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Super Copper Corp. Audit Report / Information 2025
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Audit Report / Information
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SUPER COPPER CORP.
Consolidated and Combined Financial Statements
For the Years Ended February 28, 2025 and February 29, 2024
(Expressed in Canadian Dollars)
Independent Auditor's Report
MNP
To the Shareholders of Super Copper Corp.:
Opinion
We have audited the consolidated and combined financial statements of Super Copper Corp. and its subsidiary (the "Company"), which comprise the consolidated statements of financial position as at February 28, 2025 and February 29, 2024, and the consolidated and combined statements of loss and comprehensive loss, changes in shareholders' equity (deficiency) and cash flows for the years then ended, and notes to the consolidated and combined financial statements, including material accounting policy information.
In our opinion, the accompanying consolidated and combined financial statements present fairly, in all material respects, the consolidated financial position of the Company as at February 28, 2025 and February 29, 2024, and its consolidated and combined financial performance and its consolidated and combined cash flows for the years then ended in accordance with IFRS® Accounting Standards as issued by the International Accounting Standards Board.
Basis for Opinion
We conducted our audits in accordance with Canadian generally accepted auditing standards. Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Consolidated And Combined Financial Statements section of our report. We are independent of the Company in accordance with the ethical requirements that are relevant to our audits of the consolidated and combined financial statements in Canada, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Material Uncertainty Related to Going Concern
We draw attention to Note 1 in the consolidated and combined financial statements, which indicates that the Company has accumulated losses since its inception and expects to incur further losses in the development of its business. As stated in Note 1, these events or conditions, along with other matters as set forth in Note 1, indicate that a material uncertainty exists that may cast significant doubt on the Company's ability to continue as a going concern. Our opinion is not modified in respect of this matter.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated and combined financial statements of the current period. These matters were addressed in the context of our audit of the consolidated and combined financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.
Except for the matter described in the Material Uncertainty Related to Going Concern section, we have determined that there are no other key audit matters to communicate in our report.
Other Information
Management is responsible for the other information. The other information comprises Management's Discussion and Analysis.
Our opinion on the consolidated and combined financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.
MNP LLP
1 Adelaide Street East, Suite 1900, Toronto ON, M5C 2V9
1.877.251.2922 T: 416.596.1711 F: 416.596.7894
In connection with our audits of the consolidated and combined financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the consolidated and combined financial statements or our knowledge obtained in the audits or otherwise appears to be materially misstated. We obtained Management's Discussion and Analysis prior to the date of this auditor's report. If, based on the work we have performed on this other information, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.
Responsibilities of Management and Those Charged with Governance for the Consolidated and Combined Financial Statements
Management is responsible for the preparation and fair presentation of the consolidated and combined financial statements in accordance with IFRS Accounting Standards as issued by the International Accounting Standards Board, and for such internal control as management determines is necessary to enable the preparation of consolidated and combined financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the consolidated and combined financial statements, management is responsible for assessing the Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.
Those charged with governance are responsible for overseeing the Company's financial reporting process.
Auditor's Responsibilities for the Audit of the Consolidated And Combined Financial Statements
Our objectives are to obtain reasonable assurance about whether the consolidated and combined financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Canadian generally accepted auditing standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated and combined financial statements.
As part of an audit in accordance with Canadian generally accepted auditing standards, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:
- Identify and assess the risks of material misstatement of the consolidated and combined financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
- Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control.
- Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
1 Adelaide Street East, Suite 1900, Toronto, Ontario, M5C 2V9
1.877.251.2922 T: 416.596.1711 F: 416.596.7894 MNP.ca
MNP
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Conclude on the appropriateness of management's use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the consolidated and combined financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the Company to cease to continue as a going concern.
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Evaluate the overall presentation, structure and content of the consolidated and combined financial statements, including the disclosures, and whether the consolidated and combined financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
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Plan and perform the group audit to obtain sufficient appropriate audit evidence regarding the financial information of the entities or business units within the Company as a basis for forming an opinion on the consolidated and combined financial statements. We are responsible for the direction, supervision and review of the audit work performed for the purposes of the group audit. We remain solely responsible for our audit opinion.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audits and significant audit findings, including any significant deficiencies in internal control that we identify during our audits.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the consolidated and combined financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor's report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
The engagement partner on the audit resulting in this independent auditor's report is Marufur Raza.
Toronto, Ontario
June 27, 2025
MNP LLP
Chartered Professional Accountants
Licensed Public Accountants
1 Adelaide Street East, Suite 1900, Toronto, Ontario, M5C 2V9
1.877.251.2922 T: 416.596.1711 F: 416.596.7894 MNP.ca
MNP
The accompanying notes are an integral part of these consolidated and combined financial statements.
SUPER COPPER CORP.
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
(Expressed in Canadian Dollars)
| February 28, 2025 | February 29, 2024 | |
|---|---|---|
| Note | $ | $ |
| ASSETS | ||
| Current assets | ||
| Cash | 169,515 | 55,947 |
| Sales tax receivables | 27,950 | - |
| Prepaid expenses | 175,959 | 3,000 |
| Total assets | 373,424 | 58,947 |
| LIABILITIES | ||
| Current liabilities | ||
| Accounts payable and accrued liabilities | 10 | 281,190 |
| Due to related party | 6 | 22,907 |
| 304,097 | 262,761 | |
| SHAREHOLDERS' EQUITY (DEFICIENCY) | ||
| Share capital | 7 | 1,769,135 |
| Reserves | 7 | 1,062,478 |
| Deficit | (2,762,286) | |
| 69,327 | (203,814) | |
| Total liabilities and shareholders' equity (deficiency) | 373,424 | 58,947 |
Nature of operations and going concern (Note 1)
Subsequent events (Notes 6, 7 and 13)
Approved and authorized on behalf of the Board of Directors on June 27, 2025
"Zachary Dymala-Dolesky" Director
"Raj Dewan" Director
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SUPER COPPER CORP.
CONSOLIDATED AND COMBINED STATEMENTS OF LOSS AND COMPREHENSIVE LOSS
For the years ended February 28, 2025 and February 29, 2024
(Expressed in Canadian Dollars)
| Note | 2025 $ | 2024 $ | |
|---|---|---|---|
| EXPENSES | |||
| Consulting fees | 10 | 96,000 | 347,500 |
| Exploration & evaluation expenditures | 5 | 301,484 | 133,240 |
| Filing and listing fees | 78,076 | - | |
| Foreign exchange loss | 2,697 | - | |
| Investor relations | 231,234 | - | |
| Office expenses | 60,546 | 1,258 | |
| Professional fees | 436,218 | 62,329 | |
| Share-based compensation | 7 | 1,077,831 | - |
| Travel | 53,694 | 13,588 | |
| LOSS BEFORE OTHER ITEMS | (2,337,780) | (557,915) | |
| OTHER ITEMS | |||
| Interest income | 7,463 | 5,558 | |
| Gain on investment | 4 | - | 19,908 |
| 7,463 | 25,466 | ||
| COMPREHENSIVE LOSS FOR THE YEAR | (2,330,317) | (532,449) | |
| LOSS PER SHARE – BASIC AND DILUTED | (0.09) | (0.04) | |
| WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING | 26,776,204 | 14,613,311 |
The accompanying notes are an integral part of these consolidated and combined financial statements.
