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, 2024. RISE GOLD CORP. (AN EXPLORATION STAGE COMPANY) CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS PERIOD ENDED JANUARY 31, 2025 INDEX TO CONSOLIDATED FINANCIAL STATEMENTS: Page Consolidated Interim Balance Sheets 1 Consolidated Interim Statements of Loss and Comprehensive Loss 2 Consolidated Interim Statements of Cash Flows 3 Consolidated Interim Statements of Stockholders' Equity 4 Notes to Unaudited Consolidated Interim Financial Statements 5 RISE GOLD CORP. (An Exploration Stage Company) CONDENSED CONSOLIDATED INTERIM BALANCE SHEETS (Expressed in United States Dollars) (Unaudited) AS AT January 31, 2025 July 31, 2024 ASSETS Current Cash and cash equivalents (Note 3) $ 743,546 $ 243,669 Receivables 20,380 21,971 Prepaid expenses (Note 4) 153,216 117,468 Assets held for sale (Note 6) 511,530 511,530 Total current assets 1,428,672 894,638 Non-current Mineral property interests (Note 5) 2,403,977 4,149,053 Deferred financing asset (Note 11) 91,403 111,707 Total assets $ 3,924,052 $ 5,155,398 LIABILITIES AND STOCKHOLDERS’ EQUITY Current Accounts payable and accrued liabilities $ 821,977 $ 874,589 Loan payable (Note 9) 923,860 1,658,060 Payable to related parties (Note 8) 116,317 128,949 Total current liabilities 1,862,154 2,661,598 Non-current Loan payable (Note 9) 216,327 - Credit facility (Note 11) 95,133 116,130 Total liabilities 2,173,614 2,777,728 Stockholders’ equity Capital stock, $ 0.001 par value, 400,000,000 shares authorized; 55,785,106 shares issued and outstanding (Note 12) 55,785 55,785 Additional paid-in capital (Note 12) 33,348,080 32,660,586 Cumulative translation adjustment ( 104,084 ) ( 104,084 ) Deficit ( 31,549,343 ) ( 30,234,617 ) Total stockholders' equity 1,750,438 2,377,670 Total liabilities and stockholders' equity $ 3,924,052 $ 5,155,398 Nature and continuance of operations (Note 1) Contingency (Note 7) The accompanying notes are an integral part of these condensed consolidated interim financial statements. 1 RISE GOLD CORP. (An Exploration Stage Company) CONDENSED CONSOLIDATED INTERIM STATEMENTS OF LOSS AND COMPREHENSIVE LOSS (Expressed in United States Dollars) (Unaudited) Three months ended January 31, 2025 Three months ended January 31, 2024 Six months ended January 31, 2025 Six months ended January 31, 2024 EXPENSES Accretion expense (Note 9 and 11) $ 128,836 $ 19,409 $ 158,695 $ 49,522 Consulting 66,784 113,600 121,890 166,183 Directors' fees 20,000 30,000 50,000 58,022 Filing and regulatory 11,923 8,679 35,920 21,586 Foreign exchange (gain) loss 3,286 ( 5,088 ) 5,413 7,899 General and administrative 50,606 116,992 124,972 262,151 Geological, mineral, and prospect costs (Note 5) 20,691 34,241 65,853 395,766 Interest expense (Note 9 and 11) 68,916 66,118 165,116 129,661 Professional fees 124,693 257,737 225,574 595,278 Promotion and shareholder communication 6,196 23,468 14,383 43,479 Salaries - 5,268 - 89,569 Share-based compensation (Note 12) 36,211 140,624 198,719 230,985 Loss $ ( 538,142 ) $ ( 811,048 ) $ ( 1,166,535 ) $ ( 2,050,101 ) Gain on fair value adjustment on derivative liability (Note 10) - 211,196 - 128,715 Loss on note receivable (Note 5) ( 155,727 ) ( 126 ) ( 155,727 ) ( 64,564 ) Other income 7,536 2,492 7,536 10,039 Net loss and comprehensive loss for the period $ ( 686,333 ) $ ( 597,486 ) $ ( 1,314,726 ) $ ( 1,975,911 ) Basic and diluted loss per common share $ ( 0.01 ) $ ( 0.01 ) $ ( 0.02 ) $ ( 0.05 ) Weighted average number of common shares outstanding (basic and diluted) 55,785,106 44,636,253 55,785,106 42,499,527 The accompanying notes are an integral part of these condensed consolidated interim financial statements. 