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Green Mining Innovation Inc. — Management Reports 2024
Dec 20, 2024
46766_rns_2024-12-19_b52d7d09-78f6-4ad3-adc7-146b2a17ef5d.pdf
Management Reports
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GMI GREEN MINING INNOVATION
Management's Discussion and Analysis
Green Mining Innovation Inc.
(Formerly Goldstar Minerals Inc.)
Third quarter ended September 30, 2024
(in Canadian dollars, unless otherwise stated)
2
Green Mining Innovation Inc.
(Formerly Goldstar Minerals Inc.)
Management’s Discussion and Analysis
Third quarter ended September 30, 2024
MANAGEMENT’S DISCUSSION AND ANALYSIS ... 2
1.1 RESPONSIBILITY OF FINANCIAL REPORTS ... 3
1.2 FORWARD LOOKING STATEMENTS ... 4
1.3 NATURE OF ACTIVITIES ... 5
1.4 OVERVIEW AND OUTLOOK ... 5
1.5 SELECTED FINANCIAL INFORMATION ... 6
1.6 DISCUSSION ON EXPLORATION AND EXPLOITATION ACTIVITIES ... 9
1.7 CAPITAL MANAGEMENT ... 12
1.8 OFF-BALANCE SHEET ARRANGEMENTS ... 13
1.9 CRITICAL ACCOUNTING POLICIES AND ESTIMATES ... 13
1.10 NEW ACCOUNTING STANDARDS ISSUED NOT YET ADOPTED ... 13
1.11 FINANCIAL INSTRUMENTS AND OTHER INSTRUMENTS ... 14
1.12 RISKS AND UNCERTAINTIES ... 14
1.13 COMMITMENTS AND CONTINGENCIES ... 15
1.14 QUALIFIELD PERSON ... 15
1.15 SUBSEQUENT EVENT ... 15
1.16 DISCLOSURE OF OUTSTANDING SHARE OPTIONS AND WARRANT DATA ... 16
1.17 OFF BALANCE SHEET ITEMS ... 16
Green Mining Innovation Inc. (Formerly Goldstar Minerals Inc.) Management's Discussion and Analysis Third quarter ended September 30, 2024
MANAGEMENT'S DISCUSSION AND ANALYSIS
The following Management's Discussion and Analysis ("MD&A") was prepared and provides a discussion and analysis of the financial condition and results of operations for the period ended September 30, 2024. This discussion should be read in conjunction with the Company's third quarter 2024 unaudited condensed interim financial statements and accompanying notes, the audited annual financial statements and accompanying notes for the year ended December 31, 2023 and the related annual MD&A.
The Company's third quarter 2024 unaudited condensed interim financial statements and the accompanying notes have been prepared in accordance with International Financial Reporting Standards ("IFRS") and with International Accounting Standard ("IAS") 34, Interim Financial Reporting as issued by the International Accounting Standards Board ("IASB") and using the accounting policies described therein.
Unless context in the MD&A otherwise specifies, references made to "Green Mining Innovation" or the "Company" (formerly Goldstar Minerals Inc.) which name was changed on November 8th, 2023 to Green Mining Innovation Inc. and is listed on the TSX Venture Exchange and trades under the symbol "GMI". All amounts included in the MD&A are in Canadian dollars, unless otherwise specified.
The Company's public filings can be reviewed under the Company's profile on the SEDAR website (www.sedar.com).
1.1 RESPONSIBILITY OF FINANCIAL REPORTS
This MD&A constitutes management's review of the factors that affected the Corporation's financial and operating performance for the period ended September 30, 2024. Management is responsible for the preparation of the Financial Statements and the MD&A. The Board of Directors (the "Board") has the responsibility to ensure that management assumes its responsibilities with regards to the preparation of the Financial Statements and the MD&A. To assist management, the Board has created an Audit Committee. The Audit Committee meets with management to discuss the operating results and the financial situation of the Corporation. It then makes its recommendations and submits the Financial Statements and the MD&A to the Board for their review and approval.
Green Mining Innovation Inc.
(Formerly Goldstar Minerals Inc.)
Management's Discussion and Analysis
Third quarter ended September 30, 2024
Following the recommendation of the Audit Committee, the Board has approved the Financial Statements and the MD&A on November 27th, 2024.
