Rise Gold Corp. 10-Q

ITEM 1. FINANCIAL STATEMENTS. The condensed consolidated interim financial statements of Rise Gold Corp. ("we", "us", "our", the "Company", or the "registrant"), a Nevada corporation, included herein were prepared, without audit, pursuant to rules and regulations of the Securities and Exchange Commission. Because certain information and notes normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America were condensed or omitted pursuant to such rules and regulations, the condensed consolidated interim financial statements should be read in conjunction with the financial statements and notes thereto included in the audited financial statements of the Company in the Company's Form 10-K for the fiscal year ended July 31, 2021. 1 RISE GOLD CORP. (AN EXPLORATION STAGE COMPANY) CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS PERIOD ENDED OCTOBER 31, 2021 INDEX TO CONSOLIDATED FINANCIAL STATEMENTS: Page Consolidated Interim Balance Sheet F-1 Consolidated Interim Statement of Loss and Comprehensive Loss F-2 Consolidated Interim Statement of Cash Flows F-3 Consolidated Interim Statement of Stockholders' Equity F-4 Notes to Unaudited Consolidated Interim Financial Statements F-5 2 RISE GOLD CORP. (An Exploration Stage Company) CONDENSED CONSOLIDATED INTERIM BALANCE SHEET (Expressed in United States Dollars) (Unaudited) AS AT October 31, 2021 July 31, 2021 ASSETS Current Cash $ 397,100 $ 773,279 Receivables 47,245 44,113 Prepaid expenses (Note 3) 319,064 339,034 Total current assets 763,409 1,156,426 Non-current Mineral property interests (Note 4) 4,149,053 4,149,053 Equipment (Note 5) 569,551 575,781 Total assets $ 5,482,013 $ 5,881,260 LIABILITIES AND STOCKHOLDERS' EQUITY Current Accounts payable and accrued liabilities $ 268,962 $ 165,892 Payable to related parties (Note 7) 20,000 34,010 Total current liabilities 288,962 199,902 Non-current Loan payable (Note 8) 1,037,673 976,587 Derivative liability (Note 9) 104,673 441,766 Total liabilities 1,431,308 1,618,255 Stockholders' equity Capital stock, $ 0.001 par value, 400,000,000 shares authorized (July 31, 2021 - 400,000,000 ) ; 26,770,298 (July 31, 2021 - 26,770,298 shares issued and outstanding (Note 10) 26,770 26,770 Additional paid-in capital (Note 10) 23,884,796 23,884,796 Cumulative translation adjustment ( 104,084 ) ( 104,084 ) Deficit ( 19,756,777 ) ( 19,544,477 ) Total stockholders' equity 4,050,705 4,263,005 Total liabilities and stockholders' equity $ 5,482,013 $ 5,881,260 Nature and continuance of operations (Note 1) Contingency (Note 6) The accompanying notes are an integral part of these condensed consolidated interim financial statements. F- 1 RISE GOLD CORP. (An Exploration Stage Company) CONDENSED CONSOLIDATED INTERIM STATEMENT OF LOSS AND COMPREHENSIVE LOSS (Expressed in United States Dollars) (Unaudited) FOR THE THREE MONTHS ENDED OCTOBER 31, 2021 2020 EXPENSES Accretion expense (Note 8) $ 28,963 $ 28,963 Consulting 129,513 57,464 Directors' fees 20,000 20,000 Filing and regulatory 6,530 18,277 Foreign exchange (gain) loss 6,900 ( 2,298 ) General and administrative 106,723 129,716 Geological, mineral, and prospect costs (Note 4) 54,524 189,360 Interest expense (Note 8) 32,123 28,969 Professional fees 123,700 169,616 Promotion and shareholder communication 7,363 47,546 Share-based compensation (Note 10) - 560,792 Salaries 33,750 36,399 Loss $ ( 550,089 ) $ ( 1,284,804 ) Gain on fair value adjustment on derivative liability (Note 9) 337,093 256,696 Other income 696 2,750 Net loss and comprehensive loss for the period $ ( 212,300 ) $ ( 1,025,358 ) Basic and diluted loss per common share $ ( 0.01 ) $ ( 0.04 ) Weighted average number of common shares outstanding (basic and diluted) 26,770,298 26,578,269 The accompanying notes are an integral part of these condensed consolidated interim financial statements. F- 2 RISE GOLD CORP. (An Exploration Stage Company) CONDENSED CONSOLIDATED INTERIM STATEMENT OF CASH FLOWS (Expressed in United States Dollars) (Unaudited) FOR THE THREE MONTHS ENDED OCTOBER 31, 2021 2020 CASH FLOWS FROM OPERATING ACTIVITIES Loss for the period $ ( 212,300 ) $ ( 1,025,358 ) Items not involving cash Depreciation 6,230 6,213 Interest expense 32,123 28,969 Share-based payment - 560,792 Accretion expense 28,963 28,963 Gain on fair value adjustment on derivative liability ( 337,093 ) ( 256,696 ) Non-cash working capital item changes: Receivables ( 3,132 ) ( 6,968 ) Prepaid expenses 19,970 17,036 Accounts payable and accrued liabilities 89,060 ( 65,759 ) Related party payables - ( 59,348 ) Net cash used in operating activities ( 376,179 ) ( 772,156 ) CASH FLOWS FROM FINANCING