2 RISE GOLD CORP. (An Exploration Stage Company) CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CASH FLOWS (Expressed in United States Dollars) (Unaudited) FOR THE SIX MONTHS ENDED JANUARY 31, 2025 2024 CASH FLOWS FROM OPERATING ACTIVITIES Loss for the period $ ( 1,314,726 ) $ ( 1,975,911 ) Items not involving cash Depreciation - 11,322 Interest expense 165,116 129,661 Share-based compensation 198,719 230,985 Accretion expense 158,695 49,522 Foreign exchange loss 4,469 Loss (gain) on fair value adjustment on derivative liability - ( 128,715 ) Loss on settlement of note receivable 155,727 - Non-cash working capital item changes: Receivables 1,591 68,094 Prepaid expenses ( 35,748 ) 32,755 Accounts payable and accrued liabilities ( 50,810 ) 363,614 Related party payables ( 12,632 ) 78,051 Net cash used in operating activities ( 729,599 ) ( 1,140,622 ) CASH FLOWS FROM INVESTING ACTIVITIES Proceeds from mineral property contracted for sale 1,589,349 - Net cash provided by investing activities 1,589,349 - CASH FLOWS FROM FINANCING ACTIVITIES Private placement, net of issuance cost - 950,855 Proceeds from loan 500,000 - Line of credit payment ( 42,932 ) - Loan payment ( 816,941 ) - Net cash used in financing activities ( 359,873 ) 950,855 Change in cash and cash equivalents for the period 499,877 ( 189,767 ) Cash and cash equivalents, beginning of period 243,669 758,272 Cash and cash equivalents, end of period $ 743,546 $ 568,505 Supplemental disclosure with respect to cash flows (Note 13) The accompanying notes are an integral part of these condensed consolidated interim financial statements. 3 RISE GOLD CORP. (An Exploration Stage Company) CONDENSED CONSOLIDATED INTERIM STATEMENTS OF STOCKHOLDERS' EQUITY (Expressed in United States Dollars) (Unaudited) Capital Stock Additional Paid-in Capital Shared subscribed in advance Cumulative Translation Adjustment Number Amount Deficit Total Balance as at July 31, 2023 40,362,800 $ 40,363 $ 30,304,568 $ - $ ( 104,084 ) $ ( 26,668,986 ) $ 3,571,861 Loss for the period - - - - - ( 1,378,425 ) ( 1,378,425 ) Shares subscribed in advance - - - 440,868 - - 440,868 Share-based compensation - - 90,361 - - - 90,361 Balance as at October 31, 2023 40,362,800 $ 40,363 $ 30,394,929 $ 440,868 $ ( 104,084 ) $ ( 28,047,411 ) $ 2,724,665 Loss for the period - - - - - ( 597,486 ) ( 597,486 ) Shares issued for cash, net of issuance cost 5,377,541 5,377 945,476 ( 440,868 ) - - 509,985 Share-based compensation - - 140,624 - - - 140,624 Balance as at January 31, 2024 45,740,341 $ 45,740 $ 31,481,029 $ - $ ( 104,084 ) $ ( 28,644,897 ) $ 2,777,788 Balance as at July 31, 2024 55,785,106 $ 55,785 $ 32,660,586 $ - $ ( 104,084 ) $ ( 30,234,617 ) $ 2,377,670 Loss for the period - - - - - ( 628,393 ) ( 628,393 ) Warrants issued for loans - - 488,775 - - - 488,775 Share-based compensation - - 162,508 - - - 162,508 Balance as at October 31, 2024 55,785,106 $ 55,785 $ 33,311,869 $ - $ ( 104,084 ) $ ( 30,863,010 ) $ 2,400,560 Loss for the period ( 686,333 ) ( 686,333 ) Share-based compensation - - 36,211 - - - 36,211 Balance as at January 31, 2025 55,785,106 $ 55,785 $ 33,348,080 $ - $ ( 104,084 ) $ ( 31,549,343 ) $ 1,750,438 The accompanying notes are an integral part of these condensed consolidated interim financial statements. 4 RISE GOLD CORP. (An Exploration Stage Company) NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTH PERIOD ENDED JANUARY 31, 2025 (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 effect 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 March 29, 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 September 18, 2020, the Company increased its authorized capital from 40,000,000 shares to 400,000,000 shares. On January 29, 2016, the Company completed an initial public offering in Canada and began trading on the Canadian Securities Exchange ("CSE") on February 1, 2016. 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 consolidated 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 its assets and discharge its liabilities in the normal course of business. The Company has incurred a loss of $ $ 1,314,726 for the period the six months ended January 31, 2025 and has accumulated a deficit of $ 31,549,343 . 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. These events and conditions cast substantial doubt about the Company's ability to continue as a going concern. 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 January 31, 2025, the Company had a working capital deficit of $ 433,482 (July 31, 2024 - deficit of $ 1,766,960 ). 2. BASIS OF PREPARATION Generally Accepted Accounting Principles These 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, 2024. 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. These financial statements follow the same accounting policies in the annual financial statements. The operating results for the six months ended January 31, 2025 are not necessarily indicative of the results that may be expected for the year ended July 31, 2025. 5 RISE GOLD CORP. (An Exploration Stage Company) NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTH PERIOD ENDED JANUARY 31, 2025 (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. CASH AND CASH EQUIVALENTS As at January 31, 2025, the balance of cash and cash equivalents is $ $ 743,546 (July 31, 2024: $ 243,669 ). 4. PREPAID EXPENSES January 31, 2025 July 31, 2024 Current Insurance $ 23,312 $ 56,922 Deposits 105,979 48,226 Other 23,925 12,320 Total $ 153,216 $ 117,468 6 RISE GOLD CORP. (An Exploration Stage Company) NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTH PERIOD ENDED JANUARY 31, 2025 (Expressed in United States Dollars) (Unaudited) 5. MINERAL PROPERTY INTERESTS The Company's mineral properties balance consists of: Idaho-Maryland, California July 31, 2024 $ 4,149,053 Proceeds from land contracted for sale ( 1,745,076 ) January 31, 2025 $ 2,403,977 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. As at January 31, 2025 the Company holds title to the Idaho-Maryland Gold Mine Property. As of January 31, 2025, the management does not consider that there are events or changes in circumstances to indicate that the carrying amount of the asset group may not be recoverable. 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. 7 RISE GOLD CORP. (An Exploration Stage Company) NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTH PERIOD ENDED JANUARY 31, 2025 (Expressed in United States Dollars) (Unaudited) 5. 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 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 by making the final payment of $ 1,300,000 . As at January 31, 2025, the Company has incurred cumulative exploration expenditures of $ 9,605,667 on the Idaho-Maryland Gold Mine property as follows: Six months ended January 31, 2025 Year ended July 31, 2024 Idaho-Maryland Gold Mine expenditures: Opening balance $ 9,539,814 $ 8,730,982 Consulting 47,595 715,108 Depreciation - 16,935 Engineering - 4,622 Exploration - 1,405 Logistics - 5,269 Rent 14,211 53,432 Supplies 4,047 11,251 Sampling - 810 Total expenditures for the period $ 65,853 $ 808,832 Closing balance $ 9,605,667 $ 9,539,814 8 RISE GOLD CORP. (An Exploration Stage Company) NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTH PERIOD ENDED JANUARY 31, 2025 (Expressed in United States Dollars) (Unaudited) 5. MINERAL PROPERTY INTERESTS (continued) Idaho-Maryland Gold Mine Property, California (continued) On October 1, 2024, the Company contracted to sell 66 acres of surface rights located adjacent to the Company's Idaho-Maryland Mine Property. The sale transaction is subject to two sale agreements with the same, arm's length third party. The first agreement covers 16 acres of land for total consideration of $ 1,800,000 and that contract closed on November 27, 2024 with the payment of half the sale price, minus certain deductions. The Company paid $ 816,941 of the proceeds towards the Eridanus loan. The other half of the purchase price ($ 900,000 ) is due on November 27, 2026. The buyer pays monthly interest at an annual rate of 5 % per year on the balance of the purchase price until it is paid in full. The $ 900,000 note receivable has a fair value of $ 851,852 on November 27, 2024, calculated based on an 8 % interest rate. On January 14, 2025, the Company and the buyer negotiated a discounted, accelerated payment whereby the Company received $ 702,000 in lieu of the second $ 900,000 payment due in November 2026. Carrying value of the note receivable on settlement date was $ 857,727 , resulting in a loss on settlement of $ 155,727 . The second sale agreement covers 50 acres of land for total sale price of $ 2,500,000 and is expected to close on May 26, 2025, at which point half of the sale price will be due, with the other half due on May 26, 2027. The buyer has placed $ 200,000 in escrow and will pay $ 12,500 per month until closing, with the payments to be applied against the purchase price. Commencing on the closing date, the buyer will pay monthly interest at an annual rate of 5 % per year on the balance of the purchase price until it is paid in full. Rise and the purchaser have also executed an option agreement whereby the Company may repurchase the 66 acres of land being sold for the sale price plus the cost of any capital improvements plus an increase of five percent per year on the condition that Rise acquires final government approvals to perform mining operations at the I-M Mine Property. 6. EQUIPMENT Cost Drilling equipment At July 31, 2023 $ 644,847 At July 31, 2024 $ 644,847 At January 31, 2025 $ 644,847 Accumulated depreciation At July 31, 2023 $ 116,382 Depreciation 16,935 At July 31, 2024 $ 133,317 Depreciation - At January 31, 2025 $ 133,317 Total carrying value, July 31, 2024 $ 511,530 Assets held for sale $ ( 511,530 ) Total carrying value, January 31, 2025 $ - Assets Held for Sale During the year ended July 31, 2024, the Company approved a plan to sell its drilling equipment. The Company intends to sell the equipment within the next twelve months. No impairment loss was recognized on reclassification to asset held for sale as the Company expects the fair value (estimated based on recent market prices of similar assets) less cost to sell is higher than the carrying amount. As a result, the net carrying amount of $ 511,530 has been reclassified. 9 RISE GOLD CORP. (An Exploration Stage Company) NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTH PERIOD ENDED JANUARY 31, 2025 (Expressed in United States Dollars) (Unaudited) 7. 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. 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 assessed that the probability of the Claim resulting in an unfavourable outcome and financial loss to the Company is unlikely. In September 2024, the Company received a notice from the Community Environmental Advocates Foundation of intent to file a citizen suit against the Company for alleged violations of the Clean Water Act. The Company has not yet been served with a summons and complaint filed in the citizen suit, but the Company's attorneys have engaged the Community Environmental Advocates Foundation's attorneys in an attempt to informally resolve the allegations without litigation. The Company denies all allegations contained in the notice. Management has determined that no estimate of a loss event can be determined at this time in connection with the notice. 8. 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 $ Nil (2024 - $ 89,569 ) to the previous CEO of the Company. Consulting fees of $ 66,000 and $ Nil (2024 - $ 47,411 and $ 74,494 ) to the CEO and an advisor of the Company. b) Consulting fees of $ 12,522 to the CFO of the Company c) Director fees of $ 50,000 (2024 - $ 58,022 ) to directors of the Company. d) During the period ended January 31, 2025, the Company paid $ 64,229 (2024 - $ 66,426 ) in professional and consulting fees to a company controlled by a former director of the Company. e) Share-based compensation of $ 198,719 (2024 - $ 166,619 ) for options granted during the period ended. f) As at January 31, 2025 and July 31, 2024, $ 116,317 and $ 128,949 were owed to related parties, respectively. g) A director of the Company is a manager of a private company which manages Eridanus Capital, LLC, a company that provided a secured loan to the Company's wholly owned subsidiary, Rise Grass Valley in 2019. h) A director of the Company is a manager of a private company which manages Myrmikan Gold Fund, LLC, a company that provided a secured loan to the Company's wholly owned subsidiary, Rise Grass Valley in 2024. i) During Q2 2024, certain directors of the Company purchased an aggregate of 2,532,220 units of the private placement for gross proceeds of $ 455,800 (NIL – for the period ended January 31, 2025) 10 RISE GOLD CORP. (An Exploration Stage Company) NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTH PERIOD ENDED JANUARY 31, 2025 (Expressed in United States Dollars) (Unaudited) 9. LOANS PAYABLE a) Eridanus Loan Eridanus Loan Payable Balance, July 31, 2023 $ 1,437,914 Interest expense 299,228 Accretion expense 120,918 Repayment ( 200,000 ) Balance, July 31, 2024 $ 1,658,060 Interest expense 133,726 Accretion expense 103,366 Issuance costs ( 154,351 ) Repayment ( 816,941 ) Balance, January 31, 2025 $ 923,860 On September 3, 2019, the Company completed a debt financing with Eridanus Capital LLC ("Eridanus") for $ 1,000,000 . The Eridanus 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. Eridanus received 1,150,000 bonus share purchase warrants as additional consideration for advancing the Eridanus 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 Eridanus 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 Eridanus loan is secured against the assets of the Company and its subsidiary. In February 2023, the Company renegotiated its debt agreement with Eridanus whereby the Company agreed to pay $ 250,000 applied against unpaid and accrued interest and issue 575,000 share purchase warrants to Eridanus. The maturity date of the Eridanus loan has been extended by one year to September 4, 2024 and the interest rate has been reduced to 15 % compounding monthly for a period of 12 months after which it reverts to 25 % per annum, compounding monthly. The renegotiation of the debt was accounted for as a non - substantial debt modification. Accordingly, no gain or loss was recorded and a new effective interest rate of 32.67 % was established based on the carrying value of the debt and the revised cash flow. Each warrant entitles the holder to acquire one share at an exercise price of $ 0.60 for a period of two years from the date of issuance. The fair value of these warrants was calculated to be $ 154,218 which was netted against the loan payable balance. The following weighted average assumptions were used for the Black-Scholes pricing model valuation of warrants: February 17, 2023 Risk-free interest rate 4.15 % Expected life of warrants 2 years Expected annualized volatility 99.02 % Share price at grant date $ 0.53 Exercise price $ 0.60 Fair value $ 0.27 Dividend Nil Forfeiture rate 0 % 11 RISE GOLD CORP. (An Exploration Stage Company) NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTH PERIOD ENDED JANUARY 31, 2025 (Expressed in United States Dollars) (Unaudited) 9. LOAN PAYABLE (continued) a) Eridanus Loan (continued) In September 2024, the Company amended its debt agreement with Eridanus to extend an existing loan by one year to September 4, 2025, along with a reduction in interest rate to 15 % per annum for a period of 12 months commencing September 4, 2024. Given that the renegotiation of the debt resulted in a change of the present value of the cash flow of less than 10 %, the transaction has been recorded as a non-substantial debt modification for accounting purposes. The Company issued 1,700,000 share purchase warrants at an exercise price of US$ 0.115 to Eridanus as consideration for the extension. The share purchase warrants have a 4 year expiry period from the date of issuance. The fair value of these warrants was calculated to be $ 154,351 which was netted against the loan payable balance. The following weighted average assumptions were used for the Black-Scholes pricing model valuation of warrants: September 12, 2024 Risk-free interest rate 2.72 % Expected life of warrants 4 years Expected annualized volatility 133.99 % Share price at grant date $ 0.11 Exercise price $ 0.115 Fair value $ 0.091 Dividend Nil Forfeiture rate 0 % b) Myrmikan Loan On October 10, 2024, the Company finalized a secured loan agreement with Myrmikan Gold Fund, LLC ("Myrmikan") for a $ 500,000 loan which will be used for the Company's working capital. The Myrmikan loan has a term of 4 years with an interest rate of 15 % per annum with interest accruing and payable along with the principal upon maturity. The Company issued 2,882,514 share purchase warrants at an exercise price of $ 0.1735 with a 4 year expiry period as additional consideration for advancing the Myrmikan loan. The fair value of these warrants was calculated to be $ 334,423 which was netted against the loan payable balance. The Myrmikan loan may be repaid prior to the maturity date, in whole or in part, provided that all accrued interest is paid. The Myrmikan loan