Green Mining Innovation Inc. (formerly Goldstar Minerals Inc.) is a publicly traded Corporation listed on the TSX Venture Exchange ("TSX-V") under the symbol "GMI".
1.2 FORWARD LOOKING STATEMENTS
The information presented contains "forward-looking information" under applicable Canadian legislation, concerning the business, operations and financial performance and condition of the Company. Forwardlooking information include, but are not limited to, statements with respect to the estimation of mineral reserves and mineral resources; the realization of mineral reserve estimates; the timing and amount of estimated future exploration; costs of exploration; metal prices and demand for materials; capital expenditures; success of exploration and development activities; permitting time lines and permitting, mining or processing issues; government regulation of mining operations; environmental risks; and title disputes or claims. Generally, forward-looking statements and forward-looking information can be identified by the use of forward-looking terminology such as "plans", "expects", "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates", "does not anticipate", "believes", or variations of such words and phrases or state that certain actions, events or results "may", "could", "would", "might", "will be taken", "occur", or "be achieved". Forward-looking information is based on the opinions and estimates of management as of the date such statements are made, and they are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of the Company to be materially different from those expressed or implied by such forward-looking information, including, but not limited to, unexpected events during operations; variations in ore grade; risks inherent in the mining industry; delay or failure to receive board approvals; timing and availability of external financing on acceptable terms; risks relating to international operations; actual results of exploration activities; conclusions of economic valuations; changes in project parameters as plans continue to be refined; and fluctuating metal prices and currency exchange rates. Although management of the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking information. The Company does not undertake to update any forward-looking information that is incorporated by reference herein, except in accordance with applicable securities laws. Investors are advised that National Instrument 43-101 of the Canadian Securities Administrators requires that each category of mineral reserves and mineral resources be reported separately. Mineral resources that are not mineral reserves have not demonstrated economic viability.
Green Mining Innovation Inc.
(Formerly Goldstar Minerals Inc.)
Management's Discussion and Analysis
Third quarter ended September 30, 2024
1.3 NATURE OF ACTIVITIES
Green Mining Innovation Inc. is a public Canadian natural resource exploration and development company. The Company is focused on developing deposits that contain gold and technology metals in leading mining jurisdictions in Canada. The Company holds four mining properties, these being the Fortune Property, Panache North Property and Upton Property located in the Province of Québec, and the Prince Property located in the province of Newfoundland.
1.4 OVERVIEW AND OUTLOOK
On January 27, 2023, the Company entered into a Purchase and Sale Agreement for the acquisition of 100% interest in 8 claims, totaling approximately 481 hectares (4.8 km²). In consideration for these claims, on August 15th, 2023, the Company issued 18,000,000 common shares and paid in shares a finder's fee of 5% equivalent to 900,000 common shares. As part of the agreement, the Company was committed to proceed with a nonbrokered financing for a minimum of $550,000 consisting of 9,166,666 units at a price of $0.06 per unit. Each unit was comprised of one common share and one purchase warrant where each warrant shall entitle the holder thereof to subscribe for one additional common share at an exercise price of $0.12 at any time until two years after closing. The warrants will provide for an acceleration clause if the shares trade above a specified price for more than 20 consecutive days. In respect of subscriptions sourced by an eligible finder, the Corporation paid in cash a fee equal to 7% of the amount subscribed. This private placement was closed on August 15th, 2023.
In April 2023, the Company has agreed to settle outstanding loans in the amount of $328,000 with a director and officer by completing a share settlement transaction pursuant to which the Company has issued common shares (not units) at a price to be determined at the closing. As per the settlement, the interest payable were forgiven and will be no longer payable. A total of 5,466,666 shares were issued at $0.06 on August 15th 2023, to complete this transaction.
Green Mining Innovation Inc.
(Formerly Goldstar Minerals Inc.)