ACTIVITIES Private placement, net of issuance cost - 248,198 Net cash provided by financing activities - 248,198 Change in cash for the period ( 376,179 ) ( 523,958 ) Cash, beginning of period 773,279 3,378,826 Cash, end of period $ 397,100 $ 2,854,868 Supplemental disclosure with respect to cash flows (Note 11) The accompanying notes are an integral part of these condensed consolidated interim financial statements. F- 3 RISE GOLD CORP. (An Exploration Stage Company) CONDENSED CONSOLIDATED INTERIM STATEMENT OF STOCKHOLDERS' EQUITY (Expressed in United States Dollars) (Unaudited) Capital Stock Additional Paid-in Capital Cumulative Translation Adjustment Number Amount Deficit Total Balance as at July 31, 2020 26,436,965 $ 26,437 $ 23,076,139 $ ( 104,084 ) $ ( 17,940,599 ) $ 5,057,893 Shares issued for cash, net of issuance cost 333,333 333 247,865 - - 248,198 Share-based compensation - - 560,792 - - 560,792 Loss for the period - - - - ( 1,025,358 ) ( 1,025,358 ) Balance as at October 31, 2020 26,770,298 $ 26,770 $ 23,884,796 $ ( 104,084 ) $ ( 18,965,957 ) $ 4,841,525 Balance as at July 31, 2021 26,770,298 $ 26,770 $ 23,884,796 $ ( 104,084 ) $ ( 19,544,477 ) $ 4,263,005 Loss for the period - - - - ( 212,300 ) ( 212,300 ) Balance as at October 31, 2021 26,770,298 $ 26,770 $ 23,884,796 $ ( 104,084 ) $ ( 19,756,777 ) $ 4,050,705 The accompanying notes are an integral part of these condensed consolidated interim financial statements. F- 4 RISE GOLD CORP. (An Exploration Stage Company) NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED OCTOBER 31, 2021 (Expressed in United States Dollars) (Unaudited) 1. NATURE AND CONTINUANCE OF OPERATIONS Rise Gold Corp. (the "Company") was originally incorporated as Atlantic Resources Inc. in the State of Nevada on February 9, 2007 and is in the exploration stage. On April 11, 2012, the Company merged its wholly-owned subsidiary, Patriot Minefinders Inc., a Nevada corporation, in and to the Company to affect a name change to Patriot Minefinders Inc. On January 14, 2015, the Company completed a name change to Rise Resources Inc. in the same manner. On April 7, 2017, the Company changed its name to Rise Gold Corp. These mergers were carried out solely for the purpose of effecting these changes of names. On January 29, 2016, the Company completed an initial public offering in Canada and began trading on the Canadian Securities Exchange ("CSE") under trading symbol "RISE.CN" on February 1, 2016. On September 18, 2020, the Company increased its authorized capital from 40,000,000 shares to 400,000,000 shares. The Company is in the early stages of exploration and, as is common with any exploration company, it raises financing for its acquisition activities. The accompanying condensed consolidated interim financial statements have been prepared on the going concern basis, which presumes that the Company will continue operations for the foreseeable future and will be able to realize assets and discharge liabilities in the normal course of business. The Company has incurred a loss of $ 212,300 for the three-month period ended October 31, 2021 and has accumulated a deficit of $ 19,756,777 . The ability of the Company to continue as a going concern is dependent on the Company's ability to maintain continued support from its shareholders and creditors and to raise additional capital and implement its business plan. There is no assurance that the Company will be able to obtain adequate financing in the future or that such financing will be on terms advantageous to the Company. However, the Company has been able to obtain such financings in the past. The consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. At October 31, 2021, the Company had working capital of $ 474,447 (July 31, 2021 - $ 956,524 ). As such, these material uncertainties cast a substantial doubt regarding the Company's ability to continue as a going concern. Furthermore, the novel coronavirus outbreak ("COVID-19") was declared a pandemic by the World Health Organization in 2020. The situation is dynamic and the ultimate duration and magnitude of the impact on the economy and the Company's business are not known at this time. These impacts could include an impact on the Company's ability to obtain debt and equity financing to fund ongoing exploration activities as well as its ability to explore and conduct business. These consolidated financial statements do not give effect to adjustments that would be necessary to the carrying values and classification of assets and liabilities should the Company be unable to continue as a going concern. 