Electra Battery Materials Corp 6-K/A, filed Sep 17, 2025
Electra Battery Materials Corp (ELBM)
About this 6-K/A
Electra Battery Materials Corp filed this 6-K/A on September 17, 2025.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.
20549
FORM 6-K/A
(Amendment No. 1)
REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16 UNDER THE SECURITIES EXCHANGE ACT OF 1934
For the month of September 2025
Commission File Number: 001-41356
Electra Battery Materials Corporation
(Translation
of registrant's name into English)
133 Richmond St W, Suite 602
Toronto, Ontario, Canada
M5H 2L3
(416) 900-3891
(Address
of principal executive office)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
Form 20-F
[ X ] Form 40-F [ ]
EXPLANATORY NOTE
Electra Battery Materials Corporation (the “Company”) is filing this Amendment No. 1 (“Amendment No. 1”) to its Form 6-K originally furnished to the Securities and Exchange Commission on August 15, 2025 (the “Original Filing”). This Amendment No. 1 is being furnished solely to provide updated versions of the Company’s (i) Condensed Interim Consolidated Financial Statements for the three and six months ended June 30, 2025, (ii) to its Management’s Discussion and Analysis for the three and six months ended June 30, 2025, (iii) Form 52-109F2 CEO Certification of Interim Filings, and (iv) Form 52-109F2 CFO Certification of Interim Filings, with such updated filings being attached as Exhibits 99.1, 99.2, 99.3, and 99.4, respectively to this Amendment No. 1.
EXHIBIT INDEX
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| Electra Battery Materials Corporation | ||
| (Registrant) | ||
| Date: September 17, 2025 | /s/ Trent Mell | |
| Trent Mell | ||
| Chief Executive Officer and Director | ||
Exhibit 99.1
`
ELECTRA BATTERY MATERIALS CORPORATION
(AMENDED)
CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2025 AND 2024
(UNAUDITED)
(EXPRESSED IN THOUSANDS OF CANADIAN DOLLARS)
ELECTRA BATTERY MATERIALS CORPORATION
CONDENSED INTERIM CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (UNAUDITED)
AS AT JUNE 30, 2025 AND 2024
| (expressed in thousands of Canadian dollars) |
| June 30, 2025 | December 31, 2024 (audited) | |||||||
| ASSETS | ||||||||
| Current Assets | ||||||||
| Cash and cash equivalents | $ | 2,927 | $ | 3,717 | ||||
| Marketable securities (Note 7) | - | 12 | ||||||
| Prepaid expenses and deposits | 894 | 672 | ||||||
| Receivables (Note 4) | 453 | 1,310 | ||||||
| 4,274 | 5,711 | |||||||
| Non-Current Assets | ||||||||
| Exploration and evaluation assets (Note 6) | 88,368 | 93,200 | ||||||
| Property, plant and equipment (Note 5) | 51,611 | 51,189 | ||||||
| Capital long-term prepayments (Note 5) | 139 | 139 | ||||||
| Long-term restricted cash | 1,208 | 1,208 | ||||||
| Total Assets | $ | 145,600 | $ | 151,447 | ||||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||
| Current Liabilities | ||||||||
| Accounts payable and accrued liabilities | $ | 4,858 | $ | 3,579 | ||||
| Accrued interest | 8,529 | 2,799 | ||||||
| Convertible notes payable (Note 10) | 64,552 | 63,963 | ||||||
| Warrants (Note 10) | 504 | 1,582 | ||||||
| US Warrants and 2026 Warrants (Note 12 (c)) | 1,249 | - | ||||||
| Lease liability | 53 | 50 | ||||||
| 79,745 | 71,973 | |||||||
| Non-Current Liabilities | ||||||||
| Government loan payable (Note 9) | 8,174 | 7,824 | ||||||
| Government grants (Note 9) | 3,124 | 3,124 | ||||||
| Royalty (Note 10) | 1,064 | 1,283 | ||||||
| Lease liability | 55 | 83 | ||||||
| Asset retirement obligations (Note 8) | 2,685 | 2,842 | ||||||
| Total Liabilities | $ | 94,847 | $ | 87,129 | ||||
| Shareholders’ Equity | ||||||||
| Common shares (Note 11) | 311,232 | 307,723 | ||||||
| Reserve (Note 12) | 27,474 | 26,848 | ||||||
| Accumulated other comprehensive loss | 1,624 | 4,639 | ||||||
| Deficit | (289,577 | ) | (274,892 | ) | ||||
| Total Shareholders’ Equity | $ | 50,753 | $ | 64,318 | ||||
| Total Liabilities and Shareholders’ Equity | $ | 145,600 | $ | 151,447 | ||||
| Going Concern (Note 1) Commitments and Contingencies (Note 17) | ||||||||
| Subsequent events (Note 20) | ||||||||
| Approved on behalf of the Board of Directors and authorized for issue on September 16, 2025 | ||
| Alden Greenhouse, Director | Trent Mell, Director | |
See accompanying notes to condensed interim consolidated financial statements.
| Page 2 of 28 |
ELECTRA BATTERY MATERIALS CORPORATION
CONDENSED INTERIM CONSOLIDATED STATEMENTS OF LOSS AND OTHER COMPREHENSIVE LOSS (UNAUDITED)
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2025 AND 2024
| (expressed in thousands of Canadian dollars) |
| For the three months ended June 30, | For the six months ended June 30, | |||||||||||||||
| 2025 | 2024 | 2025 | 2024 | |||||||||||||
| Operating expenses | ||||||||||||||||
| General and administrative | $ | 723 | $ | 902 | $ | 1,766 | $ | 1,425 | ||||||||
| Consulting and professional fees | 1,067 | 1,092 | 2,068 | 2,215 | ||||||||||||
| Exploration and evaluation expenditures | 48 | 81 | 89 | 144 | ||||||||||||
| Investor relations and marketing | 119 | 126 | 211 | 304 | ||||||||||||
| Salaries and benefits | 1,298 | 798 | 2,550 | 1,695 | ||||||||||||
| Share-based payments (Note 12) | 228 | 419 | 555 | 979 | ||||||||||||
| Operating loss before noted items below: | 3,483 | 3,418 | 7,239 | 6,762 | ||||||||||||
| Other | ||||||||||||||||
| Unrealized gain (loss) on marketable securities (Note 7) | - | 89 | 4 | 181 | ||||||||||||
| (Loss) gain on financial derivative liability – Convertible Notes (Note 10) | 231 | (373 | ) | (4,836 | ) | (7,184 | ) | |||||||||
| Changes in fair value of US Warrant (Note 12 (c)) | (100 | ) | (19 | ) | (100 | ) | (49 | ) | ||||||||
| Other non-operating (loss) income (Note 13) | 1,347 | (2,051 | ) | (2,514 | ) | (4,127 | ) | |||||||||
| Net loss | $ | (2,005 | ) | $ | (5,772 | ) | $ | (14,685 | ) | $ | (17,941 | ) | ||||
| Other comprehensive income (loss): | ||||||||||||||||
| Fair value adjustment of 2028 and 2027 Notes due to credit risk | (82 | ) | - | 1,798 | - | |||||||||||
| Foreign currency translation gain (loss) | (4,746 | ) | 887 | (4,813 | ) | 3,008 | ||||||||||
| Net loss and other comprehensive loss | $ | (6,833 | ) | $ | (4,885 | ) | $ | (17,700 | ) | $ | (14,933 | ) | ||||
| Basic and diluted loss per share (Note 14) | $ | (0.11 | ) | $ | (0.41 | ) | $ | (0.90 | ) | $ | (1.27 | ) | ||||
| Weighted average number of common shares outstanding - Basic and diluted (Note 14) | 17,807,021 | 14,159,544 | 16,317,480 | 14,159,298 | ||||||||||||
See accompanying notes to condensed interim consolidated financial statements.
| Page 3 of 28 |
ELECTRA BATTERY MATERIALS CORPORATION
CONDENSED INTERIM CONSOLIDATED STATEMENTS OF SHAREHOLDER’S EQUITY (UNAUDITED)
FOR THE SIX MONTHS ENDED JUNE 30, 2025 AND 2024
| (expressed in thousands of Canadian dollars) |
| Common Shares | ||||||||||||||||||||||||
| Number of shares (1) | Amount | Reserves | Accumulated Other Comprehensive Income (Loss) | Deficit | Total | |||||||||||||||||||
| Balance – January 1, 2025 | 14,809,197 | $ | 307,723 | $ | 26,848 | $ | 4,639 | $ | (274,892 | ) | $ | 64,318 | ||||||||||||
| Other comprehensive earnings for the period, net of taxes | - | - | - | (3,015 | ) | - | (3,015 | ) | ||||||||||||||||
| Net loss for the period | - | - | - | - | (14,685 | ) | (14,685 | ) | ||||||||||||||||
| Share-based payment expense | - | - | 555 | - | - | 555 | ||||||||||||||||||
| Directors’ fees paid in deferred share units | - | - | 48 | - | - | 48 | ||||||||||||||||||
| Exercise of restricted share units and warrants (Note 12) | 27,975 | 88 | (86 | ) | - | - | 2 | |||||||||||||||||
| Private placement, net of transaction costs of $337 (Note 11) | 3,125,000 | 3,421 | 109 | - | - | 3,530 | ||||||||||||||||||
| Balance – June 30, 2025 | 17,962,172 | $ | 311,232 | $ | 27,474 | $ | 1,624 | $ | (289,577 | ) | $ | 50,753 | ||||||||||||
| Balance – January 1, 2024 | 13,962,832 | $ | 304,721 | $ | 25,579 | $ | (1,557 | ) | $ | (245,445 | ) | $ | 83,298 | |||||||||||
| Other comprehensive earnings for the period, net of taxes | - | - | - | 3,008 | - | 3,008 | ||||||||||||||||||
| Net loss for the period | - | - | - | - | (17,941 | ) | (17,941 | ) | ||||||||||||||||
| Share-based payment expense | - | - | 979 | - | - | 979 | ||||||||||||||||||
| Performance based incentive payment | 41,314 | 134 | - | - | - | 134 | ||||||||||||||||||
| Exercise of restricted and performance share units (Note 12) | 84,711 | 959 | (959 | ) | - | - | - | |||||||||||||||||
| Settlement of interest on 2028 Notes (Note 10) | 210,760 | 543 | - | - | - | 543 | ||||||||||||||||||
| Balance – June 30, 2024 | 14,299,617 | $ | 306,357 | $ | 25,599 | $ | 1,451 | $ | (263,386 | ) | $ | 70,021 | ||||||||||||
| (1) | Reflects the Company’s consolidation of common shares, see Note 11(a) for details. |
See accompanying notes to condensed interim consolidated financial statements.
| Page 4 of 28 |
ELECTRA BATTERY MATERIALS CORPORATION
CONDENSED INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
FOR THE SIX MONTHS ENDED JUNE 30, 2025 AND 2024
| (expressed in thousands of Canadian dollars) |
| For the six months ended June 30, | ||||||||
| 2025 | 2024 | |||||||
| Operating activities | ||||||||
| Net loss | $ | (14,685 | ) | $ | (17,941 | ) | ||
| Adjustments for items not affecting cash: | ||||||||
| Share-based payments | 603 | 980 | ||||||
| Change in fair value of marketable securities | (4 | ) | (181 | ) | ||||
| Realized gain on marketable securities | (1 | ) | - | |||||
| Depreciation (Note 5) | 29 | 29 | ||||||
| Accretion (Notes 8, 9 and 10) | 320 | 49 | ||||||
| Changes in fair value of convertible 2028 Notes and 2027 Notes (Note 10) | 5,914 | 6,795 | ||||||
| Interest expense on convertible 2028 Notes and 2027 Notes | 5,730 | 2,629 | ||||||
| Fair value warrants 2028 Notes (Note 10) | (1,078 | ) | 389 | |||||
| Fair value gain on warrants (US Warrants and 2026 US Warrants) | 100 | - | ||||||
| Performance based incentive payment | - | 134 | ||||||
| Unrealized loss on foreign exchange | (3,593 | ) | 1,635 | |||||
| $ | (6,665 | ) | $ | (5,482 | ) | |||
| Changes in working capital: | ||||||||
| Decrease in receivables | 857 | 725 | ||||||
| Increase in prepaid expenses and other assets | (222 | ) | (2,452 | ) | ||||
| (Decrease) increase in accounts payable and accrued liabilities | 1,314 | (742 | ) | |||||
| Cash used in operation activities | $ | (4,716 | ) | $ | (7,951 | ) | ||
| Investing activities | ||||||||
| Payment (transfer) to / from restricted cash | - | 611 | ||||||
| Proceeds from sale of marketable securities (Note 7) | 13 | 594 | ||||||
| Additions to property, plant and equipment (Note 5) | (702 | ) | (265 | ) | ||||
| Cash provided in investing activities | $ | (689 | ) | $ | 940 | |||
| Financing activities | ||||||||
| Proceeds from non-brokered private place, net of transaction costs $337 (2024 - $Nil) (Note 11) | 4,679 | - | ||||||
| Proceeds (repayment) from (of) government loans (Note 9) | (18 | ) | 4,249 | |||||
| Payment of lease liability, net of interest | (65 | ) | (20 | ) | ||||
| Cash provided by financing activities | $ | 4,596 | $ | 4,229 | ||||
| Change in cash during the period | (809 | ) | (2,782 | ) | ||||
| Effect of exchange rates | 19 | 23 | ||||||
| Cash, beginning of the period | 3,717 | 7,560 | ||||||
| Cash, end of period | $ | 2,927 | $ | 4,801 | ||||
See accompanying notes to condensed interim consolidated financial statements.
| Page 5 of 28 |
ELECTRA BATTERY MATERIALS CORPORATION |
NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) |
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2025 AND 2024 |
| (expressed in thousands of Canadian dollars) |
| 1. | Significant Nature of Operations |
Electra Battery Materials Corporation (the “Company”, “Electra”) was incorporated on July 13, 2011 under the Business Corporations Act of British Columbia (the “Act”). On September 4, 2018, the Company filed a Certificate of Continuance into Canada and adopted Articles of Continuance as a Federal Company under the Canada Business Corporations Act (the “CBCA”). On December 6, 2021, the Company changed its corporate name from First Cobalt Corp. to Electra Battery Materials Corporation. The Company is in the business of producing battery materials for the electric vehicle supply chain. The Company is focused on building a supply of cobalt, nickel and recycled battery materials.
Electra is a public company which is listed on the Toronto Venture Stock Exchange (“TSXV”) (under the symbol ELBM) and on the NASDAQ (under the symbol ELBM). The Company’s registered office is Suite 2400, Bay-Adelaide Centre, 333 Bay Street, Toronto, Ontario, M5H 2T6 and the corporate head office is located at 133 Richmond Street W, Suite 602, Toronto, Ontario, M5H 2L3.
On December 31, 2024, the Company completed a share consolidation on the basis of one new post-consolidation common share for every four (4) pre-consolidation common shares. All prior share capital information has been presented based on this ratio.
The Company is focused on building a North American integrated battery materials facility for the electric vehicle supply chain. The Company is in the process of constructing its expanded hydrometallurgical cobalt refinery (the “Refinery”) in Ontario, Canada, assessing the various optimizations and modular growth scenarios for a recycled battery material (known as black mass) program, and exploring and developing its mineral properties.
Going Concern Basis of Accounting
The accompanying condensed interim consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business for the foreseeable future, and, as such, the condensed interim consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue in existence.
The Company has recurring net operating losses and negative cash flows from operations. As of June 30, 2025 and December 31, 2024, the Company had an accumulated deficit of $289,577 and $274,892, respectively. The Company’s recurring losses from operations and negative cash flows raise substantial doubt about the Company’s ability to continue as a going concern. The global economy, including the financial and credit markets, have experienced extreme volatility and disruptions, including fluctuating inflation rates and interest rates, foreign currency impacts, declines in consumer confidence, and declines in economic growth. Additionally, the Company suspended construction of the Refinery in 2023 due to lack of sufficient funding in the wake of supply chain disruptions. These factors point to uncertainty about economic stability, and the severity and duration of these conditions on our business cannot be predicted, and the Company cannot assure that it will remain in compliance with the financial covenants contained within its credit facilities. Management monitors recent developments in relation to global tariffs and does not anticipate material impacts on the financial position of the Company.
| Page 6 of 28 |
ELECTRA BATTERY MATERIALS CORPORATION |
NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) |
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2025 AND 2024 |
| (expressed in thousands of Canadian dollars) |
In order to continue its operations, the Company must achieve profitable operations and/or obtain additional equity or debt financing. Until the Company achieves profitability, management plans to fund its operations and capital expenditures with cash on hand, borrowings, and issuance of capital stock. Until the Company generates revenue at a level to support its cost structure, the Company expects to continue to incur significant operating losses and net cash outflows from operating activities.
The Company is actively pursuing various alternatives including government grants and loans, strategic partnerships, equity and debt financing to increase its liquidity and capital resources. During 2024, a government loan from Federal Economic Development Agency for Northern Ontario (“FedNor”) was received in the amount of $5,267. On August 19, 2024, the Company was awarded US$20,000 in funding by the U.S. Department of Defense (“DoD”) for the construction of the Refinery funded on a reimbursement basis. The award was made pursuant to Title III of the Defense Production Act (DPA) to expand domestic production capability. On November 25, 2024, the Company completed a private placement of US$1,000 as detailed in Note 11. On November 27, 2024, the Company issued secured convertible notes in the principal amount of US$4,000 as detailed in Note 11. On April 20, 2025, the Company announced the closing of a non-brokered private placement to raise aggregate gross proceeds up to US$3,500. The private placement consisted of units of the Company issued at a price of US$1.12 per unit (See Note 11).