Management's Discussion and Analysis
Third quarter ended September 30, 2024
1.5 SELECTED FINANCIAL INFORMATION
| SELECTED ANNUAL INFORMATION | Periods ended September 30, 2024, 2023 and 2022 | ||
|---|---|---|---|
| 2024 | 2023 | 2022 | |
| Net income (loss) | (121,703) | (184,625) | (67,065) |
| Basic and diluted loss per share | (0.00) | (0.01) | (0.01) |
| Cash and cash equivalents | 67,805 | 436,840 | 5,890 |
| Total assets | 1,824,305 | 2,170,793 | 1,614,877 |
| Current financial liabilities | 482,563 | 490,285 | 445,623 |
SUMMARY OF QUARTERLY RESULTS
The following table contains a summary of quarterly results of the last eight quarter-ends.
| Quarter ended | Comprehensive net gain (loss) | Net gain (loss) per share |
|---|---|---|
| September 30, 2024 | (121,703) | (0.00) |
| June 30, 2024 | (140,116) | (0.00) |
| March 31, 2024 | (90,787) | (0.00) |
| December 31, 2023 | (302,021) | (0.01) |
| September 30, 2023 | (184,625) | (0.00) |
| June 30, 2023 | (15,667) | (0.00) |
| March 31, 2023 | (57,333) | (0.00) |
| December 31, 2022 | (1,651,228) | (0.06) |
RESULTS OF OPERATIONS
For the period ended September 30, 2024, the Company recorded a loss of $121,703 compared to a loss of $184,625 for the period ended September 30, 2023. During the period ended September 30, 2024, the company reduced the investor and shareholder relation expenses by $23,000, reduced the miscellaneous expenses by $7,000 and reduced the share based payment expense to nil compared to $67,092 during the quarter ended September 30, 2023. Furthermore, the company recorded a mining property write-off of $21,979, for the Panache property.
Green Mining Innovation Inc.
(Formerly Goldstar Minerals Inc.)
Management's Discussion and Analysis
Third quarter ended September 30, 2024
1.5 SELECTED FINANCIAL INFORMATION - CONTINUED
LIQUIDITY AND CAPITAL RESOURCES
The Company finances its operations mainly through the sale of its shares. As at September 30, 2024, the Company had cash and cash equivalents of $67,805 compared to $317,680 as at December 31, 2023. There was a working capital deficiency as at September 30, 2024 of $398,974 compared to a deficiency of ($92,436) at December 31, 2023. As discussed under Overview and Outlook, in January 2023 the Company entered into a Purchase and Sale Agreement for the acquisition of 100% interest in 8 claims, totaling approximately 481 hectares (4.8 km²). In consideration for these claims, the Company has issued 18,000,000 common shares and pay in shares a finder's fee of 5% equivalent to 900,000 common shares. As discussed under Overview and Outlook, the Company was committed to proceed with a non-brokered financing for a minimum of $550,000 consisting of 9,166,666 units at a price of $0.06 per unit. Each unit will be comprised of one common share and one purchase warrant where each warrant shall entitle the holder thereof to subscribe for one additional common share at an exercise price of $0.12 at any time until two years after closing. The warrants will provide for an acceleration clause if the shares trade above $0.20 for more than 20 consecutive days. In respect of subscriptions sourced by an eligible finder, the Corporation paid in cash a fee equal to 7% of the amount subscribed.
On January 10, February 2, February 14, March 1, May 4th, June 3rd and June 27th 2023 a director and officer of the Company loaned the respective amounts of $3,000, $3,000, $25,000, $25,000, $50,000, $1,500 and $3,000 to the Company. These loans bear interest at a rate of 10% per annum and are repayable on demand. On July 7, October 11, October 13, October 27, and December 19, 2022, a director and officer of the Company loaned the respective amounts of $50,000, $3,000, $3,000, $94,000, and $25,000 to the Company. These loans bear interest at a rate of 10% per annum and are repayable on demand. In April 2023, the Company has agreed to settle outstanding loans in the amount of $328,000 with a director and officer by completing a share settlement transaction pursuant to which the Company has issued common shares (not units) at a price to be determined. As per the settlement, the interest payable were forgiven and will be no longer payable. As the Company does not have sufficient financial resources to cover its budgeted general administrative expenses and to meet its short-term obligations for the next twelve months, the Company intends to raise additional financing in 2024. While the Company has been successful in securing financing, raising additional funds is dependent on a number of factors outside the Company's control, and as such there is no assurance that it will be able to do so in the future.
During the period ending September 30, 2024, the company received a Governmental grant of $30,186 from Natural Resources and Forest Ministry which is part of a total $201,240 approved conditionally to the realisation of the mining project (IMV) before October 31, 2025. The Company
Green Mining Innovation Inc.
(Formerly Goldstar Minerals Inc.)
Management's Discussion and Analysis
Third quarter ended September 30, 2024
1.5 SELECTED FINANCIAL INFORMATION - CONTINUED
LIQUIDITY AND CAPITAL RESOURCES - continued
must finance 50% of the project and produce a final report at the end. The grant is to be reimbursed to the Ministry if it is not used for payment of admissible expenses for the project. Consequently, the grant assistance is recorded as deferred revenue until admissible expenses are recorded.
When admissible expenses are recorded, the deferred revenue is reversed and recorded as revenue in the Statement of Loss and comprehensive Loss.
CASH FLOWS
Cash flows used in operating activities were ($282,711) during the period ended September 30, 2024 compared to ($156,968) for the period ended September 30, 2023. Cash flows used in investing activities was $2,650 during the period ended September 30, 2024 compared to ($41,357) for the period ended September 30, 2023. Cash flows provided from financing activities are from a governmental grant of $30,186 during the period ended September 30, 2024 compared to $632,343 for the period ended September 30, 2023, explained by the issuance of shares ($550K) and an increase in the related parties loan (107K).
TRANSACTIONS WITH RELATED PARTIES
Transactions with key management personnel
The compensation of directors and executive officers of the Company comprises:
| For nine months ended September 30 | ||
|---|---|---|
| 2024 | 2023 | |
| $ | $ | |
| Management fees | 180,012 | 86,674 |
| Share base payments | 24,089 | 67,092 |
| Total | 204,101 | 153,766 |
In accordance with IAS 24, key management personnel are those persons having authority and responsibility for planning, directing and controlling the activities of the Company directly or indirectly, including any directors (executive and non-executive) of the Company.
On January 10, February 2, February 14, March 1, 2023, May 4th, June 3rd and June 27th 2023, an officer and director of the Company loaned the respective amounts of $3,000, $3,000, $25,000, and
Green Mining Innovation Inc.
(Formerly Goldstar Minerals Inc.)
Management's Discussion and Analysis
Third quarter ended September 30, 2024
1.5 SELECTED FINANCIAL INFORMATION - CONTINUED
$25,000, 50,000, 1,500 and 3,000 to the Company. These loans bear interest at a rate of 10% per annum and are repayable on demand.
These transactions, made in the normal course of business, were measured at the exchange amount, which is the amount established and agreed to by the parties.
1.6 DISCUSSION ON EXPLORATION AND EXPLOITATION ACTIVITIES
General exploration and evaluation expenditures for the periods ended September 30, 2024 and 2023
UPTON PROPERTY:
The Upton property consists of a total of 8 claims, covering an area of 481 hectares (4.8 km²). It is located in the Montérégie region of southern Québec. The property comprises a 100% interest in 8 claims covering an area of approximately 481 hectares (4.81 km²) which were acquired pursuant to the Purchase and Sale Agreement described below and 100% interest in 2 claims covering an area of approximately 120 hectares (1.20 km²) pursuant to the Purchase and Sale Agreement described below. On January 27, 2023, the Company entered into a Purchase and Sale Agreement for the acquisition of 100% interest in 8 claims, totaling approximately 481 hectares (4.8 km²). In consideration for these claims, the Company issued 18,000,000 common shares and paid in shares a finder's fee of 5% equivalent to 900,000 common shares for a total value of $1,701,000. The vendors have confirmed that they were not acting in concert regarding the affairs of the Corporation and that the issuance of 18,000,000 shares also reflected the contribution of knowledge and experience to be provided to the Corporation by the new management team. The vendors did not own shares of the Corporation prior to the transaction. As part of the agreement, the Company was also committed to proceed with a non-brokered financing for a minimum of $550,000 consisting of 9,166,666 units at a price of $0.06 per unit. Each unit will be comprised of one common share and one purchase warrant where each warrant shall entitle the holder thereof to subscribe for one additional common share at an exercise price of $0.12 at any time until two years after closing. The warrants will provide for an acceleration clause if the shares trade above $0.20 for more than 20 consecutive days. In respect of subscriptions sourced by an eligible finder, the Corporation paid in cash a fee equal to 7% of the amount subscribed.
On October 27, 2022, the Company entered into a Purchase and Sale Agreement with Jean Bernard for the acquisition of 100% interest in 2 claims, totaling 120 hectares (1.2 km²). In consideration for these claims, the Company paid $25,000 plus applicable taxes and issued 500,000 common shares at
Green Mining Innovation Inc.
(Formerly Goldstar Minerals Inc.)
Management's Discussion and Analysis
Third quarter ended September 30, 2024
a price of $0.055 per share. Upon commercial production, the Company will issue an additional 1,000,000 common shares. In 2023 these 2 claims elapsed and the cost of $73,479 was written-off.
Geological Context
The region lies within the Humber Zone of the Appalachian Geological Province. In this sector, the lithology is mainly NE oriented with a general weak dip towards the SE. On the titles of the East and North sector, meets the reverse fault (thrust) of Champlain having a NE attitude with weak dip towards the SE. This fault delimits the lithologies of Ordovician age to the NW and Cambrian to the SE.
Ordovician
This unit consists of a slate with sandstone and limestone interlayers belonging to the Bourret Formation.
Cambrian
This unit consists of feldspathic sandstone with slate interlayers of the Granby Formation belonging to the Shefford Group. This Formation contains an ovoid limestone unit of the Acton Vale Formation. The latter contains at its southern end the Upton barite deposit (45.6765°N 72.6705°W). The limestone unit is also evidenced by a circular magnetic anomaly.
Exploration work
In addition to the prospecting, geology, geochemistry and geophysics work covering the Upton deposit sector, between 1995 and 1999, in the northern sector (Permit 2646189), a VLF survey and a PP survey reveal conductive anomalies that are partially tested by a borehole at the northern limit of the limestone unit. The sounding intersects a suite of shale and limestone with a weak anomaly in Ba and Zn and explains the conductor by the presence of graphitic shale on the surface. There is no recent and material work on the other mining titles in the section.
FORTUNE PROPERTY:
The Fortune property comprises a 100% interest in a total of 8 claims (101 claims in 2022) covering approximately 5,714 hectares (57.14 km²).
The Fortune property is located in the Gaspé Peninsula of Québec, with direct access to most of the property by Highway 132 and a network of maintained roads.
In 2023 the 101 claims elapsed and the cost of $55,547 was written-off. The Company is identifying the next necessary steps to be taken.
Green Mining Innovation Inc.
(Formerly Goldstar Minerals Inc.)
Management's Discussion and Analysis
Third quarter ended September 30, 2024
1.6 DISCUSSION ON EXPLORATION AND EXPLOITATION ACTIVITIES - CONTINUED
PANACHE NORTH PROPERTY:
The Panache North property comprises a 100% interest in a total of 4 claims covering approximately 225 hectares (2.25 km²). The Panache North property is located in the Windfall Lake (Urban Barry) area of Québec. The Company is identifying the next necessary steps to be taken. During the third quarter of 2024, the 4 claims elapsed and the cost of $21,979 was written-off.
PRINCE PROPERTY:
The Prince property comprises a 100% interest in a total of 4 licenses covering approximately 125 hectares (1.25 km²).
The Prince property is located in Newfoundland. The Company is identifying the next necessary steps to be taken.
FRYING PAN ISLAND PROPERTY:
The Frying Pan Island property comprises a 100% interest in a total of 1 claim, covering an area of 25 hectares (.25 km²).
This property is located in Newfoundland. The Company is identifying the next necessary steps to be taken.
ANCTIL PROPERTY:
As a result of the Covid-19 pandemic, significant labour shortages and delays have resulted in the exploration commitment not being met and the Company has decided not to pursue exploration on this property. During the year ended December 31, 2022, the Company recorded a write-off of $1,097,973.
NEMENJICHE PROPERTY:
As a result of the Covid-19 pandemic, significant labour shortages and delays have resulted in the exploration commitment not being met and the Company has decided not to pursue exploration on this property. During the year ended December 31, 2022, the Company recorded a write-off of $402,005.
Green Mining Innovation Inc.
(Formerly Goldstar Minerals Inc.)
Management's Discussion and Analysis
Third quarter ended September 30, 2024
1.6 DISCUSSION ON EXPLORATION AND EXPLOITATION ACTIVITIES - CONTINUED
Mining properties and exploration and evaluation assets are detailed as follows:
| Fortune Property Québec | Panache North Property Québec | Prince Property Newfoundland | IMV project (Upton) Québec | Total | |
|---|---|---|---|---|---|
| $ | $ | $ | $ | $ | |
| Mining properties | |||||
| Balance, January 1, 2024 | 19,786 | 21,979 | 15,656 | 1,701,000 | 1,758,421 |
| Acquisition costs | - | - | - | - | - |
| Claim staking and renewal | - | - | - | - | - |
| Write-off | - | (21,979) | - | - | (21,729) |
| Balance, September 30, 2024 | 19,786 | - | 15,656 | 1,701,000 | 1,736,442 |
| Exploration and evaluation assets | |||||
| Balance, January 1, 2024 | - | - | - | - | - |
| Additions | - | - | - | - | - |
| Balance, September 30, 2024 | - | - | - | 4,274 | 4,274 |
| Fortune Property Québec | Panache North Property Québec | Prince Property Newfoundland | IMV project (Upton) Québec | Total | |
| --- | --- | --- | --- | --- | --- |
| $ | $ | $ | $ | $ | |
| Mining properties | |||||
| Balance, January 1, 2023 | 55,547 | 21,979 | 14,356 | 73,479 | 165,361 |
| Acquisition costs | - | - | - | 1,701,000 | 1,701,000 |
| Claim staking and renewal | 19,786 | - | 1,300 | - | 21,086 |
| Write-off | (55,547) | (73,479) | (129,026) | ||
| Balance, December 31, 2023 | 19,786 | 21,979 | 15,656 | 1,701,000 | 1,758,421 |
| Exploration and evaluation assets | |||||
| Balance, January 1, 2023 | - | - | - | - | - |
| Additions | - | - | - | 4,274 | 4,274 |
| Balance, December 31, 2023 | - | - | - | 4,274 | 4,274 |
Green Mining Innovation Inc.
(Formerly Goldstar Minerals Inc.)
Management's Discussion and Analysis
Third quarter ended September 30, 2024
1.7 CAPITAL MANAGEMENT
The capital of the Company consists of its share capital, options and warrants. The Company manages and adjusts its capital structure based on available funds in order to support the acquisition, exploration and development of mineral properties. The Board of Directors does not
1.7 CAPITAL MANAGEMENT - CONTINUED
establish quantitative return on capital criteria for management, but rather, relies on the expertise of the Company's management to sustain future development of the business.
The properties in which the Company currently has an interest are in the exploration and evaluation stage; as such, the Company is dependent on external financing to fund its activities. In order to carry out planned exploration and development, and pay for administrative costs, the Company will spend its existing working capital and raise additional funds as needed. The Company will continue to assess new properties and seek to acquire an interest in properties with sufficient geologic or economic potential if it has adequate financial resources to do so.
Management reviews its capital management approach on an ongoing basis and believes that this approach, given the size of the Company, is reasonable. There were no changes in the Company's approach to capital management during the periods ended September 30, 2024 and 2023. The Company is not subject to externally imposed capital requirements.
1.8 OFF-BALANCE SHEETS ARRANGEMENTS
The Corporation has not entered into any off-balance sheet arrangements including, without limitation, in respect of guarantee contracts, derivative financial obligations, or in respect to any obligation under a variable interest equity arrangement.
Green Mining Innovation Inc.
(Formerly Goldstar Minerals Inc.)
Management's Discussion and Analysis
Third quarter ended September 30, 2024
1.9 CRITICAL ACCOUNTING POLICIES AND ESTIMATES
The preparation of annual financial statements in conformity with IFRS requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, revenues and expenses. Actual results may differ from these estimates. Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the year in which the estimates are revised and in any future years affected. Information about assumptions and estimation uncertainties that have a significant risk of resulting in a material adjustment within the next financial year are as follows:
Going concern, Recognition and measurement of refundable credits on mining duties and tax credits related to resources, Recoverability of mining properties and exploration and evaluation assets, Measurement of the compensation warrants and Measurement of share-based payments.
1.10 NEW ACCOUNTING STANDARDS ISSUED BUT NOT YET ADOPTED
The Company has not yet adopted certain standards, interpretations to existing standards and amendments which have been issued but have an effective date of later than the reporting period. These updates are not expected to have a significant impact on the Company and are therefore not discussed herein.