2. BASIS OF PREPARATION Generally Accepted Accounting Principles The accompanying unaudited condensed consolidated interim financial statements have been prepared in conformity with generally accepted accounting principles of the United States of America ("US GAAP") and the rules and regulations of the Securities and Exchange Commission ("SEC") for financial information with the instructions to Form 10-Q and Regulation S-K. Results are not necessarily indicative of results which may be achieved in the future. The unaudited condensed consolidated interim financial statements should be read in conjunction with the Company's Annual Report on Form 10-K, which contains the audited financial statements and notes thereto, together with Management's Discussion and Analysis, for the year ended July 31, 2021. Certain information and footnote disclosures normally included in the financial statements prepared in accordance with US GAAP have been condensed or omitted pursuant to such SEC rules and regulations. The operating results for the three months ended October 31, 2021 are not necessarily indicative of the results that may be expected for the year ended July 31, 2022. F- 5 RISE GOLD CORP. (An Exploration Stage Company) NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED OCTOBER 31, 2021 (Expressed in United States Dollars) (Unaudited) 2. BASIS OF PREPARATION (continued) Basis of Consolidation These condensed consolidated interim financial statements include the accounts of the Company and its wholly-owned subsidiary, Rise Grass Valley Inc. All significant intercompany accounts and transactions have been eliminated on consolidation. Subsidiaries Subsidiaries are all entities over which the Company has exposure to variable returns from its involvement and has the ability to use power over the investee to affect its returns. The existence and effect of potential voting rights that are currently exercisable or convertible are considered when assessing whether the Company controls another entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Company until the date on which control ceases. The accounts of subsidiaries are prepared for the same reporting period as the parent company, using consistent accounting policies. Intercompany transactions, balances and unrealized gains or losses on transactions are eliminated upon consolidation. Use of Estimates The preparation of these financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Significant areas requiring the use of estimates include the carrying value and recoverability of mineral properties and the recognition of deferred tax assets based on the change in unrecognized deductible temporary tax differences. Actual results could differ from those estimates and would impact future results of operations and cash flows. 3. PREPAID EXPENSES October 31, 2021 July 31, 2021 Insurance $ 47,366 $ 74,862 Deposits 265,440 263,779 Other 6,258 393 $ 319,064 $ 339,034 F- 6 RISE GOLD CORP. (An Exploration Stage Company) NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED OCTOBER 31, 2021 (Expressed in United States Dollars) (Unaudited) 4. MINERAL PROPERTY INTERESTS The Company's mineral properties balance consists of: Idaho-Maryland, California July 31, 2021 and October 31, 2021 $ 4,149,053 Title to mineral properties Title to mineral properties involves certain inherent risks due to the difficulties of determining the validity of certain mineral titles. Additionally, the potential for problems arising from the frequently ambiguous conveying history characteristic of many mineral properties also exist. The Company received a title opinion on the mineral rights of the Idaho-Maryland Mine property which concludes that ownership belongs to Rise Grass Valley Inc. As at October 31, 2021, the Company holds title to the Idaho-Maryland Gold Mine Property. As of October 31, 2021, based on management's review of the carrying value of mineral rights, management determined that there is no evidence that the cost of these acquired mineral rights will not be fully recovered and accordingly, the Company determined that no adjustment to the carrying value of mineral rights was required. As of the date of these consolidated financial statements, the Company has not established any proven or probable reserves on its mineral properties and has incurred only acquisition and exploration costs. Idaho-Maryland Gold Mine Property, California On August 30, 2016, the Company entered into an option agreement with three parties to purchase a 100 % interest in and to the Idaho-Maryland Gold Mine property located near Grass Valley, California, United States; pursuant to the option agreement, in order to exercise the option, the Company