Grid Metals Corp. — Interim / Quarterly Report 2024

Nov 29, 2024

GridMetals CORP.

GRID METALS CORP.
INTERIM UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 2024

INDEX

Consolidated Statements of Financial Position 1
Consolidated Statements of Operations and Comprehensive Income (Loss) 2
Consolidated Statements of Changes in Shareholders' Equity 3
Consolidated Statements of Cash Flows 4
Notes to the interim unaudited condensed consolidated financial statements 5

Notice of no auditor review of interim financial statements:

Under National Instrument 51-102, Part 4, subsection 4.3(3) (a), if an auditor has not performed a review of the interim unaudited condensed consolidated financial statements, they must be accompanied by a notice indicating that the interim condensed consolidated financial statements have not been reviewed by an auditor.

The accompanying interim unaudited condensed consolidated financial statements of the Company have been prepared by, and are the responsibility of, the Company's management. The Company's independent auditor has not performed a review of these interim condensed consolidated financial statements.

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GRID METALS CORP.
INTERIM UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION AS AT
(In Canadian dollars)

	September 30, 2024	December 31, 2023
ASSETS
Current
Cash	$ 2,430,252	$ 2,717,813
Marketable securities (Note 5)	870,859	755,357
Amounts receivable (Note 6)	79,508	5,086,282
Prepaids	102,028	118,961
Total current assets	3,482,647	8,678,413
Non-current
Capital assets (Notes 7)	63,926	54,438
Right of use asset (Note 8)	3,101,777	4,057,632
Total assets	6,648,350	12,790,483
LIABILITIES
Current
Accounts payable and accrued liabilities (Notes 10, 11 and 14)	573,978	816,940
Lease obligations (Note 7)	11,989	4,612
Mill lease obligation (Note 8)	450,000	1,194,223
Flow through share premium (Note 9(a) and 9(d))	2,222,778	2,222,778
Total current liabilities	3,258,745	4,238,553
Non-current
Term loan payable (Note 12)	-	60,000
Long term lease obligations (Note 7)	13,680	-
Property acquisition obligation (Note 10)	-	241,165
Mill lease obligation (Note 8)	1,963,397	2,152,634
Total liabilities	5,235,822	6,692,352
SHAREHOLDERS' EQUITY
Capital stock (Note 9)	67,015,727	66,907,477
Contributed surplus (Note 9)	8,433,363	8,456,158
Deficit	(74,036,562)	(69,265,504)
Total shareholders' equity	1,412,528	6,098,131
Total liabilities and shareholders' equity	$ 6,648,350	$ 12,790,483

Going concern (Note 2)

Commitments and contingencies (Notes 9 and 10)

Approved on Behalf of the Board

'Thomas W. Meredith' Director

'Robin E. Dunbar' Director

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

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GRID METALS CORP.

INTERIM UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND

COMPREHENSIVE INCOME (LOSS)

(In Canadian dollars)

	For the three months ended September 30,		For the nine months ended September 30,
	2024	2023	2024	2023
Expenses
Exploration and evaluation expenditures (Note 10)	$ 583,298	$ 1,408,331	$ 3,660,445	$ 7,133,491
Management fees and directors fees (Note 13)	217,455	176,546	673,570	716,044
Office, general and administrative	233,408	104,594	483,823	575,707
Professional and consulting fees	56,406	189,170	254,466	494,503
Share-based payments (Note 9(b) and 13)	14,276	148,618	98,471	701,244
Public company costs	54,360	52,070	131,182	161,940
Amortization (Note 7 and 8)	136,228	7,179	443,309	21,407
Accretion (Notes 8 and 10)	69,218	-	267,433	-
Flow-through share premium recovery (Note 9(a) and 9(d))	-	-	-	(764,000)
Loss before the undernoted	(1,364,649)	(2,086,508)	(6,012,699)	(9,040,336)
Gain on extinguishment of debt	-	-	1,052,348	-
Loss on write-down of asset	-	-	(533,677)	-
Unrealized gain (loss) on marketable securities	106,149	(46,875)	325,792	(131,319)
Realized gain (loss) on sale of marketable securities	96,328	-	96,328	(347,021)
Government Grant (Note 10)	97,500	-	97,500	-
Gain on disposition of exploration and evaluation properties (Notes 5 and 10)	-	-	55,000	133,750
Other income	8,974	64,113	131,584	201,878
Net income (loss) and comprehensive income (loss) for the period	$ (1,055,698)	$ (2,069,270)	$ (4,787,824)	$ (9,183,048)
Net income (loss) per share
Basic and diluted earnings (loss) per share	$ (0.01)	$ (0.01)	$ (0.02)	$ (0.05)
Weighted average number of common shares outstanding - basic	204,401,164	168,350,496	204,090,124	167,374,951

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

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GRID METALS CORP.

INTERIM UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2024 AND THE TWELVE MONTHS ENDED DECEMBER 31, 2023

(In Canadian dollars)

	Capital Stock		Contributed
	# of shares	Amount	Surplus	Deficit	Total
Balance, December 31, 2022	165,162,706	$62,638,803	$8,883,947	$(60,018,082)	$11,504,668
Flow through common shares issued in connection with a private placement (Note 9(a))	28,460,450	5,058,822	-	-	5,058,822
Flow through share premium (Note 9(a))	-	(2,222,778)	-	-	(2,222,778)
Fair value assigned to finders' warrants issued in connection with the private placement (Note 9(c))	-	(294)	294	-	-
Cash share issue costs (Note 9(a))	-	(17,399)	-	-	(17,399)
Shares issued in satisfaction of a property acquisition (Note 9(a))	9,092,858	1,144,142	-	-	1,144,142
Stock-based compensation (Note 9(b))	-	-	770,408	-	770,408
Warrants expired (Note 9(c))	-	-	(1,124,340)	1,124,340	-
Warrants exercised (Note 9(c))	1,160,150	232,030	-	-	232,030
Original fair value of warrants exercised (Note 9(c))	-	74,151	(74,151)	-	-
Net loss for the year	-	-	-	(10,371,762)	(10,371,762)
Balance, December 31, 2023	203,876,164	$66,907,477	$8,456,158	$(69,265,504)	$6,098,131
Shares issued in satisfaction of a property acquisition (Note 9(a))	50,000	3,750	-	-	3,750
Shares issued pursuant to Deferred Share Unit vesting	475,000	104,500	(104,500)	-	-
Stock-based compensation (Note 9(b))	-	-	98,471	-	98,471
Warrants expired (Note 9(c))	-	-	(16,766)	16,766	-
Warrants exercised (Note 9(c))	-	-	-	-	-
Original fair value of warrants exercised (Note 9(c))	-	-	-	-	-
Net loss for the period	-	-	-	(4,787,824)	(4,787,824)
Balance, September 30, 2024	204,401,164	$67,015,727	$8,433,363	$(74,036,562)	$1,412,528

