were completed. The Company has continued to undertake activities that constitute further development of the platform.
One aspect of RESAAS' technology platform is designed to enable large real estate companies to increase the number of referrals they generate within their organization. Our clients include the worldwide RE/MAX network. Referrals are facilitated every day by RESAAS' technology, presenting new opportunities to the global agents using the network. It also provides business intelligence to the firms involved, helping them make informed decisions about expansion, growth and acquisition.
On January 31, 2024, the Company announced its Head of Industry Development, Joe Schneider, had organized, hosted and moderated an International MLS Forum event in France.
On March 5, 2024, the Company announced it had been accepted into Microsoft's Founders Hub program, securing a $150,000 USD grant in Microsoft Azure Cloud and OpenAI usage.
On March 13, 2024, the Company announced the launch of its Real Estate Agent Advisory Board, initially made up from Agents across the United States and Canada from varying brokerages.
On March 19, 2024, the Company announced the live launch of an integration with Zillow, allowing “Coming Soon” listings posted by RESAAS Agents inside the RESAAS Platform to be published on Zillow.com. The integration between the two companies uses a technical API to push unique real estate data from RESAAS to Zillow at the listing Agent’s discretion.
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On May 9, 2024, the Company announced a nationwide collaboration with Offerpad Solutions Inc., a tech-driven platform for residential real estate. The collaboration enables RESAAS Agents to generate cash offers on behalf of their clients' through Offerpad.
On May 21, 2024, the Company announced the launch of “RESAAS Performance Masterclass”, a new Real Estate Education and Agent Accountability Program, exclusively for paying RESAAS Ultimate subscribers. The Program includes coaching, mentoring and training through a Partnership with Realtor® Collective.
On June 4, 2024, the Company announced the appointment of James Huang to the role of Managing Director of Commercial Real Estate at RESAAS. Mr. Huang previously served as President of eXp Commercial and President of Sperry Commercial Global Affiliates.
On August 13, 2024, the Company announced the launch of Commercial Data Exchange (“CODE”), an Enterprise software solution developed for corporate Commercial Real Estate Brokerages (“Brokerages”). CODE brings the concept of reciprocity to the Commercial Real Estate industry. RESAAS CODE enables Brokerages to securely provide their Data to RESAAS, and specify which other Brokerages they wish to share the Data with.
On August 14, 2024, the Company announced CBRE Vancouver as the anchor tenant of “RESAAS CODE”, the Company’s newly launched Commercial Real Estate Data Exchange solution. CBRE Vancouver’s Research Division has worked closely with RESAAS to develop the software, and committed to becoming RESAAS CODE’s first customer so it could share its available properties with select other Commercial Real Estate Brokerages.
On October 9, 2024, the Company announced the addition of multiple Commercial Landlords joining RESAAS’s Commercial Data Exchange (CODE) Platform, providing their availability data to RESAAS for distribution.
On October 23, 2024, the Company announced a major upgrade to CODE through the integration of AI capabilities specifically for the movement of data. The addition of AI enables RESAAS customers to synchronize their data in real-time in a “hands-free” manner, eliminating a manual processes, human-error, and barriers to entry.
On November 7, 2024, the Company announced accelerated growth of the Company’s Commercial Data Exchange platform (CODE), fueled by the continual use of Artificial Intelligence (AI). AI capabilities within RESAAS CODE fueled growth across new customer types and into new national markets.
Selected Annual Information
The following table reflects selected financial information of the Company for the last three fiscal years derived from the audited consolidated financial statements.
| Years Ended December 31 | |||
|---|---|---|---|
| 2024 $ | 2023 $ | 2022 $ | |
| Revenue | 358,010 | 406,268 | 374,427 |
| Net loss | (1,122,328) | (2,257,203) | (1,188,717) |
| Basic and diluted loss per share | (0.01) | (0.03) | (0.02) |
| Total assets | 68,859 | 806,484 | 400,491 |
| Total non-current financial liabilities | – | – | – |
| Working capital (deficiency) | (882,109) | (69,770) | (487,507) |
| Cash dividends | – | – | – |
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Revenue
The Company’s revenue is primary earned from its cloud-based software-as-a-service for the real estate industry (“SaaS revenue”). SaaS revenue includes revenue from subscriptions fees and revenue from development work. The Company earned total revenue of $374,427 during the year ended December 31, 2022, $406,268 during the year ended December 31, 2023, and $358,010 during the year ended December 31, 2024.