was required to pay $ 2,000,000 by November 30, 2016. Upon execution of the option agreement, the Company paid the vendors a non-refundable cash deposit in the amount of $ 25,000 , which was credited against the purchase price of $ 2,000,000 upon exercise of the option. On November 30, 2016, the Company negotiated an extension of the closing date of the option agreement to December 26, 2016, in return for a cash payment of $ 25,000 , which was also credited against the purchase price of $ 2,000,000 upon exercise of the option. On December 28, 2016, the Company negotiated a further no-cost extension of the closing date of the option agreement to April 30, 2017. On January 25, 2017, the Company exercised the option by paying the net amount owing of $ 1,950,000 and acquired a 100 % interest in the Idaho-Maryland Gold Mine property. In connection with the option agreement, the Company agreed to pay a cash commission of $ 140,000 equal to 7 per cent of the purchase price of $2,000,000; the commission was settled on January 25, 2017 through the issuance of 92,000 units valued at C$ 2.00 per unit. Each unit consists of one share of common stock and one transferable share purchase warrant exercisable into one share of common stock at a price of C$ 4.00 for a period of two years from the date of issuance. On January 24, 2019, these warrants expired unexercised. The Company also incurred additional transaction costs of $ 109,053 , which have been included in the carrying value of the Idaho-Maryland Gold Mine. F- 7 RISE GOLD CORP. (An Exploration Stage Company) NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED OCTOBER 31, 2021 (Expressed in United States Dollars) (Unaudited) 4. MINERAL PROPERTY INTERESTS (continued) Idaho-Maryland Gold Mine Property, California (continued) On January 6, 2017, the Company entered into an option agreement with Sierra Pacific Industries Inc. ("Sierra") to purchase a 100 % interest in and to certain surface rights totalling approximately 82 acres located near Grass Valley, California, United States, contiguous to the Idaho-Maryland Gold Mine property acquired by the Company on January 25, 2017. Pursuant to the option agreement, in order to exercise the option, the Company was required to pay $ 1,900,000 by March 31, 2017. Upon execution of the option agreement, the Company paid the vendors a non-refundable cash deposit in the amount of $ 100,000 , which was credited against the purchase price of $ 1,900,000 upon exercise of the option. On April 3, 2017, the Company negotiated an extension of the closing date of the option agreement to June 30, 2017, in return for a cash payment of $ 200,000 , at which time a payment of $ 1,600,000 was due in order to exercise the option. On June 7, 2017, the Company negotiated an extension of the closing date of the option agreement to September 30, 2017, in return for a cash payment of $ 300,000 , at which time a payment of $ 1,300,000 was due in order to exercise the option. On May 14, 2018, the Company completed the purchase of the surface rights totalling approximately 82 acres by making the final payment of $ 1,300,000 . As at October 31, 2021, the Company has incurred cumulative exploration expenditures of $ 7,224,186 on the Idaho-Maryland Gold Mine property as follows: Three months ended October 31, 2021 Year ended July 31, 2021 Idaho-Maryland Gold Mine expenditures: Opening balance $ 7,169,662 $ 6,387,402 Consulting 11,792 520,690 Depreciation 6,230 25,579 Engineering 4,666 12,770 Exploration 2,189 124,987 Logistics 2,715 4,366 Rent 22,096 91,208 Supplies 4,836 2,474 Sampling — 187 Total expenditures for the period 54,524 782,261 Closing balance $ 7,224,186 $ 7,169,662 F- 8 RISE GOLD CORP. (An Exploration Stage Company) NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED OCTOBER 31, 2021 (Expressed in United States Dollars) (Unaudited) 5. EQUIPMENT Cost Drilling equipment At July 31, 2020 $ 644,847 At July 31, 2021 $ 644,847 At October 31, 2021 $ 644,847 Accumulated depreciation At July 31, 2020 $ 43,487 Depreciation 25,579 At July 31, 2021 $ 69,066 Depreciation 6,230 At October 31, 2021 $ 75,296 Total carrying value, July 31, 2021 $ 575,781 Total carrying value, October 31, 2021 $ 569,551 6. CONTINGENCY During the year ended July 31, 2014, the Company entered into a binding letter of intent ("LOI") with Wundr Software Inc. ("Wundr"). Under the terms of the LOI, the Company would acquire 100% of the issued and outstanding common shares of Wundr. Due to unforeseen circumstances, the Company did not complete the transactions contemplated in the LOI, which the Company announced had expired on January 10, 2014. On September 17, 2014, the Company learned that it was the subject, along with a number of additional defendants, of a notice of civil claim (the "Claim") filed in the Supreme Court of British Columbia by Wundr, under which Wundr is seeking general damages from the Company as well as damages for conspiracy to cause economic harm. None of the allegations contained in the Claim have been proven in court. Management has determined that the probability of the Claim resulting in an unfavourable outcome and financial loss to the Company is unlikely. 