SUPER COPPER CORP.
CONSOLIDATED AND COMBINED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (DEFICIENCY)
(Expressed in Canadian dollars, except for share figures)
| Number of Shares # | Share Capital $ | Reserves $ | Deficit $ | Total $ | |
|---|---|---|---|---|---|
| Balance, February 28, 2023 | 4,259,000 | 228,155 | - | (221,747) | 6,408 |
| Issuance of shares pursuant to private placements (Note 7) | 8,500,100 | 137,500 | - | - | 137,500 |
| Share issuance costs | - | (7,073) | - | - | (7,073) |
| Cancellation of shares | (300,000) | (28,200) | - | - | (28,200) |
| Issuance of shares pursuant to debt settlements (Note 7) | 11,000,000 | 220,000 | - | - | 220,000 |
| Elimination of Super Copper Holdings Ltd. | (19,200,100) | (322,227) | - | 347,787 | 25,560 |
| Acquisition of Super Copper Holdings Ltd. (Note 3) | 19,200,100 | - | - | (25,560) | (25,560) |
| Comprehensive loss for the year | - | - | - | (532,449) | (532,449) |
| Balance, February 29, 2024 | 23,459,100 | 228,155 | - | (431,969) | (203,814) |
| Issuance of shares pursuant to private placements (Note 7) | 4,158,154 | 863,000 | - | - | 863,000 |
| Issuance of shares pursuant to conversion of subscription receipts (Note 7) | 3,625,000 | 725,000 | - | - | 725,000 |
| Share issuance costs | - | (111,769) | 12,503 | - | (99,266) |
| Issuance of shares pursuant to exercise of options | 85,000 | 38,190 | (18,565) | - | 19,625 |
| Issuance of shares pursuant to exercise of finders warrants | 86,340 | 26,559 | (9,291) | - | 17,268 |
| Share-based compensation | - | - | 1,077,831 | - | 1,077,831 |
| Comprehensive loss for the year | - | - | - | (2,330,317) | (2,330,317) |
| Balance, February 28, 2025 | 31,413,594 | 1,769,135 | 1,062,478 | (2,762,286) | 69,327 |
The accompanying notes are an integral part of these consolidated and combined financial statements.
SUPER COPPER CORP.
CONSOLIDATED AND COMBINED STATEMENTS OF CASH FLOWS
For the years ended February 28, 2025 and February 29, 2024
(Expressed in Canadian Dollars)
| 2025 | 2024 | |
|---|---|---|
| $ | $ | |
| Operating activities: | ||
| Loss for the year | (2,330,317) | (532,449) |
| Gain on investment | - | (19,908) |
| Consulting fees settled with shares | - | 220,000 |
| Share-based compensation | 1,077,831 | - |
| Changes in non-cash working capital related to operations: | ||
| Sales tax receivables | (27,950) | 7,989 |
| Prepaid expenses | (172,959) | (3,000) |
| Accounts payable and accrued liabilities | 21,336 | 160,867 |
| Net cash used in operating activities | (1,432,059) | (166,501) |
| Investing activity: | ||
| Convertible note receivable | - | 120,000 |
| Net cash provided by investing activity | - | 120,000 |
| Financing Activities: | ||
| Due to related party | 20,000 | 25 |
| Issuance of shares pursuant to private placements | 1,588,000 | 107,500 |
| Share issuance costs | (99,266) | (5,273) |
| Issuance of shares pursuant to exercise of options and warrants | 36,893 | - |
| Net cash provided by financing activities | 1,545,627 | 102,252 |
| Increase in cash during the year | 113,568 | 55,751 |
| Cash – beginning of the year | 55,947 | 196 |
| Cash – end of the year | 169,515 | 55,947 |
| Supplemental information: | ||
| Interest received | 7,463 | 13,545 |
| Fair value of shares issued for debt settlements | - | 220,000 |
The accompanying notes are an integral part of these consolidated and combined financial statements.
SUPER COPPER CORP.
NOTES TO THE CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS
For the years ended February 28, 2025 and February 29, 2024
(Expressed in Canadian Dollars)
1. NATURE OF OPERATIONS AND GOING CONCERN
Super Copper Corp. (the "Company" or "Super Copper") was incorporated under the Business Corporations Act (British Columbia) on January 23, 2019. On February 23, 2024, the Company changed its name from Kepler Private Equity Ltd. to Super Copper Corp. The head office and principal address of the Company is located at 1000 – 409 Granville Street, Vancouver, BC V6C 1T2, Canada. The Company is a mineral exploration company engaged in the acquisition, exploration, and evaluation of resource properties.
The Company's common shares were listed and commenced trading on the Canadian Securities Exchange (the "CSE") effective October 7, 2024, under the trading symbol "CUPR". The Company's common shares also began trading on the Frankfurt Stock Exchange under the symbol "N60" on October 16, 2024 and on the OTCQB Market under the symbol "CUPPF" on January 15, 2025.
Super Copper is in the exploration stage and is subject to risks and challenges similar to companies in a comparable stage. These risks include, but are not limited to, the challenges of securing adequate capital in view of exploration, development and operational risks inherent in the mining industry; changes in government policies and regulations; the ability to obtain the necessary environmental permitting; challenges in future profitable production; as well as global economic, precious and base metal price volatility; all of which are uncertain.
These consolidated and combined financial statements have been prepared assuming the Company will continue as a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. At February 28, 2025, the Company had accumulated losses of $2,762,286 since its inception and expects to incur further losses in the development of its business. The continuation of the Company is dependent upon obtaining necessary financing to meet its ongoing operational levels of exploration and corporate overhead. There is a material uncertainty related to these conditions that may cast significant doubt upon the Company's ability to continue as a going concern. Additional funds will be required to enable the Company to continue its operations and there can be no assurance that financing will be available on terms which are acceptable to the Company. These consolidated and combined financial statements do not give effect to any adjustments to the amounts and classifications of assets and liabilities which might be necessary should the Company be unable to continue its operations as a going concern.
2. MATERIAL ACCOUNTING POLICIES
a) Basis of presentation and statement of compliance
These consolidated and combined financial statements have been prepared in accordance with IFRS® Accounting Standards as issued by the International Accounting Standards Board ("IASB").
These consolidated and combined financial statements are prepared on the historical cost basis except for certain financial instruments, which are measured at fair value. In addition, these consolidated and combined financial statements have been prepared using the accrual basis of accounting, except for cash flow information.