Net Loss
Net loss from operations decreased by $1,134,875 from $2,257,203 during the year ended December 31, 2023 to $1,122,328 during the year ended December 31, 2024. The decrease is primarily attributed to the decrease in stock-based compensation of $941,829 and decrease in general and administrative expenses of $270,856 from the year ended December 31, 2023 to the year ended December 31, 2024.
Operating Expenses
Amortization
Amortization expense consists of the amortization of capitalized costs to develop the Company’s platform. Amortization expense decreased by $6,148 to $3,153 for the year ended December 31, 2024 from $9,301 for the year ended December 31, 2023. There was no change in amortization of right-of-use assets for the year ended December 31, 2024 from the year ended December 31, 2023.
Consulting Fees
Consulting fees primarily consists of consultants engaged for platform development and graphics design. Consulting fees decreased by $25,073 to $130,816 for the year ended December 31, 2024 from $155,889 for the year ended December 31, 2023. The decrease is primarily attributed to a decrease in the number of consultants during the year.
General and Administrative Expenses
General and administrative expenses consist primarily of salaries and benefits, rent, insurance, information technology and facility-related costs. General and administrative expenses decreased by $270,856 to $513,133 for the year ended December 31, 2024 from $783,989 for the year ended December 31, 2023. The decrease is primarily attributed to a decrease in the salaries and benefits during the year.
Management Fee Expenses
Management fee expenses consist primarily of salaries and benefits to key management. The Company included the compensation paid to the Chief Executive Officer as management fees. Management fee expenses increased by $364 to $148,568 for the year ended December 31, 2024 from $148,204 for the year ended December 31, 2023.
Total Assets
Total assets were $68,859 at December 31, 2024 as compared with $806,484 at December 31, 2023. Assets consisted mainly of cash and cash equivalents of $14,688 and amounts receivable of $20,983 at December 31, 2024 as compared to cash and cash equivalents of $647,507, prepaid expenses of $69,151 and amounts receivable of $43,112 at December 31, 2023.
Quarterly Information
Selected consolidated financial information for each of our last eight quarters (unaudited) as prepared in accordance with IFRS is as follows:
| | December 31, 2024
$ | September 30, 2024
$ | June 30, 2024
$ | March 31, 2024
$ |
| --- | --- | --- | --- | --- |
| Total Assets | 68,859 | 134,221 | 171,342 | 450,975 |
| Working Capital
(deficiency) | (882,109) | (636,726) | (545,523) | (368,013) |
| Revenue | 86,086 | 106,372 | 95,085 | 70,467 |
| Net Loss | (248,384) | (183,623) | (252,733) | (437,588) |
| Loss per Share | (0.00) | (0.00) | (0.00) | (0.01) |
| | December 31, 2023
$ | September 30, 2023
$ | June 30, 2023
$ | March 31, 2023
$ |
| Total Assets | 806,484 | 187,396 | 261,628 | 209,335 |
| Working Capital
(deficiency) | (69,770) | (1,093,091) | (971,101) | (737,081) |
| Revenue | 90,170 | 120,688 | 114,422 | 80,988 |
| Net Loss | (269,967) | (389,283) | (320,986) | (1,276,967) |
| Loss per Share | (0.00) | (0.01) | (0.00) | (0.01) |
Three months ended December 31, 2024 and September 30, 2024
At December 31, 2024, total assets were $68,859 and working capital deficiency was $882,109 compared to total assets of $134,221 and working capital deficiency of $636,726 at September 30, 2024. The decrease in total assets and increase in working capital deficiency was the result of a decrease in cash from operating expenditures. For the three months ended December 31, 2024, the Company incurred a net loss of $248,384 compared to a net loss of $183,623 for the three months ended September 30, 2024. The increase in net loss was primarily due to the increase of allowance for expected credit losses of $88,716 and increase in professional fees of $60,369, offset against the decrease stock-based compensation of $93,645 during the three months ended December 31, 2024 as compared to the three months ended September 30, 2024. Net loss per share was $0.00 for the three months ended December 31, 2024 and for the three months ended September 30, 2024.
Three months ended December 31, 2024 and December 31, 2023
At December 31, 2024, total assets were $68,859 and working capital deficiency was $882,109 compared to total assets of $806,484 and working capital deficiency of $69,770 at December 31, 2023. The decrease in total assets and increase in working capital deficiency was the result of a decrease in cash from operating expenditures. For the three months ended December 31, 2024, the Company incurred a net loss of $248,384 compared to a net loss of $269,967 for the three months ended December 31, 2023. The decrease in net loss was primarily due to a decrease in general and administrative expenses of $156,817, offset against the increase of allowance for expected credit losses of $88,716 and the decrease in stock-based compensation recovery of $105,610 as compared to the three months ended December 31, 2023. Net loss per share was $0.00 for the three months ended December 31, 2024 and for the three months ended December 31, 2023.
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Liquidity and Capital Resources
Sources of Liquidity
Since our inception, we have incurred operating losses. We will need capital to fund our operations, which we may obtain from additional financings, debt and operations revenue or other sources. To date, we have financed our operations primarily through the issuance of our common shares.
As at December 31, 2024, we had total assets of $68,859 compared with $806,484 as at December 31, 2023. The decrease in total assets was the result of a decrease in cash from operating expenditures. The Company had a cash and cash equivalents balance of $14,688 and working capital deficiency of $882,109 at December 31, 2024, compared to a cash and cash equivalents balance of $647,507 and working capital deficiency of $69,770 at December 31, 2023.
The consolidated financial statements have been prepared on a going concern basis, which assumes that the Company will be able to realize its assets and discharge its liabilities in the normal course of business. As of December 31, 2024, the Company had not yet generated significant revenue or positive cash flow from operations and had an accumulated deficit of $58,274,994. These factors, among others, create significant doubt as to the ability of the Company to continue as a going concern. The Company's ability to meet its long-term business strategy depends on its ability to obtain additional equity debt or equity financing and to generate operational cash flow from revenue. There can be no assurances that sufficient equity can be raised on acceptable terms on a timely basis. The Company's strategy is to mitigate risks and uncertainties and to execute a business plan aimed at revenue growth and managing operating expenses and working capital requirements. Failure to implement this plan could have a material adverse effect on the Company's financial condition and results of operations.
Cash Flows
The following table summarizes the results of our cash flows for the year ended December 31, 2024, and 2023:
| 2024 | 2023 | |
|---|---|---|
| Opening balance | $647,507 | $240,351 |
| Net cash outflow from operating activities | (837,270) | (995,552) |
| Net cash inflow from financing activities | 186,706 | 1,402,708 |
| Closing balance | $(3,057) | $647,507 |
Operating Activities
Net cash outflow from operating activities decreased by $158,282 to $837,270 for the year ended December 31, 2024, compared to $995,552 for the year ended December 31, 2023.
Financing Activities
Net cash inflows from financing activities for the year ended December 31, 2024 and 2023 includes proceeds from related party loan and issuance of common shares. During the year ended December 31, 2024, the Company received net proceeds of $172,147 from related party loan and net proceeds of $30,100 from the issuance of 140,000 common shares pursuant to the exercise of stock options. During the year ended December 31, 2023, the Company received net proceeds of $1,218,950 from the issuance of 3,975,000 common shares pursuant to private placement and exercise of stock options.
Related Party Transactions
During the year ended December 31, 2024, the Company incurred management fees of $148,568 (2023 - $148,204) to the Chief Executive Officer of the Company.
As of December 31, 2024, the Company owed $649,323 (2023 - $477,176) for loans from the Chief Executive Officer of the Company, which are unsecured, non-interest bearing, and due on demand.
The amounts incurred are in the normal course of operations and have been recorded at their estimated fair values.
Contractual Obligations and Commitments
The following table summarizes our contractual commitments and obligations as of December 31, 2024:
| Carrying amount $ | Contractual cash flows $ | 1 year or less $ | 1 -5 Years $ | |
|---|---|---|---|---|
| Bank indebtedness | 17,745 | 17,745 | 17,745 | – |
| Accounts payable and accrued liabilities | 211,618 | 211,618 | 211,618 | – |
| Lease liabilities | 26,936 | 28,535 | 18,022 | 10,513 |
| Due to related party | 649,323 | 649,323 | 649,323 | – |
| 905,622 | 907,221 | 896,708 | 10,513 |
Off-Balance Sheet Arrangements
We do not have any, and during the periods presented we did not have any, off-balance sheet arrangements, other than the contractual obligations and commitments described above.
Funding Requirements
We believe we will raise sufficient funds to enable us to fund our operating expenses and capital expenditure requirements. We have based this estimate on assumptions that may prove to be wrong, and we could use our capital resources sooner than we currently expect. Our future capital requirements will depend on many factors, including:
- Raising capital through the sale of equity or convertible debt securities;
- Continue to grow monthly recurring revenue through Ultimate subscription and Premium subscription conversion, signing new accounts with MLSs and franchises;
- Continue to grow transaction revenue through the sale of consumer leads and RESAAS Pay;
- Continue to enhance the RESAAS platform to increase opportunities for monetizing;
- maintaining, enforcing and protecting our intellectual property rights and defending against any intellectual property-related claims;
- our ability to establish and maintain collaborations, licensing or other arrangements and the financial terms of such arrangements;
- the extent to which we acquire or invest in other businesses, products and technologies;
- the rate of the expansion of our physical presence in the United States and abroad; and
- the costs of operating as a public company.