7. RELATED PARTY TRANSACTIONS Key management personnel consist of the Chief Executive Officer, Chief Financial Officer, and the directors of the Company. The remuneration of the key management personnel is as follows: a) Salaries of $ 33,750 (2020 - $ 33,750 ) to the CEO of the Company. b) Director fees of $ 20,000 (2020 - $ 20,000 ) to directors of the Company. c) During the period ended October 31, 2021, the Company paid $ 35,797 (2020 - $ 34,035 ) in professional and consulting fees to a company controlled by a director of the Company. d) Share-based compensation of $ Nil (2020 - $ 560,792 ) for options granted during the period ended October 31, 2021. e) As at October 31, 2021 and July 31, 2021, $ 20,000 and $ 34,010 were owed to related parties, respectively. F- 9 RISE GOLD CORP. (An Exploration Stage Company) NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED OCTOBER 31, 2021 (Expressed in United States Dollars) (Unaudited) 8. LOAN PAYABLE On September 3, 2019, the Company completed a debt financing with Eridanus Capital LLC (the "Lender") for $ 1,000,000 (the "Loan"). The Loan has a term of 4 years and an annual interest rate of 10 % for the first two years increasing to 20 % in year 3 and to 25 % in year 4. Interest will accrue and be paid along with the principal upon the maturity date . The Lender received 1,150,000 bonus share purchase warrants as additional consideration for advancing the Loan. The fair value of these warrants was calculated to be $ 444,942 which was netted against the loan payable balance along with $ 15,000 paid to the lender for a total of $ 459,942 in issuance costs. Each warrant entitles the holder to acquire one share of common stock at an exercise price of $ 0.80 (C$ 1 .00) for a period of three years from the date of issuance. The Loan may be repaid prior to the maturity date, in whole or in part, provided that all accrued interest is paid. In addition, if total interest payments are less than $200,000, the difference will be paid to the Lender as prepayment compensation. The Loan is secured against the assets of the Company and its subsidiary and will be used for permitting, engineering and working capital at the Company's Idaho Maryland Gold Project. Loan Payable Balance, July 31, 2020 $ 742,157 Interest expense 119,523 Accretion expense 114,907 Balance, July 31, 2021 $ 976,587 Interest expense 32,123 Accretion expense 28,963 Balance, October 31, 2021 $ 1,037,673 F- 10 RISE GOLD CORP. (An Exploration Stage Company) NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED OCTOBER 31, 2021 (Expressed in United States Dollars) (Unaudited) 9. DERIVATIVE LIABILITY The exercise price of the Company's share purchase warrants is fixed in Canadian dollars and the functional currency of the Company is the USD. These warrants are considered to be a derivative as a variable amount of cash in the Company's functional currency will be received on exercise of the warrants. Accordingly, the share purchase warrants issued as part of past financings, are classified and accounted for as a derivative liability. The following table shows a continuity of the Company's derivative liability: Warrant derivative Number of warrants accounted for as derivative liability Balance, July 31, 2020 $ 2,218,107 11,159,919 Expiry - ( 5,679,836 ) Fair value adjustment ( 1,776,341 ) - Balance, July 31, 2021 $ 441,766 5,480,083 Expiry - ( 488,438 ) Fair value adjustment ( 337,093 ) - Balance, October 31, 2021 $ 104,673 4,991,645 For the three-month period ended October 31, 2021, the Company recorded a total gain on fair value of derivative liability of $ 337,093 during the period (October 31, 2020 -$ 256,696 ). The following weighted average assumptions were used for the Black-Scholes pricing model valuation of warrants as at October 31, 2021 and July 31, 2021: October 31, 2021 July 31, 2021 Risk-free interest rate 1.52 % 1.52 % Expected life of warrants 0.67 to 1.09 years 0.08 to 1.14 years Expected annualized volatility 82.9 % to 89.8 % 83.6 % to 118.2 % Dividend Nil Nil Forfeiture rate 0 % 0 % F- 11 RISE GOLD CORP. (An Exploration Stage