will be secured against the assets of the Company and its subsidiary. Myrmikan Loan Payable Balance, July 31, 2024 $ - Proceeds $ 500,000 Issuance costs $ ( 334,423 ) Interest expense 24,884 Accretion expense 25,866 Balance, January 31, 2025 $ 216,327 12 RISE GOLD CORP. (An Exploration Stage Company) NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTH PERIOD ENDED JANUARY 31, 2025 (Expressed in United States Dollars) (Unaudited) 9. LOAN PAYABLE (continued) b) Myrmikan Loan (continued) The following weighted average assumptions were used for the Black-Scholes pricing model valuation of warrants: October 10, 2024 Risk-free interest rate 2.98 % Expected life of warrants 4 years Expected annualized volatility 139.40 % Share price at grant date $ 0.14 Exercise price $ 0.1735 Fair value $ 0.116 Dividend Nil Forfeiture rate 0 % 10. 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, 2023 $ 140,015 4,991,645 Fair value adjustment ( 140,015 ) - Balance, July 31, 2024 $ - 2,291,322 Fair value adjustment - - Balance, January 31, 2025 $ - - For the six month period ended January 31, 2025, the Company recorded a total loss on fair value of derivative liability of $ Nil during the period (January 31, 2024 - gain of $ 128,715 ). For the period ended January 31, 2025, the 2,291,322 warrants expired unexercised. The following weighted average assumptions were used for the Black-Scholes pricing model valuation of warrants: July 31, 2024 Risk-free interest rate 3.46 % Expected life of warrants 0.05 years Expected annualized volatility 33.73 % Dividend Nil Forfeiture rate 0 % 13 RISE GOLD CORP. (An Exploration Stage Company) NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTH PERIOD ENDED JANUARY 31, 2025 (Expressed in United States Dollars) (Unaudited) 11. CREDIT FACILITY On February 6, 2024, the Company entered into a revolving credit facility arrangement with an arm's length lender that also provides services to the Company. Pursuant to the arrangement, each month, the lender will defer and add to the loan principal an amount equal to half of the fees billed by the lender up to $ 1,000,000 . Amounts loaned will bear interest at a rate of 12 % per annum compounded annually and will be due four years from the date of the arrangement. The Company may repay any amounts owing under the credit facility at any time without penalty. In connection with the credit facility, the Company has issued 1,000,000 non-transferable share purchase warrants to the lender, with each warrant exercisable into one share of common stock of the Company at a price of $ 0.16 per share for a period of four years from the date of issuance. The fair value of these warrants was calculated to be $ 127,336 . In addition, for each $100,000 loaned under the arrangement, the Company has agreed to issue to the lender 200,000 additional non-transferable warrants ("Additional Warrants"). Each Additional Warrant will be exercisable into one share of common stock of the Company at any time within a four-year period from the date of issuance at an exercise price equal to the market price of the shares of the Company on grant. Credit Facility Balance, July 31, 2023 $ - Principal amount 122,739 Interest expense 7,018 Issuance costs ( 15,629 ) Accretion expense 2,002 Balance, July 31, 2024 $ 116,130 Payment ( 42,932 ) Principal amount 1,801 Interest expense 6,506 Issuance costs ( 15,835 ) Accretion expense 29,463 Balance, January 31, 2025 $ 95,133 Deferred Financing Asset Balance, July 31, 2023 $ - Issuance costs 1,000,000 warrants 127,336 Allocation to credit facility ( 15,629 ) Balance, July 31, 2024 $ 111,707 Allocation to credit facility ( 20,304 ) Balance, January 31, 2025 $ 91,403 14 RISE GOLD CORP. (An Exploration Stage Company) NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTH PERIOD ENDED JANUARY 31, 2025 (Expressed in United States Dollars) (Unaudited) 11. CREDIT FACILITY (continued) The following weighted average assumptions were used for the Black-Scholes pricing model valuation of warrants: February 5, 2024 Risk-free interest rate 3.67 % Expected life of warrants 4 years Expected annualized volatility 122.71 % Share price at grant date $ 0.16 Exercise price $ 