SUPER COPPER CORP.
NOTES TO THE CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS
For the years ended February 28, 2025 and February 29, 2024
(Expressed in Canadian Dollars)
These consolidated and combined financial statements were approved and authorized for issue by the Board of Directors on June 27, 2025.
b) Consolidation
These consolidated and combined financial statements include the financial statements of the Company and its wholly-owned and controlled subsidiary, Super Copper Holdings Ltd.
Control is achieved when the Company has the power to, directly or indirectly, govern the financial and operating policies of an entity so as to obtain benefits from its activities. Subsidiaries are fully consolidated from the date on which control is obtained and continue to be consolidated until the date that such control ceases. Intercompany balances, transactions and unrealized intercompany gains and losses are eliminated upon consolidation.
These consolidated and combined financial statements are presented on a combined basis from July 11, 2023, the date of incorporation of Super Copper Holdings Ltd., to the acquisition date of February 22, 2024 (Note 3).
c) Functional currency
The functional currency and the presentation currency of the Company and its Subsidiary is the Canadian Dollar. The functional currency is the currency of the primary economic environment in which each of the companies operates.
Foreign currency transactions are translated into the functional currency using exchange rates prevailing at the dates of the transactions. At the end of each reporting period, monetary assets and liabilities that are denominated in foreign currencies are translated at the rates prevailing at that date. Non-monetary assets and liabilities are translated using the historical rate on the date of the transaction. All gains and losses on translation of these foreign currency transactions are charged to profit or loss.
d) Common control transactions
A business combination involving entities under common control is a business combination in which all of the combining entities are ultimately controlled by the same parties, both before and after the business combination, and control is not transitory. Business combinations involving entities under common control are outside the scope of IFRS 3 Business Combinations. IFRS® provides no guidance on the accounting for these types of transactions. As a result, the Company was required to develop an accounting policy. The Company determined that the predecessor values method to account for common control transactions is the most appropriate. This method requires the combined consolidated financial statements to be prepared using the predecessor carrying values without an adjustment to fair value. The consideration given is measured based on the aggregate carrying value of the assets and liabilities acquired. Transaction costs associated with common control transactions are recognized as an expense in the period.
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SUPER COPPER CORP.
NOTES TO THE CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS
For the years ended February 28, 2025 and February 29, 2024
(Expressed in Canadian Dollars)
e) Financial instruments
Recognition and Classification
The Company recognizes a financial asset or financial liability on the consolidated statement of financial position when it becomes party to the contractual provisions of the financial instrument.
The Company classifies its financial instruments in the following categories: at fair value through profit or loss ("FVTPL"), at fair value through other comprehensive income (loss) ("FVTOCI") or at amortized cost. The Company determines the classification of financial assets at initial recognition. The classification of financial asset debt instruments is driven by the Company's business model for managing those financial assets and the contractual cash flow characteristics.
Equity instruments that are held for trading are classified as FVTPL. For other equity instruments, on the day of acquisition the Company can make an irrevocable election (on an instrument-by-instrument basis) to designate them as at FVTOCI. Financial liabilities are measured at amortized cost, unless they are required to be measured at FVTPL (such as instruments held for trading or derivatives) or if the Company has opted to measure them at FVTPL.
Measurement
Financial assets and liabilities at FVTPL
Financial assets and liabilities carried at FVTPL are initially recorded at fair value and transaction costs are expensed in profit or loss. Realized and unrealized gains and losses arising from changes in the fair value of the financial assets and liabilities held at FVTPL are included in profit or loss in the period in which they arise. Where management has opted to recognize a financial liability at FVTPL, any changes associated with the Company's own credit risk will be recognized in other comprehensive income (loss). The Company has classified its cash as FVTPL. The Company does not designate any financial liabilities at FVTPL.
Financial assets at FVTOCI
Elected investments in equity instruments at FVTOCI are initially recognized at fair value plus transaction costs. Subsequently they are measured at fair value, with gains and losses recognized in other comprehensive income (loss). The Company has not designated any financial assets at FVOCI.
Financial assets and liabilities at amortized cost
Financial assets and liabilities at amortized cost are initially recognized at fair value plus or minus transaction costs, respectively, and subsequently carried at amortized cost less any impairment, using the effective interest method. The effective interest rate is the rate that discounts estimated future cash flows over the expected life of the financial instrument, or where appropriate, a shorter period. The Company has classified accounts payable and accrued liabilities and due to related party as amortized cost.
10
SUPER COPPER CORP.
NOTES TO THE CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS
For the years ended February 28, 2025 and February 29, 2024
(Expressed in Canadian Dollars)
Impairment of financial assets at amortized cost
The Company recognizes a loss allowance for expected credit losses on financial assets that are measured at amortized cost. At each reporting date, the Company measures the loss allowance for the financial asset at an amount equal to the lifetime expected credit losses if the credit risk on the financial asset has increased significantly since initial recognition. If at the reporting date, the credit risk on the financial asset has not increased significantly since initial recognition, the Company measures the loss allowance for the financial asset at an amount equal to the twelve month expected credit losses. The Company shall recognize in profit or loss, as an impairment gain or loss, the amount of expected credit losses (or reversal) that is required to adjust the loss allowance at the reporting date to the amount that is required to be recognized.
Derecognition
Financial assets
The Company derecognizes financial assets only when the contractual rights to cash flows from the financial assets expire, or when it transfers the financial assets and substantially all of the associated risks and rewards of ownership to another entity. Gains and losses on derecognition are generally recognized in profit or loss. However, gains and losses on derecognition of financial assets classified as FVTOCI remain within accumulated other comprehensive income (loss).
Financial liabilities
The Company derecognizes financial liabilities only when its obligations under the financial liabilities are discharged, cancelled or expired. Generally, the difference between the carrying amount of the financial liability derecognized and the consideration paid and payable, including any non-cash assets transferred or liabilities assumed, is recognized in profit or loss.
f) Exploration and evaluation expenditures
Exploration and evaluation expenditures include the costs of acquiring licenses and costs associated with exploration and evaluation activity. Exploration and evaluation expenditures are expensed as incurred. Once a project has been established as commercially viable and technically feasible, related development expenditure is capitalized. This includes costs incurred in preparing the site for mining operations. Capitalization ceases when the mine is capable of commercial production, with the exception of development costs which give rise to a future benefit.
SUPER COPPER CORP.