Although the Company has historically been successful in obtaining financing in the past, there can be no assurances that the Company will be able to obtain adequate financing in the future. These condensed interim consolidated financial statements do not include the adjustments to the amounts and classifications of assets and liabilities that would be necessary should the Company be unable to continue as a going concern. These adjustments may be material.
| 2. | Material Accounting Policies and Basis of Preparation |
Basis of Presentation and Statement of Compliance
The Company prepares its condensed interim consolidated financial statements in accordance with IFRS® Accounting Standards as issued by the International Accounting Standard Board (“IASB”). These condensed interim consolidated financial statements have been prepared in accordance with IAS 34, Interim Financial Reporting (“IAS 34”). These condensed interim consolidated financial statements should be read in conjunction with our most recent annual financial statements. These condensed interim consolidated financial statements follow the same accounting policies, estimates, and methods of application as our most recent annual financial statements, except as detailed in Note 3.
All amounts other than share and per share information on the condensed interim consolidated financial statements are presented in thousands of Canadian dollars unless otherwise stated. The condensed interim consolidated financial statements were authorized for issue by the Board of Directors on September 16, 2025.
Certain comparative amounts have been restated to conform with current year accounting presentation.
| 3. | New Accounting Standards Issued |
Certain new accounting standards and interpretations have been published that are either applicable in the current year or not mandatory for the current period. IFRS 18 Presentation and Disclosure in Financial Statements was issued by the IASB in April 2024, with mandatory application of the standard in annual reporting periods beginning on or after January 1, 2027. The Company is currently assessing the impact of IFRS 18 on its condensed interim consolidated financial statements. No standards have been early adopted in the current period.
| Page 7 of 28 |
ELECTRA BATTERY MATERIALS CORPORATION |
NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) |
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2025 AND 2024 |
| (expressed in thousands of Canadian dollars) |
| 4. | Receivables |
| June 30, 2025 | December 31, 2024 | |||||||
| GST receivables | $ | 301 | $ | 494 | ||||
| Grant receivables | 84 | 570 | ||||||
| Other | 68 | 246 | ||||||
| $ | 453 | $ | 1,310 | |||||
During the six months ended June 30, 2025, grant submissions consist of $403 to Natural Resources Canada (“NRCan”) and receipt of $693 including prior period submissions (December 31, 2024 - $432 submitted of which $101 have been reimbursed). In addition, during the six months ended June 30, 2025, $Nil have been submitted to the U.S. Department of Defense (“DoD”) and to date $196 have been reimbursed for prior period submissions (December 31, 2024 - $362 submitted of which $123 have been reimbursed). These reimbursements have been offset to property, plant and equipment or profit or loss for the six months ended June 30, 2025.
| 5. | Property, Plant and Equipment and Capital Long-Term Prepayments |
| Cost | Property, Plant and Equipment | Construction in Progress | Right-of- use Assets | Total | ||||||||||||
| Balance January 1, 2024 | $ | 5,989 | $ | 45,074 | $ | 301 | $ | 51,364 | ||||||||
| Reclassification | 1,334 | (1,334 | ) | - | - | |||||||||||
| Additions during the period | 133 | 386 | - | 519 | ||||||||||||
| Transfers to capital long-term prepayments | - | (139 | ) | - | (139 | ) | ||||||||||
| Asset retirement obligation - Change in estimate | (384 | ) | - | - | (384 | ) | ||||||||||
| Balance December 31, 2024 | $ | 7,072 | $ | 43,987 | $ | 301 | $ | 51,360 | ||||||||
| Additions during the period | - | 702 | - | 702 | ||||||||||||
| Asset retirement obligation - Change in estimate | (251 | ) | - | - | (251 | ) | ||||||||||
| Balance June 30, 2025 | $ | 6,821 | $ | 44,689 | $ | 301 | $ | 51,811 | ||||||||
| Accumulated Depreciation | ||||||||||||||||
| January 1, 2024 | $ | 10 | $ | - | $ | 96 | $ | 106 | ||||||||
| Change for the period | - | - | 65 | 65 | ||||||||||||
| Balance December 31, 2024 | $ | 10 | $ | - | $ | 161 | $ | 171 | ||||||||
| Change for the period | - | - | 29 | 29 | ||||||||||||
| Balance June 30, 2025 | $ | 10 | $ | - | $ | 190 | $ | 200 | ||||||||
| Net Book Value | ||||||||||||||||
| Balance December 31, 2024 | $ | 7,062 | $ | 43,987 | $ | 140 | $ | 51,189 | ||||||||
| Balance June 30, 2025 | $ | 6,811 | $ | 44,689 | $ | 111 | $ | 51,611 | ||||||||
Most of the Company’s property, plant, and equipment assets relate to the Refinery located near Temiskaming Shores, Ontario, Canada. The carrying value of property, plant, and equipment and construction in progress is $51,500 (December 31, 2024 - $51,059), all of which is pledged as security for the 2028 Notes and 2027 Notes (Note 10).
| Page 8 of 28 |
ELECTRA BATTERY MATERIALS CORPORATION |
NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) |
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2025 AND 2024 |
| (expressed in thousands of Canadian dollars) |
Capital long-term prepayments of $139 (December 31, 2024 - $139) relate to payments for long-term capital contracts made for Refinery equipment that have not yet been received by the Company as at June 30, 2025. No depreciation has been recorded for the Refinery during the six months ended June 30, 2025 (December 31, 2024 - $Nil) as the asset is not yet in service.
| 6. | Exploration and Evaluation Assets |
| Balance January 1, 2024 | Foreign Exchange | Acquisition cost | Balance December 31, 2024 | Foreign Exchange | Balance June 30, 2025 | |||||||||||||||||||
| Idaho, USA | $ | 85,634 | $ | 7,530 | $ | 36 | $ | 93,200 | $ | (4,832 | ) | $ | 88,368 | |||||||||||
All of the Iron Creek mineral properties are pledged as security for the Convertible Notes issued on February 13, 2023 and November 27, 2024 (Note 10). Upon successful commissioning of the Refinery, the Iron Creek mineral properties will be released from the Convertible Notes security package.
Certain claims relating to the Iron Creek properties were acquired by the Company against earn-in and option agreements entered with the original owners of such claims. These agreements provide a working interest in the property to the Company, upon making certain milestone payments and/or incurring certain expenditures on the property. The Company is current on all milestone payments and expenditures. The claims are also subject to future net smelter royalty (“NSR”) payments.
| 7. | Marketable Securities |
There were no marketable securities at June 30, 2025 (December 31, 2024 - $12). Shares are marked-to-market at the end of each quarter resulting in an unrealized gain of $Nil and $4 being recorded during the three and six months ended June 30, 2025, respectively (for the three and six months ended June 30, 2024 – unrealized gain was $89 and 181, respectively). During the three and six months ended June 30, 2025, the Company sold marketable securities for proceeds of $4 and $17 from sale of 13,719 shares and 48,219 shares, respectively (the three and six months ended June 30, 2024 proceeds were $562 and $594 from sale of 1,373,000 and 1,483,000 shares, respectively) and realized gain of $Nil and $1, respectively (the three and six months ended June 30, 2024 – gain of $40 and $44, respectively).
| 8. | Asset Retirement Obligations |
As at June 30, 2025, the estimated cost of closure is $3,323. The Company maintains a surety bond for $3,450 as financial assurance based on the October 2021 closure plan.
| Page 9 of 28 |
ELECTRA BATTERY MATERIALS CORPORATION |
NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) |
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2025 AND 2024 |
| (expressed in thousands of Canadian dollars) |
The full estimated closure cost in the latest closure plan incorporated new disturbances that have yet to take place, such as new roadways, new chemicals on site, and a new tailings area. The latest closure plan also included cost updates relating to remediating disturbances that existed at June 30, 2025. The following assumptions were used to calculate the asset retirement obligation:
| · | Discounted cash flows of $2,685 (December 31, 2024 - $2,842) |
| · | Closure activities date of 2073 (December 31, 2024 – 2073) |
| · | Risk-free discount rate of 3.56% (December 31, 2024 – 3.33%) |
| · | Long-term inflation rate of 3.0% (December 31, 2024 – 3.0%) |
The continuity of the asset retirement obligation at June 30, 2025 and December 31, 2024 is as follows:
| June 30, 2025 | December 31, 2024 | |||||||
| Balance at January 1, | $ | 2,842 | $ | 3,126 | ||||
| Change in estimate from discounting and estimate of costs | (251 | ) | (384 | ) | ||||
| Accretion | 94 | 100 | ||||||
| Balance | $ | 2,685 | $ | 2,842 | ||||
| 9. | Long-Term Government Loan payable, Grants and Awards |
On November 24, 2020, the Company entered into a contribution agreement with the Ministry of Economic Development and Official Languages as represented by the Federal Economic Development Agency for Northern Ontario (“FedNor”) for up to $5,000 financing related to the recommissioning and expansion of the Refinery in Ontario. The contribution is in the form of debt bearing a 0% interest rate and funded in proportion to certain Refinery construction activities. The Company received approval for an additional $5,000 funding under the agreement on December 27, 2023, which was fully received during the year ended December 31, 2024.
Once construction is completed, the cumulative balance borrowed will be repaid in 19 equal quarterly instalments. The loan was discounted using a market rate between 7.0% and 17.1% with the resulting difference between the amortized cost and cash proceeds recognized as Government Grant. The FedNor loan requires completion of the construction on or before June 30, 2025. Refer to Note 20 for the amendment of FedNor loan in relation to the completion date of the construction.
On June 10, 2024, the Company received $5,000 in contribution funding from Natural Resources Canada (“NRCan”) to support the development of its proprietary battery materials recycling technology.
On August 19, 2024, the Company was awarded US$20,000 by the U.S. Department of Defense (“DoD”). The award was made pursuant to Title III of the Defense Production Act (“DPA”) to expand domestic production capability.
On March 21, 2025, the Company was provided with a non-binding letter of intent from the Canadian Federal government in the amount of $20,000. While the discussions between the parties are ongoing, there is no guarantee or assurance that a final agreement will be reached and/or funding will be provided to the Company.
| Page 10 of 28 |
ELECTRA BATTERY MATERIALS CORPORATION |
NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) |
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2025 AND 2024 |
| (expressed in thousands of Canadian dollars) |
The following table sets out the balances of Government Loans and Government Grant as at June 30, 2025 and December 31, 2024:
| Government Loan | Government Grant | Total | ||||||||||
| Balance at January 1, 2024 | $ | 4,299 | $ | 849 | $ | 5,148 | ||||||
| FedNor loan – February 2024 | 2,267 | - | 2,267 | |||||||||
| FedNor Loan – April 2024 | 2,000 | - | 2,000 | |||||||||
| FedNor Loan (Nickel Study) - Payment | (45 | ) | - | (45 | ) | |||||||
| FedNor Loan – August 2024 | 1,000 | - | 1,000 | |||||||||
| Allocation to government grant | (2,275 | ) | 2,275 | - | ||||||||
| Accretion | 578 | - | 578 | |||||||||
| Balance at December 31, 2024 | $ | 7,824 | $ | 3,124 | $ | 10,948 | ||||||
| FedNor Loan (Nickel Study) - Payment | (18 | ) | - | (18 | ) | |||||||
| Accretion | 368 | - | 368 | |||||||||
| Balance at June 30, 2025 | $ | 8,174 | $ | 3,124 | $ | 11,298 | ||||||
| 10. | Convertible Note Arrangement |
In January 2024, the terms of the 2028 Warrants were amended and the exercise price of US$9.92 was re-priced to $4.00. On November 27, 2024, in conjunction with the issuance of the 2027 Notes discussed below, the exercise price was amended from $4.00 to $3.40.
In addition, the 2028 Warrants included a revised acceleration clause such that their term will be reduced to thirty days in the event the closing price of the common shares on the TSXV exceeds $3.40 by twenty percent or more for ten consecutive trading days, with the reduced term beginning seven calendar days after such 10 consecutive trading-day period. Upon the occurrence of an acceleration event, noteholders of the 2028 Warrants may exercise the 2028 Warrants on a cashless basis, based on the value of the 2028 Warrants at the time of exercise.
On March 21, 2024, the Company satisfied $543 (US$401) of interest through the issuance of 210,760 common shares to certain noteholders. The share issuance was approved by the TSXV.
The 2028 Notes are secured by a first priority security interest (subject to customary permitted liens) in substantially all of the Company’s assets, and the assets and/or equity of the secured guarantors. The 2028 Notes are subject to customary events of default and basic positive and negative covenants. The Company is required to maintain a reportable minimum liquidity balance of US$2,000 under the terms of the 2028 Notes. The 2028 Notes are convertible at the discretion of the lenders and as such have been classified as a current liability.
| Page 11 of 28 |
ELECTRA BATTERY MATERIALS CORPORATION |
NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) |
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2025 AND 2024 |
| (expressed in thousands of Canadian dollars) |
On November 27, 2024, the Company issued additional 2028 Notes to the noteholders, in the principal amount of $9,157 (US$6,521), as payment-in-kind for all outstanding accrued interest owing on the 2028 Notes through to August 15, 2024. The additional 2028 Notes carry the same payment conversion terms as the balance of the 2028 Notes and were issued pursuant to a supplement to the indenture dated February 13, 2023, entered into among the Company and the 2028 Notes noteholders.
For the six months ended June 30, 2025 and year ended December 31, 2024, the 2028 Notes were fair valued using the finite difference valuation method with the following key assumptions:
| · | Risk free rate at June 30, 2025 of 3.973% (December 31, 2024 – 4.393%) based on the US dollar zero curve; |
| · | Equity volatility at June 30, 2025 of 65% (December 31, 2024 – 63%) based on an assessment of the Company’s historical volatility and the estimated maximum a third-party investor would be willing to pay for; |
| · | An Electra share price at June 30, 2025 of US$1.080 (December 31, 2024 - US$1.807) reflecting the quoted market price; and |
| · | A credit spread at June 30, 2025 of 28.1% (December 31, 2024 – 26.3%). |
The following table sets out the details of the Company’s financial derivative liability related to convertible notes in the 2028 Notes as of June 30, 2025 and December 31, 2024:
| Convertible Notes Payable | Warrants | Royalty | Total | |||||||||||||
| Balance at January 1, 2024 | $ | 40,101 | $ | 1,421 | $ | 858 | $ | 42,380 | ||||||||
| Revaluation to fair value | 3,139 | 137 | - | 3,276 | ||||||||||||
| Capitalized interest | 9,157 | - | - | 9,157 | ||||||||||||
| Revaluation to fair value due to own credit risk | 1,342 | - | - | 1,342 | ||||||||||||
| Foreign exchange loss | 3,947 | 24 | 95 | 4,066 | ||||||||||||
| Accretion | - | - | 330 | 330 | ||||||||||||
| Balance at December 31, 2024 | $ | 57,686 | $ | 1,582 | $ | 1,283 | $ | 60,551 | ||||||||
| Revaluation to fair value | 6,785 | (1,078 | ) | - | 5,707 | |||||||||||
| Revaluation to fair value due to own credit risk | (1,679 | ) | - | - | (1,679 | ) | ||||||||||
| Foreign exchange loss | (3,252 | ) | - | (72 | ) | (3,324 | ) | |||||||||
| Accretion | - | - | (147 | ) | (147 | ) | ||||||||||
| Balance at June 30, 2025 | $ | 59,540 | $ | 504 | $ | 1,064 | $ | 61,108 | ||||||||
The accrued interest as at June 30, 2025 is $8,529 (December 31, 2024 - $2,799).
On November 27, 2024, the Company closed a financing transaction (the “2027 Notes”) with the holders of the 2028 Notes for gross proceeds of $5,615 (US$4,000). In connection with closing, 460,405 common shares were issued for gross proceeds of $1,401 at US$2.172 per share. The 2027 Notes were issued together with 1,136,364 detachable common share purchase warrants (“2027 Warrants”) entitling the noteholders to acquire an equivalent number of common shares at a price of $4.00 per share until November 26, 2026. The 2027 Warrants were issued as replacement for warrants previously issued through an equity financing which took place on August 23, 2023 with an exercise price of $6.84. The same number of warrants were cancelled and re-issued as part of the 2027 Notes. 2027 Warrants met the fixed for fixed criteria and were classified as equity. The total proceeds were allocated between convertible notes and warrants using relative fair value on the issuance date. The fair value of warrants on issuance date was estimated using the Black-Scholes Option Pricing Model approach with the following inputs: a risk-free rate of 3.20% per year, an expected life of 2 years, expected volatility based on historical prices of 70.00%, no expected dividends and a share price of $2.72.
| Page 12 of 28 |
ELECTRA BATTERY MATERIALS CORPORATION |
NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) |
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2025 AND 2024 |
| (expressed in thousands of Canadian dollars) |
As at initial recognition on November 27, 2024, the convertible notes were fair valued using the finite difference valuation method with the following key assumptions:
| · | Risk free rate at November 27, 2024 of 4.268% based on the US dollar zero curve; |
| · | Equity volatility at November 27, 2024 of 63% based on an assessment of the Company’s historical volatility and the estimated maximum a third-party investor would be willing to pay for; |
| · | An Electra share price at November 27, 2024 of US$1.938 reflecting the quoted market prices; and |
| · | A credit spread at November 27, 2024 of 26.0%. |
The transaction costs relating to the 2027 Notes and equity financing in the amount of $903 were allocated between 2027 Notes, 2027 Warrants and equity based on relative fair value on issuance date in the amount of $633, $89 and $180, respectively. The transaction costs for debt related to 2027 Notes were recorded in the condensed interim consolidated statements of loss and other comprehensive loss in other non-operating loss. The transaction costs for the 2027 Warrants and equity were deducted from reserves and common shares, respectively in the condensed interim consolidated statements of equity.
The 2027 Notes rate pari passu to the 2028 Notes, bear interest at a rate of 12.0% per annum, payable quarterly in cash, and mature on November 12, 2027. The 2027 Notes are also guaranteed by substantially all of the Company’s subsidiaries and are secured on a first lien basis by substantially all of the assets of the Company and its subsidiaries. The initial conversion rate of the 2027 Notes is 240,211 common shares per US$1,000 principal amount of Notes (equivalent to an initial conversion price of approximately US$2.4978 per common share) subject to certain adjustments set forth in the 2027 Notes. The conversion price is subject to adjustments on the provision of the subscription agreements. The Company is required to maintain a reportable minimum liquidity balance of US$2,000 under the terms of the 2027 Notes.