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

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GRID METALS CORP.
INTERIM UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In Canadian dollars)

For the nine months ended September 30,	2024	2023
Cash flows from operating activities
Net income (loss) for the period	$ (4,787,824)	$ (9,183,048)
Adjustments not affecting cash
Shares issued for property acquisition	3,750	1,144,142
Shares issued pursuant to Deferred Share Unit Vesting	104,500	-
Share based compensation	98,471	701,244
Realized (gain) loss on marketable securities	(96,328)	347,021
Unrealized (gain) loss on marketable securities	(325,792)	131,319
Accretion	267,433	-
Amortization	443,309	21,407
Interest on lease obligations	516	509
Gain on disposition of property	(55,000)	-
Loss on revaluation of asset	533,677	-
Gain on extinguishment of debt	(1,052,348)	-
Shares received pursuant to property sale	-	(117,500)
Flow-through share premium recovery	-	(764,000)
Changes in non-cash working capital
Amounts receivable	5,006,774	53,738
Prepaids	16,933	(90,975)
Lease obligations	7,377	-
Accounts payable and accrued liabilities	(242,962)	160,714
Advance on exploration	-	(279,260)
Cash flows from operating activities	(77,514)	(7,874,689)
Cash flows from investing activities
Proceeds on sale of marketable securities	245,243	2,487,682
Additions to capital assets	(30,618)	-
Cash flows from investing activities	214,625	2,487,682
Cash flows from financing activities
Long term lease obligations	13,680	-
Payment of Mill lease obligation	(100,000)	-
Repayment of term loan	(60,000)	-
Property acquisition obligation	(278,352)	-
Proceeds on exercise of warrants	-	232,030
Payment of lease obligations	-	(10,485)
Cash flows from financing activities	(424,672)	221,545
Change in cash for the period	(287,561)	(5,165,462)
Cash, beginning of period	2,717,813	9,396,673
Cash, end of period	$ 2,430,252	$ 4,231,211

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

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GRID METALS CORP.

NOTES TO THE INTERIM UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2024

(In Canadian dollars)

1. GENERAL INFORMATION

Grid Metals Corp. (“Grid” or, the "Company") was incorporated under the laws of Ontario on July 15, 1997, and is engaged in the business of exploring and developing base and precious metal mineral properties. Substantially all of the efforts of the Company are devoted to these business activities and to date the Company has not earned significant revenues. The principal business address of the Company is 3335 Yonge Street, Suite 304 Toronto, Ontario, M4N 2M1.

The interim unaudited condensed consolidated financial statements of the Company for the nine months ended September 30, 2024 and 2023 were authorized for issue in accordance with a resolution of the Board of Directors on November 29, 2024.

1. GOING CONCERN

The Company’s ability to realize the costs it has incurred to date on its properties is dependent upon it being able to identify economically recoverable reserves; to finance their exploration and evaluation costs; to resolve any environmental, regulatory, or other constraints which may hinder the successful development of the reserves; and to attain profitable operations.

The business of mining and exploration for minerals involves a high degree of risk, and there can be no assurance that current exploration programs will result in profitable mining operations. The recoverability of the expenditures incurred on the exploration properties and the Company’s continued existence is dependent upon the preservation of its interest in the underlying properties, the discovery of economically recoverable reserves, the achievement of profitable operations, or the ability of the Company to raise alternative financing, if necessary, or alternatively upon the Company’s ability to dispose of its interests on an advantageous basis.

Although the Company has taken steps to verify title to the properties on which it is conducting exploration and in which it has an interest, in accordance with industry standards for the current stage of exploration of such properties, these procedures do not guarantee the Company’s title. Property title may be subject to government licensing requirements or regulations, unregistered prior agreements, unregistered claims, Aboriginal claims, and non-compliance with regulatory and environmental requirements. The Company’s property interests may also be subject to increases in taxes and royalties, and political uncertainty.

The Company has cumulative operating losses at September 30, 2024. The Company expects to incur further losses in the exploration and development of its properties. The Company will have an ongoing need for equity financing for working capital and exploration and development of its properties.

These interim unaudited condensed consolidated financial statements have been prepared on the basis of accounting principles applicable to a going concern. Accordingly, they do not give effect to adjustments that would be necessary should the Company be unable to continue as a going concern and therefore be required to realize its assets and liquidate its liabilities and commitments in other than the normal course of business and at amounts different from those in the accompanying consolidated financial statements. Such adjustments could be material. It is not possible to predict whether the Company will be able to raise adequate financing or to ultimately attain profitable levels of operations.

Details of deficit and working capital of the Company are as follows:

	September 30, 2024	December 31, 2023
Deficit	$ 74,036,562	$ 69,265,504
Working capital	$ 223,902	$ 4,439,860

1. BASIS OF PRESENTATION

The Company applies International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB") and the interpretations issued by the IFRS Interpretations Committee. These unaudited 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 the IASB.

The policies applied in these unaudited condensed interim financial statements are based on IFRSs issued and outstanding as of November 29, 2024, the date the Board of Directors approved the statements. The same accounting policies and methods of computation are followed in these unaudited condensed interim financial statements as compared with the most recent annual financial statements as at and for the year ended December 31, 2023. Any subsequent changes to IFRS that are given effect in the Company's annual financial statements for the year ending December 31, 2023, could result in restatement of these unaudited condensed interim financial statements.

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GRID METALS CORP.

NOTES TO THE INTERIM UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2024

(In Canadian dollars)

4. SIGNIFICANT ACCOUNTING POLICIES

Basis of consolidation

These interim unaudited condensed consolidated financial statements include the accounts of the Company and its controlled subsidiaries. An investor controls an investee when it is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee.

These interim unaudited condensed consolidated financial statements include the accounts of the Company; its 72.56% owned Maskwa Nickel Chrome Mines Limited, a Manitoba corporation; its wholly-owned subsidiary, Global Nickel Inc., a Canadian federally incorporated company; and its wholly owned subsidiary 1000078824 Ontario Inc., an Ontario corporation that holds the Company’s 75% interest in a joint operation with Lithium Equities Investments LLC (“LEI”). The financial statements of the subsidiaries are consolidated from the date that control commences until the date that control ceases. All inter-company balances and transactions have been eliminated.

Basis of measurement

These interim unaudited condensed consolidated financial statements have been prepared on a going concern basis, under the historical cost basis, except for those financial instruments recorded at Fair Value through Profit and Loss and have been prepared using the accrual basis of accounting except for cash flow information.