1.11 FINANCIAL INSTRUMENTS AND OTHER INSTRUMENTS
Financial assets and liabilities have been classified into categories that determine their basis of measurement and, for items measured at fair value, whether changes in fair value are recognized in the statement of income or comprehensive income. Those categories are: fair value through profit or loss; loans and receivables; available for sale financial assets; and, for liabilities, amortized cost. The numbers reproduced in the financial statements as at September 30, 2024, shows the carrying values and fair values of assets and liabilities for each of these categories as at September 30, 2024 and December 31, 2023. Furthermore, financial risks factors are well described in these financial statements.
14
Green Mining Innovation Inc.
(Formerly Goldstar Minerals Inc.)
Management's Discussion and Analysis
Third quarter ended September 30, 2024
1.12 RISKS AND UNCERTAINTIES
An investment in the common shares of the Corporation should be considered highly speculative for a variety of reasons. The following is a general description of certain significant risk factors which should be considered:
a) Mining industry and mining projects
Exploration and development projects have no operating history upon which to base estimates of future operating costs and capital requirements. Mining projects frequently require a number of years and significant expenditures during the mine development phase before production available to the Corporation is the sale of additional equity capital and the borrowings of funds. There is no assurance that such funding will be available to the Corporation or that it will be obtained on terms favourable to the Corporation or will provide the Corporation with sufficient funds to meet its objectives, which may adversely affect the Corporation's business and financial position. In addition, any future equity financings by the Corporation may result in a substantial dilution of the existing shareholders. Failure to obtain sufficient financing may result in delaying or indefinite postponement of further exploration and evaluation, development or production on any or all of the Corporation's properties or even a loss of property interest.
b) Uninsured Risks
The Corporation's business is subject to a number of risks and hazards, including environmental conditions adverse, environmental regulations, political uncertainties, industrial accidents, labour disputes, unusual or unexpected geological conditions, ground or slope failures, cave-ins, and natural phenomena such as inclement weather conditions, floods and earthquakes. Such occurrences could result in damage to mineral properties or production facilities, personal injury or death, environmental damage to the Corporation's properties or the properties of others, delays in mining, monetary losses and possible legal liability.
c) Going Concern
The future of the Corporation depends on its ability to finance its activities and to develop its assets. Failure to obtain sufficient financing may result in the Corporation not being able to continue its operations, realize its assets and discharge its liabilities in the normal course of business in the foreseeable future.
15
Green Mining Innovation Inc.
(Formerly Goldstar Minerals Inc.)
Management's Discussion and Analysis
Third quarter ended September 30, 2024
1.13 COMMITMENTS AND CONTINGENCIES
The Company's mining and exploration activities are subject to various laws and regulations governing the protection of the environment. These laws and regulations are continually changing and generally becoming more restrictive. The Company has made, and expects to make in the future, expenditures to comply with such laws and regulations.
The Company is committed to incur eligible exploration and evaluation expenses of $720,000 by December 31, 2022, related to its flow-through share financings completed in 2021. In 2022, the Company has amended its commitment to $477,653. As at September 30, 2024, the Company has incurred $477,653 of eligible expenses.
However, there is no guarantee that the funds spent by the Company will qualify as Canadian exploration expenses, even if the Company has committed to take all the necessary measures for this purpose. Refusals of certain expenses by tax authorities could have negative tax consequences for investors or the Company.
In such event, the Company will indemnify each flow-through share subscriber for the additional taxes payable by such subscriber as a result of the Company's failure to renounce the qualifying expenditures as agreed.
1.14 QUALIFIED PERSON
Jacques Marchand Ing, is the Qualified Person under National Instrument 43-101 who has reviewed the scientific and technical information in this document.
1.15 SUBSEQUENT EVENT
None
Green Mining Innovation Inc.
(Formerly Goldstar Minerals Inc.)
Management's Discussion and Analysis
Third quarter ended September 30, 2024
1.16 DISCLOSURE OF OUTSTANDING SHARE, OPTIONS AND WARRANT DATA
Common shares outstanding: 60,792,100
Warrants outstanding: 9,166,665
| Number of warrants | Exercise Price | Expiry Date |
|---|---|---|
| 9,166,665 | $0.12 | August 14, 2025 |
Options outstanding: 750,000
| Number of options | Exercise Price | Expiry Date |
|---|---|---|
| 250,000 | $0.10 | September 24, 2028 |
| 500,000 | $0.10 | June 5, 2029 |
1.17 OFF BALANCE SHEET ITEMS
The Company does not have any off balance sheet items.
NOVEMBER 27, 2024