Company) NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED OCTOBER 31, 2021 (Expressed in United States Dollars) (Unaudited) 10. CAPITAL STOCK AND ADDITIONAL PAID-IN-CAPITAL Private Placements On September 23, 2020, the Company completed a non-brokered private placement for a total of $ 250,000 through the issuance of 333,333 units at a price of $ 0.75 per Unit (C$ 1.02 per Unit), with each Unit comprising one share of common stock and one-half of one common share purchase warrant. Each whole warrant entitles the holder to acquire one Share at an exercise price of $ 1 .00 (C$ 1.36 ) until September 21, 2022. The Company has paid associated legal fees of $ 1,802 in connection with this financing. Stock Options On September 22, 2020, the Company granted a total of 1,338,500 stock options to the Company's President and CEO, Benjamin Mossman. The stock options are exercisable at a price of $ 0.90 (C$ 1.20 ) per share until September 22, 2025. The Company recorded share-based compensation of $ 560,792 in connection with this grant. The following incentive stock options were outstanding and exercisable as at October 31, 2021: Number of Options Weighted Average Exercise Price (C$) Expiry Date 75,000 0.50 March 17, 2023 350,000 1.20 April 19, 2023 180,000 1.00 November 30, 2023 290,000 0.70 August 21, 2024 1,338,500 1.20 September 22, 2025 2,233,500 1.09 As at October 31, 2021, the aggregate intrinsic value of the Company's stock options is $ Nil (July 31, 2021 - $ 1,313 ). Stock option transactions are summarized as follows: Number of Options Weighted Average Exercise Price ($C) Balance outstanding and exercisable, July 31, 2020 1,005,000 1.00 Options granted 1,338,500 1.20 Options expired - 110,000 1.50 Balance outstanding and exercisable, July 31, 2021 2,233,500 1.09 Balance outstanding and exercisable, October 31, 2021 2,233,500 $ 1.09 F- 12 RISE GOLD CORP. (An Exploration Stage Company) NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED OCTOBER 31, 2021 (Expressed in United States Dollars) (Unaudited) 10. CAPITAL STOCK AND ADDITIONAL PAID-IN-CAPITAL (continued) Share-Based Payments The Company has a stock option plan under which it is authorized to grant options to executive officers and directors, employees and consultants enabling them to acquire up to 10% of the issued and outstanding common stock of the Company. Under the plan the exercise price of each option equals the market price of the Company's stock, less any applicable discount, as calculated on the date of grant. The options can be granted for a maximum term of 5 years with vesting determined by the board of directors. Warrants The following warrants were outstanding as at October 31, 2021: Number of Warrants Exercise Price (C$) Expiry Date 518,407 1.00 July 3, 2022 2,302,517 1.00 August 19, 2022 1,150,000 1.00 September 3, 2022 2,225,352 1.36 July 31, 2022 166,666 1.36 September 21, 2022 6,362,942 1.14 During the period ended October 31, 2021, a total of 488,438 warrants with an exercise price of C$ 1.20 expired unexercised. Warrant transactions are summarized as follows: Number of Warrants Weighted Average Exercise Price ($C) Balance, July 31, 2019 8,196,524 $ 1.57 Warrants issued 5,677,869 1.00 Warrants expired ( 1,402,393 ) ( 2.50 ) Balance, July 31, 2020 12,472,000 $ 1.27 Warrants issued 166,666 1.36 Warrants expired ( 5,787,286 ) ( 1.30 ) Balance, July 31, 2021 6,851,380 $ 1.14 Warrants expired ( 488,438 ) ( 1.20 ) Balance, October 31, 2021 6,362,942 $ 1.14 F- 13 RISE GOLD CORP. (An Exploration Stage Company) NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED OCTOBER 31, 2021 (Expressed in United States Dollars) (Unaudited) 11. SUPPLEMENTAL DISCLOSURE WITH RESPECT TO CASH FLOWS During the three-month periods ended October 31, 2021 and 2020, the Company had the following non-cash financing and investing activities: For the period ended October 31, 2021: a) The Company accrued $ 32,123 of interest expense as part of the outstanding balance of loan payable. For the period ended October 31, 2020: b) Company accrued $ 28,969 of interest expense as part of the outstanding balance of loan payable. 12. SEGMENTED INFORMATION A reporting segment is defined as a component of the Company that: - Engages in business activities from which it may earn revenues and incur expenses; - Operating results are reviewed regularly by the entity's chief operating decision maker; and - Discrete financial information is available. The Company has determined that it operates its business in one geographical segment located in California, United States, where all of its equipment and mineral property interests are located. F-14