NOTES TO THE CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS
For the years ended February 28, 2025 and February 29, 2024
(Expressed in Canadian Dollars)
g) Provision for decommissioning and restoration
The Company recognizes provisions for statutory, contractual, constructive or legal obligations associated with the reclamation of mineral properties in the year in which it is probable that an outflow of resources will be required to settle the obligation and when a reliable estimate of the amount can be made. Initially, a provision for a decommissioning liability is recognized based on expected cash flows required to settle the obligation and discounted at a pre-tax rate specific to the liability. Following the initial recognition of the decommissioning liability, the carrying amount of the liability is increased for the passage of time and adjusted for changes to the current market-based discount rate and the amount or timing of the underlying cash flows needed to settle the obligation. The increase in the provision due to passage of time is recognized as interest expense. Significant judgments and estimates are involved in forming expectations of the amounts and timing of future closure and reclamation cash flows. As at February 28, 2025, the Company has no known material restoration, rehabilitation or environmental liabilities related to its exploration and evaluation assets.
h) Extinguishment of financial liabilities with equity instruments
IFRIC 19, Extinguishing Financial Liabilities with Equity Instruments, provides guidance on how to account the partial or full extinguishment of a financial liability by issuing equity instruments. The Company measures the equity instruments issued to creditors to settle or extinguish financial liabilities at fair value. The difference between the carrying amount of the financial liability extinguished and the initial measurement amount of the equity instruments are included in the consolidated and combined statement of loss and comprehensive loss. The Company measures equity instruments issued to creditors to settle or extinguish financial liabilities at carrying value, with no gain or loss recorded, where the creditor is also a direct or indirect shareholder and is acting in its capacity as an existing direct or indirect shareholder.
i) Share capital
Equity instruments are contracts that give a residual interest in the net assets of the Company. Equity-settled common share options and warrants, denominated in the Company's functional currency, issued by the Company are classified as equity instruments.
Costs directly identifiable with the raising of share capital financing are charged against share capital. Share issuance costs incurred in advance of closing a financing are recorded as deferred assets. Share issuance costs related to incomplete financing transactions are charged to profit or loss.
Equity financing transactions may involve the issuance of units. Units comprise common shares and share purchase warrants. The Company allocates unit offering proceeds between common shares and share purchase warrants using the residual value method, with the common shares being valued first and the balance, if any, allocated to the attached warrants.
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SUPER COPPER CORP.
NOTES TO THE CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS
For the years ended February 28, 2025 and February 29, 2024
(Expressed in Canadian Dollars)
Warrants issued to agents or brokers on a non-cash basis in connection with share capital financings are recorded at fair value using the Black-Scholes option pricing model and charged against share capital as issue costs with an offsetting increase to share-based payments reserve.
j) Share-based payments
Share-based payments to employees are measured at the fair value of the instruments issued and amortized over the vesting periods. Share-based payments to non-employees are measured at the fair value of goods or services received or the fair value of the equity instruments issued, if it is determined the fair value of the goods or services cannot be reliably measured, and are recorded at the date the goods or services are received. The corresponding amount is recorded to the share-based payment reserve. The fair value of options is determined using the Black-Scholes option pricing model which incorporates all market vesting conditions. The number of shares and options expected to vest is reviewed and adjusted at the end of each reporting period such that the amount recognized for services received as consideration for the equity instruments granted shall be based on the number of equity instruments that eventually vest.
When options are exercised, the corresponding amounts previously recorded in the share-based payment reserve are transferred to share capital. When options expire unexercised, the corresponding amounts remain in the share-based payment reserve.
Where the terms and conditions of options are modified before they vest, the increase in the fair value of the options, measured immediately before and after the modification, is also charged to profit or loss over the remaining vesting period.
k) Loss per share
The Company presents basic and diluted loss per common share at each reporting period. The basic loss per common share is calculated by dividing the loss available to common shareholders of the Company by the weighted average number of common shares outstanding during the period. Diluted loss per share does not adjust the loss attributable to common shareholders or the weighted average number of common shares outstanding when the effect is anti-dilutive. The weighted average number of common shares outstanding is adjusted retrospectively for changes in capitalization such as share splits, reverse splits, or cancellations without consideration.
l) Income taxes
Income tax expense comprises current and deferred income tax. Tax is recognized in the income statement except to the extent that it relates to items recognized directly into equity, in which case the related tax effect is recognized in equity.
Current tax expense is based on the results for the period as adjusted for items that are not taxable or not deductible. Current tax expense is calculated using tax rates, laws and government policies that were enacted or substantively enacted at the statement of financial position date.
13
SUPER COPPER CORP.
NOTES TO THE CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS
For the years ended February 28, 2025 and February 29, 2024
(Expressed in Canadian Dollars)
Deferred tax is accounted for using a temporary difference approach and is the tax expected to be payable or recoverable on temporary differences between the carrying amounts of assets and liabilities in the statement of financial position and the corresponding tax bases used in the computation of taxable income. Deferred tax is calculated based on the expected manner in which temporary differences related to the carrying amounts of assets and liabilities are expected to reverse using tax rates and laws enacted or substantively enacted at the statement of financial position date which are expected to apply in the period of reversal.
Deferred tax assets and liabilities are not recognized in respect of temporary differences that arise on initial recognition of assets and liabilities acquired other than in a business combination and which do not affect accounting or taxable profit or loss at the time of the transaction. The following temporary differences are not provided for: goodwill not deductible for tax purposes; the initial recognition of assets or liabilities that affect neither accounting nor taxable loss and at the time of the transaction, does not give rise to equal taxable and deductible temporary differences.
m) Critical accounting estimate, judgments and assumptions
The preparation of these consolidated and combined financial statements in conformity with IFRS® requires management to make judgement and estimates and form assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets/liabilities at the date of the financial statements and reported amount of revenues and expenses during the reporting period. Actual outcomes could differ from these estimates.
On an on-going basis, management evaluates its estimates underlying various assumptions. Significant assumptions about the future and other sources of estimation uncertainty that management has made at the consolidated statement of financial position date that could result in material adjustments to the carrying amounts of assets and liabilities, include the following:
Critical accounting estimates
- Fair value of stock options and warrants
Critical accounting judgments
- Recognition of deferred tax assets and liabilities
- Going concern
- Common control transaction
- ACQUISITION OF SUPER COPPER HOLDINGS LTD.
On February 22, 2024, the Company entered into a share exchange agreement (the "Share Exchange Agreement") with Super Copper Holdings Ltd. (formerly Super Copper Corp.) (the "Subsidiary") and the former holders of the issued and outstanding common shares of the Subsidiary (the "Subsidiary Shareholders"), pursuant to which the Company acquired 100% of the issued and outstanding shares of the Subsidiary from the Subsidiary Shareholders in exchange for 19,200,100 common shares of the Company.
14
SUPER COPPER CORP.
NOTES TO THE CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS
For the years ended February 28, 2025 and February 29, 2024
(Expressed in Canadian Dollars)
The acquisition was considered to be a business combination between entities under common control. As a result, assets acquired and liabilities assumed were recorded at their predecessor carrying values rather than at fair value. The issuance of 19,200,100 shares has been measured based on the net liabilities acquired through Super Copper Holdings Ltd. being $25,560 allocating nil value to the consideration paid with $25,560 charged directly to retained earnings.
4. INVESTMENTS
On February 16, 2022, the Company subscribed for 119 convertible note units in ESE Entertainment Inc. ("ESE") for total investment of $119,000. Each unit consisted of $1,000 in principal amount of an unsecured convertible note and 250 common share purchase warrants of ESE. The convertible note bore interest at a simple rate of 10% per annum and matured on February 16, 2024. Each warrant was exercisable into one common share of ESE at a price of $1.60 per share expiring two years from closing. The warrants expired unexercised on February 16, 2024.
On April 8, 2022, the Company subscribed for 1 convertible note unit in ESE for total investment of $1,000. Each unit consisted of $1,000 in principal amount of an unsecured convertible note and 313 common share purchase warrants of ESE. The convertible note bore interest at a simple rate of 10% per annum and matured on April 7, 2024. Each warrant was exercisable into one common share of ESE at a price of $1.60 per share expiring two years from closing. The warrants expired unexercised on April 7, 2024.
On August 17, 2023, the convertible notes were repaid. The convertible notes were fair valued using the convertible bond model with the following assumptions: Share price of $0.175; risk-free interest rate of 4.96%; credit spread - 25.97% and annualized volatility of 71.29% using comparable companies.
The changes in the convertible note receivable during the years ended February 28, 2025 and February 29, 2024 were as follows:
| $ | |
|---|---|
| Balance, February 28, 2023 | 99,134 |
| Gain on investment | 20,866 |
| Repayment | (120,000) |
| Balance, February 29, 2024 and February 28, 2025 | - |
During the year ended February 28, 2025, $nil (February 29, 2024 - $5,558) of interest income were recorded on the convertible notes.
The changes in the warrants during the years ended February 28, 2025 and February 29, 2024 were as follows:
SUPER COPPER CORP.
NOTES TO THE CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS
For the years ended February 28, 2025 and February 29, 2024
(Expressed in Canadian Dollars)
| $ | |
|---|---|
| Balance, February 28, 2023 | 958 |
| Loss on investment | (958) |
| Balance, February 29, 2024 and February 28, 2025 | - |
5. EXPLORATION AND EVALUATION ASSET
The Company, through Super Copper Holdings Ltd., entered into a joint venture agreement dated September 1, 2023 (the "JV Agreement") with Gardner Y Esteffan Limitada ("Gareste"), a Chilean corporation, regarding the future exploration and development of the Cordillera Cobre mineral project (the "Cordillera Cobre Property") located in the Atacama Region of the Republic of Chile. The Cordillera Cobre Property is an exploration stage property that is comprised of 27 applications for exploitation claims. The applications are pending regulatory approval required to certify the mining concessions.
Pursuant to the JV Agreement, the Subsidiary, has the right to earn-in up to a 100% net interest in the Cordillera Cobre Property in consideration of (a) incurring expenditures on the property in the amount of US$2,490,000 (the "Earn-in Expenditures"), (b) making cash payments to Gareste in the amount of US$2,050,000 (the "Earn-in Payments"), and (c) issuing 6,000,000 common shares of the Company to Gareste or its designee as follows:
| Payment Deadline | Earn-in Expenditures and Payments | Share Consideration | Percentage Interest Earned | Aggregate Interest Earned | |
|---|---|---|---|---|---|
| 1. | Within 14 days of execution of JV Agreement | US$50,000 (Earn-in Payment) (paid) | Nil | Nil | Nil |
| 2. | On or before the date that is 30 days after execution of JV Agreement | US$100,000 (Earn-in Expenditure) (completed) | Nil | Nil | Nil |
| 3. | On or before the date that is 14 days following completion of a go-public financing | US$100,000 (Earn-in Expenditure) (completed) | Nil | 10% | 10% |
| 4. | On or before the date that is 16 months of becoming a publicly listed entity | US$500,000 (Earn-in Expenditure) | 1,000,000 | 15% | 25% |
16
17
SUPER COPPER CORP.
NOTES TO THE CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS
For the years ended February 28, 2025 and February 29, 2024
(Expressed in Canadian Dollars)
| 5. | On or before the date that is 30 months after execution of JV Agreement | US$1,350,000 (Earn-in Expenditure) | 2,000,000 | 24% | 49% |
|---|---|---|---|---|---|
| 6. | On or before the date that is 42 months after execution of JV Agreement | US$440,000 (Earn-in Expenditure) | 1,000,000 | 2% | 51% |
| 7. | On or before the date that is 54 months after execution of JV Agreement | US$2,000,000 (Earn-in Payment) | 2,000,000 | 49% | 100% |
| TOTAL: | US$4,540,000 | ||||
| (US$2,050,000 Earn-in Payments / US$2,490,000 Earn-in Expenditures) | 6,000,000 | 100% |
On April 18, 2024, the Company has earned 10% of the project interest in the Cordillera Cobre Property.
The term of the JV Agreement is 20 years, with a 2-year automatic renewal thereafter, unless the JV Agreement is earlier terminated. A party whose interest is diluted to less than 10% will have its interest converted to a 2.0% net smelter return royalty.
The exploration and evaluation expenditures incurred during the years ended February 28, 2025 and February 29, 2024 are as follows:
| February 28, 2025 | February 29, 2024 | |
|---|---|---|
| $ | $ | |
| Claim renewal fees | 30,000 | 68,990 |
| Field supplies | 1,970 | - |
| Geological consulting | 200,396 | 64,250 |
| Labs and analysis | 17,461 | - |
| Survey and mapping | 24,214 | - |
| Travel | 27,443 | - |
| 301,484 | 133,240 |
SUPER COPPER CORP.
NOTES TO THE CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS
For the years ended February 28, 2025 and February 29, 2024
(Expressed in Canadian Dollars)
6. DUE TO RELATED PARTY
During the year ended February 28, 2025, the Company received advances of $20,000. The advances are unsecured, interest-free and payable on demand. The balance due to related party as at February 28, 2025 was $22,907 (February 29, 2024 – $2,907). Advances of $20,000 have been repaid subsequent to February 28, 2025.
7. SHARE CAPITAL
a) Authorized – Unlimited common shares without par value.
b) Issued and outstanding share capital
On July 11, 2023, Super Copper Holdings Ltd. issued 100 seed shares for nominal gross proceeds.
On July 28, 2023, Super Copper Holdings Ltd. issued 7,500,000 common shares for gross proceeds of $37,500.
On August 16, 2023, Super Copper Holdings Ltd. issued 300,000 common shares for gross proceeds of $30,000. Finder’s fees of $1,800 were paid in connection with the share issuance. The 300,000 common shares were cancelled on February 16, 2024.
On August 23, 2023, Super Copper Holdings Ltd. issued 11,000,000 common shares valued at $220,000 for debt settlement with a company 100% owned by a director of the Company.
On November 15, 2023, Super Copper Holdings Ltd. issued 300,000 common shares for gross proceeds of $30,000.
On January 15, 2024, Super Copper Holdings Ltd. issued 400,000 common shares for gross proceeds of $40,000. Share issuance costs of $5,273 were incurred.
On February 22, 2024, the Company issued 19,200,100 common shares in exchange for acquisition of Super Copper Holdings Ltd. Refer to Note 3. Upon acquisition, the share capital balance of Super Copper Holdings Ltd. included in the consolidated and combined financial statements was eliminated.
On March 12, March 15, 2024, and April 10, 2024, the Company completed private placements of an aggregate of 1,100,000 common shares at a price of $0.10 per share for aggregate gross proceeds of $110,000. Share issuance costs of $4,300 were incurred.
On April 26, 2024, the Company completed the first tranche of a subscription receipt private placement (“Subscription Receipt Private Placement”) at a price of $0.20 per Subscription Receipt for gross proceeds of $385,160 and issued 1,925,800 Subscription Receipts. Each Subscription Receipt entitled the holder thereof to receive one common share of the Company on the date (the “Conversion Date”) that is within 10 business days after the later of the date that: (i) the Company obtains a Final Receipt for the Prospectus; and (ii) the
18
SUPER COPPER CORP.
NOTES TO THE CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS
For the years ended February 28, 2025 and February 29, 2024
(Expressed in Canadian Dollars)
receipt of conditional approval of the CSE (the “Escrow Release Conditions”).
In connection with the first tranche, 4,050 finder’s warrants (“Finder’s Warrants”) were issued. Each Finder’s Warrant entitles the holder to acquire one common share of the Company at an exercise price of $0.20 per common share until October 26, 2026. The fair value of the Finder’s Warrants issued has been estimated to be $439 using the Black-Scholes option pricing model using the following assumptions: share price at the time of issuance $0.20; risk-free interest rate of 4.43%; expected life of 2 years; dividend yield of 0%; forfeiture rate of 0% and annualized volatility of 100%.
On April 30, 2024, the Company completed the second tranche of its Subscription Receipt Private Placement at a price of $0.20 per Subscription Receipt for gross proceeds of $245,000 and issued 1,225,000 Subscription Receipts. In connection with the second tranche, 35,250 Finder’s Warrants were issued. These Finder’s Warrants have an expiry date of April 30, 2026. The fair value of the Finder’s Warrants issued has been estimated to be $3,818 using the Black-Scholes option pricing model using the following assumptions: share price at the time of issuance $0.20; risk-free interest rate of 4.45%; expected life of 2 years; dividend yield of 0%; forfeiture rate of 0% and annualized volatility of 100%.
On June 7, 2024, the Company completed the third tranche of its Subscription Receipt Private Placement at a price of $0.20 per Subscription Receipt for gross proceeds of $94,840 and issued 474,200 Subscription Receipts. In connection with the third tranche, 3,870 Finder’s Warrants were issued. These Finder’s Warrants have an expiry date of June 7, 2026. The fair value of the Finder’s Warrants issued has been estimated to be $418 using the Black-Scholes option pricing model using the following assumptions: share price at the time of issuance $0.20; risk-free interest rate of 4.03%; expected life of 2 years; dividend yield of 0%; forfeiture rate of 0% and annualized volatility of 100%.
On August 29, 2024, the Company completed a private placement of 825,000 common shares at a price of $0.20 per share for gross proceeds of $165,000. Share issuance costs of $6,180 were incurred.
On September 26, 2024, a total of 3,625,000 Subscription Receipts were deemed converted into 3,625,000 common shares, and the Company also issued the remaining one-half finder’s fees, being a total of 43,170 Finder’s Warrants and $8,634 cash. Additional share issuance costs of $36,805 were incurred in cash. The Finder’s Warrants are exercisable into common shares at $0.20 per share until September 26, 2026. The fair value of the Finder’s Warrants issued has been estimated to be $4,617 using the Black-Scholes option pricing model using the following assumptions: share price at the time of issuance $0.20; risk-free interest rate of 3.01%; expected life of 2 years; dividend yield of 0%; forfeiture rate of 0% and annualized volatility of 100%.
On December 27, 2024, the Company closed the first tranche of a non-brokered private placement (the "Offering") and issued 1,238,932 units at a price of $0.23 per unit, raising gross proceeds of $284,954. Each unit consists of one common share of the Company and one common share purchase warrant (a "Warrant"). Each Warrant entitles the holder to purchase one additional common share of the Company at a price of $0.30 per share until December 27, 2026, subject to acceleration. The Company allocated $nil to the Warrants. The Company paid cash finder’s fees of $11,249 in connection with the first tranche of the Offering.
19
SUPER COPPER CORP.
NOTES TO THE CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS
For the years ended February 28, 2025 and February 29, 2024
(Expressed in Canadian Dollars)
On January 15, 2025, the Company closed the second and final tranche of the Offering and issued 556,722 units at a price of $0.23 per unit, raising gross proceeds of $128,046. Each unit consists of one common share of the Company and a Warrant. Each Warrant entitles the holder to purchase one additional common share of the Company at a price of $0.30 per share until January 15, 2027, subject to acceleration. The Company allocated $nil to the Warrants. The Company paid cash finder's fees of $5,594 and incurred share issuance costs of $14,884 in connection with the second tranche of the Offering.
The Warrants are subject to an acceleration right held by the Company, such that if the share price closes at $0.45 or above for a period of five consecutive trading days, the Company may, at any time after such an occurrence, give written notice (via news release) to the holders of the Warrants that the Warrants will expire at 5:00 p.m. (Vancouver time) on the 30th day following the giving of notice, unless exercised by the holders prior to such date.
On February 27, 2025, the Company closed the first tranche of a non-brokered private placement and issued 437,500 units at a price of $0.40 per unit, raising gross proceeds of $175,000. Each unit consists of one common share of the Company and a Warrant. Each Warrant entitles the holder to purchase one additional common share of the Company at a price of $0.65 per share until February 27, 2027, subject to acceleration. The Company allocated $nil to the Warrants. The Company paid cash finder's fees of $6,650, incurred share issuance costs of $4,970 and issued 16,625 finder's warrants. The finder's warrants are exercisable into common shares at $0.65 per share until February 27, 2027. The fair value of the finder's warrants issued has been estimated to be $3,211 using the Black-Scholes option pricing model using the following assumptions: share price at the time of issuance $0.44; risk-free interest rate of 2.64%; expected life of 2 years; dividend yield of 0%; forfeiture rate of 0% and annualized volatility of 100%.
The Warrants are subject to an acceleration right held by the Company, such that if the share price closes at $1.00 or above for a period of five consecutive trading days, the Company may, at any time after such an occurrence, give written notice (via news release) to the holders of the Warrants that the Warrants will expire at 5:00 p.m. (Vancouver time) on the 30th day following the giving of notice unless exercised by the holders prior to such date.
