What changed in this filing

/stocks — the workspaceLOADING

Item 2. Management’s Discussion and Analysis

2024-11-12 compared with 2024-05-14 · 37 added, 72 removed, 105 unchanged (51% of the section changed)

26 unchanged sentences

The following discussion updates our outlook and plan of operations for the foreseeable future.

It also analyzes our financial condition and summarizes the results of our operations for the three and nine months ended March 31, 2024 and compares these results to the results of the prior year three and nine months ended March 31, 2023.

It also analyzes our financial condition and summarizes the results of our operations for the three months ended September 30, 2024 and compares these results to the results of the prior year three months ended September 30, 2023.

Operating Highlights:

For the three and nine months ended March 31, 2024, the Company highlights include:

• The BLM filed the Notice of Intent in the Federal Registry, initiating the preparation of an Environmental Impact Statement in compliance with the National Environmental Policy Act process for the proposed Grassy Mountain Gold mine.

• Paramount closed a $15 million financing with Sprott through the issuance of a Debenture.

The proceeds of the Debenture will be used to fund the continued permitting of the proposed Grassy Mountain Gold Mine and general corporate purposes.

It was also used to repay the Company's outstanding debt.

• The State of Oregon issued a Notice to Proceed with the permitting and preparation of draft permits.

• The State of Oregon's Technical Review Team determined that Paramount's Consolidated Permit Application for the Grassy Mountain Project is complete.

• Completed an updated technical report summary ("TRS") for the Sleeper Gold Property under Item 1300 of Regulation S-K.

For the three months ended September 30, 2024, the Company highlights include:

• The State of Oregon's Technical Review Team approved the completion of the Environmental Evaluation (“EE”) for the Grassy Mountain project.

The approval commenced the 225 day clock for the writing of draft permits under State law.

Outlook and Plan of Operation:

4 unchanged sentences

We ensure we have sufficient cash on hand to meet our annual land holding costs as the maintenance of mining claims and leases are essential to preserve the value of our mineral property assets.

Comparison of Operating Results for the nine months ended March 31, 2024 and 2023

We did not earn any revenue from mining operations for the nine months ended March 31, 2024 and 2023.

Our net loss for three months ended March 31, 2024 was $1,814,045 compared to a net loss of $1,647,760 in the previous three months ended March 31, 2023.

The drivers of the increase in net loss of 10% are fully described below.

Our net loss for nine months ended March 31, 2024, was $5,462,764 compared to a net loss of $4,920,461 in the previous nine month period ended March 31, 2023.

The drivers of the increase in net loss of 11% are fully described below.

Comparison of Operating Results for the three months ended September 30, 2024 and 2023

We did not earn any revenue from mining operations for the three months ended September 30, 2024 and 2023.

Our net loss for three months ended September 30, 2024 was $1,572,138 compared to a net loss of $2,074,160 in the previous three months ended September 30, 2023.

The drivers of the decrease in net loss of 24% are fully described below.

The Company expects to incur losses for the foreseeable future as we continue with our planned exploration and development programs.

Exploration and Land Holding Costs

For the three months ended March 31, 2024 and 2023, exploration expenses were $965,938 and $597,315, respectively.

This represents an increase of 62% or $368,623.

Exploration, Development, Reclamation and Land Holding Costs

For the three months ended September 30, 2024 and 2023, exploration expenses were $395,298 and $513,097, respectively.

This represents an decrease of 23% or $117,799.

Expenses related to our exploration or development activities are generally not comparable from period to period as activities will vary based on several factors.

At Grassy Mountain the Company continued with permitting activities with state and federal permitting agencies.

These expenses totaled $604,716.

At Grassy Mountain, the Company continued with permitting activities with state and federal permitting agencies and these expenses totaled $337,069.

A significant amount of the expenses incurred were related to the State of Oregon completing its environmental evaluation of the proposed gold mine at Grassy Mountain.

At Sleeper, the Company completed the conversion of several collection ponds from the previous mining operations to evaporation cells with expenses totaling $361,222.

For the three months ended March 31, 2024 and 2023, $1,088,339 and $47,123 of the costs associated with the reclamation work have been reimbursed by an insurance policy and these reimbursements have been recorded as other income on the Statement of Operations, respectively.

In the prior year comparable period, the Company focused its efforts on completing permit applications for the Grassy Mountain Project and incurred expenses related to reclamation activities its Sleeper Gold Project.

For the three months ended March 31, 2024 and 2023, land holding costs were $157,143 and $157,143, respectively.

There were no changes in our land holdings and costs associated with holding our mining claims remaining unchanged from last year to this year.

For the nine months ended March 31, 2024 and 2023, exploration expenses were $3,999,659 and $1,902,312, respectively.

This represents a increase of 110% or $2,097,347.

Expenses related to our exploration or development activities are generally not comparable from period to period as activities will vary based on several factors.