0.16 Fair value $ 0.13 Dividend Nil Forfeiture rate 0 % 12. CAPITAL STOCK AND ADDITIONAL PAID-IN-CAPITAL Private Placements On April 29, 2024, the Company completed a non-brokered private placement over two tranches for gross proceeds totaling $ 954,253 through the issuance of 10,044,765 units in total at a price of $ 0.095 per unit with each unit consisting of one share of common stock and one-half of one share purchase warrant. Each whole warrant entitles the holder to acquire one additional share of common stock at an exercise price of $ 0.158 for a period of three years from the date of issuance. Certain directors of the Company purchased an aggregate of 5,669,478 units of the private placement for gross proceeds of $ 538,600 . The Company paid fees of $ 1,995 and issued 21,000 finder's warrants where each finder's warrant entitles the holder to acquire one share at a price of $ 0.158 for a period of two years. The Company paid legal fees of $ 4,515 in connection with this financing. On December 7, 2023, the Company completed a non-brokered private placement over two tranches for gross proceeds totaling $ 967,957 through the issuance of 5,377,541 units in total at a price of $ 0.18 per unit with each unit consisting of one share of common stock and one-half of one share purchase warrant. Each whole warrant entitles the holder to acquire one additional share of common stock at an exercise price of $ 0.26 for a period of two years from the date of issuance. Certain directors of the Company purchased an aggregate of 2,532,220 units of the private placement for gross proceeds of $ 455,800 . The Company paid fees of $ 6,480 and issued 36,000 finder's warrants where each finder's warrant entitles the holder to acquire one share at a price of $ 0.26 until November 7, 2025. The Company paid legal fees of $ 10,624 in connection with this financing. Stock Options On October 21, 2024, the Company granted a total of 1,006,750 stock options with a fair value of $ 106,859 to a consultant of the Company. The stock options are exercisable at a price of $ 0.11 (C$ 0.16 ) per share until October 21, 2029. 15 RISE GOLD CORP. (An Exploration Stage Company) NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTH PERIOD ENDED JANUARY 31, 2025 (Expressed in United States Dollars) (Unaudited) 12. CAPITAL STOCK AND ADDITIONAL PAID-IN-CAPITAL (continued) Stock Options (continued) On September 20, 2024, the Company granted 1,006,750 stock options to an officer of the Company. The stock options are exercisable at a price of US$ 0.10 (C$ 0.14 ) per share for a period of five years from the date of grant, subject to vesting, 25 % vesting on the date of grant and 12 % vesting every 3 months thereafter. As at January 31, 2025, the Company recorded share-based compensation of $ 74,417 on the statement of loss and comprehensive loss in connection with this grant. A total of 2,013,500 in stock options held by a director of the Company were cancelled. On May 1, 2024, the Company granted 412,241 stock options to an officer of the Company. The options are exercisable into common shares of the Company at $ 0.17 (C$ 0.25 ) per share for a period of five years from the date of grant, subject to vesting, 25 % vesting on the date of grant and 12 % vesting every 3 months thereafter. As at January 31, 2025, the Company recorded share-based compensation of $ 17,443 (July 31, 2024 - $ 31,849 ) on the statement of loss and comprehensive loss in connection with this grant. On May 1, 2024, the Company granted a total of 592,238 stock options with a fair value of $ 82,673 to directors of the Company. The stock options are exercisable at a price of $ 0.17 (C$ 0.25 ) per share until May 1, 2029. On December 12, 2023, the Company granted a total of 707,752 stock options with a fair value of $ 140,624 to directors of the Company. The stock options are exercisable at a price of $ 0.25 (C$ 0.36 ) per share until December 12, 2028. On September 22, 2023, the Company granted a total of 397,780 stock options with a fair value of $ 90,361 to officers and directors of the Company. The stock options are exercisable at a price of $ 0.26 (C$ 0.38 ) per share until September 22, 2028. The