Until such time, if ever, as we can generate substantial revenues, we expect to finance our cash needs through a combination of equity offerings, collaborations, strategic alliances, debt financings, and marketing, distribution or licensing arrangements. We do not have any committed external source of funds. To the extent that we raise additional capital through the sale of equity or convertible debt securities, the ownership interest of our existing shareholders may be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect the rights of holders of our common shares. Debt financing, if available, may involve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital expenditures or declaring dividends or other distributions.
If we raise additional funds through collaborations, strategic alliances or marketing, distribution or licensing arrangements with third parties, we may have to relinquish valuable rights to our technologies, future revenue streams, or to grant licenses on terms that may not be favorable to us. If we are unable to raise additional funds through equity or debt financings or other arrangements when needed, we may be required to delay, limit, reduce or terminate our platform development or future commercialization efforts or grant rights to develop and market platform that we would otherwise prefer to develop and market ourselves.
Critical Accounting Estimates
We make estimates and assumptions about the future that affect the reported amounts of assets and liabilities. Estimates and judgments are continually evaluated based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. In the future, actual experience may differ from these estimates and assumptions.
The effect of a change in accounting estimate is recognized prospectively by including it in comprehensive income in the period of the change, if the change affects that period only, or in the period of the change and future periods, if the change affects both.
Information about critical judgments in applying accounting policies that have the most significant risk of causing material adjustment to the carrying amounts of assets and liabilities recognized in our consolidated financial statements within the next financial year are discussed below.
(a) Share-based Payments
The grant date fair value of share-based payment awards granted to employees is recognized as a stock-based compensation expense, with a corresponding increase in equity, over the period that the employees unconditionally become entitled to the awards. The amount recognized as an expense is adjusted to reflect the number of awards for which the related service and non-market vesting conditions are expected to be met, such that the amount ultimately recognized as an expense is based on the number of awards that do meet the related service and non-market performance conditions at the vesting date. For share-based payment awards with non-vesting conditions, the grant date fair value of the share-based payment is measured to reflect such conditions and there is no true-up for differences between expected and actual outcomes.
Where equity instruments are granted to parties other than employees, they are recorded by reference to the fair value of the services received. If the fair value of the services received cannot be reliably estimated, we measure the services received by reference to the fair value of the equity instruments granted, measured at the date the counterparty renders service.
All equity-settled share-based payments are reflected in share-based payment reserve, until exercised. Upon exercise, shares are issued from treasury and the amount reflected in share-based payment reserve is credited to share capital, adjusted for any consideration paid.
The fair value of stock options granted is measured using a Black-Scholes model. Measurement inputs include share price on measure date, exercise price of the option, expected volatility, actual and expected life of the option, expected dividends based on the dividend yield at the date of the grant, anticipated forfeiture rate, and the risk-free interest rate. The expected life of the options is based on historical experience and general option holder behavior.
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The Company also makes an estimate of the number of options that will be forfeited and the rate is adjusted to reflect the actual number of options that vest. Consequently, the actual stock-based compensation expense may vary from the amount estimated.
(b) Impairment of Non-financial Assets
The carrying amounts of our non-financial assets are reviewed at each reporting date to determine whether there is any indication of impairment. If indicators exist, then the asset’s recoverable amount is estimated.
The recoverable amount of an asset or cash-generating unit is the greater of its value in use and its fair value less costs to sell. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. For the purpose of impairment testing, assets that cannot be tested individually are grouped together into the smallest identifiable group of assets that generates cash inflows from continuing use that are largely independent of the cash inflows of other assets or groups of assets (the cash-generating unit, or “CGU”).
Our corporate assets do not generate separate cash inflows. If there is an indication that a corporate asset may be impaired, then the recoverable amount is determined for the CGU to which the corporate asset belongs.
An impairment loss is recognized if the carrying amount of an asset or its CGU exceeds its estimated recoverable amount. Impairment losses are recognized in profit or loss. Impairment losses recognized in respect of CGUs are allocated first to reduce the carrying amount of any goodwill allocated to the units, and then to reduce the carrying amounts of the other assets in the unit (group of units) on a pro rata basis.