During the year ended February 28, 2025, 85,000 stock options were exercised for gross proceeds of $19,625. $18,565 were transferred from reserves to share capital as a result.
During the year ended February 28, 2025, 86,340 finders warrants were exercised for gross proceeds of $17,268. $9,291 were transferred from reserves to share capital as a result.
20
SUPER COPPER CORP.
NOTES TO THE CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS
For the years ended February 28, 2025 and February 29, 2024
(Expressed in Canadian Dollars)
c) Options
Pursuant to the Company's equity incentive compensation plan (the "Option Plan"), the Company may grant incentive stock options to directors, officers, employees and consultants of the Company or any subsidiary thereof. The total number of shares issuable pursuant to the Option Plan is up to a maximum of 20% of the issued and outstanding common shares of the Company at any given time. The exercise price of each stock option shall not be lower than the market price or such discount from the market price as may be permitted by the stock exchange on which the common shares are listed and provided that no stock option shall have a term exceeding ten years. The Board of Directors determines the vesting terms of the stock options which may vary between grants.
The activity of the stock options during the years ended February 28, 2025 and February 29, 2024 is as follows:
| Options # | Weighted average exercise price CAD$ | |
|---|---|---|
| Balance outstanding, February 29, 2024 | - | - |
| Granted | 5,015,000 | 0.29 |
| Cancelled | (175,000) | 0.20 |
| Exercised | (85,000) | 0.23 |
| Balance outstanding, February 28, 2025 | 4,755,000 | 0.30 |
The weighted average fair value of stock options granted during the year ended February 28, 2025 of $0.21 was estimated using the Black-Scholes option pricing model with the following weighted average assumptions:
| 2025 | |
|---|---|
| Stock price | $0.29 |
| Exercise price | $0.29 |
| Risk-free interest rate | 2.98% |
| Expected life | 5.0 years |
| Expected volatility | 100% |
| Expected dividends | Nil |
The options granted vested immediately upon grant. Expected volatility is based on peer companies' volatilities.
During the year ended February 28, 2025, the Company recorded $1,077,831 (2024 - $nil) of share-based compensation expense.
21
22
SUPER COPPER CORP.
NOTES TO THE CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS
For the years ended February 28, 2025 and February 29, 2024
(Expressed in Canadian Dollars)
As at February 28, 2025, the Company had the following stock options outstanding:
| Expiry Date | Exercise Price $ | Remaining Life (Years) | Options Outstanding and Exercisable # |
|---|---|---|---|
| October 7, 2029 | 0.20 | 4.61 | 225,000 |
| October 22, 2029 | 0.275 | 4.65 | 3,230,000^{(1)} |
| November 22, 2029 | 0.275 | 4.73 | 200,000 |
| January 9, 2030 | 0.385 | 4.87 | 1,100,000^{(2)} |
| 0.30 | 4,755,000 |
(1) Subsequent to February 28, 2025, 131,000 of these stock options were exercised and 600,000 of these stock options were cancelled.
(2) Subsequent to February 28, 2025, 600,000 of these stock options were cancelled.
d) Warrants
A summary of warrants activity is as follows:
| Warrants # | Weighted average exercise price CAD$ | |
|---|---|---|
| Balance outstanding, February 29, 2024 | - | - |
| Issued | 2,233,154 | 0.37 |
| Balance outstanding, February 28, 2025 | 2,233,154 | 0.37 |
As at February 28, 2025, the Company had the following warrants outstanding:
| Expiry Date | Exercise Price $ | Remaining Life (Years) | Warrants Outstanding # |
|---|---|---|---|
| December 27, 2026 | 0.30 | 1.83 | 1,238,932 |
| January 15, 2027 | 0.30 | 1.88 | 556,722 |
| February 27, 2027 | 0.65 | 2.00 | 437,500 |
| 0.37 | 2,233,154 |
SUPER COPPER CORP.
NOTES TO THE CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS
For the years ended February 28, 2025 and February 29, 2024
(Expressed in Canadian Dollars)
e) Finders Warrants
A summary of finders warrants activity is as follows:
| Finders warrants # | Weighted average exercise price CAD$ | |
|---|---|---|
| Balance outstanding, February 29, 2024 | - | - |
| Issued | 102,965 | 0.27 |
| Exercised | (86,340) | 0.20 |
| Balance outstanding, February 28, 2025 | 16,625 | 0.65 |
As at February 28, 2025, the Company had the following finders warrants outstanding:
| Expiry Date | Exercise Price $ | Remaining Life (Years) | Warrants Outstanding # |
|---|---|---|---|
| February 27, 2027 | 0.65 | 2.00 | 16,625 |
| 16,625 |
- FINANCIAL INSTRUMENTS AND RISK
Classification and Fair Value of Financial Instruments
IFRS 7, Financial Instruments: Disclosures, establishes a fair value hierarchy that reflects the significance of the inputs used in making the measurements. The fair value hierarchy has the following levels:
Level 1 - quoted prices (unadjusted) in active markets for identical assets or liabilities;
Level 2 - inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and
Level 3 - inputs for the asset or liability that are not based on observable market data (unobservable inputs).
The Company's financial instruments include cash, due to related party and accounts payable and accrued liabilities. Financial instruments are classified into one of the following categories: FVTPL, FVTOC, or amortized cost. The carrying values of the Company's financial instruments are classified into the following categories:
24
SUPER COPPER CORP.
NOTES TO THE CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS
For the years ended February 28, 2025 and February 29, 2024
(Expressed in Canadian Dollars)
| Financial Instrument | Category | February 28, 2025 | February 29, 2024 |
|---|---|---|---|
| $ | $ | ||
| Cash | FVTPL | 169,515 | 55,947 |
| Due to related party | Amortized cost | 22,907 | 2,907 |
| Accounts payable and accrued liabilities | Amortized cost | 281,190 | 259,854 |
Cash is carried at fair value using a level 1 fair value measurement. The carrying values of due to related party and accounts payable and accrued liabilities approximate their fair values due to the relatively short periods of maturity of these instruments.
Credit risk
Credit risk is the risk of financial loss to the Company if a counterparty to a financial instrument fails to meet its contractual obligations. The Company's credit risk is primarily attributable to its cash. The Company limits exposure to credit risk by maintaining its cash with financial institutions. Deposits held with these institutions may exceed the amount of insurance provided on such deposits. The Company's maximum exposure to credit risk at the reporting date is the carrying value of cash.
Liquidity risk
Liquidity risk is the risk that the Company will not meet its financial obligations as they fall due. The Company's objective to managing liquidity risk is to ensure that it has sufficient liquidity available to meet liabilities when due. As at February 28, 2025, the Company had current liabilities of $304,097 and cash balance of $169,515. All of the Company's current financial liabilities have contractual maturities of 30 days or are due on demand and are subject to normal trade terms.