At Grassy Mountain the Company continued with permitting activities with state and federal permitting agencies.

These expenses totaled $1,170,834.

At Sleeper, the Company completed an updated TRS and completed converting several collection ponds from the previous mining operations to evaporation cells with expenses totaling $2,828,825.

For the nine months ended March 31, 2024 and 2023, $2,381,272 and $87,431 of the costs associated with the reclamation work have been reimbursed by an insurance policy and these reimbursements have been recorded as other income on the Statement of Operations, respectively.

For the nine months ended March 31, 2024 and 2023, land holding costs were $471,429 and $475,341, respectively.

At Sleeper, expense of $58,229 were related to general maintenance of operations and mining claims.

For the three months ended September 30, 2024 and 2023, reclamation expenses were $53,937 and $746,696, respectively.

This represents a decrease of 93% or $ 692,759.

The immaterial change is due to no changes in our land holdings and costs associated with holding our mining claims remaining unchanged from last year to this year.

The decrease in reclamation expenses reflects that in the previous year comparable period the Company was conducting a one-time conversion of historical mining collection ponds to e-cell conversion ponds.

This work was substantially completed in the previous fiscal year.

On-going regular monitoring activities for the Sleeper Gold project continue year to year.

For the three months ended September 30, 2024 and 2023, land holding costs were $166,565 and $157,143, respectively.

The increase in land holding costs of $9,422 from the previous period relates to the increase in holding costs imposed by the BLM commencing in September 2024.

Salaries and Benefits

For the three month period ended March 31, 2024 and 2023, salary and benefits were $675,952 and $393,219, respectively.

For the three month period ended September 30, 2024 and 2023, salary and benefits were $288,480 and $279,596, respectively.

This represents an increase of 3%.

Salary and benefits are comprised of cash and equity based compensation of the Company’s executive and corporate administration teams.

The increase primarily reflects annual bonuses for 2023 paid to employees in the three month period ended March 31, 2024 compared to the three month period ended March 31, 2023.

Included in the salary and benefits expense amount for the three months ended March 31, 2024 and 2023 was non-cash equity based compensation of $65,134 and $72,490, respectively.

For the nine months ended March 31, 2024 and 2023, salary and benefits were $1,214,742 and $961,512, respectively.

This represents an increase of 26% or $253,230.

Salary and benefits are comprised of cash and equity based compensation of the Company’s executive and corporate administration teams.

The increase primarily reflects annual bonuses for 2023 paid to employees during the nine month period ended March 31, 2024 compared to the nine month period ended March 31, 2023.

Included in the salary and benefits expense amount for the nine months ended March 31, 2024 and 2023 was non-cash equity based compensation of $168,471 and $237,037.

The increase primarily reflects increases to base salaries paid to employees in the three month period ended September 30, 2024 compared to the three month period ended September 30, 2023.

Included in the salary and benefits expense amount for the three months ended September 30, 2024 and 2023 was non-cash equity based compensation of $47,830 and $63,254, respectively.

Directors’ Compensation

For the three month period ended March 31, 2024 and 2023, directors’ compensation expenses were $90,076 and $55,366, respectively.

For the three month period ended September 30, 2024 and 2023, directors’ compensation expenses were $51,530 and $29,033, respectively.

This represents an increase of 77%.

1 unchanged sentence

The increase reflects higher equity based compensation recorded in the current quarter compared to the prior year’s comparable period.

For the nine months ended March 31, 2024 and 2023, directors' compensation expenses were $148,059 and $113,940, respectively.

This represents an increase of 30%.

The increase reflects higher equity based compensation recorded in the current quarter compared to the prior year’s period.

Professional Fees and General and Administration

For the three months ended March 31, 2024 and 2023, professional fees were $52,156 and $12,919, respectively.

For the three months ended September 30, 2024 and 2023, professional fees were $171,997 and $55,252, respectively.

This represents an increase of $116,745.

The increase was mainly due to in one-time consulting fees and legal fees incurred in the period.

Professional fees include legal, audit, advisory and consultant expenses incurred on corporate and operational activities being performed by the Company on a period-by-period basis.

For the nine months ended March 31, 2024 and 2023, professional fees were $205,722 and $281,542, respectively.

This represents a decrease of $75,820.

The decrease was mainly due to the recording of audit fees for our fiscal year ended June 30, 2022 during the three months ended September 30, 2022.

The increase was mainly due to consulting fees and legal fees incurred in the current period that were not incurred in the previous year comparable period.

Professional fees include legal, audit, advisory and consultant expenses incurred on corporate and operational activities being performed by the Company on a period-by-period basis.

For the three months ended March 31, 2024 and 2023, general and administration expenses decreased by 39% to $148,306 from $242,858.

The decrease in general and administration expenses from the previous year’s comparable period was mainly due to lower insurance and travel costs.

For the nine months ended March 31, 2024 and 2023, general and administration expenses decreased by 25% to $462,951 from $616,396.