Exploration and evaluation assets – acquisition costs and exploration expenditures

All acquisition costs and exploration expenditures relating to properties are expensed as incurred.

Joint Arrangements

A joint arrangement is defined as one over which two or more parties have joint control, which is the contractually agreed sharing of control over an arrangement. This exists only when the decisions about the relevant activities (being those that significantly affect the returns of the arrangement) require the unanimous consent of the parties sharing control. There are two types of joint arrangements, joint operations (“JO”) and joint ventures (“JV”). A JO is a joint arrangement whereby the parties that have joint control of the arrangement have rights to the assets and obligations for the liabilities, relating to the arrangement. A JV is a joint arrangement whereby the parties that have joint control of the arrangement have rights to the net assets of the joint venture.

Loss per share

Basic loss per share is calculated using the weighted average number of shares outstanding. Diluted loss per share is calculated by assuming that any proceeds from the exercise of dilutive stock options and warrants would be used to repurchase common shares at the average market price during the year, with the incremental number of shares being included in the denominator of the diluted loss per share calculation. The diluted loss per share calculation excludes any potential conversion of options and warrants that would increase earnings per share or decrease loss per share. During the nine months ended September 30, 2024 and 2023, all outstanding options, warrants restricted share units and deferred share units were considered anti-dilutive and were excluded from diluted loss per share calculation.

5. MARKETABLE SECURITIES

The Company's marketable securities have been designated as FVPL and are reported at fair value based on quoted market prices as follows:

	September 30, 2024	December 31, 2023
1911 Gold Corporation(1)	$ 868,512	713,405
Other	2,347	41,952
	$ 870,859	755,357

(1) On December 21, 2023, the Company acquired 6,666,667 units (each a “Unit”) of 1911 Gold Corporation (“1911”) at $0.06 per Unit for total consideration of $400,000. Each Unit consisted of one common share (each, a “1911 Share”) and one 1911 Share purchase warrant, exercisable for two years at a strike price of $0.10 (each, a “1911 Warrant”). During the year ended December 31, 2023 the Company recognized an unrealized gain of $313,405 on the Units, based on the quoted market value of 1911’s common shares on December 31, 2023. During the nine months ended September 30, 2024, the Company sold 2,090,000 1911 Shares for $273,236, realizing a net gain of $177,096, to hold 4,576,667 1911 Shares and 6,000,000 1911 Warrants at September 30, 2024. The Company realized a net loss of $80,768 on the disposition of other assets. The Company recognized an unrealized gain of $364,107 on its remaining 1911 Shares and 1911 Warrants, and an unrealized loss $26,605 on its other investments, based on the quoted market values of their respective common shares on September 30, 2024.

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GRID METALS CORP.

NOTES TO THE INTERIM UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2024

(In Canadian dollars)

6. ACCOUNTS RECEIVABLE

The balance of accounts receivable is comprised as follows:

	September 30, 2024	December 31, 2023
Harmonized sales tax	$ 79,508	$ 106,257
Subscription receivable	-	4,980,025
	$ 79,508	$ 5,086,282

7. CAPITAL ASSETS

The Company’s capital assets consist of the following:

	Right-of-Use Asset	Vehicles	Total
Cost
Balance December 31, 2022	$ 65,055	$ 77,912	$ 142,967
Additions	-	-	-
Balance December 31, 2023	65,055	77,912	142,967
Additions	30,618	-	30,618
Balance September 30, 2024	95,673	77,912	173,585
Amortization
Balance December 31, 2022	47,707	12,237	59,944
Additions	13,011	15,574	28,585
Balance December 31, 2023	60,718	27,811	88,529
Additions	9,439	11,691	21,130
Balance September 30, 2024	70,157	39,502	109,659
Net book value
Balance December 31, 2022	17,348	65,675	83,023
Balance December 31, 2023	4,337	50,101	54,438
Balance September 30, 2024	$ 25,516	$ 38,410	$ 63,926

The Company has a lease for office premises in the amount of $1,083 per month base rent, until October 31, 2026. The Company recognized a right-of-use asset and corresponding lease obligations related to the office premises, the continuity of the office premises lease obligations for the nine months ended September 30, 2024 and the year ended December 31, 2023 is as follows:

	September 30, 2024	December 31, 2023
Balance, beginning of period	$ 4,612	$ 17,996
Additions	30,618	-
Interest	516	596
Payments	(10,077)	(13,980)
Balance, end of period	25,669	4,612
Current portion of lease obligations	(11,989)	(4,612)
Long-term portion of lease obligations	$ 13,680	$ -

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GRID METALS CORP.

NOTES TO THE INTERIM UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2024

(In Canadian dollars)

8. MILL LEASE

On July 18, 2023, the Company signed a binding lease agreement with 1911 Gold Corporation ("1911 Gold") to use the True North mill, located in Bissett, Manitoba, for the production of lithium spodumene concentrate, which was finalized on October 25, 2023 (the "Lease").

The financial terms of the Lease, as amended, are as follows:

• An upfront, non-refundable payment of $300,000 (paid);
• a $550,000 payment by October 25, 2023 (paid);
• an equity participation payment in an equity offering of $400,000 (paid);
• monthly payments covering incremental ongoing site expenses for site security, environmental monitoring and maintenance commencing January 1, 2024 including a minimum of $160,000 prior to termination of the lease (the "Mill Operating Costs");
• payments including for potential environmental liabilities of:
• $500,000 on April 30, 2024 reduced to $100,000 payable on June 15, 2024 (paid);
• $1,000,000 on December 31, 2024 reduced to $200,000 payable on December 31, 2024,
• $nil on April 25, 2025 increased to $250,000 payable on April 25, 2025, (at which time the lease can be terminated)
• $900,000 on December 31, 2025 increased to $1,000,000 payable on December 31, 2025, and;
• $1,000,000 payable upon commencement of commercial production by the Company at the True North Mill which is defined as the processing of at least 200,000 tonnes of lithium material;
• a payment of $1,000,000 on the fifth anniversary of the Lease;
• a payment of $2,000,000 if the Parties agree to extend the lease for an additional five-year period at the end of the first five-year term of the Lease;
• a payment of $1,000,000 on the sixth anniversary of the Lease;
• a 1% net smelter returns royalty in favour of 1911, subject to the Company having the right of first refusal on any disposition of the royalty by 1911;
• a fee of $7.50 per tonne of lithium material processed through the True North Mill during the term of the Lease; and,
• if the Lease is extended, the assumption by the Company of up to $10,000,000 of incremental reclamation obligations prorated equally over years 6-10 of the Lease.

Due to the amendments to the Lease presented above, the Company recognized a write down of the lease assets of $533,677 and gain on the extinguishment of debt of $1,052,348 during the nine month period ended September 30, 2024.

The continuity of the capitalized Lease costs for the nine months ended September 30, 2024 and the year ended December 31, 2023 is as follows:

	September 30, 2024	December 31, 2023
Balance, beginning of period	$ 4,057,632	$ -
Additions	-	4,180,244
Write-down of asset	(533,677)	-
Amortization	(422,178)	(122,612)
Balance, end of period	$ 3,101,777	$ 4,057,632

The continuity of the Lease obligations for the nine months ended September 30, 2024 and the year ended December 31, 2023 is as follows:

	September 30, 2024	December 31, 2023
Balance, beginning of year	$ 3,346,857	$ -
Additions	-	$3,280,244
Principal payments	(100,000)	-
Extinguishment of debt	(1,052,348)	-
Accretion	218,888	66,613
Balance, end of year	2,413,397	- 3,346,857
Current portion of lease obligations	(450,000)	(1,194,223)
Long-term portion of lease obligations	$ 1,963,397	$ 2,152,634

The Company used an interest rate of 10% to determine the present value of the Lease obligations. Payments to date totalling $1,000,000, the Company's 1911 Unit investment totalling $400,000 (Note 5), Mill Operating Costs of $94,433, and contingent and long-term payments after December 31, 2025, totalling $13,500,000 were not included in the calculation of the present value of the Lease obligations.

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GRID METALS CORP.

NOTES TO THE INTERIM UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2024

(In Canadian dollars)

9. CAPITAL STOCK

(a) Common shares

Authorized

The authorized capital stock of the Company consists of an unlimited number of common shares.

During the nine months ended September 30, 2024, and the year ended December 31, 2023, the following common share activity occurred:

(i) On June 19, 2024, 475,000 common shares were issued in connection with the vesting of Deferred Share Units (“DSUs”).

(ii) On March 30, 2024, 50,000 common shares were issued in connection with a property acquisition in the Falcon West area. The shares were valued at $3,750, being the quoted market value of the shares on the date of issuance.

(iii) On December 29, 2023, the Company issued 4,000,000 special flow-through common shares at $0.18 per special flow-through common shares for gross proceeds of $720,000 and 1,151,143 ordinary flow-through common shares at $0.14 per ordinary flow-through common share for proceeds of $161,202.

(iv) On December 22, 2023, the Company issued 23,209,000 special flow-through common shares at $0.18 per special flow-through common share for gross proceeds of $4,177,620. At December 31, 2023, $4,980,025 of the gross proceeds of the special flow-through common share and flow-through common shares offerings were included in accounts receivable and were collected subsequent to year end (Note 6).

(v) On September 29, 2023, 7,142,858 common shares were issued in connection with the cancellation of an option to purchase an additional interest in the Donner Lake and Campus Creek Joint Ventures. The shares were valued at $857,142, being the quoted market value of the shares on the date of issuance (see Note 9).

(vi) On April 26, 2023, 1,500,000 common shares were issued in connection with the acquisition of the Gossan Claims (see Note 10).

(vii) On April 9, 2023, 250,000 common shares were issued in connection with the acquisition of the Eagle Claims (see Note 10).

(viii) Between February 2, 2023 and February 6, 2023, 1,160,150 shares were issued in connection with warrants exercised for $232,030. The original fair value of the warrants was $74,151, which amount was transferred from contributed surplus to capital stock.

(ix) On January 25, 2023, 200,000 common shares were issued in connection of mining claims located in Manitoba. The shares were valued at $42,000 being the quoted market value of the shares on the date of issuance.

(b) Stock option plan and stock-based compensation

The Company has an equity incentive plan to provide employees, directors, officers, and consultants with equity offerings and options to purchase common shares of the Company (the “Plan”). Under the Plan, the exercise price of each option equals the market price of the Company’s stock on the day of grant and the maximum term of option is five years. The maximum number of shares which may be issued under the program shall not exceed 10% of the issued and outstanding shares. At September 30, 2024, the maximum number of shares issuable pursuant to the Plan was 20,440,116, of which 14,395,000 shares have been granted; 11,120,000 stock options, 1,600,000 restricted share units and 1,675,000 deferred share units, leaving 6,045,116 shares available for issue.

The following summarizes the employees, directors, officers, and consultants’ stock options that have been granted, exercised, expired, vested, or cancelled during the nine months ended September 30, 2024, and the year ended December 31, 2023.

	Number of options	Weighted average exercise price
Balance, December 31, 2022	5,670,000	$0.24
Options granted	5,550,000	$0.20
Balance, December 31, 2023	11,220,000	$0.22
Options expired	(100,000)	$0.15
Balance, September 30, 2024	11,120,000	$0.22

During the nine months ended September 30, 2024, there were nil options granted (2023 – 5,550,000) and 100,000 options expired (2023 – nil). During the twelve months ended December 31, 2023, there were 5,550,000 options granted and nil expired.

The total option share-based payment expense recorded during the nine months ended September 30, 2024 was $44,623 (2023 - $642,636).

9

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GRID METALS CORP.

NOTES TO THE INTERIM UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2024

(In Canadian dollars)

The following table summarizes information about the share options as at September 30, 2024.

Expiry date	Number of options outstanding	Weighted average remaining life (years)	Exercisable	Exercise price	Weighted average exercise price of exercisable options
February 26, 2025	2,340,000	0.09	2,340,000	$ 0.25	$ 0.05
June 17, 2025	130,000	0.01	130,000	$ 0.25	$ 0.00
May 12, 2026	800,000	0.12	800,000	$ 0.25	$ 0.02
October 19, 2026	250,000	0.05	250,000	$ 0.12	$ 0.00
March 11, 2027	1,750,000	0.38	1,750,000	$ 0.25	$ 0.04
October 28, 2027	300,000	0.08	300,000	$ 0.19	$ 0.01
May 2, 2028	5,550,000	1.79	5,550,000	$ 0.20	$ 0.10
	11,120,000	2.52	11,120,000		$ 0.22

The vesting term of the options expiring on May 2, 2028 are as follows: 3,483,334 vested on the grant date; 1,033,333 vested on November 2, 2023, and 1,033,333 vest on May 2, 2024.

The fair value of options granted has been estimated using the Black-Scholes Option Pricing Model with the following assumptions on the grant date of the options:

Grant date	Number of options outstanding	Exercise price	Expected option life (years)	Risk free interest rate	Dividend yield	Expected volatility(1)	Underlying share price	Fair value per option on grant date
February 26, 2020	2,340,000	$ 0.25	5.00	1.14%	nil	142%	$ 0.190	$ 0.17
June 17, 2020	130,000	$ 0.25	5.00	0.37%	nil	159%	$ 0.190	$ 0.17
May 12, 2021	800,000	$ 0.25	5.00	0.97%	nil	150%	$ 0.230	$ 0.21
October 19, 2021	250,000	$ 0.12	5.00	1.42%	nil	170%	$ 0.115	$ 0.11
March 11, 2022	1,750,000	$ 0.25	5.00	1.80%	nil	138%	$ 0.220	$ 0.19
October 28, 2022	300,000	$ 0.19	5.00	3.38%	nil	110%	$ 0.175	$ 0.14
May 2, 2023	5,550,000	$ 0.20	5.00	2.95%	nil	111%	$ 0.165	$ 0.13
	11,120,000

(1) The expected volatility is based on the Company's historical share price.

Deferred Stock Units

During the nine months ended September 30, 2024 the Company issued nil Deferred Stock Units ("DSUs") to directors of the Company pursuant to the Plan (2023 - nil) and 475,000 DSUs vested and were exchanged into 475,000 common shares of the Company (2023 - nil). During the year ended December 31, 2023, the Company issued nil DSU's to directors of the Company pursuant to the Plan. The total charge to operations during the nine months ended September 30, 2024 the DSU's was $nil (2023 - $nil). As at September 30, 2024, there were a total of 1,675,000 DSUs issued pursuant to the Plan (2023 - 2,150,000).

Restricted Share Units

During the nine months ended September 30, 2024 the Company issued nil Restricted Share Units ("RSUs") pursuant to the Plan (2023 - 1,500,000). During the year ended December 31, 2023 the Company issued 1,500,000 RSUs pursuant to the Plan), which are exchangeable into common shares of the Company on a one for one basis upon achieving the vesting conditions. The RSU's issued during the year ended December 31, 2023 vested as follows:

• 400,000 RSUs vest on performance based metrics; 300,000 vest upon the Company obtaining a listing on the Australian Stock Exchange and 100,000 vest upon, in the estimation of the board, there was a high level of technical performance by the exploration group during 2023 or, upon a new mineral discovery. The RSU's were valued at the market price as of the date they were issued, and the expense charged to income on a straight-line basis over the five year term of the RSU's.

---

GRID METALS CORP.

NOTES TO THE INTERIM UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS SEPTEMBER 30, 2024

(In Canadian dollars)

• 1,100,000 RSUs vest based on meeting the following performance requirements:
• 366,668 RSU’s vest upon the volume weighted average price (“VWAP”) of the Company’s shares being above $0.25 for 20 consecutive trading days prior to May 3, 2026.
• 366,666 RSU’s vest upon the VWAP of the Company’s shares being above $0.35 for 20 consecutive trading days prior to May 3, 2026.
• 366,666 RSU’s vest upon the VWAP of the Company’s shares being above $0.45 for 20 consecutive trading days prior to May 3, 2026.

The market based RSUs were valued using the Monte Carlo pricing model assuming a risk free rate of 3.48% and volatility of 95.7% and an underlying share price of $0.165, resulting in a value of $141,937, which is recognized during the three year performance limitation based on the probability of the performance RSUs vesting.

At September 30, 2024 there were a total of 1,600,000 RSUs issued pursuant to the Plan (2023 – 1,600,000) of which 100,000 have vested. The total charge to operations for the RSU’s during the nine months ended September 30, 2024 was $53,848 (2023 – $58,608).

c) Warrants

A summary of warrant activity for the nine months ended September 30, 2024 and the year ended December 31, 2023 is as follows:

	Number of warrants	Weighted average exercise price
Balance, December 31, 2022	26,603,300	$ 0.24
Warrants issued	9,996	$ 0.15
Warrants expired	(13,033,150)	$ 0.20
Warrants exercised	(1,160,150)	$ 0.20
Balance, December 31, 2023	12,419,996	$ 0.20
Warrants expired	(360,000)	$ 0.20
Balance, September 30, 2024	12,059,996	$ 0.20

During the nine months ended September 30, 2024, there were nil warrants issued, nil warrants were exercised and 360,000 warrants expired. The 360,000 warrants that expired had an original estimated fair value of $16,766, which amount was transferred from contributed surplus to deficit. During the year ended December 31, 2023, 9,996 warrants were issued, 13,033,150 warrants expired, and 1,160,150 warrants were exercised. The 13,033,150 warrants that expired had an original estimated fair value of $1,124,340, which amount was transferred from contributed surplus to deficit.

At September 30, 2024, the following common share purchase warrants were outstanding:

Expiration date	Warrants Outstanding	Exercise price	Term (years)	Weighted average remaining life (years)	Risk free interest rate	Dividend yield	Expected volatility(1)	Underlying share price	Fair value per warrant on issue date
September 26, 2025	12,000,000	$ 0.200	3.00	0.983	3.81%	nil	95%	$ 0.120	$ 0.06
December 29, 2025	9,996	$ 0.150	2.00	0.001	3.88%	nil	72%	$ 0.230	$ 0.03
April 5, 2027	50,000	$ 0.175	5.00	0.010	1.79%	nil	113%	$ 0.150	$ 0.12
	12,059,996			0.994

(1) The expected volatility is based on the Company’s historical share price.

---

GRID METALS CORP.

NOTES TO THE INTERIM UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS SEPTEMBER 30, 2024

(In Canadian dollars)

d) Flow-through share premium continuity

The flow-through share premium continuity is as follows:

Balance, December 31, 2021	$ 167,090
Expenditures renounced	(167,090)
Flow-through share premium additions	764,000
Balance, December 31, 2022	764,000
Expenditures renounced	(764,000)
Flow-through share premium additions	2,222,778
Balance, December 31, 2023 and September 30, 2024	$ 2,222,778

1. EXPLORATION AND EVALUATION EXPENDITURES

For the nine months ended September 30, 2024

	Makwa	Mayville	Eagle	Gossan	Donner Lake Lithium	Campus Creek	Falcon West	Other	Total
Acquisition	$ 6,052	$ -	$ 204	$ 16	$ 15	$ -	$ 150,929	$ 92,687	$ 249,903
Assays	10,108	5,432	8,967	-	89,055	-	83,623	736	197,921
Consulting	36,013	35,228	30,698	29,541	109,019	1,302	92,490	3,906	338,197
Drilling	-	-	-	-	902,569	-	506,678	-	1,409,247
Geological	69,572	40,103	-	-	6,611	-	-	-	116,286
Geophysics	127,095	66,230	2,800	19,750	2,600	-	700	3,501	222,676
Labour	76,382	10,547	28,403	485	78,949	951	49,538	11,907	257,162
Other	67,567	35,178	17,482	22,626	218,663	546	71,834	8,584	442,480
Project Development	-	-	-	-	549,357	-	-	-	549,357
Permitting and Consultation	-	-	-	-	-	-	-	80,999	80,999
Subtotal	$ 392,789	192,718	88,554	72,418	1,956,838	2,799	955,792	202,320	3,864,228
Reimbursements from JO partner	-	-	-	-	(203,783)	-	-	-	(203,783)
Total	$ 392,789	$ 192,718	$ 88,554	$ 72,418	$ 1,753,055	$ 2,799	$ 955,792	$ 202,320	$ 3,660,445
	Makwa	Mayville	Eagle	Gossan	Donner Lake Lithium	Campus Creek	Falcon West	Other	Total
---	---	---	---	---	---	---	---	---	---
Acquisition	$ -	$ -	$ 335,150	$ 710,000	$ 857,142	$ -	$ 358,020	$ (3,750)	$ 2,256,562
Assays	-	134,755	-	-	346,106	44,723	10,923	-	536,507
Consulting	55,368	49,607	7,563	11,690	372,399	7,517	30,477	34,580	569,201
Drilling	-	330,714	-	-	2,311,604	144,249	-	-	2,786,567
Geological	54,627	78,439	-	-	127,773	-	-	16,344	277,183
Geophysics	3,790	28,677	20,375	4,200	140,660	-	-	32,475	230,177
Labour	38,236	52,416	1,741	-	181,719	40,637	1,966	6,707	323,422
Other	98,210	59,808	-	-	449,808	5,932	132,664	32,742	779,164
Project Development	-	-	-	-	191,018	-	-	-	191,018
Staking	-	-	-	-	-	-	-	22,577	22,577
Subtotal	$ 250,231	734,416	364,829	725,890	4,978,229	243,058	534,050	141,675	7,972,378
Reimbursements from JO partner	-				(838,887)				(838,887)
Total	$ 250,231	$ 734,416	$ 364,829	$ 725,890	$ 4,139,342	$ 243,058	$ 534,050	$ 141,675	$ 7,133,491

It is in the normal course of business for the Company to acquire and divest exploration and evaluation claims based on the results of exploration. Certain of the properties are subject to a net smelter return royalty ("NSR") payable on future mineral production.

---

GRID METALS CORP.
NOTES TO THE INTERIM UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 2024
(In Canadian dollars)

MANITOBA

Makwa

The Company, through its wholly owned subsidiary Global Nickel Inc, owns a 100% interest in the Makwa property which is a nickel copper platinum group metal exploration project located near Lac du Bonnet, in southeast Manitoba.

The mineral rights of the Makwa Property consist of a mineral lease, a surface lease, and exploration and evaluation assets claims held by the Company. An annual payment of approximately $10,000 must be made to the province of Manitoba to keep the mineral lease and surface lease in good standing. There is a 1.0% NSR royalty on the Makwa property. The Company has the option to purchase 0.5% of the NSR royalty for $500,000.

Mayville

The Company directly owns a 60% interest in the Mayville property which is a copper nickel platinum group metal exploration project located near Lac du Bonnet, in southeast Manitoba, which includes the base metal rights on the Donner Lake Lithium Property.

An additional 29% interest is held through the Company’s 72.56% interest in Maskwa Nickel Chrome Mines Limited (“MNCM”), a company which holds the remaining 40% interest in the Mayville property. A royalty payment in the amount of $210,000 will be due in five equal annual payments upon the commencement of commercial production on any portion of the MNCM property. Under the terms of a joint arrangement between MNCM and the Company (also the “Operator”), if the interest of one party in the joint arrangement is diluted below 10% the interest is converted to a 10% Net Profits Interest which is payable after the property reaches commercial production and the Operator has recouped all capital investment, exploration and preproduction costs related to the property. As the Company owns 72.56% of MNCM this would equate to a 2.74% Net Profits Interest in the property.

Gossan Claims

During the year ended December 31, 2023, the Company acquired the Ore Fault, Page, and Chrome claims (the “Gossan Claims”) located near the Makwa project. Consideration was $1,100,000 in cash payable over three years ($500,000 payable on closing, $300,000 payable on each of the first (paid) and second anniversaries of closing), 1,500,000 common shares of the Company, valued at $0.14 per share being the quoted market value of the shares on the date they were issued, a 2% net smelter return (“NSR”) royalty payable upon the commencement of commercial production from the Gossan Claims, and a $300,000 cash payment due upon the commencement of commercial production from the Gossan Claims. As a triggering event has not yet occurred, this contingent amount has not been reflected these financial statements.

The present value of the future payment was determined using a 20% discount rate. The difference between the present value and the future value of the payments will be recognized as accretion expense on a pro rata basis to the payment date.

Eagle Claims

During the year ended December 31, 2023, the Company acquired a 100% interest in the Eagle Claims for consideration of $300,000 cash on closing, 250,000 common shares, a 2% NSR royalty payable upon the commencement of commercial production from the Eagle Claims, half of which can be bought back by the Company for $1,000,000, and a deferred cash payment if the Company defines a NI 43-101 compliant mineral resource of greater than 2 million tonnes. The lithium and rare metal rights for Eagle are for the credit of the Donner Lake Lithium JV.

Donner Lake Lithium (formerly Mayville Lithium)

The Property consists of mining claims in the Bird River area. On January 12, 2022, the Company completed a transaction with LRC (the “LRC Transaction”) to create a lithium exploration property in the Mayville/Donner Lake area and immediately thereafter sell 25% of the designated property to LRC. A joint arrangement was formed and 25% of the mineral rights over certain claims from the Mayville Property and the Tanco Property were sold to LRC for a price of $1,563,750 (US$1,250,000). The sale included offtake rights for 25% of products subject to the prior rights of Tanco on the Tanco Property. A 2% gross overriding royalty on lithium and related metals on the entire Donner Lake Property was sold to LRC for an additional C$1,563,750 (US$1.25 million). During the period LRC’s interest in the joint arrangement was assigned to LEI, an investment fund managed by Waratah Capital Advisors.

On July 5, 2023, the Company announced that it had agreed to acquire and terminate the option to acquire an additional 20% of 1000078824 Ontario Inc. (the “Option”) for consideration of 7,142,858 common shares of the Company. The Option had been assigned by LRC to Lithium Equities Investments LP. The acquisition of the Option was approved by non-interested shareholders of the Company at the Company’s annual general meeting on September 29, 2023.

Grid is the project operator and has retained the base metal and precious metal mineral rights to the Donner Lake Lithium Property. Tantalum Mining Corporation of Canada Limited holds a 2% Net Smelter Return Royalty on certain claims comprising part of the property and has a right to match commercial terms on the sale of products produced from claims comprising part of the property.

Falcon West Lithium

The property consists of mining claims located in southeast Manitoba. One claim was acquired from a third party for $20,000 cash and

---

GRID METALS CORP.

NOTES TO THE INTERIM UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS SEPTEMBER 30, 2024

(In Canadian dollars)

50,000 common shares subject to a 2% NSR. A parcel of two claims were acquired from a second third party for $300,000 cash and 200,000 common share subject to a 2% NSR. The balance of the property was acquired by the staking of mining claims.

During the nine months ended September 30, 2024, the Company received a grant of $97,500 from the Manitoba Mineral Development Fund to support strategic mineral development projects in the province.

Fox River West/Northern Manitoba

The Northern Manitoba properties consist of a 100% interest in certain mineral exploration licenses ("MELs") in the western one-third of the Fox River Belt ("Fox River") and the eastern flank of the Thompson Nickel Belt ("Thompson East"). The Company paid a deposit of $51,300 upon filing, equal to the first year cumulative spending requirement for the Fox River MELs. The Thompson East MELs are located approximately 30 km east of the city of Thompson. The Company paid a deposit of $5,250 upon filing, equal to 50% of the first year cumulative spending requirement for the Thompson East MELs.

The spending commitments on the MELs are as follows:

Expiry Date	Fox River	Thompson East
Upon Issue	$ 51,300	$5,250	(paid in full)
December 7, 2022	$ 51,269	$ 13,250	(spending requirements met)
December 7, 2023	$ 102,537	$ 53,000	(spending requirements met)
December 7, 2024	$ 153,806	$ 79,500
December 7, 2025	$ 307,611	*
December 7, 2026	$ 410,148	*
Total	$ 1,076,671	$151,000

• Spending commitments subject to renewal

ONTARIO

East Bull Lake

The East Bull Lake Palladium Property ("EBL") is a platinum group metals ("PGM") exploration project located in the Sudbury Mining Division, Ontario, Canada. The Company has fulfilled its commitments to earn a 100% interest in the approximately 466 unpatented mining claims comprising the EBL property. EBL is subject to underlying royalties held by the original optionors of the property of up to 3%.

Campus Creek Lithium Property

During the year ended December 31, 2021, the Company entered into an option agreement for the Campus Creek property ("Campus Creek"). Campus Creek consists of certain mining clams in the McNamara Lake area northwest of Thunder Bay, Ontario. The option enabled the Company the right to earn a 100% interest in the mining claims subject to an 2% NSR interest by incurring annual work expenditures, making annual payments of cash, and issuing common shares as follows:

• On signing - $10,000 and 100,000 shares (paid and issued)
• Year 1 - $20,000, 125,000 shares and $50,000 of work commitments
• Year 2 - $40,000, 133,000 shares and $100,000 of work commitments
• Year 3 - $60,000, 150,000 shares and $200,000 of work commitments
• Year 4 - $80,000, 150,000 shares and $400,000 of work commitments

Pursuant to the LRC Transaction, the Company formed a joint arrangement with LRC covering Campus Creek and sold 25% of the property to LRC for C$312,750 (US$250,000) - which during the period was assigned to Lithium Equities Investments LLC, (LEI) an investment fund managed by Waratah Capital Advisors. The Company also sold a 2% gross overriding royalty on the property for C$1,251,000 (US$1,000,000). LRC also has the right to acquire 20% of 1000078824 Ontario Inc., Grid's wholly owned subsidiary that holds the Donner Lake and Campus Creek claims, on commercially reasonable terms subject to Grid's approval. On closing of the LRC transaction, the Company completed all option payments and stock issuances pursuant to the Campus Creek option agreement, and the work requirements were cancelled.

Exploration Program Advances

Pursuant to the Donner Lake and Campus Creek lithium exploration and development joint arrangements with LEI described in Note 10, the Company is entitled to request cash calls from LEI at the beginning of each quarter for their proportionate share of the estimated Exploration Costs, as adjusted pursuant to the joint arrangement agreements.

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GRID METALS CORP.

NOTES TO THE INTERIM UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2024

(In Canadian dollars)

The following is continuity schedule of the exploration advances:

Balance, December 31, 2022	$ 279,260
Exploration costs advanced by minority joint arrangement partner	1,315,398
Minority share of exploration expenses on joint arrangements during the year	(1,664,719)
Minority share of operator's fee	(124,854)
Unrecovered portion of exploration expenses on joint arrangements during the year	194,915
Balance, December 31, 2023	$ -
Exploration costs advanced by minority joint arrangement partner	203,783
Minority share of exploration expenses on joint arrangements during the period	(515,240)
Minority share of operator's fee	(38,643)
Unrecovered portion of exploration expenses from prior year	194,915
Unrecovered portion of exploration expenses on joint arrangements during the period	155,184
Balance, September 30, 2024	$ -

11. COMMITMENTS AND CONTINGENCIES

See Notes 7 and 9 for details of other commitments and contingencies.

The Company's exploration and evaluation 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 believes its operations are materially in compliance with all applicable laws and regulations. The Company has made, and expects to make in the future, expenditures to comply with such laws and regulations.

During 2023 flow-through common shares were issued in the amount of $ 5,058,822, and as a result the Company must spend at least $5,058,822 on eligible exploration expenses before December 31, 2024.

The Company has indemnified the subscribers of current and previous flow-through share offerings against any tax related amounts that become payable by the shareholder as a result of the Company not meeting its expenditure commitments.

An employment contract between the Company and its President & CEO provides for the following:

a) Upon termination without cause the President is entitled to one month's severance for every year since 1998 to a maximum of twenty-four months, plus a prospective bonus equal to the greater of the last bonus paid to the president or 75% of his then annual salary. In this instance the estimated contingent liability would amount to approximately $750,000.
b) In the event of a change of control, if the President is terminated, or constructively dismissed, within nine months of the change of control the President is entitled to two year's remuneration plus a prospective bonus equal to the greater of two times the average annual bonus paid to the president or one year's annual remuneration. In this instance the estimated contingent liability would amount to approximately $850,000.
c) The minimum amount due in one year pursuant to this contract is $275,000.

A contract between the Company and Harris Capital Corporation, for Chief Financial Officer ("CFO") consulting services, provides for the following:

a) Upon termination without cause the CFO is entitled to six month's notice. In this instance the estimated contingent liability would be $60,000.
b) In the event of a change of control, if the CFO is terminated the CFO is entitled to 12 month's remuneration. In this instance the estimated contingent liability would be $120,000.
c) The minimum amount due in one year pursuant to this contract is $120,000.

An employment contract between the Company and its Chief Development Officer ("CDO") provides for the following:

a) Upon termination without cause the CDO is entitled to six month's notice. In this instance the estimated contingent liability would amount to approximately $125,000.
b) In the event of a change of control, if the CDO is terminated, or constructively dismissed, within nine months of the change of control the CDO is entitled to one year's remuneration. In this instance the estimated contingent liability would be approximately $250,000.
c) The minimum amount due in one year pursuant to this contract is $250,000.

As a triggering event has not occurred, these contingent obligations have not been recorded in these financial statements.

---

GRID METALS CORP.

NOTES TO THE INTERIM UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2024

(In Canadian dollars)

12. TERM LOAN PAYABLE

The term loan payable of $60,000 was taken by the Company under the Canada Emergency Business Assistance program. As long as 75% of the principal amount of the loan is repaid on or prior to December 31, 2023, which the Company intends to do, the terms of the loan are as follows:

a) It is unsecured,
b) Non-interest bearing,
c) The remaining 25% will be forgiven. The forgiveness of the remaining 25% will not be recognized until the 75% has been repaid.

Prior to January 18, 2024, the Company repaid 66⅔% of the principal amount of the CEBA loan, as a result, the remaining amount was forgiven.

13. RELATED PARTY TRANSACTIONS

Director’s fees, professional fees and other compensation of directors and key management personnel were as follows for the nine months ended September 30, 2024 and 2023:

Nine months ended September 30,	2024	2023
	$	$
Short-term compensation and benefits	949,532	966,234
Share-based payments (stock option, RSU and DSU grants)	91,275	423,914
Total key management compensation	1,040,807	1,390,148

Short-term compensation and benefits charged to exploration and evaluation expenditures during the nine months ended September 30, 2024 amounted to $89,986 (2023 – $105,315).

Amounts due to key management personnel included in accounts payable amounted to $65,691 (2023 – $22,645).

Legal fees were charged by a legal firm during the nine month period ended September 30, 2024, of which an officer of the Company is an employee, for legal and corporate secretarial services in the amount of $41,981 (2023 - $91,124). Accounts payable and accrued liabilities include $10,441 owing to the legal firm (2023 – $24,994).

Amounts due to related parties included in accounts payable are unsecured, non-interest bearing and due on demand.

See also Notes 9(b) and 11.

14. FINANCIAL INSTRUMENTS

The carrying amounts for cash, amounts receivable, accounts payable, accrued liabilities, term loans, and exploration program advances approximate their estimated fair value due to the short-term nature of these financial instruments.

Cash and amounts receivable are recorded at amortized cost, which upon their initial measurement is equal to their fair value. Subsequent measurements are recorded at amortized cost using the effective interest rate method.

Marketable securities are classified as FVPL, are measured at their fair value, which is based on quoted market prices at the end of the reporting period, and are therefore classified as Level 1 within the fair value hierarchy. Changes in fair value are included in profit and loss.

Accounts payable and accrued liabilities, lease obligations and term loan payable are initially measured at their fair value. Subsequent measurements are recorded at amortized cost using the effective interest rate method.

The Company's risk exposures and the impact on its financial investments, as summarized below, have not changed significantly for the periods ended September 30, 2024 and 2023.

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GRID METALS CORP.

NOTES TO THE INTERIM UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2024

(In Canadian dollars)

Credit Risk

The Company’s credit risk is primarily attributable to cash and amounts receivable. The Company has no significant concentration of credit risk arising from operations. Management believes that the credit risk concentration with respect to the financial instruments included in accounts receivable is remote.

Liquidity Risk

The Company's main source of liquidity is derived from its common stock issuances. As at September 30, 2024, the Company had current assets of $3,482,647 (December 31, 2023 - $8,678,413) to settle current liabilities of $3,258,745 (December 31, 2023 - $4,238,553). Current liabilities include un-renounced flow through share premium, which will be a non-cash item on settlement, of $2,222,778 (December 31, 2023 - $2,222,778). All of the Company's financial liabilities have contractual maturities that are subject to normal trade terms.

Interest Rate Risk

Interest rate risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate due to changes in market interest rates. The Company has cash balances and no interest-bearing debt. The Company's current policy is to invest excess cash in investment-grade short-term deposit certificates issued by its banking institutions. The Company monitors its cash balances and is satisfied with the creditworthiness of its banks. As a result, the Company's exposure to interest rate risk is minimal.

Market Risk

Foreign Currency Risk

The Company's functional and reporting currency is the Canadian dollar, and all expenditures are transacted in Canadian dollars. As a result, the Company’s exposure to foreign currency risk is minimal.

Price Risk

The Company is exposed to price risk with respect to commodity prices. The Company closely monitors commodity prices to determine the appropriate course of action to be taken by the Company. As the Company's properties are in the exploration and evaluation stage and, to date do not contain any identified mineral resources or reserves, the Company does not hedge against commodity price risk.

Sensitivity Analysis

Based on management's knowledge and experience of the financial markets, the Company believes the following movements are reasonably possible over a twelve-month period:

a) The Company receives low interest rates on its cash balances and, as such, the Company does not have significant interest rate risk.
b) The Company does not hold balances in foreign currencies to give rise to exposure to foreign exchange risk.

15. CAPITAL MANAGEMENT

Capital management is reflected by the manner in which the Company manages its capital stock. The Company's objectives when managing capital are:

a) To safeguard the Company’s financial capacity and liquidity for future earnings in order to continue to provide an appropriate return to shareholders and other stakeholders;
b) To maintain a flexible capital structure which optimizes the cost of capital at an acceptable risk; and
c) To enable the Company to maximize growth by meeting its capital expenditure budget, to expand its budget to accelerate projects, and to take advantage of acquisition opportunities.

There were no significant changes in the Company's approach to capital management during the periods ended September 30, 2024 and 2023.

As at September 30, 2024, the Company’s capital stock was $67,015,727 (December 31, 2023 - $66,907,477). The Company regularly monitors and reviews the amount of capital in proportion to risk and future development and exploration opportunities. The Company manages the capital structure and makes adjustments to it in the light of changes in economic conditions and the risk characteristics of the underlying assets. In order to maintain or adjust the capital structure, the Company may issue new debt or equity or similar instruments, reduce debt levels from, or make adjustments to, its capital expenditure program.

The Company is not subject to any capital requirements imposed by a lending institution or regulatory body, other than the TSX Venture Exchange (“TSXV”) which requires adequate working capital or financial resources of the greater of (i) $50,000 and (ii) an amount required in order to maintain operations and cover general and administrative expenses for a period of 6 months. As at September 30, 2024, the Company believes it is compliant with the policies of the TSXV.

16. SUBSEQUENT EVENTS

Subsequent to September 30, 2024 the Company sold 4,576,667 1911 Shares for gross proceeds of $759,945, to hold nil.