9. CAPITAL MANAGEMENT
The Company's objectives when managing capital are to safeguard its ability to continue as a going concern and to maintain a flexible capital structure which optimizes the cost of capital within a framework of acceptable risk. The Company manages its capital structure and makes adjustments to it in light of changes in economic conditions and the risk of characteristics of the underlying assets. In order to maintain or adjust the capital structure, the Company issues new shares through private placements.
The Company is not subject to any external capital requirement.
As at February 28, 2025, the Company's capital structure consists of share capital and deficit.
SUPER COPPER CORP.
NOTES TO THE CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS
For the years ended February 28, 2025 and February 29, 2024
(Expressed in Canadian Dollars)
10. RELATED PARTY TRANSACTIONS
Key management personnel are those persons responsible for planning, directing and controlling the activities of the entity, and include executives and non-executive directors. The Company incurred charges from directors and officers, or to companies controlled by these individuals during the years ended February 28, 2025 and February 29, 2024 as follows:
| February 28, 2025 | February 29, 2024 | |
|---|---|---|
| $ | $ | |
| Accounting fees | 54,905 | - |
| Consulting fees | 140,000 | 347,500 |
| Share-based compensation | 240,087 | - |
| 434,992 | 347,500 |
During the year ended February 28, 2025, the Company incurred $140,000 (February 29, 2024 – $347,500) to companies 100% owned by a director of the Company for technology, geological, and capital markets consulting services. $220,000 of the fees in 2024 were settled with common shares of the Company. The Company also incurred $54,905 (February 29, 2024 – $nil) to a company in which the CFO is an owner for accounting and financial reporting services.
Accounts payable and accrued liabilities at February 28, 2025 includes $61,292 (February 29, 2024 – $143,481) due to a company 100% owned by a director of the Company, and a company in which the CFO is an owner.
11. COMMITMENTS
The Company entered into a management consulting agreement with a company 100% owned by a director of the Company on April 1, 2024, which replaces all previously entered consulting agreements. The new agreement has a term of 4 years. The agreement includes a monthly fee of $8,000, certain employment benefits, and a bonus which can be achieved through the completion of certain performance conditions related to M&A and investment transactions in the Company. The bonus is calculated based on amount equal to 5% of the transaction value, with transaction value being all consideration either paid or received, in cash or securities, in a merger, acquisition, investment or other transaction with an aggregate value over $10,000. There is also a bonus related to exchange listings and market capitalization.
12. INCOME TAXES
The following table reconciles the expected income taxes recovery at the Canadian statutory income tax rates to the amounts recognized in the statements of loss and comprehensive loss for the years ended February 28, 2025 and February 29, 2024:
26
SUPER COPPER CORP.
NOTES TO THE CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS
For the years ended February 28, 2025 and February 29, 2024
(Expressed in Canadian Dollars)
| 2025 | 2024 | |
|---|---|---|
| Statutory tax rate | 27% | 27% |
| $ | $ | |
| Loss before income taxes | (2,330,317) | (532,449) |
| Expected income tax recovery at statutory rate | (629,185) | (143,760) |
| Share based compensation and non-deductible expenses | 291,014 | 63,490 |
| Tax rate differential | (10,839) | 9,130 |
| Share issuance cost booked directly to equity | (6,431) | (1,420) |
| Change in deferred tax asset not recognized | 355,441 | 72,560 |
| Income tax recovery | - | - |
Deferred taxes are provided as a result of temporary differences that arise due to the differences between the income tax values and the carrying amount of assets and liabilities. Deferred tax assets have not been recognized in respect of the following deductible temporary differences as at February 28, 2025 and February 29, 2024:
| 2025 | 2024 | |
|---|---|---|
| $ | $ | |
| Non-capital loss carry forward | 500,000 | 388,640 |
| Capital loss available for carryforward | - | 67,590 |
| 20(1)(e) financing pool | 25,000 | 5,440 |
| Exploration expenditures | - | 65,650 |
| Total | 525,000 | 527,320 |
Share issuance and financing costs will be fully amortized in 2029. Non-capital losses are expected to expire between 2039 and 2045. The remaining deductible temporary differences may be carried forward indefinitely. Deferred tax assets have not been recognized in respect of these items because it is not probable that future taxable profit will be available against which the Company can utilize the benefits therefrom.
The Company's Canadian non-capital income tax losses expire as follows:
| $ | |
|---|---|
| 2039 | 120 |
| 2040 | 5,150 |
| 2041 | 72,470 |
| 2042 | 70,870 |
| 2043 | 53,640 |
| 2044 | 419,920 |
| 2045 | 1,228,650 |
| 1,850,820 |
SUPER COPPER CORP.
NOTES TO THE CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS
For the years ended February 28, 2025 and February 29, 2024
(Expressed in Canadian Dollars)
13. SUBSEQUENT EVENTS
On March 9, 2025, the Company granted a total of 750,000 stock options to consultants. The stock options have an exercise price of $0.50 per share and expire five years from the date of grant. The stock options vested immediately.
On March 9, 2025, the Company granted 500,000 restricted share units ("RSUs") to a consultant. The RSUs was to vest on July 9, 2025. However, on April 15, 2025, the consulting agreement with the consultant was terminated and accordingly, the RSUs have been forfeited.
On March 20, 2025, the Company closed the second and final tranche of a non-brokered private placement and issued 850,000 units at a price of $0.40 per unit, raising gross proceeds of $340,000. Each unit consists of one common share of the Company and a Warrant. Each Warrant entitles the holder to purchase one additional common share of the Company at a price of $0.65 per share until March 20, 2027, subject to acceleration. The Company paid cash finder's fees of $2,660 and US$2,500 and issued 6,650 finder's warrants. The finder's warrants are exercisable into common shares at $0.65 per share until March 20, 2027.
The Warrants are subject to an acceleration right held by the Company, such that if the share price closes at $1.00 or above for a period of five consecutive trading days, the Company may, at any time after such an occurrence, give written notice (via news release) to the holders of the Warrants that the Warrants will expire at 5:00 p.m. (Vancouver time) on the 30th day following the giving of notice unless exercised by the holders prior to such date.
On March 14, 2025, 36,000 stock options were exercised for gross proceeds of $9,900.
On March 25, 2025, 95,000 stock options were exercised for gross proceeds of $26,125.
On May 29, 2025, the Company closed a non-brokered private placement and issued 4,000,000 units at a price of $0.25 per unit to Apeiron Investment Group Limited ("Apeiron"), raising gross proceeds of $1,000,000. Each unit consists of one common share of the Company and a Warrant. Each Warrant entitles the holder to purchase one additional common share of the Company at a price of $0.30 per share until May 29, 2028. In exchange for Apeiron providing advisory services to the Company, the Company also granted 3,000,000 RSUs on closing of the private placement. To facilitate the granting of the RSUs, an aggregate of 1,200,000 outstanding options were cancelled.
27