For the six months ended June 30, 2025 and for the year ended December 31, 2024, the 2027 Notes were fair valued using the finite difference valuation method with the following key assumptions:
| · | Risk free rate at June 30, 2025 of 3.98% (December 31, 2024 – 4.39% based on the US dollar zero curve; |
| · | Equity volatility at June 30, 2025 of 65% (December 31, 2024 – 63%) based on an assessment of the Company’s historical volatility and the estimated maximum a third-party investor would be willing to pay for; |
| · | An Electra share price at June 30, 2025 of US$1.080 (December 31, 2024 – US$1.807) reflecting the quoted market prices; and |
| · | A credit spread at June 30, 2025 of 28.1% (December 31, 2024 – 26.3%). |
| Page 13 of 28 |
ELECTRA BATTERY MATERIALS CORPORATION |
NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) |
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2025 AND 2024 |
| (expressed in thousands of Canadian dollars) |
The following table sets out the details of the Company’s financial derivative liability related to convertible notes in the 2027 Notes as of June 30, 2025 and December 31, 2024:
| 2027 Notes | ||||
| Balance at January 1, 2024 | $ | - | ||
| Initial recognition at fair value | 4,921 | |||
| Revaluation to fair value | 1,217 | |||
| Foreign exchange loss | 139 | |||
| Balance at December 31, 2024 | 6,277 | |||
| Revaluation to fair value | (871 | ) | ||
| Revaluation to fair value due to own credit risk | (119 | ) | ||
| Foreign exchange loss | (275 | ) | ||
| Balance at June 30, 2025 | $ | 5,012 | ||
On March 5, 2025, the Company entered into an agreement to defer interest until February 15, 2027 with the holders of its senior secured debt, which includes all outstanding 2028 Notes and 2027 Notes, collectively referred to as the “Notes”. As consideration for this deferral, Electra will pay additional interest of 2.25% per annum on the 2028 Notes and 2.5% per annum on the 2027 Notes, calculated on the principal amounts of the Notes. All deferred interest, including deferred amounts of additional interest, will accrue interest at the applicable stated rate of interest borne by the applicable series of Notes. All deferred interest (including all interest thereon) will become payable immediately if an event of default occurs under the applicable note indenture prior to February 15, 2027.
The following table sets out the details of the Company’s financial derivative liability related to convertible notes in the 2028 Notes and 2027 Notes as of June 30, 2025 and December 31, 2024:
| Convertible Notes Payable | Warrants | Royalty | Total | |||||||||||||
| Balance at January 1, 2024 | $ | 40,101 | $ | 1,421 | $ | 858 | $ | 42,380 | ||||||||
| Initial recognition at fair value | 4,921 | - | - | 4,921 | ||||||||||||
| Revaluation to fair value | 4,356 | 137 | - | 4,493 | ||||||||||||
| Capitalized interest | 9,157 | - | - | 9,157 | ||||||||||||
| Revaluation to fair value due to own credit risk | 1,342 | - | - | 1,342 | ||||||||||||
| Foreign exchange loss | 4,086 | 24 | 95 | 4,205 | ||||||||||||
| Accretion | - | - | 330 | 330 | ||||||||||||
| Balance at December 31, 2024 | $ | 63,963 | $ | 1,582 | $ | 1,283 | $ | 66,828 | ||||||||
| Revaluation to fair value | 5,914 | (1,078 | ) | - | 4,836 | |||||||||||
| Revaluation to fair value due to own credit risk | (1,798 | ) | - | - | (1,798 | ) | ||||||||||
| Foreign exchange loss | (3,527 | ) | - | (72 | ) | (3,599 | ) | |||||||||
| Accretion | - | - | (147 | ) | (147 | ) | ||||||||||
| Balance at June 30, 2025 | $ | 64,552 | $ | 504 | $ | 1,064 | $ | 66,120 | ||||||||
For the three and six months ended June 30, 2025, the Company recorded a gain of $231 and a loss of $4,836, respectively (for the three and six months ended June 30, 2024 – a gain of $373 and $7,184, respectively), for the Notes.
| 11. | Shareholder’s Equity |
| a) | Authorized Share Capital |
The Company is authorized to issue an unlimited number of common shares without par value. As at June 30, 2025, the Company had 17,962,172 (December 31, 2024 – 14,809,197) common shares outstanding.
| Page 14 of 28 |
ELECTRA BATTERY MATERIALS CORPORATION |
NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) |
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2025 AND 2024 |
| (expressed in thousands of Canadian dollars) |
On December 31, 2024, the Company completed a share consolidation on the basis of one new post-consolidation common share for every 4 pre-consolidation common shares. All prior share capital information has been presented based on this ratio.
| b) | Issued Share Capital |
During the six months ended June 30, 2025, the Company issued common shares as follows:
| · | The Company issued 26,975 and 1,000 common shares for the exercise of restricted share units and warrants, respectively. |
| · | On April 14, 2025, the Company closed the first (occurring on April 3, 2025) and second tranches of its non-brokered private placement, raising an aggregate gross proceeds of US$3,500 ($5,016). An aggregate of 3,125,000 units (each, a “Unit”) were issued at a price of US$1.12 per Unit under the private placement. Each Unit consists of one common share in the capital of the Company and one transferable common share purchase warrant (“2026 Warrants”), with each warrant entitling the holder to purchase one common share of the Company at a price of US$1.40 at any time for a period of eighteen (18) months following the issue date. In connection with the closing of the Offering, the Company paid an aggregate of $338 in cash finders fees and issued 183,333 non-transferrable finders warrants and finders warrants fair valued at $109. Each finders warrant is exercisable to acquire one common share of the Company at an exercise price of US$1.12 until October 14, 2026. The finder warrants were measured based on the fair value of the warrants issued as the fair value of consideration for the services cannot be estimated reliably. |
The transaction represents a compound financial instrument that is accounted for based on the residual method. The liability component, which represents the 2026 Warrants, was evaluated based on the Black Scholes option pricing model in the amount of $1,258 on initial recognition. The residual balance of $3,758 was then allocated to the equity component (common shares issued). The transaction costs of $447 were allocated proportionately between the financial liability and the equity component. Transaction costs allocated to the equity component were accounted for as a deduction from equity of $337. Transaction costs allocated to the 2026 Warrants were recorded directly in the consolidated statement of loss and comprehensive loss of $109.
During the year ended December 31, 2024, the Company issued common shares as follows:
| · | On February 27, 2024, the Company has settled a total of $134 of earned performance-based incentive cash payments to certain non-officer employees by issuing a total of 41,314 common shares at a market price of $3.24 per share to these individuals. The expense was recorded in salaries and benefits. |
| · | On March 21, 2024, the Company issued an aggregate of 210,760 common shares at a market issue price of $2.58 per common share in satisfaction of a portion of the interest payable to certain of the holders of US$51,000 principal amount of 8.99% senior secured convertible notes. |
| · | On November 27, 2024, the Company closed a financing transaction with the holders of the 2027 Notes for gross proceeds of US$5,000 and issued 443,225 common shares and 1,136,364 detachable common share purchase warrants, valued at $1,221 (net of transaction costs of $180 and $694 (net of transaction costs of $89), respectively (see Note 10). |
| Page 15 of 28 |
ELECTRA BATTERY MATERIALS CORPORATION |
NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) |
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2025 AND 2024 |
| (expressed in thousands of Canadian dollars) |
| · | During the year ended December 31, 2024, the Company issued 18,568 common shares for the exercise of deferred share units, 130,414 common shares for the exercise of restricted share units and 2,084 for the exercise of performance share units. |
| 12. | Share Based Payments |
The Company adopted a long-term incentive plan (“LTIP”) on December 20, 2024, whereby it can grant stock options, restricted share units (“RSUs”), Deferred Share Units (“DSUs”), and Performance Share Units (“PSUs”) to directors, officers, employees, and consultants of the Company. The maximum number of shares that may be reserved for issuance under the LTIP is 3,150,000.
In 2024, the Company implemented an employee share purchase plan (“ESPP”) to provide its employees an incentive to promote performance and growth potential over the long-term. The Company has reserved 250,000 common shares that can be issued under the ESPP.
Stock options generally vest in equal tranches over three years. The grant date fair value is determined using the Black-Scholes Option Pricing Model and this value is recognized as an expense over the vesting period. DSUs vest in one year but cannot be exercised until the holder ceases to be a Director or Officer of Electra. DSUs are valued based on the market price of the Company’s common shares on the grant date. PSUs generally vest over 18 – 24 months if certain performance metrics have been achieved. They are valued based on the market price of the Company’s shares on the grant date and this value is expensed over the vesting period. RSUs generally vest over 12 – 36 months. They are valued based on the market price of the Company’s shares on the grant date and this value is expensed over the vesting period.
| a) | Stock Options |
During the six months ended June 30, 2025:
| · | On January 1, 2025, the Company granted 125,000 stock options at an exercise price of $2.60 that will vest in two equal tranches on the first and second anniversaries of the grant date. The fair value of the options at the date of the grant was $190 using the Black-Scholes Option Pricing Model, assuming a risk-free rate of 2.87% per year, an expected life of 3 years, expected volatility based on historical prices in the range of 90.0%, no expected dividends and a share price of $2.60. |
During the year ended December 31, 2024:
| · | On January 15, 2024, the Company granted 25,000 stock options at an exercise price of $2.00 that will vest in three equal tranches on the first, second and third anniversaries of the grant date. The fair value of the options at the date of the grant was $29 using the Black-Scholes Option Pricing Model, assuming a risk-free rate of 4.15% per year, an expected life of 3 years, expected volatility based on historical prices of 87%, no expected dividends and a share price of $2.00. |
| · | On February 12, 2024, the Company granted 753,923 incentive stock options and 26,235 RSUs to certain directors, officers, employees and contractors of the Company. The RSUs will vest on the first anniversary of the grant date and will be settled in cash or common shares at the discretion of the Company. The stock options are exercisable for four years at $3.24 and will vest in two equal tranches, on the first and second anniversary of the grant date. The fair value of the options at the date of the grant was $1,377 using the Black-Scholes Option Pricing Model, assuming a risk-free rate of 4.15% per year, an expected life of 4 years, expected volatility based on historical prices of 85%, no expected dividends and a share price of $3.24. |
| Page 16 of 28 |
ELECTRA BATTERY MATERIALS CORPORATION |
NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) |
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2025 AND 2024 |
| (expressed in thousands of Canadian dollars) |
| · | On August 28, 2024, the Company granted 250,000 incentive stock options to consultants for services to be rendered. The stock options are exercisable for three years at $3.28 and will vest in four equal quarterly tranches. The fair value of the options at the date of the grant was $418 using the Black-Scholes Option Pricing Model, assuming a risk-free rate of 3.31% per year, an expected life of 2 years, expected volatility based on historical prices of 94%, no expected dividends and a share price of $3.28. |
| · | On September 9, 2024, the Company granted 33,891 DSUs to certain directors of the Company. The DSUs will vest on the first anniversary of the grant date and will be settled in cash or common shares at the discretion of the Company. |
The changes in incentive stock options outstanding are summarized as follows:
| Exercise price | Number of shares issued or issuable on exercise | |||||||
| Balance at January 1, 2024 | $ | 14.00 | 193,142 | |||||
| Granted | 3.22 | 1,028,923 | ||||||
| Expired | 10.02 | (34,953 | ) | |||||
| Forfeited / Cancelled | 12.91 | (16,749 | ) | |||||
| Balance at December 31, 2024 | $ | 4.61 | 1,170,363 | |||||
| Granted | 2.60 | 125,000 | ||||||
| Expired | 24.12 | (4,167 | ) | |||||
| Balance at June 30, 2025 | $ | 4.35 | 1,291,196 | |||||
Incentive stock options outstanding and exercisable (vested) at June 30, 2025 are summarized as follows:
| Options Outstanding | Options Exercisable | ||||||||||||||||||||
| Exercise price | Number of shares issuable on exercise | Weighted average remaining life (Years) | Weighted average exercise price | Number of shares issuable on exercise | Weighted average exercise price | ||||||||||||||||
| $ | 2.00 | 25,000 | 2.55 | $ | 2.00 | 8,333 | $ | 2.00 | |||||||||||||
| 2.60 | 125,000 | 2.51 | 2.60 | - | 2.60 | ||||||||||||||||
| 3.24 | 753,923 | 2.62 | 3.24 | 376,962 | 3.24 | ||||||||||||||||
| 3.28 | 250,000 | 2.16 | 3.28 | 187,500 | 3.28 | ||||||||||||||||
| 9.60 | 56,423 | 1.69 | 9.60 | 37,616 | 9.60 | ||||||||||||||||
| 10.08 | 10,185 | 0.03 | 10.08 | 10,185 | 10.08 | ||||||||||||||||
| 10.44 | 6,945 | 0.16 | 10.44 | 6,945 | 10.44 | ||||||||||||||||
| 12.84 | 15,000 | 2.37 | 12.84 | 10,000 | 12.84 | ||||||||||||||||
| 21.60 | 41,428 | 1.56 | 21.60 | 41,428 | 21.60 | ||||||||||||||||
| 24.84 | 7,292 | 0.79 | 24.84 | 7,292 | 24.84 | ||||||||||||||||
| Total | 1,291,196 | 2.40 | $ | 4.35 | 686,261 | $ | 5.24 | ||||||||||||||
| Page 17 of 28 |
ELECTRA BATTERY MATERIALS CORPORATION |
NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) |
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2025 AND 2024 |
| (expressed in thousands of Canadian dollars) |
During the six months ended June 30, 2025, the Company expensed $545 (the six months ended June 30, 2024 - $560) for options valued at share prices $2.00 to $21.60, as shared-based payment expense.
Incentive stock options outstanding and exercisable (vested) at December 31, 2024 are summarized as follows:
| Options Outstanding | Options Exercisable | ||||||||||||||||||||
| Exercise price | Number of shares issuable on exercise | Weighted average remaining life (Years) | Weighted average exercise price | Number of shares issuable on exercise | Weighted average exercise price | ||||||||||||||||
| $ | 2.00 | 25,000 | 3.04 | $ | 2.00 | - | $ | 2.00 | |||||||||||||
| 3.24 | 753,923 | 3.12 | 3.24 | - | 3.24 | ||||||||||||||||
| 3.28 | 250,000 | 2.66 | 3.28 | 62,500 | 3.28 | ||||||||||||||||
| 9.60 | 56,425 | 2.19 | 9.60 | 18,808 | 9.60 | ||||||||||||||||
| 10.08 | 10,185 | 0.52 | 10.08 | 10,185 | 10.08 | ||||||||||||||||
| 10.44 | 6,944 | 0.66 | 10.44 | 6,944 | 10.44 | ||||||||||||||||
| 12.84 | 15,000 | 2.87 | 12.84 | 10,000 | 12.84 | ||||||||||||||||
| 21.60 | 44,205 | 2.05 | 21.60 | 29,470 | 21.60 | ||||||||||||||||
| 24.84 | 7,292 | 1.29 | 24.84 | 7,292 | 24.84 | ||||||||||||||||
| 29.16 | 1,389 | 0.13 | 29.16 | 1,389 | 29.16 | ||||||||||||||||
| Total | 1,170,363 | 2.88 | $ | 4.61 | 146,588 | $ | 10.56 | ||||||||||||||
During the year ended December 31, 2024, the Company expensed $1,212 (the year ended December 31, 2023 - $513) for options valued at share prices $2.00 to $24.84, as shared-based payment expense.
| (b) | DSUs, RSUs and PSUs |
During the six months ended June 30, 2025, the Company expensed $48 (the year ended December 31, 2024 - $218) for DSUs, $ Nil (the year ended December 31, 2024 - $Nil) for PSUs, and $10 (the year ended December 31, 2024 - $338) for RSUs as shared-based payment expense.
Deferred Shares Units
The Company’s DSUs outstanding at June 30, 2025 and December 31, 2024 were as follows:
| Number of Units | June 30, 2025 | December 31, 2024 | ||||||
| Balance at January 1, | 157,085 | 154,041 | ||||||
| Granted | - | 33,891 | ||||||
| Exercised | - | (18,568 | ) | |||||
| Expired | - | (12,279 | ) | |||||
| Balance | 157,085 | 157,085 | ||||||
| Page 18 of 28 |
ELECTRA BATTERY MATERIALS CORPORATION |
NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) |
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2025 AND 2024 |
| (expressed in thousands of Canadian dollars) |
Restricted Share Units
The Company’s RSUs outstanding at June 30, 2025 and December 31, 2024 were as follows:
| Number of Units | June 30, 2025 | December 31, 2024 | ||||||
| Balance at January 1, | 26,975 | 133,288 | ||||||
| Granted | - | 26,235 | ||||||
| Exercised | (26,975 | ) | (130,414 | ) | ||||
| Forfeited / Cancelled | - | (2,134 | ) | |||||
| Balance | - | 26,975 | ||||||
Performance Share Units
The Company’s PSUs outstanding at June 30, 2025 and December 31, 2024 were as follows:
| Number of Units | June 30, 2025 | December 31, 2024 | ||||||
| Balance at January 1, | - | 8,507 | ||||||
| Exercised | - | (2,083 | ) | |||||
| Expired / Cancelled | - | (6,424 | ) | |||||
| Balance | - | - | ||||||
| c) | Warrants |
Details regarding warrants issued and outstanding are summarized as follows:
| Canadian dollar denominated warrants | Grant date | Expiry date | Weighted average exercise price | Number of shares issued or issuable on exercise | ||||||||
| Balance at January 1, 2024 | $ | 6.84 | 5,111,364 | |||||||||
| Repricing of warrants (Note 10) | February 13, 2023 | February 13, 2028 | 3.40 | 2,699,014 | ||||||||
| Cancellation of warrants | August 11, 2023 | August 11, 2025 | 6.84 | (1,136,364 | ) | |||||||
| Issuance of warrants (Note 10) | November 27, 2024 | November 12, 2026 | 4.00 | 1,136,364 | ||||||||
| Balance at December 31, 2024 and June 30, 2025 | $ | 6.23 | 7,810,378 | |||||||||
| United States dollar denominated warrants (US Warrant and 2026 US Warrants) | Grant date | Expiry date | Weighted average exercise price | Number of shares issued or issuable on exercise | ||||||||
| Balance at January 1, 2024 | US$10.38 | 3,319,802 | ||||||||||
| Repricing of warrants (Note 10) | February 13, 2023 | February 13, 2028 | US$9.92 | (2,699,014 | ) | |||||||
| Balance at December 31, 2024 | US$12.40 | 620,788 | ||||||||||
| Issuance of warrants (Note 11) | April 3 and 14, 2025 | October 3 and 14, 2026 | US$1.38 | 3,308,333 | ||||||||
| Exercise of warrants | (1,000 | ) | ||||||||||
| Balance at June 30, 2025 | US$3.12 | 3,928,121 | ||||||||||
| Page 19 of 28 |
ELECTRA BATTERY MATERIALS CORPORATION |
NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) |
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2025 AND 2024 |
| (expressed in thousands of Canadian dollars) |
On November 27, 2024, in connection with the 2027 Notes, 1,136,364 detachable common share purchase warrants were issued as detailed in Note 11, which replaced 2023 private placement warrants.
On April 3 and 14, 2025, 3,125,000 (“2026 Warrants”) were issued to subscribers in the Company’s non-brokered private placement (Note 11). The fair value of the warrants were estimated using the Black-Scholes Option Pricing Model assuming a risk-free interest rate ranging from 2.40% to 2.58%, an expected life of 1.5 years, an expected volatility of 85.0% no expected dividends, and a share price ranging from $1.38 to $1.50. The warrant exercise price is denominated in US dollars, a currency different than the Company’s functional currency. Therefore, the warrants have been classified as a financial liability in the condensed interim statements of financial position. The fair value of the warrants as at June 30, 2025 were estimated using the Black Scholes Option Pricing Model assuming a risk-free interest rate of 2.59%, an expected life ranging from 1.26 to 1.29 years, an expected volatility of 77.0% no expected dividends, and a share price of $1.48. The fair value of the 2026 Warrants on initial recognition was $1,349 and $1,249 as of June 30, 2025, with a gain of $100 recognized in the condensed interim on the statement of loss. As part of the private placement, the Company issued 183,333 finder’s warrants as transaction costs. The fair value of the finder’s warrants were estimated using the Black-Scholes Option Pricing Model assuming a risk-free interest rate ranging of 2.58%, an expected life of 1.5 years, an expected volatility of 85.0% no expected dividends, and a share price of $1.50 resulting in a fair value of the broker warrants was $109 and classified in equity.
During the six months ended June 30, 2025, 1,000 warrants were exercised for proceeds of $2.
| 13. | Other Non-Operating Income (Expense) |
The Company’s Other Non-Operating Income (Expense) comprises the following for the three and six months ended June 30, 2025 and 2024:
| For the three months ended June 30, | For the six months ended June 30, | |||||||||||||||
| 2025 | 2024 | 2025 | 2024 | |||||||||||||
| Foreign exchange gain (loss) | $ | 3,813 | $ | (614 | ) | $ | 3,904 | $ | (1,771 | ) | ||||||
| Interest income (expense) | (2,589 | ) | (1,420 | ) | (6,448 | ) | (2,403 | ) | ||||||||
| Realized gain (loss) on marketable securities | - | 40 | 1 | 44 | ||||||||||||
| Other non-operating income (expense) | 123 | (57 | ) | 29 | 3 | |||||||||||
| $ | 1,347 | $ | (2,051 | ) | $ | (2,514 | ) | $ | (4,127 | ) | ||||||
| 14. | Loss Per Share |
The following table sets forth the computation of basic and diluted loss per share for the three and six months ended June 30, 2025 and 2024:
| For the three months ended June 30, | For the six months ended June 30, | |||||||||||||||
| 2025 | 2024 | 2025 | 2024 | |||||||||||||
| Numerator | ||||||||||||||||
| Net loss for the period – basic and diluted | $ | (2,005 | ) | $ | (5,772 | ) | $ | (14,685 | ) | $ | (17,941 | ) | ||||
| Denominator | ||||||||||||||||
| Basic and Diluted – weighted average number of shares outstanding | 17,807,021 | 14,159,544 | 16,317,480 | 14,159,298 | ||||||||||||
| Loss Per Share – Basic and Diluted | $ | (0.11 | ) | $ | (0.41 | ) | $ | (0.90 | ) | $ | (1.27 | ) | ||||
The basic loss per share is computed by dividing the net loss by the weighted average number of common shares outstanding during the period. The diluted loss per share reflects the potential dilution of common share equivalents, such as outstanding stock options, and share purchase warrants, in the weighted average number of common shares outstanding during the period, if dilutive.
| Page 20 of 28 |
ELECTRA BATTERY MATERIALS CORPORATION |
NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) |
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2025 AND 2024 |
| (expressed in thousands of Canadian dollars) |
Conversion option, share purchase warrants and stock options were excluded from the calculation of diluted weighted average number of common shares outstanding for the three and six months ended June 30, 2025 and 2024 as the warrants and stock options were anti-dilutive.
| 15. | Management of Capital |
The Company’s objectives when managing capital are to ensure it has sufficient cash available to support its future Refinery expansion and exploration activities; and ensure compliance with debt covenants under the convertible notes arrangement.
The Company manages its capital structure, consisting of cash and cash equivalents, share capital and debt (convertible notes and loans), and will make adjustments depending on the funds available to the Company for its future Refinery expansion and exploration activities. The Board of Directors does not establish quantitative return on capital criteria for management but rather relies on the expertise of the Company’s management to sustain future development of the business.
Management reviews its capital management approach on an ongoing basis and believes that this approach, given the size of the Company, is reasonable. Other than the reportable minimum liquidity balance covenant under the convertible note arrangement, the Company is not subject to externally imposed capital requirements. The convertible notes arrangement does not impose any quantitative ratio covenants on the Company in the normal course of construction and operation of its current assets.
| 16. | Fair Value Measurements |
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. All assets and liabilities for which fair value is measured or disclosed in the consolidated financial statements are categorized within the fair value
hierarchy, described, as follows, based on the lowest-level input that is significant to the fair value measurement as a whole:
Level 1 — Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities;
Level 2 — Quoted prices in markets that are not active or inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability; and
Level 3 — Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (supported by little or no market activity). The fair value hierarchy gives the highest priority to Level 1 inputs and the lowest priority to Level 3 inputs.
| Page 21 of 28 |
ELECTRA BATTERY MATERIALS CORPORATION |
NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) |
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2025 AND 2024 |
| (expressed in thousands of Canadian dollars) |
Assets and Liabilities Measured at Fair Value
The Company’s fair value of financial assets and liabilities were as follows:
| Classification | ||||||||||||||||||||
| June 30, 2025 | Fair value through profit or loss | Amortized cost | Level 1 | Level 3 | Total Fair Value | |||||||||||||||
| Assets: | ||||||||||||||||||||
| Cash and cash equivalents | $ | - | $ | 2,927 | $ | - | $ | - | $ | 2,927 | ||||||||||
| Restricted cash | - | 1,208 | - | - | 1,208 | |||||||||||||||
| Receivables | - | 453 | - | - | 453 | |||||||||||||||
| $ | - | $ | 4,588 | $ | - | $ | - | $ | 4,588 | |||||||||||
| Liabilities: | ||||||||||||||||||||
| Accounts payable and accrued liabilities | $ | - | $ | 4,858 | $ | - | $ | - | $ | 4,858 | ||||||||||
| Accrued interest | - | 8,529 | - | - | 8,529 | |||||||||||||||
| Long-term government loan payable | - | 8,174 | - | - | 8,174 | |||||||||||||||
| Convertible Notes payable 1 | 64,552 | - | - | 64,552 | 64,552 | |||||||||||||||
| Warrants - Convertible Notes payable 1 | 504 | - | - | 504 | 504 | |||||||||||||||
| US Warrants | 1,249 | - | - | 1,249 | 1,249 | |||||||||||||||
| Royalty | - | 1,064 | - | - | 1,064 | |||||||||||||||
| $ | 66,305 | $ | 22,625 | - | $ | 66,305 | $ | 88,930 | ||||||||||||
| Classification | ||||||||||||||||||||
| December 31, 2024 | Fair value through profit or loss | Amortized cost | Level 1 | Level 3 | Total Fair Value | |||||||||||||||
| Assets: | ||||||||||||||||||||
| Cash and cash equivalents | $ | - | $ | 3,717 | $ | - | $ | - | $ | 3,717 | ||||||||||
| Restricted cash | - | 1,208 | - | - | 1,208 | |||||||||||||||
| Receivables | - | 1,310 | - | - | 1,310 | |||||||||||||||
| Marketable securities | 12 | - | 12 | - | 12 | |||||||||||||||
| $ | 12 | $ | 6,235 | $ | 12 | $ | - | $ | 6,247 | |||||||||||
| Liabilities: | ||||||||||||||||||||
| Accounts payable and accrued liabilities | $ | - | $ | 3,579 | $ | - | $ | - | $ | 3,579 | ||||||||||
| Accrued interest | - | 2,799 | - | - | 2,799 | |||||||||||||||
| Long-term government loan payable | - | 7,824 | - | - | 7,824 | |||||||||||||||
| Convertible Notes payable 1 | 63,963 | - | - | 63,963 | 63,963 | |||||||||||||||
| Warrants - Convertible Notes payable 1 | 1,582 | - | - | 1,582 | 1,582 | |||||||||||||||
| Royalty | - | 1,283 | - | - | 1,283 | |||||||||||||||
| $ | 65,545 | $ | 15,485 | - | $ | 65,545 | $ | 81,030 | ||||||||||||
1 Components of 2028 and 2027 Notes payable, see Note 10.
Valuation techniques
A) Marketable securities
Marketable securities are included in Level 1 as these assets are quoted on active markets.
B) Convertible Notes
For the convertible notes payable designated at fair value through profit or loss, the valuation is derived by a finite difference method, whereby the convertible debt as a whole is viewed as a hybrid instrument consisting of two components, an equity component (i.e., the conversion option) and a debt component, each with different risks. The key inputs in the valuation include risk-free rates, share price, equity volatility, and credit spread. As there are significant unobservable inputs used in the valuation, the convertible notes payable is included in Level 3.
| Page 22 of 28 |
ELECTRA BATTERY MATERIALS CORPORATION |
NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) |
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2025 AND 2024 |
| (expressed in thousands of Canadian dollars) |
Methodologies and procedures regarding Level 3 fair value measurements are determined by the Company’s management. Calculation of Level 3 fair values is generated based on underlying contractual data as well as observable and unobservable inputs. Development of unobservable inputs requires the use of significant judgment. To ensure reasonability, Level 3 fair value measurements are reviewed and validated by the Company’s management. Review occurs formally on a quarterly basis or more frequently if review and monitoring procedures identify unexpected changes to fair value.
While the Company considers its fair value measurements to be appropriate, the use of reasonably alternative assumptions could result in different fair values. On a given valuation date, it is possible that other market participants could measure a same financial instrument at a different fair value, with the valuation techniques and inputs used by these market participants still meeting the definition of fair value. The fact that different fair value measurements exist reflects the judgment, estimates and assumptions applied as well as the uncertainty involved in determining the fair value of these financial instruments.
The fair value of the 2028 Notes has been estimated based on significant unobservable inputs which are equity volatility and credit spread. The Company used an equity volatility of 65% (December 31, 2024 – 63%). If the Company had used an equity volatility that was higher or lower by 10%, the potential effect would be an increase of $361 (December 31, 2024 - $963) or a decrease of $237 (December 31, 2024 - $826) to the fair value of the 2028 Notes. The Company used a credit spread of 28.1% (December 31, 2024 – 26.3%). If the Company had used a credit spread that was higher or lower by 5%, the potential effect would be a decrease of $4,253 (December 31, 2024 - $4,273) or an increase of $4,833 (December 31, 2024 - $4,901) to the fair value of convertible note payable.
The fair value of the 2027 Notes has been estimated based on significant unobservable inputs which are equity volatility and credit spread. The Company used an equity volatility of 65% (December 31, 2024 – 63%). If the Company had used an equity volatility that was higher or lower by 10%, the potential effect would be an increase of $203 (December 31, 2024 - $204) or a decrease of $230 (December 31, 2024 - $198) to the fair value of the convertible note payable. The Company used a credit spread of 28.1% (December 31, 2024 – 26.3%). If the Company had used a credit spread that was higher or lower by 5%, the potential effect would be a decrease of $302 (December 31, 2024 - $218) or an increase of $344 (December 31, 2024 – $275) to the fair value of convertible note payable.
C) Warrants – Convertible Notes
The 2028 Warrants issued are accounted for at fair value through profit or loss are valued using a Monte Carlo Simulation Model to better model the variability in exercise date. The key inputs in the valuation include risk-free rates and equity volatility. As there are significant unobservable inputs used in the valuation, the financial derivative liability is included in Level 3.
The fair value of the 2028 Warrants has been estimated using a significant unobservable input which is equity volatility. The Company used an equity volatility of 65% (December 31, 2024 – 63%). If the Company had used an equity volatility that was higher or lower by 10%, the potential effect would be an increase of $249 (December 31, 2024 - $200) or a decrease of $135 (December 31, 2024 - $227) to the fair value of the warrants.
| Page 23 of 28 |
ELECTRA BATTERY MATERIALS CORPORATION |
NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) |
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2025 AND 2024 |
| (expressed in thousands of Canadian dollars) |
D) Royalty
The fair value of the Royalty has been estimated at inception using a discounted cash flow model. The key inputs in the valuation include the effective interest rate of 19.2% and cash flows estimates of future operating and gross revenues. As there are significant unobservable inputs used in the valuation, the Royalty is included in Level 3. A 10% increase or decrease in the effective interest rate would be an increase of $268 (December 31, 2024 - $250) or a decrease of $218 (December 31, 2024 - $213) to the fair value of the royalty.
E) Other Financial Derivative Liability (US Warrants and 2026 Warrants)
The fair value of the US Warrants issued in foreign currency as at June 30, 2025 was $Nil (December 31, 2024 - $Nil) and is accounted for at FVTPL. The valuation of warrants where the strike price is in US dollars and the warrants can be exercised at a time prior to expiry. The Company uses a Monte Carlo Simulation Model to better model the variability in exercise dates. The key inputs in the valuation include risk-free rates and equity volatility. As there are significant unobservable inputs used in the valuation, the financial derivative liability is included in Level 3.
The fair value of the 2026 Warrants issued in foreign currency as at June 30, 2025 was $1,249 (December 31, 2024 - $Nil) and is accounted for at FVTPL. The valuation of warrants where the strike price is in US dollars and the warrants can be exercised at a time prior to expiry. The Company uses the Black Scholes Option Pricing Model. The key inputs in the valuation include risk-free rates and equity volatility. As there are significant unobservable inputs used in the valuation, the financial derivative liability is included in Level 3.
The Company used an equity volatility of 77%. If the Company used an equity volatility that was higher or lower by 10%, the potential effect would be an increase of $206 or a decrease of $202 to the fair value of the embedded derivative.
| 17. | Commitments and Contingencies |
From time to time, the Company and/or its subsidiaries may become defendants in legal actions and the Company intends to defend itself vigorously against all legal claims. Electra is not aware of any unrecorded claims against the Company that could reasonably be expected to have a materially adverse impact on the Company’s condensed interim consolidated financial position, results of operations or the ability to carry on any of its business activities.
| Page 24 of 28 |
ELECTRA BATTERY MATERIALS CORPORATION |
NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) |
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2025 AND 2024 |
| (expressed in thousands of Canadian dollars) |
As at June 30, 2025, the Company’s commitments relate to purchase and services commitments for work programs relating to Refinery expansion and payments under financing arrangements. The Company had the following commitments as at June 30, 2025.
| 2025 | 2026 | 2027 | 2028 | Thereafter | Total | |||||||||||||||||||
| Purchase commitments | $ | 836 | $ | - | $ | - | $ | - | $ | - | $ | 836 | ||||||||||||
| Convertible notes payments 1 | - | 19,860 | 12,798 | 81,005 | - | 113,663 | ||||||||||||||||||
| Government loan payments | 18 | 36 | 36 | 1,615 | 8,484 | 10,189 | ||||||||||||||||||
| Lease payments | 74 | 118 | 43 | - | - | 235 | ||||||||||||||||||
| Royalty payments 2 | - | - | - | 464 | 2,617 | 3,081 | ||||||||||||||||||
| Other | 273 | 68 | - | - | 2,046 | 2,387 | ||||||||||||||||||
| $ | 1,201 | $ | 20,082 | $ | 12,877 | $ | 83,084 | $ | 13,147 | $ | 130,391 | |||||||||||||
1 Convertible notes payment amounts are based on contractual maturities of 2028 Notes, 2027 Notes and the assumption that it would remain outstanding until maturity. Interest is calculated based on terms as at June 30, 2025.
2 Royalty payments are estimated amounts associated with the royalty agreements entered with the convertible debt holders as part of the 2028 Notes offering. The estimated amounts and timing are subject to changes in cobalt sulfate prices, timing of completion of the refinery, reaching commercial operations and timing and amounts of sales.
| 18. | Segmented Information |
The Company’s Chief Operating Decision Maker (“CODM”) is its Chief Executive Officer. The CODM reviews the results of Company’s refinery business and exploration and evaluation activities as discrete business units, separate from the rest of the Company’s activities which are reviewed on an aggregate basis.