In respect of assets other than goodwill and intangible assets that have indefinite useful lives, impairment losses recognized in prior periods are assessed at each reporting date for any indications that the loss has decreased or no longer exists. An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortization, if no impairment loss had been recognized.
(c) Revenue Recognition for Special Contracts and Projects
The Company has projects with multiple deliverables that generally include subscriptions for software and services. Estimates are required to determine the status of a project at each period end.
Quantitative and Qualitative Disclosures about Financial Risks
Our activities expose us to a variety of financial risks: market risk (including foreign currency risk), cash flow and fair value interest rate risk, credit risk, and liquidity risk. Our principal financial instrument comprises cash and cash equivalents, and this is used to finance our operations. We have various other financial instruments such as amounts receivable and payables that arise directly from our operations. The category of loans and receivables contains only trade and other receivables, shown on the face of the balance sheet, all of which mature within one year. We have compared fair value to book value for each class of financial asset and liability and no difference was identified. We have a policy, which has been consistently followed, of not trading in financial instruments.
Interest Rate Risk
The Company’s exposure to interest rate risk relates to its ability to earn interest income on cash balances at variable rates and its short-term term deposits at prescribed market rates. The fair value of the Company’s cash is not significantly affected by changes in short-term interest rates. The income earned from the bank accounts and short-term term deposits is subject to movements in interest rates.
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Foreign Currency Risk
Foreign currency risk refers to the risk that the value of a financial commitment or recognized asset or liability will fluctuate due to changes in foreign currency rates. Our net income and financial position, as expressed in Canadian dollars, are exposed to movements in foreign exchange rates against the U.S. dollar. We are exposed to foreign currency risk as a result of operating transactions and the translation for foreign bank accounts. We monitor our exposure to foreign exchange risk. Exposures are generally managed through natural hedging via the currency denomination of cash balances and any impact currently is not material to us.
The Company is mainly exposed to foreign currency risk to the extent that the following monetary assets and liabilities are denominated in US dollars:
| December 31, 2024 US$ | December 31, 2023 US$ | |
|---|---|---|
| Cash | 826 | 17,491 |
| Amounts receivable | 11,192 | 27,250 |
| Accounts payable and accrued liabilities | (32,497) | (75,041) |
| Net exposure | (20,479) | (30,300) |
| Canadian dollar equivalent | $ (29,467) | $ (40,075) |
A 10% change in the foreign exchange rate of US dollars is not expected to have a material impact on the Company's consolidated financial statements.
Credit Risk
Credit risk is the risk of a financial loss to the Company if a customer or counterparty to a financial instrument fails to meet its contractual obligations. The Company is exposed to credit risk associated with cash and the potential non-collectability of accounts receivable. The risk to cash is mitigated by placing the cash in high credit quality Canadian financial institutions. To reduce the credit risk of amounts receivable, the Company regularly reviews the collectability of the amounts receivable to ensure there is no indication that these amounts will not be fully recoverable. The Company's credit risk and maximum exposure thereto is as follows:
| December 31, 2024 $ | December 31, 2023 $ | |
|---|---|---|
| Cash held in Canadian financial institutions | 14,688 | 642,507 |
| Accounts receivable | 20,983 | 43,112 |
| $ 35,671 | $ 690,619 |
Liquidity Risk
We have funded our operations since inception primarily through the issuance of equity securities. Until such time as we can generate significant revenue from platform, if ever, we expect to finance our operations through a combination of public or private equity or debt financings or other sources. Adequate additional financing may not be available to us on acceptable terms, or at all. Our inability to raise capital as and when needed would have a negative impact on our financial condition and our ability to pursue our business strategy.
Subsequent Events
On January 3, 2025, the Company granted 25,000 stock options with a five-year term and an exercise price of $0.29 per option. The stock options vested on the grant date.
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Outstanding Share Data
As at May 27, 2025, we had no Class A preferred shares issued and outstanding.
As at May 27, 2025, we had no Class B preferred shares issued and outstanding.
As at May 27, 2025, we had 80,037,002 common shares issued and outstanding.
As at May 27, 2025, we had 7,945,000 stock options and 2,075,000 warrants issued and outstanding.
Additional Disclosure for Venture Issuers Without Significant Revenues
During the year ended December 31, 2024, the material components of general & administrative expenses included rent of $15,246 (2023 - $13,852), employee wages of $411,780 (2023 - $548,577), office expenses of $19,704 (2023 - $61,852), platform and information technology expenses of $55,072 (2023 - $145,781), and insurance of $9,342 (2023 - $9,059).