following incentive stock options were outstanding as at January 31, 2025: Number of Options outstanding Weighted Average Exercise Price (C$) Expiry Date 305,000 0.94 February 7, 2027 460,000 0.77 February 21, 2028 277,780 0.38 September 22, 2028 612,202 0.36 December 12, 2028 562,238 0.25 May 1, 2029 412,241 0.25 May 1, 2029 1,006,750 0.14 September 20, 2029 1,006,750 0.16 October 21, 2029 4,642,961 0.33 As at January 31, 2025, the aggregate intrinsic value of the Company's stock options is $ Nil (2024 - $ Nil ). As at January 31, 2025, the Company has 4,642,961 options issued and outstanding where 3,807,622 options are exercisable as at January 31, 2025 with a weighted average exercise price of C$ 0.36 . 16 RISE GOLD CORP. (An Exploration Stage Company) NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTH PERIOD ENDED JANUARY 31, 2025 (Expressed in United States Dollars) (Unaudited) 12. CAPITAL STOCK AND ADDITIONAL PAID-IN-CAPITAL (continued) Stock Options (continued) Stock option transactions are summarized as follows: Number of Options Weighted Average Exercise Price ($C) Balance outstanding and exercisable, July 31, 2023 3,638,500 0.93 Options granted 2,110,011 0.29 Options expired ( 170,000 ) 1.00 Balance outstanding, July 31, 2024 5,578,511 0.69 Options granted 2,013,500 0.15 Options expired and cancelled ( 2,949,050 ) 0.92 Balance outstanding, January 31, 2025 4,642,961 $ 0.30 The following weighted average assumptions were used for the Black-Scholes pricing model valuation of stock options issued during the period ended October 21, 2024 and September 20, 2024: October 21, 2024 September 20, 2024 Risk-free interest rate 2.98 % 2.73 % Expected life of stock options 5 years 5 years Expected annualized volatility 135.38 % 132.92 % Share price at grant date $ 0.12 $ 0.13 Dividend Nil Nil Forfeiture rate 0 % 0 % 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. 17 RISE GOLD CORP. (An Exploration Stage Company) NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTH PERIOD ENDED JANUARY 31, 2025 (Expressed in United States Dollars) (Unaudited) 12. CAPITAL STOCK AND ADDITIONAL PAID-IN-CAPITAL (continued) Warrants The following warrants were outstanding at January 31, 2025: Number of Warrants Exercise Price (CAD$) Expiry Date 1,529,008 0.87 February 17, 2025 575,000 0.87 February 17, 2025 1,623,214 0.38 November 7, 2025 36,000 0.39 November 7, 2025 1,065,555 0.38 December 7, 2025 1,000,000 0.23 February 5, 2028 9,000 0.23 April 9, 2026 2,873,170 0.23 April 9, 2027 12,000 0.23 April 29, 2026 2,149,212 0.23 April 29, 2027 1,700,000 0.17 September 12, 2028 2,882,514 0.25 October 10, 2028 15,454,673 0.34 Warrant transactions are summarized as follows: Number of Warrants Weighted Average Exercise Price (C$) Balance, July 31, 2023 16,661,247 $ 0.91 Warrants issued 8,768,151 0.26 Warrants expired ( 8,717,823 ) 0.92 Balance, July 31, 2024 16,711,575 0.58 Warrants issued 4,582,514 0.22 Warrants expired ( 5,839,416 ) 0.96 Balance, January 31, 2025 15,454,673 0.34 18 RISE GOLD CORP. (An Exploration Stage Company) NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTH PERIOD ENDED JANUARY 31, 2025 (Expressed in United States Dollars) (Unaudited) 13. SUPPLEMENTAL DISCLOSURE WITH RESPECT TO CASH FLOWS During the six-month periods ended January 31, 2025 and 2024, the Company had the following non-cash financing and investing activities: For the period ended January 31, 2025: a) The Company accrued $ 165,116 of interest expense as part of the outstanding balance of loan payable. b) The Company issued a total of 1,700,000 share purchase warrants, as consideration for loan extension, entitling the holder to acquire one share at an exercise price of US$ 0.115 until September 12, 2028 with a total fair value of $ 154,351 . c) The Company issued 2,882,514 share purchase warrants for a secured loan agreement entitling the holder to acquire one share at an exercise price of US$ 0.1735 until October 10, 2028 with a total fair value of $ 334,423 . For the period ended January 31, 2024: a) The Company accrued $ 129,661 of interest expense as part of the outstanding balance of loan payable. 14. 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. 19