The Company’s exploration and evaluation activities are located in Idaho, USA, with its head office function in Canada. All of the Company’s capital assets, including property and equipment, and exploration and evaluation assets are located in Canada and USA, respectively.
| (a) | Segmented operating results for the three and six months ended June 30, 2025 and 2024: |
| For the three months ended June 30, 2025 | Refinery | Exploration and Evaluation | Corporate and Other | Total | ||||||||||||
| Operating expenses | ||||||||||||||||
| Consulting and professional fees | $ | 226 | $ | - | $ | 841 | $ | 1,067 | ||||||||
| Exploration and evaluation expenditures | - | 48 | - | 48 | ||||||||||||
| General and administrative and travel | 365 | 2 | 356 | 723 | ||||||||||||
| Investor relations and marketing | - | - | 119 | 119 | ||||||||||||
| Salaries and benefits | 466 | - | 832 | 1,298 | ||||||||||||
| Share-based payments | - | - | 228 | 228 | ||||||||||||
| Operating loss | $ | 1,057 | $ | 50 | $ | 2,376 | $ | 3,483 | ||||||||
| Gain on financial derivative liability - Convertible Notes | - | - | 231 | 231 | ||||||||||||
| Changes in US Warrants and 2026 US Warrants | - | - | (100 | ) | (100 | ) | ||||||||||
| Other non-operating loss | - | - | 1,347 | 1,347 | ||||||||||||
| Income (loss) before taxes | $ | (1,057 | ) | $ | (50 | ) | $ | 898 | $ | 2,005 | ||||||
| Page 25 of 28 |
ELECTRA BATTERY MATERIALS CORPORATION |
NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) |
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2025 AND 2024 |
| (expressed in thousands of Canadian dollars) |
| For the three months ended June 30, 2024 | Refinery | Exploration and Evaluation | Corporate and Other | Total | ||||||||||||
| Operating expenses | ||||||||||||||||
| Consulting and professional fees | $ | 98 | $ | - | $ | 994 | $ | 1,092 | ||||||||
| Exploration and evaluation expenditures | - | 81 | - | 81 | ||||||||||||
| General and administrative and travel | 183 | - | 719 | 902 | ||||||||||||
| Investor relations and marketing | - | - | 126 | 126 | ||||||||||||
| Salaries and benefits | 370 | - | 428 | 798 | ||||||||||||
| Share-based payments | - | - | 419 | 419 | ||||||||||||
| Operating loss | $ | 651 | $ | 81 | $ | 2,686 | $ | 3,418 | ||||||||
| Unrealized gain on marketable securities | - | - | 89 | 89 | ||||||||||||
| Loss on financial derivative liability - Convertible Notes | - | - | (373 | ) | (373 | ) | ||||||||||
| Changes in US Warrants | - | - | (19 | ) | (19 | ) | ||||||||||
| Other non-operating loss | - | - | (2,051 | ) | (2,051 | ) | ||||||||||
| Loss before taxes | $ | 651 | $ | 81 | $ | 5,040 | $ | 5,772 | ||||||||
Segmented operating results for the six months ended June 30, 2025 and 2024:
| For the six months ended June 30, 2025 | Refinery | Exploration and Evaluation | Corporate and Other | Total | ||||||||||||
| Operating expenses | ||||||||||||||||
| Consulting and professional fees | $ | 379 | $ | - | $ | 1,689 | $ | 2,068 | ||||||||
| Exploration and evaluation expenditures | - | 89 | - | 89 | ||||||||||||
| General and administrative and travel | 873 | 2 | 891 | 1,766 | ||||||||||||
| Investor relations and marketing | - | - | 211 | 211 | ||||||||||||
| Salaries and benefits | 965 | - | 1,585 | 2,550 | ||||||||||||
| Share-based payments | - | - | 555 | 555 | ||||||||||||
| Operating loss | $ | 2,217 | $ | 91 | $ | 4,931 | $ | 7,239 | ||||||||
| Unrealized gain on marketable securities | - | - | 4 | 4 | ||||||||||||
| Loss on financial derivative liability - Convertible Notes | - | - | (4,836 | ) | (4,836 | ) | ||||||||||
| Changes in US Warrants | - | - | (100 | ) | (100 | ) | ||||||||||
| Other non-operating loss | - | - | (2,514 | ) | (2,514 | ) | ||||||||||
| Loss before taxes | $ | 2,217 | $ | 91 | $ | 12,377 | $ | 14,685 | ||||||||
| Page 26 of 28 |
ELECTRA BATTERY MATERIALS CORPORATION |
NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) |
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2025 AND 2024 |
| (expressed in thousands of Canadian dollars) |
| For the six months ended June 30, 2024 | Refinery | Exploration and Evaluation | Corporate and Other | Total | ||||||||||||
| Operating expenses | ||||||||||||||||
| Consulting and professional fees | $ | 199 | $ | - | $ | 2,016 | $ | 2,215 | ||||||||
| Exploration and evaluation expenditures | - | 144 | - | 144 | ||||||||||||
| General and administrative and travel | 258 | - | 1,167 | 1,425 | ||||||||||||
| Investor relations and marketing | - | - | 304 | 304 | ||||||||||||
| Salaries and benefits | 660 | - | 1,035 | 1,695 | ||||||||||||
| Share-based payments | - | - | 979 | 979 | ||||||||||||
| Operating loss | $ | 1,117 | $ | 144 | $ | 5,501 | $ | 6,762 | ||||||||
| Unrealized gain on marketable securities | - | - | 181 | 181 | ||||||||||||
| Loss on financial derivative liability - Convertible Notes | - | - | (7,184 | ) | (7,184 | ) | ||||||||||
| Changes in US Warrants | - | - | (49 | ) | (49 | ) | ||||||||||
| Other non-operating loss | - | - | (4,127 | ) | (4,127 | ) | ||||||||||
| Loss before taxes | $ | 1,117 | $ | 144 | $ | 16,680 | $ | 17,941 | ||||||||
| (b) | Segmented assets and liabilities as at June 30, 2025 and December 31, 2024: |
| Total Assets | Total Liabilities | |||||||||||||||
June 30, 2025 | December 31, 2024 | June 30, 2025 | December 31, 2024 | |||||||||||||
| Refinery | $ | 52,027 | $ | 52,434 | $ | 3,072 | $ | 3,707 | ||||||||
| Exploration and Evaluation 1 | 88,456 | 93,276 | 64 | 87 | ||||||||||||
| Corporate and Other | 5,117 | 5,737 | 91,711 | 83,335 | ||||||||||||
| $ | 145,600 | $ | 151,447 | $ | 94,847 | $ | 87,129 | |||||||||
1 Total non-current assets comprising of exploration and evaluation assets in the amount of $88,368 (December 31, 2024 - $93,200) are located in Idaho, USA. All other assets are located in Canada.
| 19. | Related Party Transactions |
The Company’s related parties include key management personnel and companies related by way of directors or shareholders in common. The Company paid and/or accrued during the three and six months ended June 30, 2025 and 2024, the following fees to management personnel and directors.
| For the three months ended June 30, | For the six months ended June 30, | |||||||||||||||
| 2025 | 2025 | 2024 | ||||||||||||||
| Management | $ | 665 | $ | 474 | $ | 1,330 | $ | 837 | ||||||||
| Directors’ fees | 54 | 15 | 101 | 85 | ||||||||||||
| $ | 719 | $ | 489 | $ | 1,431 | $ | 922 | |||||||||
During the three and six months ended June 30, 2025, the Company had share-based payments made to management and directors of $147 and $382, respectively (for the three and six months ended June 30, 2024 - $513 and $833, respectively).
| Page 27 of 28 |
ELECTRA BATTERY MATERIALS CORPORATION |
NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) |
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2025 AND 2024 |
| (expressed in thousands of Canadian dollars) |
As at June 30, 2025, the accrued liabilities balance for related parties was $1,022 (December 31, 2024 - $161), which relates mainly to compensation accruals.
| 20. | Subsequent Events |
| (a) | Subsequent to June 30, 2025, the completion of construction required by FedNor was extended to June 2027 (Note 9). Governmental loans repayment commencement date was changed from June 2026 to June 2028. |
| (b) | Subsequent to June 30, 2025, the Company entered into a term sheet and transaction support agreement with its 2028 and 2027 Notes holders pursuant to which it launched a debt-to-equity conversion that will reduce its convertible debt outstanding by 60% as part of a comprehensive financial restructuring (the “Transaction”). In addition, the Company launched a US$30,000 financing (the “Equity Financing”), which includes a US$10,000 conditional commitment from the 2028 and 2027 Notes holders. |
Key Terms are the following:
| (i) | Subsequent to June 30, 2025, the Company received a waiver from the noteholders to reduce the reportable minimum liquidity balance to US$1,900 (from US$2,000) for the 2028 Notes and 2027 Notes from September 1, 2025 to October 1, 2025 and US$1,400 from October 1, 2025 to October 21, 2025. |
| (ii) | The Company will convert approximately US$40,000 of its outstanding Notes, plus accrued and unpaid interest, into equity at a price of US$0.60 per Common Share. This exchange will reduce total debt under the Notes to approximately US$27,000. |
| (iii) | The concurrent Equity Financing will consist of US$30,000 of Units at a price of US$0.75 per Unit. Each Unit will consist of one common share and one common share purchase Warrant, with each Warrant exercisable for one common share for US$1.25 for a period of three (3) years from the date of issuance. The Equity Financing is expected to close in tandem with the Transaction. |
| (iv) | The remaining 40% of the Notes, plus accrued and unpaid interest, will be exchanged for a new term loan, maturing three years after completion of the Transaction with an annual interest rate of 8.99%. |
| (v) | To support operations during the restructuring process, the lenders will provide US$2,000 in short-term bridge debt in the form of 90-day Bridge Notes. In return, the Noteholders will gain the right to appoint one director to the Company’s board of directors. |
| (vi) | Amendment of Royalty Agreements to extend the length of the royalty on revenue from five years following the commencement of commercial production to seven years following the commencement of commercial production and raise the aggregate cap under all Royalty Agreements from US$6,000 to US$10,000. |
| (c) | Subsequent to June 30, 2025, the Company announced it signed a term sheet for $17,500 in proposed funding from Invest Ontario, an agency of the Government of Ontario, to support construction of its cobalt sulfate refinery in Temiskaming Shores.
The term sheet signed with Invest Ontario expresses an intent to work toward completing definitive documentation but does not constitute a binding agreement. While discussions between the parties are ongoing, there is no guarantee or assurance that final agreements will be reached and funding will be provided to the Company. |
Page 28 of 28
Exhibit 99.2
ELECTRA BATTERY MATERIALS CORPORATION
(AMENDED)
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2025 and 2024
(EXPRESSED IN THOUSANDS OF CANADIAN DOLLARS)
ELECTRA BATTERY MATERIALS CORPORATION
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2025 AND 2024
(expressed in thousands of Canadian dollars)
Contents
| General | 3 |
| Company Information | 3 |
| Highlights | 3 |
| Projects & Outlook | 5 |
| Summary of Quarterly Results | 8 |
| Results of Operations for the Three Months Ended June 30, 2025 | 8 |
| Summary of Six Months Ended June 30, 2025 and 2024 Results | 9 |
| Results of Operations for the Six Months Ended June 30, 2025 | 9 |
| Selected Quarterly Financial Information | 10 |
| Capital Structure, Resources & Liquidity | 10 |
| Capital Structure | 10 |
| Liquidity | 12 |
| Commitments | 12 |
| Related Party Transactions | 13 |
| Off Balance Sheet Arrangements | 13 |
| Financial Instruments | 13 |
| Risk Management | 14 |
| Financial Risk Factors | 14 |
| Business Risks and Uncertainties | 14 |
| Significant Accounting Estimates | 17 |
| Future Changes in Accounting Policies & Initial Adoption | 17 |
| Internal Control Over Financial Reporting | 17 |
| Cautionary Statement Regarding Forward-Looking Statements | 18 |
| Page 2 of 18 |
ELECTRA BATTERY MATERIALS CORPORATION
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2025 AND 2024
(expressed in thousands of Canadian dollars)
General
This Management’s Discussion and Analysis (“MD&A”) of Electra Battery Materials Corporation (“Electra” or the “Company”) was prepared as at September 16, 2025 and provides analysis of the Company’s financial results for the three and six months ended June 30, 2025 and 2024. The information herein should be read in conjunction with the condensed interim consolidated financial statement for the three and six months ended June 30, 2025 and 2024 and consolidated financial statements for the years ended December 31, 2024, and 2023 with accompanying notes which have been prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”). All dollar figures, excluding share prices, are expressed in thousands of Canadian dollars unless otherwise stated. Financial Statements are available at www.sedarplus.com and the Company’s website www.electrabmc.com.
Company Information
Electra Battery Materials Corporation was incorporated on July 13, 2011 under the Business Corporations Act of British Columbia (the “Act”). On September 4, 2018, the Company filed a Certificate of Continuance into Canada and adopted Articles of Continuance as a Federal Company under the Canada Business Corporations Act (the “CBCA”). On December 6, 2021, the Company changed its corporate name from First Cobalt Corp. to Electra Battery Materials Corporation to better align with its strategic vision.
The Company is in the business of producing battery materials, including refining material from mining operations and from the recycling of battery scrap and end of life batteries. Electra is focused on building a diversified portfolio of assets that are highly leveraged to critical minerals and the battery supply chain with assets located in North America. The Company has two significant North American assets:
| (i) | a hydrometallurgical refinery located in Ontario, Canada (the “Refinery”); and |
| (ii) | a number of properties and option agreements within the Idaho Cobalt Belt (the “Idaho Properties”), including the Company’s flagship mineral project, Iron Creek (the “Iron Creek Project”). |
Electra is a public company whose common shares are listed on the TSX Venture Exchange (“TSXV”) and on the Nasdaq Capital Market (“Nasdaq”) and trades under the symbol ELBM in both cases.
The Company’s registered and records office is Suite 2400, Bay-Adelaide Centre, 333 Bay Street, Toronto, Ontario, M5H 2T6. The Company’s head office is located at 133 Richmond Street W, Suite 602, Toronto, Ontario, M5H 2L3.
Highlights
Six months ended June 30, 2025 and through the date of this document, and includes some history for context.
Refinery Project
The Company continued progressing plans to recommission and expand the Refinery with a view to becoming the first refiner of battery grade cobalt sulfate in North America.
| · | Ethical Sourcing Update: On July 31, 2025, the Company announced the start of the metallurgical testing on cobalt feedstock from two strategic North American sources: the historic Cobalt Camp in Ontario and the Company’s Iron Creek cobalt and copper project in Idaho. The objective of this initiative is to strengthen and diversify Electra’s cobalt refinery feedstock pipeline by integrating domestic sources alongside existing global supply partners. On February 6, 2025, the Company also established an MOU with Nord Precious Metals including a framework to process potential future cobalt-bearing silver concentrates at Electra’s Refinery in Ontario. On commissioning and in the medium term, cobalt feed requirements for Electra’s refinery will be met through agreements with Glencore and Eurasian Resources Group (ERG), two leaders in the supply of ethical cobalt. |
| Page 3 of 18 |
ELECTRA BATTERY MATERIALS CORPORATION
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2025 AND 2024
(expressed in thousands of Canadian dollars)
| · | Early Works Project: On June 19, 2025, the Company announced the launch of an early works program which encompasses targeted site-level activities to prepare for the restart of the full-scale construction. |
| · | Production Capacity: The Refinery is expected to produce up to 6,500 tonnes of cobalt per year, once fully operational, supporting over 1 million electric vehicles (“EVs”) annually. |
| · | Sales Agreement: LG Energy Solutions has agreed to purchase up to 80% of the Refinery’s capacity over the first five years. |
| · | Strategic Importance: The Refinery could support the North American defense industrial base needs by diversifying critical supply chains for lithium-ion battery production. |
Refining & Recycling of Black Mass
The Company launched a black mass trial late in 2022 at the Refinery to recover high-value elements found in shredded lithium-ion batteries. To date, Electra has produced quality nickel-cobalt mixed hydroxide, technical grade lithium carbonate, and graphite products in its black mass recycling trial, and the Company continues to advance this project.
| · | Black Mass Refining: On June 5, 2025, the Company announced the completion of a feasibility level Class 3 Engineering Study for the construction of a modular battery recycling facility adjacent to its cobalt sulfate refinery. The facility will be designed to recover lithium, nickel, cobalt, manganese, and graphite from lithium-ion battery manufacturing scrap and end-of-life batteries using Electra’s proprietary hydrometallurgical process. A successful 2023 trial processed 40 tonnes of black mass from shredded lithium-ion batteries, recovering critical minerals including nickel, cobalt, and lithium. |
| · | Technical Grade Lithium: The Company successfully produced a technical-grade lithium product in 2024, marking further advances in its capabilities to produce critical materials for the EV industry. |
| · | Joint Venture with Three Fires Group: On June 12, 2025, the Company and Three Fires Group announced significant progress on the Aki Battery Recycling joint venture. Aki is Canada’s first Indigenous-led lithium-ion battery recycling initiative, advancing a low-emission, circular solution for battery waste. Since launching in 2024, Aki has shortlisted technology partners, engaged with government for funding, and is evaluating sites near First Nations lands. Through partnership with Electra’s refinery, Aki aims to establish a fully Canadian closed-loop supply chain for critical battery materials. |
| · | Environmental and Social Impact: The Aki joint venture aims to reduce the carbon footprint of the battery materials supply chain and contribute to the participation of First Nations communities in the energy transition. |
Government Support & Financing
| · | Government of Canada Letter of Intent (“LOI”): On March 21, 2025, the Company announced receipt of a funding proposal for $20,000 to support construction of the Refinery. |
| · | This is in addition to the August 2024 U.S. Department of Defense Award of US$20,000 under Title III of the Defense Production Act and a non-binding term sheet for a US$20,000 investment from a strategic battery materials partner received on September 10, 2024, both to support completion of Refinery construction. |
| · | Convertible Notes Update: On March 5, 2025, the Company entered into an agreement with the holders of its senior secured debt that enhances the Company’s financial flexibility. Under this agreement, lenders have agreed to defer all interest payments until February 15, 2027, allowing Electra to invest its capital towards completing its cobalt refinery rather than debt servicing. |
| Page 4 of 18 |
ELECTRA BATTERY MATERIALS CORPORATION
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2025 AND 2024
(expressed in thousands of Canadian dollars)
| • | Equity Financing: On April 14, 2025, the Company closed a non-brokered private placement to raise gross proceeds of US$3,500 to advance Refinery construction and for general corporate purposes. |
| (a) | Subsequent to June 30, 2025, the completion of construction required by FedNor was extended to June 2027 (Note 9). Governmental loans repayment commencement date was changed from June 2026 to June 2028. |
| (b) | Subsequent to June 30, 2025, the Company entered into a term sheet and transaction support agreement with its2028 and 2027 Notes holders pursuant to which it will launch a debt-to-equity conversion that will reduce its convertible debt outstanding by 60% as part of a comprehensive financial restructuring (the “Transaction”). In addition, the Company intends to launch a US$30,000 financing (the “Equity Financing”), which will include a US$10,000 conditional commitment from the 2028 and 2027 Notes holders. Together, the Transaction and Equity Financing are designed to strengthen the Company’s capital structure and provide the funding required to advance the commissioning of North America’s first cobalt sulfate refinery. |
Key Terms are the following:
| (i) | Subsequent to June 30, 2025, the Company received a waiver from the noteholders to reduce the reportable minimum liquidity balance to US$1,900 (from US$2,000) for the 2028 Notes and 2027 Notes from September 1, 2025 to October 1, 2025 and US$1,400 from October 1, 2025 to October 21, 2025. |
| (ii) | The Company will convert approximately US$40,000 of its outstanding Notes, plus accrued and unpaid interest, into equity at a price of US$0.60 per Common Share. This exchange will reduce total debt under the Notes to approximately US$27,000. |
| (iii) | The concurrent Equity Financing will consist of US$30,000 of Units at a price of US$0.75 per Unit. Each Unit will consist of one common share and one common share purchase Warrant, with each Warrant exercisable for one common shares for US$1.25 for a period of three (3) years from the date of issuance. The Equity Financing is expected to close in tandem with the Transaction. |
| (iv) | The remaining 40% of the Notes, plus accrued and unpaid interest, will be exchanged for a new term loan, maturing three years after completion of the Transaction with an annual interest rate of 8.99%. |
| (v) | To support operations during the restructuring process, the lenders will provide US$2,000 in short-term bridge debt in the form of 90-day Bridge Notes. In return, the Noteholders will gain the right to appoint one director to the Company’s board of directors. |
| (vi) | Amendment of Royalty Agreements to extend the length of the royalty on revenue from five years following the commencement of commercial production to seven years following the commencement of commercial production and raise the aggregate cap under all Royalty Agreements from US$6,000 to US$10,000. |
| • | Subsequent to June 30, 2025, the Company announced it signed a term sheet for $17,500 in proposed funding from Invest Ontario, an agency of the Government of Ontario, to support construction of its cobalt sulfate refinery in Temiskaming Shores. Once operational, the facility will be the first in North America dedicated to producing battery-grade cobalt sulfate. The term sheet signed with Invest Ontario expresses an intent to work toward completing definitive documentation but does not constitute a binding agreement. While discussions between the parties are ongoing, there is no guarantee or assurance that final agreements will be reached and funding will be provided to the Company. |
Idaho Exploration
| · | On February 20, 2025, the Company provided an update on its exploration efforts at the CAS Property in the Idaho Cobalt Belt, U.S.A. Recent and historical data from CAS highlight high-grade gold values over significant intervals and underscore the growing importance of the CAS Property to Electra’s Idaho exploration strategy. The presence of high-grade gold mineralization at CAS adds further strategic value to Electra’s Idaho holdings. |
| · | The Company received a 10-year exploration permit in late 2024 from the U.S. Forestry Service for an area encompassing the Iron Creek and Ruby Deposits Property and the adjacent CAS and Redcastle Options Agreement Properties in the Idaho Cobalt Belt. |
Corporate
| · | On February 25, 2025, the Company announced the appointment of Alden Greenhouse to the Company’s Board of Directors. Mr. Greenhouse is currently the Vice-President, Critical & Strategic Minerals for Agnico Eagle Mines Limited, a leading Canadian mining company with global operations. In his current role, Mr. Greenhouse oversees Agnico Eagle’s initiatives related to critical and strategic minerals. | |
| • | On August 25, 2025, the Company announced the appointment of David Stetson to the Company’s Board of Directors. Mr. Stetson is a seasoned executive with decades of leadership experience in the natural resources sector, including 14 years as a CEO. | |
| • | On September 9, 2025, the Company announced the nomination of Gerard Hueber, Rear Admiral, U.S. Navy (retired) to its Board of Directors. Mr. Heber is a decorated naval leader and seasoned executive with decades of experience spanning the U.S. Navy and industry. Most recently, he served as the Vice President of Naval Power Requirements and Capabilities where he oversaw an $8 billion naval portfolio in Raytheon, a business in RTX, which is the world’s largest aerospace and defense company. |
The Company’s primary focus remains on its Refinery project, enhancing supply chain resilience, and securing financing to support the expansion of its critical minerals operations, while advancing the Idaho Properties.
Projects & Outlook
The Company’s vision is to build a North American supply of battery materials with a focus on refining material from mining operations and from the recycling of battery scrap and end of life batteries. The Company’s primary asset is the wholly owned Refinery located in Ontario, Canada. The Company also owns the Idaho Properties within the Idaho cobalt belt in the United States. The Idaho Properties include the Iron Creek cobalt-copper project and other minerals projects. The Company also holds royalty interests over several silver and cobalt properties in Ontario known as the Cobalt Camp.
The Refinery
The Company has been progressing plans to recommission and expand the Refinery with a view to becoming the first refiner of battery grade cobalt sulfate in North America. Electra’s primary focus is to advance the expansion and recommissioning of the Refinery, as the first phase of a multiphase plan.
| · | Phase 1 involves the expansion and recommissioning of the Company’s Refinery, with an initial production target of 5,000 tonnes per year of battery-grade cobalt sulfate, sourced from cobalt hydroxide supplied by certified mining operations in the Democratic Republic of Congo. |
| · | Phase 2 includes a permit amendment and further expansion of certain refinery circuits to increase cobalt production to 6,500 tonnes per year of battery-grade cobalt sulfate, matching the Refinery’s crystallization circuit’s nameplate capacity. The Company has invested in larger equipment to enable this future production increase. |
| · | Phase 3 focuses on the recycling of black mass from spent lithium-ion batteries, sourced from various battery shredders in the United States and other regions. |
| · | Phase 4 involves the construction of a nickel sulfate plant, providing essential components (excluding manganese) to attract a precursor manufacturer to add to the Company’s refining operations. |
In 2020, the Company announced the results of an engineering study on the expansion of the Refinery that demonstrated that the facility could become a significant, globally competitive producer of cobalt sulfate for the electric vehicle market. The engineering study determined the Refinery could produce 25,000 tonnes of battery-grade cobalt sulfate annually (equating to approximately 5,000 tonnes of cobalt contained in sulfate), which would represent approximately 5% of the total refined global cobalt market and 100% of the North American cobalt sulfate supply. The study indicated strong operating margins at the asset level.
| Page 5 of 18 |
ELECTRA BATTERY MATERIALS CORPORATION
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2025 AND 2024
(expressed in thousands of Canadian dollars)
The Company initiated construction to recommission the facility in 2022, however paused construction in 2023 due to impacts of post-COVID inflation and supply chain disruptions on project schedule and costs. It was determined that approximately US$60,000 would be required to complete the construction. This construction cost estimate was as of 2023 and does not include inflation or escalation to current pricing. All long-lead, custom-fabricated equipment is on site, and the facility was operational throughout 2023 as a plant scale demonstration plant, processing battery black mass. The Company started an early works program budgeted at approximately C$750,000 particularly focused on advancing the solvent extraction facility. At this time, the Company will require additional financing to continue operations and complete the construction of the Refinery.
Refining & Recycling of Black Mass
Black mass is the material left after expired lithium-ion batteries are shredded and their casings removed. It contains high-value elements including nickel, cobalt, manganese, copper, lithium, and graphite, which can be recycled to make new batteries. With increasing demand for these metals and a projected supply shortage of sustainable critical minerals such as nickel and cobalt, black mass recycling is increasingly important to the EV battery supply chain. McKinsey & Company predicts that available battery materials for recycling will grow by 20% per year through 2040.
In February 2023, Electra completed the first plant-scale recycling of black mass material in North America, successfully recovering key metals including nickel, cobalt, and graphite using its proprietary process. By March 2023, the plant was also recovering lithium and successfully produced mixed hydroxide precipitate (MHP) at contained metal grades for nickel and cobalt above quoted market specifications. The trial also recovered copper and manganese. In the fall of 2024, the Company achieved a key milestone, producing lithium carbonate with greater than 99% purity, or technical grade, confirming it can produce high-quality, battery-grade materials from recycled black mass. To date, the Company has shipped approximately 28 tonnes of MHP to customers.
This has attracted interest from companies in the battery supply chain looking for North American refining solutions, and in June 2024, the Company received a $5,000 funding commitment from Canada’s Critical Mineral Research Development & Demonstration Program to demonstrate that its hydrometallurgical process can recycle black mass on a continuous production basis, to prove it is scalable, profitable, and reproducible at other locations.
On June 5, 2025, the Company completed a feasibility level Class 3 Engineering study for the construction of a modular battery recycling facility adjacent to its cobalt refinery north of Toronto, building on the technology and expertise accumulated during a year-long black mass recycling trial, whereby Electra produced technical grade lithium and a nickel and cobalt product from end-of-life lithium batteries.
The facility will be designed to recover lithium, nickel, cobalt, manganese and graphite from lithium-ion battery manufacturing scrap and end of life batteries using the Company’s hydrometallurgical process. The next phase of work, funded in part by Natural Resources Canada, will involve operating and recycling process under continuous and semi-continuous conditions to simulate commercial scale throughput.
Exploration & Evaluation Assets
The Company is focused on building a North American battery materials supply chain. The Company’s Idaho Properties include the Iron Creek Project, its flagship exploration property; with a March 2023 resource estimate (the “2023 MRE”). The properties cover approximately 3,260 hectares with both patented and unpatented claims, as well as 600 meters of underground drifting. In addition to the Iron Creek resource, there are numerous cobalt-copper targets on the property.
The 2023 MRE includes a mineral resource estimate based on all drilling conducted through the end of 2022. The resource model calculated an indicated mineral resource of 4.45 million tonnes at 0.19% Co and 0.73% Cu and an inferred mineral resource of 1.23 million tonnes at 0.08% Co and 1.34% Cu. The mineralization remains open along strike and downdip. The resource does not include the Ruby target which has had insufficient drilling conducted to effectively calculate a volume and grade of mineralization. Management believes that there is potential to continue to expand the size of the Iron Creek resource and continue drilling at the Ruby target.
| Page 6 of 18 |
ELECTRA BATTERY MATERIALS CORPORATION
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2025 AND 2024
(expressed in thousands of Canadian dollars)
In July 2024, the Company announced a previously unknown copper surface showing, the Malachite Hill Copper Showing (the “MHS”), on an unexplored boundary area of the Redcastle Agreement claims portion of the Idaho properties. The Malachite Copper Showing was discovered in 2023 and assay results of outcrop grab samples indicate elevated copper (maximum = 2,660 parts per million copper), and low cobalt values. This finding demonstrates the presence of favourable host rocks at surface in this area of the Redcastle Property; however, the extent of the surface mineralization exposure remains to be determined. Interestingly, the MHS appears to be located approximately two (2) kilometres along strike (southeast) of Electra’s Ruby cobalt-copper target.
In the latter half of 2024, the Company received a Decision Notice for the Iron Creek Exploration Drilling from U.S. Forestry Service. The 10-year exploration permit allows the Company to undertake exploration activities including setting up 91 drilling locations, along with constructing temporary access roads and staging areas, over 11.3 acres of the Idaho properties.
In February of 2025, the Company provided an update on its exploration efforts at the CAS Property in the Idaho Cobalt Belt, U.S.A. Recent and historical data from CAS highlight high-grade gold values over significant intervals and underscore the growing importance of the CAS Property to Electra’s Idaho exploration strategy. The presence of high-grade gold mineralization at CAS adds further strategic value to Electra’s Idaho holdings. Between 2003 and 2006, over 2,600m of drilling was conducted over on the CAS Property, identifying significant gold values. Copper-rich massive sulfide boulders were also discovered nearby, but despite previous exploration the bedrock source of this style of mineralization has not been found. The most notable highlights from previous drilling include:
| · | IC03-02 6.2m from 77.4m at 8.3 g/t Au and 0.51% Co |
| · | IC03-03 1.5m from 72.8m at 8.5 g/t Au and 0.54% Co |
| · | IC03-04 4.6m from 128.0m at 8.3 g/t Au and 0.34% Co |
| · | IC03-07 3.0m from 41.1m at 9.2 g/t Au and 0.08% Co |
Electra holds a significant land position in the Idaho Cobalt Belt, including the Iron Creek deposit and the highly prospective Ruby target area. The CAS Property option expands this footprint and opens the door for potential collaboration with gold-focused explorers.
Asset Value Continuity
Balance January 1, 2024 | Foreign Exchange | Acquisition cost | Balance December 31, 2024 | Foreign Exchange | Balance June 30, 2025 | |||||||||||||||||||
| Idaho, USA | $ | 85,634 | $ | 7,530 | $ | 36 | $ | 93,200 | $ | (4,832 | ) | $ | 88,368 | |||||||||||
| Page 7 of 18 |
ELECTRA BATTERY MATERIALS CORPORATION
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2025 AND 2024
(expressed in thousands of Canadian dollars)
Summary of Quarterly Results
| Three months ended June 30, 2025 | Three months ended June 30, 2024 | |||||||
| ($) | ($) | |||||||
| Financial Position | ||||||||
| Current Assets | 4,274 | 6,973 | ||||||
| Exploration and Evaluation Assets | 88,368 | 88,619 | ||||||
| Property, plant and equipment | 51,611 | 51,369 | ||||||
| Total Assets | 145,600 | 148,169 | ||||||
| Current Liabilities | 79,745 | 64,621 | ||||||
| Long-term Liabilities | 15,102 | 13,527 | ||||||
| Operations | ||||||||
| General and administrative | 723 | 902 | ||||||
| Consulting and professional fees | 1,067 | 1,092 | ||||||
| Exploration and evaluation expenditures | 48 | 81 | ||||||
| Investor relations and marketing | 119 | 126 | ||||||
| Salary and benefits | 1,298 | 798 | ||||||
| Share-based payments | 228 | 419 | ||||||
| Total Operating Expenses | 3,483 | 3,418 | ||||||
| Change in fair value of marketable securities | — | 89 | ||||||
| Gain (loss) on financial derivative liability – Convertible Notes | 231 | (373 | ) | |||||
| Changes in fair value of US Warrant | (100 | ) | (19 | ) | ||||
| Other non-operating expense | 1,347 | (2,051 | ) | |||||
| Net loss | (2,005 | ) | (5,772 | ) | ||||
| Basic and diluted loss per share | (0.11 | ) | (0.41 | ) | ||||
Results of Operations for the Three Months Ended June 30, 2025
During the three months ended June 30, 2025, the Company recorded a net loss of $2,005 (net loss of $5,772 for the three months ended June 30, 2024), a loss per share of $0.11 (loss of $0.41 for the three months ended June 30, 2024).
| · | Net loss for the three months ended June 30, 2025, included a gain of $231 relating to fair value adjustment of the 2028 Notes and 2027 Notes (loss of $373 - for the three months ended June 30, 2024 for the 2028 Notes). The gain on the Notes is the result of changes to the US$/C$ exchange rate, discount rate, and time to maturity. |
| · | General and administrative expenses were $723 for the three months ended June 30, 2025, compared to $902 for the three months ended June 30, 2024. The majority of the decrease was due to Refinery related G&A and lower consulting fees. |
| · | Consulting and professional fees were $1,067 for the three months ended June 30, 2025 which was in line with the $1,092 for the three months ended June 30, 2024. |
| · | Salary and benefits were $1,298 for the three months ended June 30, 2025, compared to $798 for the three months ended June 30, 2024. The increase was due to higher number of employees rather than contractors during the current period and lower compensation and benefits accruals during the previous comparable period. |
| · | Shared-based payments for the three months ended June 30, 2025 of $228 compared to $419 for the three months ended June 30, 2024. The decrease was due to quantity and timing of options granted and corresponding expensing thereof. |
| · | Exploration and evaluation expenditures were $48 for the three months ended June 30, 2025, compared to $81 for the three months ended June 30, 2024. |
| Page 8 of 18 |
ELECTRA BATTERY MATERIALS CORPORATION
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2025 AND 2024
(expressed in thousands of Canadian dollars)
Summary of Six Months Ended June 30, 2025 and 2024 Results
| Six months ended June 30, 2025 | Six months ended June 30, 2024 | |||||||
| ($) | ($) | |||||||
| Operations | ||||||||
| General and administrative | 1,766 | 1,425 | ||||||
| Consulting and professional fees | 2,068 | 2,215 | ||||||
| Exploration and evaluation expenditures | 89 | 144 | ||||||
| Investor relations and marketing | 211 | 304 | ||||||
| Salary and benefits | 2,550 | 1,695 | ||||||
| Share-based payments | 555 | 979 | ||||||
| Total Operating Expenses | 7,239 | 6,762 | ||||||
| Change in fair value of marketable securities | 4 | 181 | ||||||
| Loss on financial derivative liability – Convertible Notes | (4,836 | ) | (7,184 | ) | ||||
| Changes in fair value of US Warrant | (100 | ) | (49 | ) | ||||
| Other non-operating expense | (2,514 | ) | (4,127 | ) | ||||
| Net loss | (14,685 | ) | (17,941 | ) | ||||
| Basic and diluted loss per share | (0.90 | ) | (1.27 | ) | ||||
Results of Operations for the Six Months Ended June 30, 2025
During the six months ended June 30, 2025, the Company recorded a net loss of $14,685 (net loss of $17,941 for the six months ended June 30, 2024), a loss per share of $0.90 (loss of $1.27 for the six months ended June 30, 2024).
| · | Net loss for the six months ended June 30, 2025, included a loss of $4,836 relating to fair value adjustment of the 2028 Notes and 2027 Notes (loss of $7,184 - for the six months ended June 30, 2024 for the 2028 Notes). |
| · | General and administrative expenses were $1,766 for the six months ended June 30, 2025, compared to $1,425 for the six months ended June 30, 2024. The majority of the increase was due to Refinery related G&A including higher accrual of property insurance, project management services, utilities, and repairs and maintenance expenses. |
| · | Consulting and professional fees were $2,068 for the six months ended June 30, 2025, which is in line with $2,215 for the six months ended June 30, 2024. |
| · | Salary and benefits were $2,550 for the six months ended June 30, 2025, compared to $1,695 for the six months ended June 30, 2024. The increase was due to higher number of employees rather than contractors during the current period and lower compensation accruals during the previous comparable period. |
| · | Share-based payments for the six months ended June 30, 2025 were $555 compared to $979 for the six months ended June 30, 2024. The decrease was due to quantity and timing of options granted and corresponding expensing thereof. |
| · | Exploration and evaluation expenditures were $89 for the six months ended June 30, 2025, compared to $144 for the six months ended June 30, 2024. |
| Page 9 of 18 |
ELECTRA BATTERY MATERIALS CORPORATION
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2025 AND 2024
(expressed in thousands of Canadian dollars)
Selected Quarterly Financial Information
| For the three months ended, | Net income (loss) | Income (loss) per share | Total assets | |||||||||
| June 2025 | $ | (2,005 | ) | $ | (0.11 | ) | $ | 145,600 | ||||
| March 2025 | (12,680 | ) | (0.86 | ) | 151,432 | |||||||
| December 2024 | (8,565 | ) | (0.61 | ) | 151,447 | |||||||
| September 2024 | (2,941 | ) | (0.21 | ) | 144,715 | |||||||
| June 2024 | (5,772 | ) | (0.41 | ) | 148,169 | |||||||
| March 2024 | (12,169 | ) | (0.87 | ) | 149,335 | |||||||
| December 2023 | (46,859 | ) | (3.36 | ) | 148,692 | |||||||
| September 2023 1 | (9,223 | ) | (1.79 | ) | 210,152 | |||||||
1 Quarters have been restated to reflect current presentation including adoption of US dollars as the functional currency for its US-based subsidiaries and the change in the royalty liability as described below.
The royalty liability measured upon initial recognition of the fair value on the extinguishment of the previously outstanding 2026 Notes and recognition of the 2028 Notes has been reduced from $2,178 to $721. There is a corresponding $1,457 reduction in the loss on extinguishment of 2026 Notes and recognition of the 2028 Notes.
The royalty liability was reduced for the quarter ended September 30, 2023 from $2,432 to $832.
There were no changes to the Consolidated Statements of Cash Flow.
Capital Structure, Resources & Liquidity
As of the date of this MD&A, the Company has 17,962,172 common shares issued and outstanding. In addition, there are outstanding share purchase warrants and stock options for a further 7,764,499 and 1,281,011 common shares, respectively. The Company currently has 157,085 Deferred Share Units (“DSUs”), no Restricted Share Units (“RSUs”) and no Performance Share Units (“PSUs”) outstanding under its Long-Term Incentive Plan.
The following warrants were outstanding at the date of this MD&A:
| Grant date | Expiry date | Number of warrants outstanding | Weighted average exercise price | |||||||
| November 15, 2022 | November 15, 2025 | 620,788 | US$12.40 | |||||||
| February 13, 2023 | February 13, 2028 | 2,699,014 | $ | 3.40 | ||||||
| November 27, 2024 | November 12, 2026 | 1,136,364 | $ | 4.00 | ||||||
| April 3 and 14, 2025 | October 3 and 14, 2026 | 3,308,333 | US$1.38 | |||||||
| 7,764,499 | ||||||||||
Capital Structure
The Company manages its capital structure to maximize its financial flexibility, adjusting it in response to changes in economic conditions and the risk characteristics of the underlying assets and business opportunities. The Company does not presently utilize any quantitative measures to monitor its capital but rather relies on the expertise of the Company’s management to sustain the future development of the business. Management reviews its capital management approach on an ongoing basis and believes that this is appropriate, given the size of the Company.
The Company will adjust its capital structure based on management’s assessment of the optimal capital mix to effectively advance its assets. As of June 30, 2025, the Company’s debt component of its capital structure has a par value of $82,914 (US$60,771) of convertible notes.
In February 2023, the company refinanced its debt by issuing 2028 Notes with a principal of US$51,000 and settling the 2026 Notes with a principal of US$36,000, resulting in net proceeds of US$15,000 after interest and transaction costs.
| Page 10 of 18 |
ELECTRA BATTERY MATERIALS CORPORATION
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2025 AND 2024
(expressed in thousands of Canadian dollars)
On January 12, 2024, the company received approval from the TSX Venture Exchange (“TSXV”) and warrant holders to amend the terms of 10,796,054 outstanding warrants associated with the 2028 Notes expiring in February 2028. The amendments included lowering the exercise price to $4.00 per share and adding an acceleration clause, which shortens the term to 30 days if the stock price exceeds $4.80 for ten consecutive trading days. In such cases, warrants could be exercised on a cashless basis.
On March 13, 2024, the TSXV approved the issuance of common shares to settle US$401 in interest associated with the 2028 Notes. On March 21, 2024, the Company issued 210,760 shares at a deemed price of $2.58 per share, based on a 5-day volume-weighted average price, to partially satisfy interest payments on the US$51,000 in convertible notes.
On August 28, 2024, Altitude Capital Consultants Inc. (“Altitude”) was engaged for an initial term of twelve months. The Company granted Altitude 250,000 incentive stock options in accordance with the Company’s long-term incentive plan, exercisable at a price of $3.28 for a period of three-years, which vested in four equal quarterly tranches over a one-year period. The Company is at arms-length from Altitude and its principals, and the services provided by Altitude do not include investor relations or promotional activities.
On November 27, 2024, the Company issued additional 2028 Notes to the noteholders, in the principal amount of US$6,521, as payment-in-kind for all outstanding accrued interest owing on the 2028 Notes through to August 15, 2024. The additional 2028 Notes carry the same payment conversion terms as the balance of the 2028 Notes and were issued pursuant to a supplement to the indenture dated February 13, 2023, entered into among the Company and GLAS Trust Company LLC as trustee for the 2028 Notes and their noteholders.
Following the amendment of additional 2028 Notes, the exercise price of the 2028 Warrants was reduced to $3.40 per share. In addition, the 2028 Warrants now include a revised acceleration clause such that their term will be reduced to thirty days in the event the closing price of the common shares on the TSXV exceeds $3.40 by twenty percent or more for ten consecutive trading dates, with the reduced term beginning seven calendar days after such ten consecutive trading-day period. Upon the occurrence of an acceleration event, noteholders of the 2028 Warrants may exercise the 2028 Warrants on a cashless basis, based on the value of the 2028 Warrants at the time of exercise.
On December 31, 2024, the Company completed a reverse share split of its outstanding common share capital on the basis of four (4) pre-Reverse Split shares for every one (1) post-Reverse Split share. At the opening of markets on January 2, 2025, the common shares of the Company commenced trading on a post-Reverse Split basis under the existing ticker symbol “ELBM”. The exercise price and the number of common shares issuable upon exercise of outstanding stock options, warrants and other outstanding securities, including comparative figures, were adjusted to reflect the reverse share split under the terms of such securities for the holders of such instruments.
On March 5, 2025, the Company announced an agreement with the holders of its senior secured debt to defer all interest payments until February 15, 2027, allowing Electra to invest its capital towards completing its cobalt refinery rather than debt servicing. The agreement covers all outstanding 2028 Notes and 2027 Notes. As consideration for this deferral, Electra will pay additional interest of 2.25% per annum on the 2028 Notes and 2.5% per annum on the 2027 Notes.
On April 14, 2025, the Company closed the final tranche of its oversubscribed non-brokered private placement raising aggregate gross proceeds of approximately US$3,500 (the “Offering”), the first tranche of which closed on April 3, 2025.
Under the Offering, an aggregate of 3,125,000 units of the Company (each, a “Unit”) were issued at a price of US$1.12 per Unit. Each Unit consisted of one common share in the capital of the Company (“Common Shares”) and one transferable common share purchase warrant (each, a “Warrant”), with each warrant entitling the holder to purchase one common share of the Company at a price of US$1.40 at any time for a period of eighteen (18) months following the issue date. The net proceeds raised from the Offering will be used to advance the Company’s Refinery project site in Temiskaming Shores, Ontario and for general corporate purposes.
| Page 11 of 18 |
ELECTRA BATTERY MATERIALS CORPORATION
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2025 AND 2024
(expressed in thousands of Canadian dollars)
In connection with the closing of the Offering, the Company paid an aggregate of US$219 in cash finders fees and issued 183,333 non-transferrable finders warrants (each, a “Finders Warrant”). Each Finders Warrant is exercisable to acquire one Common Share of the Company at an exercise price of US$1.12 per common share until October 14, 2026.
The Company is actively pursuing various alternatives including equity and debt financing to increase its liquidity and capital resources to fund Refinery expenditures. The Company will also need working capital funding for the purchase of consumables before the startup of operations.
Liquidity
The Company’s objective in managing liquidity risk is to maintain sufficient liquidity to meet operational and asset advancement requirements as well as ensuring compliance with the minimum reportable liquidity balance covenant.
At June 30, 2025, the Company had unrestricted cash of $2,927 (December 31, 2024 - $3,717) compared to accounts payable and accrued liabilities of $4,857 (December 31, 2024 - $3,579).
At this time, the Company does not have sufficient financial resources necessary to complete the construction and final commissioning of the Refinery and will require additional financing in 2025 to continue operations, complete the construction of the Refinery, advance its battery recycling strategy, and remain in compliance with the reportable minimum liquidity covenant under the 2027 Notes and 2028 Notes. Failure to remain in compliance with the liquidity terms may result in the instrument becoming due before the contractual maturity.
The Company had the following summarized cash flows:
| Six months ended June 30, 2025 | Six months ended June 30, 2024 | |||||||
| Cash used in operation activities | $ | (4,717 | ) | $ | (7,951 | ) | ||
| Cash used in / provided by investing activities | (689 | ) | 940 | |||||
| Cash provided by financing activities | 4,596 | 4,229 | ||||||
| Change in cash during the period | (810 | ) | (2,782 | ) | ||||
| Effect of exchange rates | 20 | 23 | ||||||
| Cash, beginning of period | 3,717 | 7,560 | ||||||
| Cash, end of the period | $ | 2,927 | $ | 4,801 | ||||
Cash used in operating activities was $4,717 during the six months ended June 30, 2025, compared to $7,951 used in operating activities during the six months ended June 30, 2024. The decrease in cash used in operating activities was driven primarily by changes in working capital.
Cash used in investing activities was $689 during the six months ended June 30, 2025, compared to cash provided by investing activities of $940 during the six months ended June 30, 2024. The increase in cash used in investing activities relates to the increase in capital spending.
Cash flows provided by financing activities were $4,596 during the six months ended June 30, 2025, compared to the $4,229 from financing activities during the six months ended June 30, 2024. The change was primarily driven by proceeds from private financing which closed on April 14, 2025, compared to receipt of FedNor funds in 2024.
Commitments
From time to time, the Company and/or its subsidiaries may become defendants in legal actions and the Company take appropriate measures to minimize the impact. Electra is not aware of any claims against the Company that could reasonably be expected to have a materially adverse impact on the Company’s consolidated financial position, results of operations or the ability to carry on any of its business activities.
The Company’s commitments relate to purchase and services commitments for work programs relating to refinery expansion and payments under financing arrangements.
| Page 12 of 18 |
ELECTRA BATTERY MATERIALS CORPORATION
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2025 AND 2024
(expressed in thousands of Canadian dollars)
The Company had the following commitments as of June 30, 2025:
| 2025 | 2026 | 2027 | 2028 | Thereafter | Total | |||||||||||||||||||
| Purchase commitments | $ | 836 | $ | — | $ | — | $ | — | $ | — | $ | 836 | ||||||||||||
| Convertible notes payments 1 | — | 19,860 | 12,798 | 81,005 | — | 113,663 | ||||||||||||||||||
| Government loan payments | 18 | 36 | 36 | 1,615 | 8,484 | 10,189 | ||||||||||||||||||
| Lease payments | 74 | 118 | 43 | — | — | 235 | ||||||||||||||||||
| Royalty payments 2 | — | — | — | 464 | 2,617 | 3,081 | ||||||||||||||||||
| Other | 273 | 68 | — | — | 2,046 | 2,387 | ||||||||||||||||||
| $ | 1,201 | $ | 20,082 | $ | 12,877 | $ | 83,084 | $ | 13,147 | $ | 130,391 | |||||||||||||
1 Convertible notes payment amounts are based on contractual maturities of 2028 Notes, 2027 Notes and the assumption that it would remain outstanding until maturity. Interest is calculated based on terms as at June 30, 2025.
2 Royalty payments are estimated amounts associated with the royalty agreements entered with the convertible debt holders as part of the 2028 Notes offering. The estimated amounts and timing are subject to changes in cobalt sulfate prices, timing of completion of the refinery, reaching commercial operations and timing and amounts of sales.
The Company has recorded a provision for environmental remediation, reclamation and decommissioning for its Ontario assets. For the Refinery, a liability of $2,685 has been recorded, linked to the closure plan filed and accepted in March 2022 and updated in November 2022. In relation to the refinery closure plan, an amount of $3,450 has been posted via a surety bond with the Ministry of Northern Development, Mines, Natural Resources and Forestry (“NDMNRF”) as financial assurance.
Related Party Transactions
The Company’s related parties include key management personnel and the Board of Directors.
The Company paid and/or accrued during the three and six months ended June 30, 2025 and 2024, the following fees to management personnel and directors.
| For the three months ended June 30, | For the six months ended June 30, | |||||||||||||||
| 2025 | 2025 | 2024 | ||||||||||||||
| Management | $ | 665 | $ | 474 | $ | 1,330 | $ | 837 | ||||||||
| Directors’ fees | 54 | 15 | 101 | 85 | ||||||||||||
| $ | 719 | $ | 489 | $ | 1,431 | $ | 922 | |||||||||
During the three and six months ended June 30, 2025, the Company had share-based payments made to management and directors of $147 and $382, respectively (for the three and six months ended June 30, 2024 - $513 and $833, respectively).
As at June 30, 2025, the accrued liabilities balance for related parties was $1,022 (December 31, 2024 - $161), which relates mainly to compensation accruals.
Off Balance Sheet Arrangements
The Company currently has no off-balance sheet arrangements.
Financial Instruments
Refer to Note 18 of the Company’s Consolidated financial statements for the years ended December 31, 2024 and 2023.
| Page 13 of 18 |
ELECTRA BATTERY MATERIALS CORPORATION
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2025 AND 2024
(expressed in thousands of Canadian dollars)
Risk Management
Financial Risk Factors
The Company’s risk exposure and the impact on the Company’s financial instruments are summarized below:
Liquidity Risk
Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they fall due. The Company does not have sufficient financial resources necessary to complete the construction and final commissioning of the Refinery and the Company is going through a planning and budgeting process to update the capital estimates and completion schedule associated with the Refinery. The Company attempts to ensure there is sufficient access to funds to meet ongoing business requirements, considering its current cash position and potential funding sources. Although the Company has historically been successful in obtaining financing in the past, there can be no assurances that the Company will be able to obtain adequate financing in the future. The Company has future obligations to pay semi-annual interest payments and the principal upon maturity related to the convertible debt. The semi-annual interest payments have been deferred to February 2027. Repayment of the interest-free loan from Canada’s Critical Mineral Research Development & Demonstration Program begins in 2026, subject to further agreement to defer repayment. Upon the issuance of the 2028 Notes and retirement of the previously outstanding 2026 Notes in February 2023, the Company is subject to a reportable minimum cash balance requirement of US$2,000.
Credit Risk
Credit risk is the risk that one party to a financial instrument will fail to discharge an obligation and cause the other party to incur a financial loss. The Company’s primary exposure to credit risk is on its cash and cash equivalents and restricted cash which are being held with major Canadian banks that are high-credit quality financial institutions as determined by rating agencies.
Interest Rate Risk
Interest rate risk is the risk that the fair value of future cash flow of a financial instrument will fluctuate because of changes in market interest rate. Company currently does not have any financial instruments that are linked to LIBOR, SOFR, or any form of a floating market interest rate. Therefore, changes in the market interest rate does not have an impact on the Company as at June 30, 2025.
Foreign Currency Risk
Foreign currency risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because they are denominated in currencies that differ from the Company’s functional currency, Canadian Dollars. The Company is exposed to foreign currency risk on fluctuations related to cash, receivables, and accrued liabilities that are denominated in US Dollars. In addition, the Company’s 2028 Notes are denominated in US dollars and fluctuations in foreign exchange rates will impact the Canadian dollar amounts required to settle interest and principal payments for these convertible notes. The Company has not used derivative instruments to reduce its exposure to foreign currency risk nor has it entered foreign exchange contracts to hedge against gains or losses from foreign exchange.
Business Risks and Uncertainties
There are many risk factors facing companies involved in the mineral exploration industry. Risk Management is an ongoing exercise upon which the Company spends a substantial amount of time. While it is not possible to eliminate all the risks inherent to the industry, the Company strives to manage these risks, to the greatest extent possible. The following risks are most applicable to the Company.
| Page 14 of 18 |
ELECTRA BATTERY MATERIALS CORPORATION
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2025 AND 2024
(expressed in thousands of Canadian dollars)
Going Concern
As discussed above, the Company will require additional financing in 2025 to continue operations, complete the construction of the Refinery, advance its battery recycling strategy and remain in compliance with the minimum liquidity covenant under the 2028 Notes and 2027 Notes. The Company is actively pursuing various alternatives including equity and debt financing to increase its liquidity and capital resources, which include discussions with the noteholders of Company regarding a potential restructuring of the outstanding notes. The Company is also in discussion with various parties on alternatives to finance the funding of feedstock purchases. Although the Company has historically been successful in obtaining financing in the past, there can be no assurances that the Company will be able to obtain adequate financing in the future. This represents a material uncertainty that casts substantial doubt on the Company’s ability to continue as a going concern. The financial information presented does not include the adjustments to the amounts and classifications of assets and liabilities that would be necessary should the Company be unable to continue as a going concern. These adjustments may be material.
Financing
The Company has raised funds through grants, equity financing and debt arrangements to fund its operations and the advancement of the Refinery. The market price of natural resources, specifically cobalt prices, is highly speculative and volatile. Instability in prices may affect the interest in resource assets and the development of and production from such properties. This may adversely affect the Company’s ability to raise capital or obtain debt to fund corporate activities and growth initiatives. The completion of the Refinery project is dependent on additional financing.
Technical Capabilities of the Refinery
The Company’s strategic priority is the advancement of the Refinery, with significant engineering studies and metallurgical testing conducted to date. There is no assurance that the final refining process will have the capabilities to produce specific end products. The Company manages this risk by employing and contracting technical experts in metallurgy and engineering to support refinery process decisions.
Ability to Meet Debt Service Obligations
The Company has debt obligations under the Notes, which include ongoing coupon payments and payment of principal at maturity. In the event, that the refinery construction is not completed as planned or sufficient cash flow from refinery operations is not generated, there is a risk that the Company may not have sufficient available capital to meet its debt obligations. Additionally, the Company is subject to certain covenants related to the Notes, which include minimum liquidity of US$2,000. Should the Company breach a covenant or be unable to service the debt, the assets pledged may be transferred to the lenders.
Macroeconomic Risks
Political and economic instability (including Russia’s invasion of Ukraine and war in Israel), global or regional adverse conditions, such as pandemics or other disease outbreaks (including the COVID-19 global outbreak) or natural disasters, currency exchange rates, trade tariff developments, transport availability and cost, including import-related taxes, transport security, inflation and other factors are beyond the Company’s control. The macroeconomic environment remains challenging, and the Company’s results of operations could be materially affected by such macroeconomic conditions.
Industry and Mineral Exploration Risk
Mineral exploration is highly speculative, involves many risks and frequently is non-productive. There is no assurance that the Company’s exploration efforts will be successful. At present, the Company’s projects do not contain any proven or probable reserves. Success in establishing reserves is a result of several factors, including the quality of the project itself. Substantial expenditures are required to establish reserves or resources through drilling, to develop metallurgical processes, and to develop the mining and processing facilities and infrastructure at any site chosen for mining. Because of these uncertainties, no assurance can be given that planned exploration programs will result in the establishment of mineral resources or reserves. The Company may be subject to risks, which could not reasonably be predicted in advance. Events such as labour disputes, natural disasters or estimation errors are prime examples of industry-related risks. The Company attempts to balance this risk through ongoing risk assessments conducted by its technical team.
| Page 15 of 18 |
ELECTRA BATTERY MATERIALS CORPORATION
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2025 AND 2024
(expressed in thousands of Canadian dollars)
Commodity Prices
The Company’s mineral exploration operations and its prospects are largely dependent on movements in the price of various minerals. Prices fluctuate daily and are affected by several factors well beyond the control of the Company. The mineral exploration industry in general is a competitive market and there is no assurance that, even if commercial quantities of proven and probable reserves are discovered, a profitable market may exist. The Company has not entered any price hedging programs.
Environmental
Exploration projects or operations are subject to the environmental laws and applicable regulations of the jurisdiction in which the Company operates. Environmental standards continue to evolve, and the trend is to a longer, more complete and rigid process. The Company reviews environmental matters on an ongoing basis. If and when appropriate, the Company will make appropriate provisions in its financial statements for any potential environmental liability.
Title of Assets
Although the Company conducts title reviews in accordance with industry practice prior to any purchase of resource assets, such reviews do not guarantee that an unforeseen defect in the chain on title will not arise and defeat our title to the purchased assets. If such a defect were to occur, our entitlement to the production from such purchased assets could be jeopardized.
Competition
The Company expects to compete in the burgeoning North American Critical Minerals Industry with the completion of the Cobalt Sulfate refinery. The industry is developing in Canada with new entrants expected in the short term. Many of these competitors have substantially longer histories in the industry as well as substantially greater financial, sales and marketing resources than the Company.
The Company engages in the highly competitive resource exploration industry. The Company competes directly and indirectly with major and independent resource companies in its exploration for and development of desirable resource properties. Many companies and individuals are engaged in this business, and the industry is not dominated by any single competitor or a small number of competitors. Many of such competitors have substantially greater financial, technical, sales, marketing, and other resources, as well as greater historical market acceptance than does the Company. The Company will compete with numerous industry participants for the acquisition of land and rights to prospects, and for the equipment and labour required to operate and develop such prospects.
Competition could materially and adversely affect the Company’s business, operating results and financial condition. Such competitive disadvantages could adversely affect the Company’s ability to participate in projects with favorable rates of return.
Cybersecurity
The Company’s operations depend, in part, on how well it and its third-party service providers protect networks, equipment, information technology (“IT”) systems and software against damage from a number of threats, including, but not limited to, cable cuts, natural disasters, intentional damage and destruction, fire, power loss, hacking, computer viruses, vandalism and theft. The Company’s operations also depend on the timely maintenance, upgrade and replacement of networks, equipment, IT systems and software, as well as pre-emptive expenses to mitigate the risks of failures. Any of these and other events could result in information system failures, delays and/or increase in capital expenses. The failure of information systems or a component of information systems could, depending on the nature of any such failure, adversely impact the Company’s reputation and results of operations.
| Page 16 of 18 |
ELECTRA BATTERY MATERIALS CORPORATION
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2025 AND 2024
(expressed in thousands of Canadian dollars)
The Company’s information technology systems and on-line activities, including its e-commerce websites, also may be subject to denial of service, malware or other forms of cyberattacks. While the Company has taken measures to protect against those types of attacks, those measures may not adequately protect its on-line activities from such attacks. The Company’s risk and exposure to these matters cannot be fully mitigated because of, among other things, the evolving nature of these threats. As a result, cyber security and the continued development and enhancement of controls, processes and practices designed to protect systems, computers, software, data and networks from attack, damage or unauthorized access is a priority. As cyber threats continue to evolve, the Company may be required to expend additional resources to continue to modify or enhance protective measures or to investigate and remediate any security vulnerabilities.
U.S. Legislative and Regulatory Policies.
The recent election of President Trump may result in legislative and regulatory changes that could have an adverse effect on the Company and its financial condition. In particular, there is uncertainty regarding U.S. tariffs and support for existing treaty and trade relationships, including with Canada. Implementation by the U.S. government of new legislative or regulatory policies could impose additional costs on the Company, decrease U.S. demand for the Company’s products, or otherwise negatively impact the Company, which may have a material adverse effect on the Company’s business, financial condition and operations. In addition, this uncertainty may adversely impact: (i) the ability of companies to transact business with companies such as the Company; (ii) the Company’s profitability; (iii) regulation affecting the Canadian natural resources and mineral industry; (iv) global stock markets (including the TSXV); and (v) general global economic conditions. All of these factors are outside of the Company’s control, but may nonetheless lead the Company to adjust its strategy in order to compete effectively in global markets.
Additional information on risks and uncertainties relating to The Company’s business is provided in the Company’s Annual Information Form dated March 28, 2025 (“AIF”), under the heading “Risk Factors”. Additional information relating to Electra, including the AIF, is available on SEDAR+ at www.sedarplus.com.
Significant Accounting Estimates
Refer to Note 3 of the Company’s audited consolidated financial statements for the year ended December 31, 2024 and 2023.
Future Changes in Accounting Policies & Initial Adoption
Certain new accounting standards and interpretations have been published that are either applicable in the current year or not mandatory for the current period.
In addition, IFRS 18 Presentation and Disclosure in Financial Statements was issued by the IASB in April 2024, with mandatory application of the standard in annual reporting periods beginning on or after January 1, 2027. The Company is currently assessing the impact of IFRS 18 on its consolidated financial statements. No standards have been early adopted in the current period.
Internal Control Over Financial Reporting
The President and Chief Executive Officer and Chief Financial Officer of the Company are responsible for designing internal controls over financial reporting or causing them to be designed under their supervision to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with IFRS.
Although progress continues to be made strengthening Internal Controls over Financing Reporting (“ICFR”) during 2024 and 2025, management acknowledges certain significant deficiencies in its internal controls over financial reporting. These deficiencies are not uncommon for an early-stage, pre-revenue company with a small finance team and limited resources. Like many small companies at a similar stage of development, Electra has not yet implemented the full suite of systems, processes, and personnel typically found in more mature organizations. Management continues to assess and enhance its internal controls as the company scales and transitions toward commercial operations.
| Page 17 of 18 |
ELECTRA BATTERY MATERIALS CORPORATION
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2025 AND 2024
(expressed in thousands of Canadian dollars)
Management identified the following areas where significant deficiencies exist:
| · | Control Environment |
| o | The Company has added trained financial reporting and accounting personnel with appropriate skills and knowledge regarding the design, implementation, and operation of internal controls over financing reporting. The team is in the process of implementing and improving processes and procedures to identify, monitor and improve IFRS and DCP. |
| · | Procurement, Payment and Receiving Processes |
| o | The Company continues to improve reporting and receiving processes to ensure adherence to the Company’s policies at the Company’s Refinery project. |
Disclosure Controls and Procedures
Similar to ICFR, the Company has improved its Disclosure Controls and Procedures (“DCP”) during the 2024 and 2025 period. Nevertheless, the Company’s President and Chief Executive Officer and Chief Financial Officer note similar deficiencies in the disclosure controls and procedures as in the ICFR.
Limitations of Controls and Procedures
The Company’s management, including the President and Chief Executive Officer and Chief Financial Officer, believes that any internal controls over financial reporting and disclosure controls and procedures, no matter how well designed, can have inherent limitations. Therefore, even those systems determined to be effective can provide only reasonable assurance that the objectives of the control system are met.
Cautionary Statement Regarding Forward-Looking Statements
This MD&A contains certain statements that may be deemed “forward-looking statements”, including statements regarding developments in the Company’s operations in future periods, adequacy of financial resources and plans and objectives of the Company. All statements in this document, other than statements of historical fact, which address events or developments that the Company expects to occur, are forward-looking statements. Forward-looking statements are statements that are not historical facts and are generally, but not always, identified by the words “expects”, “plans”, “anticipates”, “believes”, “intends”, “estimates”, “projects”, “potential”, “interprets” and similar expressions, or events or conditions that “will”, “would”, “may”, “could” or “should” occur. Forward-looking statements in this document include statements regarding the advancement of the Refinery, future exploration programs, liquidity, and effects of accounting policy changes.
Although the Company believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results may differ materially from those in forward-looking statements. Factors that could cause the actual results to differ materially from those in forward-looking statements include market prices, exploration success, a successful outcome of the work in support of the recommissioning of the Refinery, continued availability of capital and financing, inability to obtain required regulatory or governmental approvals and general economic, market or business conditions. Investors are cautioned that any such statements are not guarantees of future performance and actual results or developments may differ materially from those projected in the forward-looking statements. Readers are cautioned not to place undue reliance on this forward-looking information.
Forward-looking statements are based on the beliefs, estimates and opinions of the Company’s management on the date the statements are made. The Company undertakes no obligation to update these forward-looking statements if Management’s beliefs, estimates, opinions, or other factors should change except as required by law.
These statements are based on several assumptions including, among others, assumptions regarding general business and economic conditions, the timing of the receipt of regulatory and governmental approvals for the work programs described herein, the ability of the Company and other relevant parties to satisfy stock exchange and other regulatory requirements promptly, the availability of financing for the Company’s proposed work programs on its assets on reasonable terms and the ability of third-party service providers to deliver services promptly. The foregoing list of assumptions is not exhaustive. Events or circumstances could cause results to differ materially.
Page 18 of 18
Exhibit 99.3
Form 52-109F2
Certification of Amended Interim Filings
Full Certificate
I, Trent Mell, Chief Executive Officer of Electra Battery Materials Corporation, certify the following:
| 1. | Review: I have reviewed the amended interim financial report and amended interim MD&A (together, the “amended interim filings”) of Electra Battery Materials Corporation (the “issuer”) for the interim period ended June 30, 2025. |
| 2. | No misrepresentations: Based on my knowledge, having exercised reasonable diligence, the amended interim filings do not contain any untrue statement of a material fact or omit to state a material fact required to be stated or that is necessary to make a statement not misleading in light of the circumstances under which it was made, with respect to the period covered by the amended interim filings. |
| 3. | Fair presentation: Based on my knowledge, having exercised reasonable diligence, the amended interim financial report together with the other financial information included in the amended interim filings fairly present in all material respects the financial condition, financial performance and cash flows of the issuer, as of the date of and for the periods presented in the amended interim filings. |
| 4. | Responsibility: The issuer’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (DC&P) and internal control over financial reporting (ICFR), as those terms are defined in National Instrument 52-109 Certification of Disclosure in Issuers’ Annual and Interim Filings, for the issuer. |
| 5. | Design: Subject to the limitations, if any, described in paragraphs 5.2 and 5.3, the issuer’s other certifying officer(s) and I have, as at the end of the period covered by the amended interim filings |
| (a) | designed DC&P, or caused it to be designed under our supervision, to provide reasonable assurance that |
| (i) | material information relating to the issuer is made known to us by others, particularly during the period in which the amended interim filings are being prepared; and |
| (ii) | information required to be disclosed by the issuer in its annual filings, amended interim filings or other reports filed or submitted by it under securities legislation is recorded, processed, summarized and reported within the time periods specified in securities legislation; and |
| (b) | designed ICFR, or caused it to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with the issuer’s GAAP. |
| 5.1 | Control framework: The control framework the issuer’s other certifying officer(s) and I used to design the issuer’s ICFR is Risk Management and Governance: Guidance on Control (COCO Framework), published by The Canadian Institute of Chartered Accountants. |
| 5.2 | ICFR – material weakness relating to design: “N/A” |
| 5.3 | Limitation on scope of design: “N/A” |
| 6. | Reporting changes in ICFR: The issuer has disclosed in its amended interim MD&A any change in the issuer’s ICFR that occurred during the period beginning on March 31, 2025 and ended on June 30, 2025 that has materially affected, or is reasonably likely to materially affect, the issuer’s ICFR. |
Date: September 16, 2025
| “Trent Mell” |
Trent Mell
Chief Executive Officer
Exhibit 99.4
Form 52-109F2
Certification of Amended Interim Filings
Full Certificate
I, Marty Rendall, Chief Financial Officer of Electra Battery Materials Corporation, certify the following:
| 1. | Review: I have reviewed the amended interim financial report and amended interim MD&A (together, the “amended interim filings”) of Electra Battery Materials Corporation (the “issuer”) for the interim period ended June 30, 2025. |
| 2. | No misrepresentations: Based on my knowledge, having exercised reasonable diligence, the amended interim filings do not contain any untrue statement of a material fact or omit to state a material fact required to be stated or that is necessary to make a statement not misleading in light of the circumstances under which it was made, with respect to the period covered by the amended interim filings. |
| 3. | Fair presentation: Based on my knowledge, having exercised reasonable diligence, the amended interim financial report together with the other financial information included in the amended interim filings fairly present in all material respects the financial condition, financial performance and cash flows of the issuer, as of the date of and for the periods presented in the amended interim filings. |
| 4. | Responsibility: The issuer’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (DC&P) and internal control over financial reporting (ICFR), as those terms are defined in National Instrument 52-109 Certification of Disclosure in Issuers’ Annual and Interim Filings, for the issuer. |
| 5. | Design: Subject to the limitations, if any, described in paragraphs 5.2 and 5.3, the issuer’s other certifying officer(s) and I have, as at the end of the period covered by the amended interim filings |
| (a) | designed DC&P, or caused it to be designed under our supervision, to provide reasonable assurance that |
| (i) | material information relating to the issuer is made known to us by others, particularly during the period in which the amended interim filings are being prepared; and |
| (ii) | information required to be disclosed by the issuer in its annual filings, amended interim filings or other reports filed or submitted by it under securities legislation is recorded, processed, summarized and reported within the time periods specified in securities legislation; and |
| (b) | designed ICFR, or caused it to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with the issuer’s GAAP. |
| 5.1 | Control framework: The control framework the issuer’s other certifying officer(s) and I used to design the issuer’s ICFR is Risk Management and Governance: Guidance on Control (COCO Framework), published by The Canadian Institute of Chartered Accountants. |
| 5.2 | ICFR – material weakness relating to design: “N/A” |
| 5.3 | Limitation on scope of design: “N/A” |
| 6. | Reporting changes in ICFR: The issuer has disclosed in its amended interim MD&A any change in the issuer’s ICFR that occurred during the period beginning on March 31, 2025 and ended on June 30, 2025 that has materially affected, or is reasonably likely to materially affect, the issuer’s ICFR. |
Date: September 16, 2025
| “Marty Rendall” |
Marty Rendall
Chief Financial Officer