The decrease in general and administration expenses from the previous year’s comparable period was mainly due to lower insurance and travel costs.

For the three months ended September 30, 2024 and 2023, general and administration expenses increased by 38% to $188,313 from $136,283.

The increase in general and administration expenses from the previous year’s comparable period was mainly due to higher insurance, marketing and travel costs.

Liquidity and Capital Resources

As an exploration and development company, Paramount funds its operations, reclamation activities and discretionary exploration programs with its cash on hand.

At March 31, 2024, we had cash and cash equivalents of $7,012,365 compared to $824,920 as at June 30, 2023.

At September 30, 2024, we had cash and cash equivalents of $4,293,941 compared to $5,423,059 as at June 30, 2024.

We had working capital of approximately $4,838,147.

2 unchanged sentences

("Cantor") and Canaccord Genuity LLC to proactively increase its financial flexibility.

In March 2024, the Company established a new $3.1 million "at the market" offering program with Cantor and A.G.P./Alliance Global Partners.

During the nine months ended March 31, 2024, the Company issued 4,261,515 shares under the program for net proceeds of $1,167,893.

Subsequent to the period ended March 31, 2024, the Company sold 1,727,026 shares under the program for gross proceeds of $719,351.

During the month of December 2023, the Company entered into a Debenture in favor of Sprott.

Pursuant to the Debenture, Sprott advanced $15,000,000 to Paramount, which will be used to fund the continued permitting of the proposed Grassy Mountain Gold Mine and for general corporate purposes.

Proceeds from the Debenture were also used for the repayment of the Company’s outstanding 2019 secured convertible notes and its bridge promissory note in favor of Seabridge Gold Inc.

The main uses of cash for the nine months ended March 31, 2024 were:

In May 2024, the Company established a new $7 million "at the market" offering program with Cantor and A.G.P./Alliance Global Partners.

During the three months ended September 30, 2024, the Company issued 114,918 shares under the program for net proceeds of $46,358.

The main uses of cash for the three months ended September 30, 2024 were:

• Cash used in operating activities of $1,167,455 were mainly used to fund our permitting and exploration activities at our projects, salary and benefits costs of our employees and ongoing general and administration costs.

• Cash used in investing activities of $100,000 for the payment on the agreement to purchase the Bald Peak claims and on the agreement to purchase the Frost claims.

In addition to cash used in operating and investing activities, the Company received cash during the nine months ended March 31, 2024 as follows:

• Cash provided by financing activities of $9,352,259 which included sales under the ATM program, proceeds from the issuance of the Debenture to Sprott which were offset by the repayment of the 2019 convertible notes and Seabridge Loan.

• Cash used in investing activities of $8,021 for the purchase of computer equipment.

In addition to cash used in operating and investing activities, the Company received cash during the three months ended September 30, 2024 as follows:

• Cash provided by financing activities of $46,358 from sales under the ATM program.

Going Concern and Capital Resources

The Consolidated Financial Statements of the Company have been prepared on a “going concern” basis, which means that the continuation of the Company is presumed even though events and conditions exist that, when considered in aggregate, raise substantial doubt about the Company’s ability to continue as a going concern because it is possible that the Company will be required to adversely change its current business plan or may be unable to meet its obligations as they become due within one year after the date that these financial statements were issued.

The Condensed Consolidated Financial Statements of the Company have been prepared on a “going concern” basis, which means that the continuation of the Company is presumed even though events and conditions exist that, when considered in aggregate, raise substantial doubt about the Company’s ability to continue as a going concern because it is possible that the Company will be required to adversely change its current business plan or may be unable to meet its obligations as they become due within one year after the date that these financial statements were issued.

Paramount expects to continue to incur losses as a result of costs and expenses related to maintaining its properties and general and administrative expenses.

5 unchanged sentences

• $1.8 million on the Grassy Mountain Project state and federal permitting activities

• $1.7 million on the Bald Peak Project

For any interest that accrues and is owing on the outstanding Debenture, the Company expects to elect to pay the quarterly-annual interest payment in shares of its Common Stock.

Subsequent to May 14, 2024, the Company expects to fund operations as follows:

Subsequent to November 12 2024, the Company expects to fund operations as follows:

• Existing cash on hand and working capital.

3 unchanged sentences

• Equity financings or sale of royalties.

Historically, we have been successful in accessing capital through equity and debt financing arrangements or by the sale of royalties on its mineral properties, no assurance can be given that additional financing will be available to it in amounts sufficient to meet its needs, or on terms acceptable to the Company.

Historically, we have been successful in accessing capital through equity and debt financing arrangements or by the sale of royalties on our mineral properties, no assurance can be given that additional financing will be available to it in amounts sufficient to meet its needs, or on terms acceptable to the Company.

In the event that we are unable to obtain additional capital or financing, our operations, exploration and development activities will be significantly adversely affected.

35 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis